Tips for Boosting Your Company’s Financial Health

How Would You Rate the Financial Well-Being of Your Business?

In 2015, researchers found that more than three-quarters of all small business owners rated the financial well-being of their business as excellent. If you were asked about the financial health of your business, would you be able to respond the same way? Running your own business is a risk. In order to succeed, it requires confidence, self-assurance, and a little bit of courage.

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When starting a new business, there are countless decisions to make and hurdles to overcome, from deciding how you want to structure your business to figuring out who you want to hire.

At the top of the list, however, are your company’s finances.

Taking care of your finances is one of the most important parts of getting your business up and running.

To make sure that you keep your finances under control, check out these financial management tips for small businesses:

Give Your Business A Checkup

When you go to the doctor for an annual checkup, they start by measuring your vital signs. Your heart rate, body temperature, and blood pressure all provide vital clues as to your overall health. You can take a similar approach with your business.

Give your company’s financial health a checkup by evaluating your cash flow. How much money are you bringing in each month? Where is that money coming from? How much money is flowing out of your business? Where is that money being spent? Monitoring these factors is absolutely vital if you want your business to succeed – especially in the earliest stages of running a business when your company is still finding its financial footing. Although you can track your finances yourself using a software program, you may be better off hiring a professional accountant to help you instead.

Other habits that you use in your daily life can also be applied to your business. For instance, in your personal life, you probably do your best to avoid spending more money than you have coming in. This helps keep you from falling behind on your bills or going into debt. Taking a similar approach with your business by reducing your spending can dramatically improve your finances, as well. According to the State of Small Business Report, equipment upgrades accounted for 38% of the total expenses for small businesses.

Finding a way to reduce this number can save your business a lot of money. Take some time to evaluate your current suppliers. Anytime you purchase supplies or upgrade your equipment, compare prices to get the best deal possible. If you have been working with a particular merchant for a long time, you also may be able to negotiate a lower rate. This is especially true if they believe that you may take your business elsewhere.

Stay on Top of Invoicing

If you want to stay in good physical health, you need to take good care of your body by eating healthy foods, getting enough exercise, and managing your personal hygiene. Paying the same amount of attention to your company’s invoicing can have similar benefits from a financial health perspective. Not only can poor invoicing practices cost your business money, but they also can sour customer relationships. To keep from falling into this trap, focus on developing excellent invoicing habits. Be as straightforward and precise as possible with your pricing. Anytime you discuss pricing with your customers or clients, periodically ask questions to make sure that they understand what you are saying.

Whenever you get a new customer, conduct a credit check. Additionally, ask the customer to submit a deposit along with their order. In terms of billing, always send out invoices in a timely manner, asking customers to let you know when they receive them. Have a dedicated staff member who is responsible for keeping track of payments and reaching out to customers who have not paid their bills. To encourage people to submit payments by the due date, think about adding late fees for past-due payments. Minimize the risk of confusion by creating highly detailed invoices that are designed with clarity in mind.

Take A Closer Look at Your Insurance

An important part of protecting your health is making sure that you have a good health insurance policy. Even if you are healthy, you can get into an accident at any time. The same goes for your business. Even if everything is going smoothly with your business right now, accidents or unexpected problems can occur that wind up costing you a lot of money. To protect your business, invest in the right type of insurance for your industry. Depending on what type of business you own, this can include everything from liability insurance and property insurance to product liability insurance, car insurance, and worker’s compensation insurance. Even if you work out of your own home, you should consider buying an insurance policy specifically for home-based businesses.

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Visualize Your Success

Some studies have shown that people who visualize themselves in better health often see improvements in their health in the real world. To apply this concept to your business, spend some time visualizing the future of your company. Where do you see yourself at this time next year? What about five or ten years down the road? When you visualize yourself reaching your long-term financial goals, you are a lot more likely to achieve them.

Be Open to The Idea of Growth

Keeping tabs on your income and expenses and maintaining good financial records makes it easier to spot growth opportunities. At least once a year, sit down and take a look at your company’s financial records. As you take in the data, consider your goals and objectives. This can help you identify areas for potential growth, allowing you to make adjustments as needed.

Consider Non-traditional Financing

Even when someone is doing everything right when it comes to maintaining their physical health, they still sometimes need to give their bodies a little bit of a boost by taking the right supplements or vitamins. If your company’s financial health has gotten a little bit off track or if you need some extra funding to get going, applying for a traditional loan or looking into non-traditional financing could be viable options. There are a lot of different types of loans available. To figure out which ones are most appropriate for your business, set up a time to meet with your banker. They can help you choose the right loan for your needs.

Maintaining the financial health of your business is all about educating yourself, tracking your progress, and having a plan.

As long as you follow the steps above, you shouldn’t have any trouble keeping your company’s finances healthy and strong.

6 Tips For Choosing A Financial Advisor

Are you looking for better ways to manage your finances?

You need to hire the best financial advisor for the best results.

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Here are some useful tips to help you find a good financial advisor.

Qualifications

You can always find a certified financial advisor by using referrals from trusted sources but that’s not enough. You need to check the background and qualifications of each potential candidate as well as their credentials. Contact the professional associations to find out if there are any disciplinary complaints about them.

Interviews

Take a list of potential financial advisor and interview a number of them. During the interview, you need to find out whether you’re comfortable discussing your finances with the people you’re interviewing. Do they provide the exact services you’re looking for? Also, you should find out their experience, education and specialties as well as their current number of clients.

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Additionally, you need to know how long they have been in business, their communication schedule with clients, the types of investment products/services they are registered to sell, the type of organizations that regulate them, how they get their money and if there are any disciplinary cases by the industry associations or regulators against them.

What Are Your Financial Goals And Needs?

Find an advisor who can help you meet your goals and needs. For instance, are you looking for exemplary investment advice? Look for a someone who is properly registered with the Canadian securities regulator authority. On the other hand, if you’re looking for insurance advice, find someone with a valid insurance license.

References

Find out if they have served clients with similar needs to yours and ask for references. Also, does the advisor work hand in hand with other experts such as insurance agents, accountants or lawyers?

Fee Comparison

How does the financial advisor expect to get paid? Ask for a few quotes from different candidates then compare them. There’s should be a clearly defined agreement and if there are any changes to the compensation during the relationship, it should be changed.

Conflicts

Find out how your financial advisor will help you choose the right investments. For instance, are there many recommendations or is it limited to the specific products he/she is registered to sell? Is there a larger profit from recommending on product over the other? Are there profits to be made with every purchase or sale?

 

3 Questions you must ask a Financial Advisor

I hope these tips give you some food for thought when choosing a financial advisor. Feel free to leave a comment below.

How to Spot a Coming Stock Market Crash

Signs of Huge Economic Changes

One of the biggest fears of every single investor is a stock market crash. Let’s examine the typical “what if” scenario.

What would happen if I had invested everything into the stock market and it crashes?

One of the easiest ways to eliminate that fear from your being is through candlestick signals.

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We all can see those image of the great stock market crash of 1929 as if it had just happened yesterday. Over the past 20 years, we have had multiple stock market crashes. However, these stock market crashes have had different results. In this case, we had institutional investors trying to fail and how in save their investment record, while the public was trying to get into the stock market.

While no one wants a stock market crash, it is not something you have to fear on a daily basis. Instead, you can use candlestick signals as a way to protect yourself. Despite what you might have heard, a stock market does not crash unexpectedly. An example of this will be the stock market crash of 1929 which had the majority of selling occurred in October, whereas it actually began in August. Recent stock market crashes over the past 20 years have revealed definite candlesticks sell signals before the big sale day. There is absolutely no reason to fear the stock market crashes. As a candlestick investor, you are able to utilize the signals and be able to prepare yourself for the situation. When you are able to identify specific market trends you thereby can eliminate any apprehension about upcoming market crashes.

One of the primary advantages of candlestick signals is you are able to identify investor sentiment in the general market trend.

Usually, a stock market will crash at the end of those downtrends. With this in mind, you will realize that the big selling days do not come as a surprise. In addition to candlestick signals reducing any apprehension about the stock market, they also allow you to be in a position of either being longer short for current market trends.

One of the most dangerous rationales for any investor is buying into the market because “it’s different this time”. Many people believe that the United States stock market has been changed due to the level of technology in changing as well as the many online tools that are designed to make trade easier and safer, however, this simply is not true.

The problem with many investors today is that they are focused on worrying how the next crash is going to be different than the last, whereas the vast majority of stock market crashes have all been the same,

and it is more important to look at those similarities than differences …

By looking back at the past five stock market crash is beginning in 1907 and in 2010, all of them had striking similarities that need to be looked for. One cannot live on a daily basis expecting the stock market to crash. More than likely it will be years before another significant crash. The best that you can do is to watch for the proper signals and simply be prepared for the inevitable.

It is important to realize that the market is always going to rally strong before the crash happens, and this is easy to spot.

Another similarity that has happened in every significant crash is an external catalyst, an example of this was in 1907, after the major San Francisco earthquake and the United States scooped up the vast liquidity from around the world causing the market to crash. In some cases, it may be a simple new financial contraption that is not understood and it injects leverage in to assist them that is already unbalanced pushing it further into chaos. In 1987, we saw this with portfolio insurance, then in 2008 it was due to the appearance of mortgage-backed securities, and once again in 2010 it was due to algorithmic trading. All similar situations just new circumstances that can be learned and avoided.