Starting a company is a product of an easy part, but sustaining the operations and making these operations flow is the biggest challenge. I have a testimony to attest to that, based on my previous management of Lawn Care business. If you can avoid the most common causes of business failure, your odds of success will greatly rise. Data from different credible sources show that one in three startups fail in their first three years. If you want to constitute a solid business, here are some important aspects you have to consider.
Carry Out Market Research
Many people assume that the lack of funding or having a wrong team are the primary reasons behind business failure. That is not always the case. You need to plan and research, as these are crucial elements when it comes to ensuring you have a feasible business idea. If you have a competitive pricing, you will receive a very good return on investment. You need to spend time doing research on your business idea and determining if your products and services are fit for the market. Listen to feedback from customer and other business associates.
Have a solid business plan
Startup are usually based on novel ideas and if they are well synched with market, they can work wonders. When you fail to prepare for your business, you are basically planning to fail. All startups require to have a very careful thought-out business plan. It should be realistic and have a well-thought projections for the future. Business structure in early days prove to be fundamentally important, but many startup businesses fail due to not setting their sights too high or wish to diversify very fast.
Have a good team
Having a quality and well determined team is a key component to your startup success. While recruiting, you need to have a careful consideration to ensure your employees bring on new skills to your business. The same goes to your business partner. Your partners should be passionate with the same vigor as you, and have skills and knowledge that complement yours.
If you do not shout out your business, no one will know that you exist. You need to use all your marketing channels. You need to have a professional website as well as being present on all important social media channels. You also need to manage your finances. If you lack capital you might find yourself with a lot of trouble in implementing your business plans. Businesses that seek professional and consultation services might also find themselves in a huge debt.
Enhance Leadership Skills
You need to enhance your leadership skills and put a strong focus on your leadership skills. Keep building your skills and never stop learning. A good leader should be able to steer the radar smoothly even on stormy days. When it comes to technology, you need to ensure that your software is well updated and flexible. On your leadership skills, you need to communicate, delegate, motivate and channelize all your energies so as to have a successful team.
Are you among the 1% of Americans who control more than 40 percent of the country’s wealth? If yes, then you know well that life is full of choices. Do you have a business be it Oil business, manufacturing business or simple businesses such as west palm beach towing service? Are you super rich out of your business? The US economy has a lot of loopholes that allow the super-rich to evade paying taxes. Documents obtained by the New York Times showed that Donald Trump declared a huge operating loss of$916 million in 1995. This amount was enough to enable them to avoid paying taxes for a period of 18 years. So how best do you keep your money away from the government? Which methods do these guys use to stay on top of the game?
The wealthiest Americans afford to avoid paying taxes through two key methods; Either by doing their own financial and tax planning or by paying someone to do it for them. Let’s explore these methods further.
Capital Gain Management
Assets that are held for than a year are considered as long-term capital gains. These assets are taxed at a rate of 15 percent. However, short-term capital gains are taxed at the ordinary income tax. The super-rich classify their monetary streams as capital gains, and in that way, they take advantage of rates falling under the 15 percent bracket. They also use another strategy known as tax loss harvesting, which involves selling off poorly performing investments, at times of their best convenience, and using the losses to offset capital gains.
Modification of Income
The super-rich are experts at keeping their taxable income and corresponding applicable tax rates at the lowest rate possible. They incorporate and pay themselves at a reasonable smaller salary and take a higher portion of their income as dividends. Dividend income is taxed at a smaller rate of 15 percent. They also use another method of taking a portion of their compensation as stock, which only gets taxed only when the options are exercised.
The mega-rich enjoy the same tax-deferred benefits of retirement programs such as IRAs and 401 Ks same as you do. Due to their wealth, they place themselves in a better position to max it out annually thus taking the full advantage of the taxes limits and advantages allowed by law. They also make use of other tax deferral ways such as stock option path and deferred compensation plans.
Some strategic borrowing tactics, in fact, earn the super-rich money. Because of the leverage of the super-rich, they can borrow money whenever they spot an opportunity. They purchase a stock at a fixed rate and use those options as collateral to borrow money. They then use this money to make money off other opportunities. To pay the loan, they use those proceeds or hand over the shares and avoid capital gains. Another strategy these guys use is taxes upon death. For those who own vast amounts of estates, they establish irrevocable trust in which the taxpayer no longer owns specific assets.
Would it not be nice if there was magic follow of managing money such that you won’t regret ever again? If you are tired of regrets as far as money management is concerned, then it may be time you take a serious approach to manage your finances. A good portion of us don’t know how to handle money properly. Having a sound money management plan may be some light to the end of the tunnel for those struggling with their finances. Managing your money is a discipline that takes time to understand and improve on. To master money management, it takes commitment and a solid understanding of your financial situation.
This article explores critical and fundamental steps to help you manage your money the right way.
Create a Budget
Effective money management starts with having a budget. If you don’t have a budget in place, start by creating one. Creating and sticking to a budget might seem a little bit hard at the initial stages, but it pays off at the final stage. Creating a budget helps pay off debts and start living for future expenses such as retirement, car, and mortgage. A budget will create a balance in your life and assist in creating some peace of mind.
Understanding your Expenses
As most people off their head how much they spend per month on their total expenses and you will , they have no idea in their expenses. Most people have on idea on the total amount spend per month on their most basic needs. The solution to this problem is simply keeping a track of all your expenses. Take all your receipts be it utility bills, groceries, restaurant bills among others and have a summation. The ideas is to have both your variable and fixed expenses accounted for to get a total amount.
Understand Your Income
Again, ask anyone off their heads how much they make in a month and very few will be able to answer this simple question. There is a big difference between income tax and expenses and most people are not aware of the differences. To have a better understanding of your money and hence control it, you must understand all the sources your income streams come from. After you have a grasp of your income, figure out your total expenses and subtract from your total income. If you end up with a negative amount, it means you simply spend more than you make. If you end up with a positive number, its good news. This is the amount you should use as savings.
Consolidate Your Debt
No one likes debt and you should do as much as you can to manage it. The first thing you need to do is to get the debt under control and work towards getting rid of it. Consolidate your debt to one place and try to have it attract the lowest interest possible. Additionally, slash and if possible remove unnecessary expenses. For every money you make, set a certain percentage for saving. Think about creating an emergency fund too.
Then transition to adulthood is sometimes hard to detect, but one thing you will note when you arrive at adulthood is paying taxes. Every American must meet their tax obligations. Every day is a tax day in America, and there is a lot of confusion associated with tax forms and requirements. Every American citizen is subject to local, state and federal taxation. However, there is a huge number of citizens who do not know anything about taxes. Here are important things every American citizen needs to be aware of as far as taxation is concerned.
Taxes are Expensive
There is no doubt taxes are costly, eating up to a quarter of the Gross Domestic Product every year. Only the most informed taxpayers will understand these details without issues. Based on data from Tax Foundation, the average American needs to work for about three months every year to meet their tax obligations. In other words, about 31 percent of all the money you make is directed towards paying taxes.
The different States have Different Taxes
A good number of American taxpayers until now don’t know that different states attract various tax deductions. Each state comprises of its local authorities with tax structure systems that are best in line with their needs. States such as California, New York, and Wisconsin attract a higher tax bracket. The Taxation levels for citizens living in New York are almost double those of citizens living in Wyoming. It helps to do simple research to determine if you’re paying more in your state as compared to others in a different state.
Government and Tax
Apparently, the government does not raise enough money from taxation. The American government has different organs from local and federal authorities all tasked with the responsibility of raising taxes, but the collection is never enough. The amount of money the federal government spends is more than what it collects. This is the reason the government owes other countries money, a good example being China, which it owes about $1.3 trillion.
How Government Spends Tax Collected
It goes without doubt that taxes affect the performance of an economy. Studies also show there are adverse effects of taxation on investment and economic growth. It is also costly to comply with taxation requirements. So are you wondering where does all the money go? Well, over half of the money collected from taxes caters for medical care and social security. About 20 percent goes to income security and other benefits while national security absorbs about 17 percent. The remaining percentage is divided into other sectors such as education, transport, energy among others.
The fact remains that all taxpayers are investors in their nation and tax dollars collected come back to the community. The government uses tax to fund health care programs, education, highway, and bridges, clean drinking water, national parks, national weather services among others. We do not all pay taxes equally and for obvious reasons we don’t all earn the same. Our tax codes are full of special tax codes and are tilted heavily in favor of the rich.
Outsourcing is the practice of using a third-party firm to handle work that is in typical situations performed by a company or individuals. Small companies and individuals alike routinely outsource their financial and tax needs, including payroll processing, distribution, accounting and many other essential functions. Many large companies and individuals turn to outsourcing to cut on costs. The concept of outsourcing key business operations became popular in the 1990s as companies went seeking to address the rising labor costs. As the model evolved, outsourcing became an excellent cost-cutting measure, and most companies and wealthy individuals adopted it.
The back office operations of a business organization or company tend to scale up during the rapid growth periods. During the expansion period, companies may start to suffer from the shortage of financial and human resources at the expense of core activities needed to fuel the company forward. This calls for the need to outsource and here are the key benefits of outsourcing.
Benefits of Outsourcing
The most obvious and notable benefits of outsourcing are cost savings. You can get the job done at a lower cost and a better quality. Due to the apparent differences in wages between western counties and Asian or African countries, the same kind of work is done in a different country at a lower cost, or at a small fraction of what it would otherwise cost here in America. There are obvious cost savings of about 60 percent or more when you outsource to countries such as India.
Outsourcing can be a better option when functions of a company’s back office are complicated, and the size of your company is notably preventing you from accomplishing them in a consistent and manageable manner. The overhead cost of performing a particular task can be extremely high if you decide to do it all by yourself. The best way to go about it is to outsource services to a specialized firm or organization that can deliver best quality services.
Access to Qualified professionals
When you outsource tasks, as a business owner, you gain access to qualified advisors and expertise in many fields. Third party service providers are specialists in what they do and provide perfect resources for getting projects and work done. Such service providers have to constantly hone their skills and up their game to be the best in their field. When you go outsourcing, you can trust the company you give work to deliver something good.