Can my office help you “Achieve Your #Goals?”

Right now it might seem impossible to have the life of your dreams. But with a little planning a solid education, a new home, and the financial security to start a family are closer than you think.

Financial planning is more than knowing how to invest – it’s knowing the right goals for every stage of your life. By partnering with a financial expert, we can set the right goals to help you achieve your dreams – not just add to your 401k.

Check out this short video that shows how we can work together to meet your #Goals:

 

Healthy Business Practices for Entrepreneurs

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Two roads diverged in a wood, and I— 

I took the one less traveled by, 

And that has made all the difference.

-Robert Frost

Starting your own business can be like having a baby — a very important life decision that might not always be a rational one. 9 months into your 9-5 insipid job and you might decide to take the proverbial exit from the freeway, onto the smaller more challenging road less travelled.

But it’s not always smooth sailing. Akin to raising a baby, your business is bound to give you many sleepless nights, demanding all your attention and testing your resolve at every stage. Persevere, and you shall be rewarded.

While watching your business take its first steps towards success will fill your heart with joy, there are a few steps you must take in order to witness this. Here are a few healthy business practices every small business owner must practice —

  1. Assess your product— as a businessman, one must always strive to deliver products/services of the highest quality. You need to ask yourself several questions before starting your business — will my product fulfil consumers’ needs? Is there a market for the product/service I’m delivering? Is the pricing right? A thorough SWOT analysis of your product will shed light upon different aspects of your product, and will help you identify key strengths and weaknesses, and how they can be overcome.

    2. Gauge the market and your competitors— the business environment can be like a warzone, you often don’t have complete control, and your fate depends on the exterior environment, your enemies, and your comrades. There can be landmines everywhere, so one must tread with utmost caution, or result going kaput.
    It is thus imperative for a businessman to have adequate knowledge about the market his product/service exists in and the competitors in that market. This knowledge is indispensable for a businessman. It serves as a crucial decision-making factor in charting the growth route of a business. The product/service should be strong enough to be able to withstand blitzkrieg marketing campaigns by competitors.

  1. Evaluate yourself— a successful small business owner always monitors the value of his business. The value of a business plays a fundamental role in making future business decisions and financial planning, especially when matters such as the sale of your business or an insurance evaluation are at hand.

4.Transparency — make sure to keep a record of all financial transactions undertaken by and for the business. In an environment where fraud and lawsuits are rampant, being transparent will add credibility to your business, and create a favourable perception in the minds of the consumers. Maintain the transparency of your business like a ruby smitten by the Sun, and it’ll go a long way in adding goodwill to your business, ultimately leading to a gradual increase in equity.

  1. Set realistic expectations— don’t expect to go win 8 Olympic golds like Phelps in 2008 in the nascent stages of your business; it’s important to set expectations that are reasonable and achievable. Don’t trudge into waters deeper than you can survive in. Typically, you should give about 12 months before starting too see a customer bring more value to your business than how much it cost you on-board that one customer. It’s essential to take an as much as you can handle, and no more. If not the case, you might end up compromising on the quality of your product/service, and this can have a detrimental effect on the credibility of your business.

While starting a business is a path several people have chosen to tread in recent times, sustaining it and maintaining its viability are the biggest hurdles. The aforementioned business practices will help you take obstacles head on, and ensure a first place finish in this ultra-marathon.

Contact my office at 215-886-2122 and lets talk.

 

Assisted Living vs. Senior Home Health Care

Assisted Living vs. Senior Home Health Care

BUY-SELL AGREEMENT MISTAKES

Prudent business owners establish buy-sell agreements if there are partners or shareholders in the business, and sometimes even in a one-owner business.  With a buy-sell agreement, the owners agree that if one owner leaves the business because of death, retirement, disability, or other triggering events, the remaining owner(s) will buy out that owner or the owner’s estate.

Too often, however, business owners use canned buy-sell agreements, with little thought given as to how the contract best fits their particular needs.

FAILURE TO FUND

One of the most common mistakes business owners make is failing to properly fund a buy-sell agreement.  Let’s say two partners, each owning half the business, agree to buy the other out in the event of death or other triggering event.  However, how is the remaining owner going to pay for the other half of the business?

Few owners will have the cash, and banks will be reluctant to loan, especially if the business is still young and unproven.  Bankers will question how the business, having just lost a key person, can service the debt of a new loan.

A new partner could be brought in, but the remaining owner may not want the new partner.  The most common solution, though not the only one, is for a life insurance policy to be taken out on each partner or shareholder in the amount of the value of the interest of the owner.

There are many different methods of structuring the policies (ownership of the policies by the business can have severe tax consequences, for example), so business owners should work with a qualified financial advisor.

DECIDING THE PURCHASE PRICE

This may seem an easy question in the beginning, when the owners mutually agree on the value of the business.  However, what happens several years down the road?  What is an acceptable evaluation to the Internal Revenue Service?  If the owners have not re-valued the business each year, there could be serious disputes.  If one owner leaves in a way that is detrimental to the business (such as taking clients), should the departing owner receive a smaller price for his or her interest?

ALL OWNERS MAY NOT BE EQUAL

Buy-sell agreements are usually easier to develop if the owners have equal shares of the business.  However, what if there is a majority owner?  The majority owner may not want the minority owners to buy his or her stock, preferring to have family members or a key employee take over.  A standard buy-sell agreement may not allow this to happen.

Perhaps two, completely different, buy-sell agreements are needed.  One for the minority owner might call for the interest to be sold to the majority owner(s).  The majority owner might wish to have an agreement that calls for other family members to acquire his or her shares.  Perhaps a stock redemption agreement may be the most suitable arrangement for one of the owners.

MISSING TRIGGERS

Nearly all buy-sell agreements allow for the death or the retirement of the owners to trigger the buy-sell option.  Sometimes overlooked is the disability or divorce of an owner.

In the event of divorce, for example, the stock could end up in the hands of the spouse, which the remaining owners may not want.  Other triggering events can be the firing of a minority owner, or the personal bankruptcy of one owner.

REFUSING THE RIGHT OF FIRST REFUSAL

A common provision in buy-sell agreements is the right of first refusal.  The departing owner cannot sell his or her interest without first offering the remaining owners the opportunity to buy it.  This may sound like it puts each owner in control, but in reality that is not always the case.

A minority owner of a small business, for example, will probably have a hard time finding an outside buyer willing to pay for fair market value for a minority interest.

On the other hand, if the departing owner does find a buyer, the remaining owners may find it difficult to come up with the money to buy the owner out in order to avoid bringing in an undesired new co-owner.

By tailoring an agreement to your needs, these and other common buy-sell agreement problems can be anticipated and avoided.

This is one way we help our business owner clients, give me a call at 215-886-2122 to see how I can ad value to your business.

Business Planning Checklist

Is your business plan up to date, this checklist will give you a good start to answer that question.  If you have questions, give my office a call at 215-886-2122.

Business Planning Checklist_Page_1Business Planning Checklist_Page_2

Have an LTC policy and getting a rate increase?

Have a long term care policy and a rate increase, an excellent article from the NY Times:NY Times Article on LTC rate increases