Small Business Tips

Money Post Archive
Featuring articles on the topics of money and finance including cutting costs, budgeting, bartering, borrowing, earning, saving, investing, collections, cash flow, expenses, credit, scams and financial planning for the small business owner.
Small Business Loans & Grants

We all know money is everything when starting a new business. Fortunately there are many groups that are pleased to give you money for starting up a legitimate business.

Ken Yancey, CEO of Score.org, offers 5 steps on the topic:

1.) Consider city, county, or state assistance programs for qualified small businesses. Some examples include tax abatements, urban-renewal set-asides, rural access, workforce training, and economic development.

2.) Contact your state senator’s or representative’s office. The staff there can be helpful in pointing you toward state funds or programs for businesses.

3.) Take advantage of “in-kind” credits. Like cash, these can be used as matching funds. In one case, a state program counted a company’s $200,000 local property-tax abatement as part of the matching requirement.

Recommended Reading:
How To Fund A New Business
Look to the States for Small Business Grants
SBA.gov – Federal Grant Resources


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By Chris Brunner
Friday, December 15th, 2017 @ 12:09 AM CDT

Money |

How NOT to Fund a Business

How many of you have used a credit card for a business expense? With credit card companies aggressively offering easy approval with sizable credit limits it’s understandable why many people do this.

Banks put small business owners through the wringer before lending money. … if the banks want to lend responsibly, look at it from your own point of view: why would you want to borrow irresponsibly? Because that’s exactly what using your personal credit card can be.

Bottom line: be responsible and use the credit card(s) sparingly. Your business will be much stronger, and you will be much happier.

Source:
ShropshireStar.com (U.K.)


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By Chris Brunner
Saturday, November 18th, 2017 @ 12:00 AM CDT

Money |

Find a Financial Planner

“There is a belief in this country that ‘I don’t need to deal with money management because I hardly have any money’. Many young people engage in “short-term thinking,” like expecting to save money only after they graduate from college or professional school.”

Unfortunately the topic of saving and investing money is not taught in our schools unless you specialize in the subject. It doesn’t matter how much money you make. Take the time to find a good financial planner Springfield Mo that will guide you in the right direction.

I recently took the step and I can personally tell you it was an extremely good feeling.

Source:
The New York Times


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By Chris Brunner
Saturday, November 4th, 2017 @ 12:00 AM CDT

Money |

Small Business Scams

Finding the contact information for a small business owner is amazingly easy, no matter if your business is online or not. Here are two of the latest and most dangerous scams that are affecting business owners across the country:

The “We Just Need Your Checking Account Number To Confirm Your Creditworthiness” Scam

This scam allows the culprit to record your checking account number in order to write demand drafts payable from your account. Not only do they not require a signature, but they require no action by the checking account holder.

The “Please Cash Our Check For $4.23″ Scam

This scam is much more brilliant and extremely sneaky. The scammer sends a legitimate check made out to your company. If you cash or deposit that check, your account information is printed on it. The check is returned to the scammer with your account info present allowing him to begin writing demand drafts against your account.

What to do:

Keep an eye on your account. I check mine daily. If any withdraws (large or small) show up that you aren’t familiar with, contact your bank immediately. If your bank doesn’t offer online account access, find one that does.

Source:
Entrepreneur.com


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By Chris Brunner
Wednesday, November 1st, 2017 @ 12:01 AM CDT

Money |

Finding a Good Accountant

Ah, it’s that time of year again. Time to start worrying about getting your taxes filed. And if you own a business, taxes can be a really stressful burden. If you do your taxes yourself or have a friend/family member help, you may want to consider hiring a CPA. Having a CPA do your taxes can be much more relaxing and take some of the burden off your shoulders.

First, it may help to know what a CPA is (if you don’t already). It stands for “Certified Public Accountant,” though it may be more appropriate to call them Certified Professional Advisors, because their roles in aiding your business will often go beyond your accounting.

Continue Reading: “Finding a Good Accountant”


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By Michelle Cramer
Tuesday, October 17th, 2017 @ 12:01 AM CDT

Money, Operations, Taxes |

Ways to Save on Technology in 2008

As each new year approaches, we all try and think of ways to make things for our business work more smoothly. And we definitely want to cut corners where we can and save some money. Here are some ideas to help to save some dough when it comes to your business’ technology needs:

Speed Things Up
Have your network bandwidth increased to speed up the overall processing time of your computers. The faster things move on your computer system, the quicker tasks get done. This means more time available for other tasks and, essentially, saving money because employees are getting more done for the same amount.

Consider Remote Access
If you have employees who are on the road a lot (including yourself), or even those who may be workaholics and would put in more time in their off hours if the had the option, then you may want to consider making your system remotely accessible. You will need to have a server that can provide for access by multiple users, or simply set up password-secure access to your service. Provide your employees with a laptop, a wireless card and an internet browser and they will be able to access your system and do extra work wherever a Wi-Fi connection is available. While it’s an investment, it will save you money in the long run because, again, more work will get done in a shorter amount of time.

Continue Reading: “Ways to Save on Technology in 2008″


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By Michelle Cramer
Thursday, October 12th, 2017 @ 12:07 AM CDT

Money, Technology |

How to Improve Your Credit Score

We all know the importance of a good credit score. We know that, the higher our number on that scale from 340-800, the better chances we have of obtaining loans, buying a home or new car, or getting our business off and running.

While lenders may consider anyone for a loan/mortgage, individuals with credit scores of 700 or better are typically offered better interest rates and financing options. If your credit score is low, there are ways to improve it, but doing so first requires that you better understand how your credit score is calculated.

Your credit score is more or less calculated by the data of your credit history being punched into a program and that program coming up with a number. This is why your credit score may vary a bit between each of the three credit bureaus, since they don’t all use the same calculation program. While exact values are undetermined, the calculation of your credit score is broken down into these approximate values:

Continue Reading: “How to Improve Your Credit Score”


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By Michelle Cramer
Friday, October 6th, 2017 @ 12:10 AM CDT

Money |

Obtaining a Business Loan – How to Write a Business Plan : Part 8 of 8

OBTAINING A BUSINESS LOAN
Okay, so your Business Plan has been edited, revised, perfected and now you’ve got your final packet ready to go. You’re ready to march into the world and present your business to lenders in hopes of obtaining funds to get your business moving.

But not so fast.

Before you walk through the doors of any bank, you need to know what else they will be looking for outside of your Business Plan in order to approve a loan.

Credit History
What potential lenders will look at most are credit records for both the individual owners of the business (the credit report associated with your social security number) and the business itself (the credit report associated with the business’ EIN or tax identification number). So, before you take your fund request to a bank, request a copy of your credit report from all three agencies: Equifax, Experian and TransUnion. Examine each report for errors and resolve all discrepancies before applying for a business loan.

Continue Reading: “Obtaining a Business Loan – How to Write a Business Plan : Part 8 of 8″


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By Michelle Cramer
Thursday, October 5th, 2017 @ 12:00 AM CDT

Money, Operations |

The Psychology of Pricing

When starting your business, and throughout it’s progression, you will always be evaluating and reevaluating how much to actually charge for the product/service you provide. You must take into consideration how much it cost your business to make the product or provide the service (i.e., supplies, payroll, etc.), how much of a profit you will need to make in order to keep your business running, and the like.

But there is more to it than simply picking a price that covers your overhead and makes a little profit. You have to take into consideration the thought process of your average customer and the psychology of pricing.

You want to provide your clients with a perception that they’re getting a great deal, and there are a few possibilities for conveying that:

Continue Reading: “The Psychology of Pricing”


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By Michelle Cramer
Friday, September 22nd, 2017 @ 12:02 AM CDT

Money, Startup |

New Safety Measures for Imports on the Horizon

On November 6th 2007, President Bush proposed new safety measures to insure that items imported into the United States meet safety standards. This step is resulting from the increased number of recalls in the past couple of years, specifically items such as toothpaste, dog food and toys produced overseas.

Bush proposes that the following improvements be made:

• Giving the Food and Drug Administration (FDA) the authority to order mandatory recalls of unsafe products. As it stands now, the FDA can only encourage companies to voluntarily recall unsafe items, but have no way of enforcing a recall if the company refuses to do so.

• An increase in the presence of U.S. inspectors from Customs, Border Patrol the Consumer Product Safety Commission (CPSC) and other agencies in countries that are major exporters to the U.S.

• A certification program (“seal of approval”) for companies that meet safety standards on a proven and regular basis. This change is expected to help encourage retailers to use businesses with the certification, and help discern those companies that are not meeting safety standards often enough.

Continue Reading: “New Safety Measures for Imports on the Horizon”


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By Michelle Cramer
Wednesday, September 20th, 2017 @ 12:02 AM CDT

Business Law, Money |

Avoiding Cash Flow Mistakes

Managing cash flow is an important, but often overlooked, function of small business. All too often you can find your business in financial trouble if you don’t learn how to handle funds correctly. Here are some common mistakes you should be aware of:

“Fly By the Seat of Your Pants” Accounting
Many people are, unfortunately, never taught how to handle finances. Teenagers open checking accounts when they get their first job, and never seem to learn how to keep up. I’ve talked to many in the banking industry who run into people that say “I had checks in my checkbook, so that means I have money in the account.”

Fortunately, if you own your own business, you are probably a bit smarter than that, at least I hope so. But many business owners still don’t keep track of the business finances well enough. They have a tendency to pay bills as they come, buy supplies as they need them and spend money on personal items because it’s there.

Continue Reading: “Avoiding Cash Flow Mistakes”


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By Chris Brunner
Monday, September 18th, 2017 @ 12:04 AM CDT

Money |

How to Buy Back the Business You Sold

There are many entrepreneurs out there who move on, selling the business they created from nothing to a larger company. The sale happens for any number of reasons: the owner just couldn’t make ends meet but there was a market for the product, the owner was ready to move on to something else, or the company had reached a plateau that only a larger company could overcome.

Often these entrepreneurs have a change of heart and want to buy their business back. Many times this is because they just can’t let go and are disappointed in the way the new owners are handling things. On the other hand, the new owners may not be as pleased with their purchase as they anticipated and may even offer to sell the business back. Regardless of the reason, an entrepreneur looking to buy back his previously owned business shouldn’t dive right back in without doing a little leg work first.

Continue Reading: “How to Buy Back the Business You Sold”


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By Michelle Cramer
Friday, August 25th, 2017 @ 12:09 AM CDT

Money, Ownership |

When to Consider Bankruptcy as an Option

Truth is, most of us don’t want to EVER consider bankruptcy as an option to get out of debt looming over our heads, especially when it comes to our goal for a successful business. Filing bankruptcy, in the eyes of most, is like admitting defeat at our dreams, and no one wants to do that.

Unfortunately, however, there are often circumstances beyond our control, such as unexpected medical problems, which force us into a financial corner that, no matter how we try, we just can’t seem to get out of. If you’re in that corner, and haven’t consider bankruptcy as an option yet, maybe you should.

Consider the following to determine whether bankruptcy may be your only way out:

Map Out a Payment Timeline
Determine your personal average monthly income, and list your personal expenses (such as groceries, mortgage, etc.). Next, list your businesses monthly income and business expenses (utilities, supplies, payroll, etc.). Determine what you have left each month after expenses. No, list your debts, including monthly interest, and find a total.

Continue Reading: “When to Consider Bankruptcy as an Option”


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By Michelle Cramer
Thursday, August 24th, 2017 @ 12:00 AM CDT

Business Law, Money |

How and When You Should Pay Yourself

As a business owner, there are many things you have to worry about. Bills, supplies, meeting customer demand, hiring employees you can count on, choosing the right price for your product… the list goes on and on. One thing that may seem to be moved to the back burner in the midst of all of these concerns is yourself, more specifically, the personal funds you get out of the company.

So, how and when do you pay yourself for all of your hard work? Let’s first focus on the when.

When
To make things easier on your company’s budget, it’s best to pay yourself when you pay your employees. For example, if you pay your employees bi-monthly, then you should be paid on the 15th and 30th as well. This makes for easier accounting for the business, and leaves no doubt as to what you can expect.

Continue Reading: “How and When You Should Pay Yourself”


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By Michelle Cramer
Thursday, August 17th, 2017 @ 12:00 AM CDT

Money, Ownership |

A Little Relief from High Gas Prices on the Horizon

National Payment Card

Though it’s not because gas prices are necessarily going down. It’s because gas stations in Texas (with a nation-wide expansion in the works) are providing up to ten cents off per gallon with a special program. The program comes from a two year old, eight person company called National Payment Card (NPC). And all you have to do is pay for your gas by swiping your driver’s license through the credit card slot on the gas pump.

Well, first you have to enter your driver’s license number and bank account information on the NPC website. When your driver’s license is swiped, an automatic withdrawn is taken from your bank account through an e-check with the Automated Clearing House, which is typically used for direct deposits.

Many are skeptical of the idea of giving out such personal information. In fact, the Texas Department of Public Safety does not endorse NPC or any other program that uses your state issued driver’s license. But what those who have their doubts don’t seem to acknowledge is the fact that programs like PayPal (which I know, through experience, to be entirely secure) require more personal information from you than the NPC program.

Continue Reading: “A Little Relief from High Gas Prices on the Horizon”


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By Michelle Cramer
Friday, August 4th, 2017 @ 12:05 AM CDT

Money, Operations |

Local Currency Helps Small Business

It’s not news that big-box businesses are popping up everywhere and harming the local small business economy wherever they land. In fact, a study in Maine by the Institute for Local Self-Reliance (ILSR) showed that only about 14 cents on the dollar of funds that went into a big-box business stayed in the state. This compared to a whopping 54 cents on the dollar for locally-owned businesses.

In an effort to discover ways to bring more customers to the small business community, the community of Barrington, Massachusetts has created a local currency called BerkShares. One BerkShare note is worth 90 cents in U.S. currency. Four banks int he Barrington area participating, along with some 280 locally-owned businesses who have registered with the program, and 250 more in the area that take the currency but aren’t officially registered. As part of their participation, businesses offer customers who use BerkShares a 10% discount on their purchases.

Continue Reading: “Local Currency Helps Small Business”


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By Michelle Cramer
Wednesday, July 26th, 2017 @ 12:01 AM CDT

Money |

Funding Options for Small Business

When I started my photography business this year, I vowed that I would not go into debt to make it happen. Things are still slow as I build my portfolio and get the word out, which means there are times when I have no money coming in at all. And that’s fine, it just means that I’m not making any purchases to further things along either.

I do invest my own money in the business. In fact, that’s exactly how I got the business started in the first place, by saving up for it. And that’s how I take it to the next level with advertising, etc. I save up for a particular piece of equipment or ad.

Investing your own money in your business is the most cost effective way to get things moving, especially in the beginning. Additionally, as your business grows and has more revenue coming in, you can invest your personal income as a loan to the business, with an interest rate and all, where the business pays you back for your investment.

Continue Reading: “Funding Options for Small Business”


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By Michelle Cramer
Tuesday, July 25th, 2017 @ 12:00 AM CDT

Money, Startup |

Being Sued by Big Business Competition

Tom Szaky has a new business – TerraCycle provides organic plant food, made from worm feces, and just recently secured its major financial backer. But just about that time, Szaky received a 173 page lawsuit. The Plaintiff: Scotts Miracle-Gro. Their accusations: that TerraCycle falsely claims that its product “outgrows the leading synthetic fertilizer,” and trade dress issues (in other words, TerraCycle’s packaging too closely resembles Miracle-Gro’s).

How do you, as a small business owner, deal with the squeeze from the big business corporate competition. Well, it’s foremost important to keep in mind that, if you make claims against those competitors, like your product can outgrow their’s, you probably need to make sure you can back up that claim.

Continue Reading: “Being Sued by Big Business Competition”


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By Michelle Cramer
Thursday, July 13th, 2017 @ 12:00 AM CDT

Business Law, Money |

Tips for Gaining and Impressing Potential Investors

It’s not often that a new business can really get itself off the ground without investors to help push it along. But, of course, getting investors to write you a check isn’t all that easy. You obviously believe in the business you want to start because it’s your brain child – a part of you. But convincing others to believe as whole-heartedly as you do can be a rough task.

Here are some tips for getting potential investors to believe in you and the future of your epiphany:

Continue Reading: “Tips for Gaining and Impressing Potential Investors”


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By Michelle Cramer
Thursday, July 6th, 2017 @ 12:02 AM CDT

Money, Networking, Startup |

How the Bee Colony Collapse May Affect Your Business

Many people don’t realize that the honey bee population is a vital part of the farming industry in our nation. The business of raising bees is worth about $15 billion in the U.S. Worldwide, honey bees are also responsible for pollinating more than 90 types of fruits and vegetables, especially almonds, apples and blueberries.

But what has become known as the Colony Collapse Disorder is threatening to change the livelihood of some businesses. If colony losses are significant it won’t only effect the bee keepers income. Farmers who use bees to pollinate their crops will either face substantial costs to produce crops or a significant drop in production. Either way, consumers may see a raise in prices of crops in order for farmers to break even.

Continue Reading: “How the Bee Colony Collapse May Affect Your Business”


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By Michelle Cramer
Tuesday, July 4th, 2017 @ 12:01 AM CDT

Money, Operations |

What Makes Gasoline So Expensive These Days?

On the surface this may not seem like a topic related to small business, but it most certainly is. The price of gas affects all of us in tremendous ways. And if you travel for the sake of your business, it’s really hitting the wallet hard.

Last summer, when gas prices averaged $3.00 a gallon, most of us assumed that would be the worst of it. Boy, were we wrong. With gas prices currently averaging $3.20 a gallon (though it’s closer to $4 on the west coast), the anticipation of what this year’s summer will bring is a black cloud looming over our heads.

So, what’s the deal? Why can’t we keep something affordable that nearly every person in the nation is so dependent on? That right there is the problem… our dependency on gasoline for our every day lives. Now, I’m not trying to go “green” here, but the concept of supply and demand is not new to the business world. As the demand for a product increases, and the supply decreases, then the price continues to climb.

Continue Reading: “What Makes Gasoline So Expensive These Days?”


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By Michelle Cramer
Friday, June 30th, 2017 @ 12:02 AM CDT

Money, Operations |

Retirement for the Sole-Proprietor

When you go solo and start your own small business, it can often be hard to save for retirement. Yes, there are options like Roth IRAs, but as your business grows, the maximum contribution of $5,000 doesn’t always seem to be the best option.

Additionally, savings accounts have a meager return on the precious funds you’ve worked so hard to earn. Wouldn’t something like a 401(k) plan that many corporate employees get to take advantage of be nice?

Well, cheer up because the option is out there. In fact, it has been since 2001, but only now are sole proprietors becoming more aware of it’s benefits as the kinks have been ironed out. It’s called a “solo 401(k)” (a/k/a “solo k,” a/k/a “uni-k“). This retirement option is strictly limited to sole proprietors without employees.

Continue Reading: “Retirement for the Sole-Proprietor”


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By Michelle Cramer
Sunday, June 25th, 2017 @ 12:00 AM CDT

Money, Ownership |

Tips for Adapting to the Postage Rate Increase

United States Postal Service

In 1847 the first U.S. postage stamps were released, the five cent Ben Franklin and the ten cent George Washington. And, in just a week, the rate for postage stamps will increase to 41 cents – more than eight times that of the Ben Franklin.

You may be asking yourself, why the increase, since we just did this a little over a year ago? The stamp increase is to help cover operational expenses. Last year’s increase was mandated by Congress to fund an escrow account.

While the stamp increase won’t severely effect most business owners, the U.S. Post Office is also changing the postage rates for packages and this may cause a bit of a strain. But don’t worry, there are some ways to work around the added expense.

Continue Reading: “Tips for Adapting to the Postage Rate Increase”


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By Michelle Cramer
Sunday, June 18th, 2017 @ 12:01 AM CDT

Money, Operations |

A New Way for Employees to Get Paid

Some say that there will soon come a day when checks are no longer in existence. Well, how would you like to get paid by your employer with a debit card? Sounds a bit strange, but it’s catching on and here’s why:

Many businesses have employees, such as minors or new U.S. immigrants, that don’t hold bank accounts. When those employees receive their paycheck, they will pay up to 10% of the check in order to get it cashed. A recent alternative is providing employees with a payroll debit card.

Basically, the employer deposits funds in a payroll account and then distributes payroll debit cards to his employees. Each card has an amount attached to it that is equal to that of the employee’s paycheck for that pay period. The funds can be withdrawn from an ATM or the card used as a debit card at any retailer.

Not only does it save employees without bank accounts the expense of getting a check cashed, but it also saves the employer the expense of printing paper paychecks. Checks typically cost $1-2 to print, while it is only about twenty-cents to provide a payroll debit card.

There are still a few bugs left to work out, however. Most state laws require that employees get their entire paycheck on pay day. This could be a problem if the ATM machine has a withdrawal limit that is less the the employee’s paycheck amount. The employer may to have to pay extra ATM withdrawal fees for all of the funds to be accessible at once.

Not to mention the fact that changing over to a payroll debit card process (in addition to direct deposit) can be time consuming, as most employees would be wary of such a change at first. It would take some time to reassure them that the process is secure and efficient.

Payroll debit cards are clearly one of the first steps in the extinction of checks. Despite the wrinkles that remain in the process, it is definitely something that makes things a bit easier for the employee, and requires less paperwork for the employer, which is always a good thing.

Source:
• CNNMoney.com: The End of the Paycheck


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By Michelle Cramer
Wednesday, May 31st, 2017 @ 12:01 AM CDT

Money, Operations, Technology |

Why Small Businesses are Gullible to Scams

What’s this world coming to that so many people are scamming others for money . . . and we’re falling for it? It really blows me away that so many people fail to do their homework and check out what their told by a random nobody who calls them up and says, “You owe us money.”

Granted, some of these scammers are good… too good really, but most of them prey on the gullible. And, unfortunately, small businesses can be far too gullible. They’re targets. New small businesses are hit by scammers because they have less experience in the ways of the business world and will probably assume everyone’s who they say they are.

Also, most small businesses are too small to afford a full-time legal staff to check out offers or claims. And many are in desperate need of investors and will jump at the chance of “free money.” And that’s what the scammers are hoping for.

There are endless scams out there, but if you own a small business, here are three common scams to look out for:

Overpayment
With this tactic, scammers order a product from you and mail in a check for payment, but they write the check for more than they owe, making look as though it was simply a misunderstanding, such as sending a check for $950, when the bill was $750, and claiming the seven looked like a nine. Your company sends a refund of $200 with the shipment of the items purchased.

But, a couple weeks later, the check bounces because the account is closed or doesn’t exist. And you’ve just given away your product, been stuck with the bill for a bounced check, and are out $200.

What makes this work is the fact that the small business owner is gullible enough to trust that the check will clear, and that should never be the case, not even with your regular customers, and MOST ESPECIALLY not with a new customer. Give the check 7-10 days to clear the bank before you even ship the product. And, if the check is written for too much, return it and require the correct amount. Make it part of your payment policy and you’ll avoid the scammers.

Disappearing Act
A common example is a fax received asking if you are interested in selling your business. If you are and you contact the company, they charge you several thousands of dollars (we’re talking $5-10K) for that company to determine what your business is worth. The problem is, you pay them and they never return. Poof, they disappear.

The best way to avoid this type of scam is to check out any business, whether you hear of them by fax or word of mouth, before giving them your money. Check their registration with the Secretary of State and the Better Business Bureau. Ask around and see if anyone else has heard of them. Even do a Google Search. Chances are, if they’re scammers, you’ll find out real quick. And unless you can find a solid gold list of references and validation, don’t even both.

Directory Listings
Fake invoices have been around for awhile, but an added twist to this fraud is that many scammers are claiming to be directory listings, whether in print or online. They typically call and tell you that your listing is about to expire and convince you to renew. Then they send you a bill for several hundred dollars.

Generally, however, there is no directory to begin with and you’ve just paid to have your company name listed nowhere. As a rule of thumb, if you’ve never heard of or even seen the directory, it probably doesn’t exist.

A great way to throw the scammer for a loop is, when they call for your renewal, ask for a copy of the previous directory so that you can make sure you like they way your company is listed before it’s renewed. They’re sure to hang-up at that point.

Again, always check to verify the true existence and good standing of a company before you do business with them. I have listed helpful resources below. Don’t give the benefit of the doubt — that’s what makes you gullible in the scammer’s eyes. I guarantee, anyone who is a legitimate customer will understand your skepticism and wait patiently for you to verify their company or funds.

Resources:
National Fraud Information Center
Better Business Bureau
BBB Online Reliability Seal Program
Federal Trade Commission
Internet Crime Complaint Center


Related Readings:

• Entrepreneur.com: Common Small-Business Scams
• Systematic, Inc.: How to Steer Clear of Internet Scams


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By Michelle Cramer
Friday, May 19th, 2017 @ 12:01 AM CDT

Money, Operations, Technology |

A Newer Way of Avoiding High Energy Bills

Warmer temperatures are anticipated for the year (the groundhog didn’t see his shadow this time, which means early spring). Inventories abound for natural gas and prices are falling. Things might actually be at a good state right now, and it’s time your business took advantage of it.

How? By tapping into (no pun intended) fixed rate natural gas contracts. Basically, you are locked into a fixed rate per therm (a measurement of natural gas) and pay the same amount each month.

The contracts last up to three years and are provided by companies such as Xcel, IDT Energy, Accent Energy and CenterPoint Energy. Basically these and other firms come to an agreement with utility companies to deliver natural gas to consumers through a pipeline. The utility company makes a profit off of the transmission charge, so they are willing to contract out the supplying of the gas, as long as the transmission charge is paid.

Using fixed rate natural gas contracts can save you money, but it can also cost you more. It simply depends upon whether gas prices go up or down. Right now, they’re down, which means it would be smart to get in on this opportunity now, with a lower fixed rate, and pay less later.

Another advantage of these contracts is stability and consistency in your bills. A fixed energy bill will allow you to budget the expenses of your business more easily, causing less stress come bill paying time.

They’re worth looking into for any business owner. Anything that is easier or cheaper over the long term is usually worth it.

Sources:
• CNNMoney.com: How to Avoid Sky-High Energy Bills
• StarTribune.com: Fixed-rate Gas Plans No Bargain for Some


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By Michelle Cramer
Monday, May 15th, 2017 @ 12:01 AM CDT

Money, Operations |

National Minimum Wage on the Verge of Increasing

It’s been over 10 years since the national minimum wage was increased. Ten years! I find that simply astounding. The cost of living has gone up in that amount of time, without a doubt, but the income that many families generate hasn’t budged. There is something very wrong with that picture and the Senate is pushing for a change.

The plan is to increase the current minimum wage of $5.15 per hour to $7.25 in three increments over the next two years. I like the idea of easing into the change, so that small businesses can adjust accordingly. The Senate bill also includes some tax breaks for small business to ease the transitional pain, while hitting up the large corporate businesses for more money to balance things out.

The bill currently under examination will no longer allow corporations to deduct the cost of jury verdicts or out of court settlements in lawsuits, generating an estimated $540 million over the next ten years. A beautiful plan if you ask me. Even though I work for a law firm that represents local corporations, I think that a corporation that is found guilty of wrong doing in a jury trial should not be allowed to deduct the funds it has to pay out from the judgment. It seems to defeat the purpose of punishment.

Also, the tax-defered portion of severance or retirement packages given to former corporate executives will be limited. Instead of all $210 million like former Home Depot Chaiman-CEO Bob Nardelli received (don’t even get me started on that one) being tax deferred, the amount defferable would be limited to $1 million a year or a figure equivalent to the five year average of the receipient’s taxable salary. Another brilliant idea, especially since it is expected to generate $810 million in revenue over the next 10 years.

What’s funny to me is that those in the Senate who are against the minimum wage increase claim that the beneficiaries would likely only be teenagers with part-time jobs, rather than the working poor. Uh, hello, I beg to differ! As one whose husband stocks shelves in a grocery store to help pay for college, I am well aware of the fact that the minimum wage increase would be highly beneficial to our income.

Additionally, there are plenty of people working at McDonald’s that do so full time to support a family who would benefit from the increase. I used to work in day care, and even those teachers are barely paid just over minimum wage (around $6 an hour), at least where I’m from. Explain to me how these people wouldn’t benefit?

The House version of the bill doesn’t include tax breaks for small businesses (boo), but they plan to address those issues in a separate bill. This will cause a bit of a slow down between House and Senate in getting the bill passed on to the President, but ultimately I think both the increase and tax breaks will become law. Congress would be imbeciles not to pass them. It’s simply time for it.

Minimum Wage Increase Chart

Minimum Wage Increase Chart

Source:
• AOL Small Business: Minimum Wage Bill Divides Businesses


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By Michelle Cramer
Friday, May 12th, 2017 @ 12:00 AM CDT

Money, Taxes |

Fire Bad Clients to Increase Profits

Are your profits being hindered by deadbeat clients?

Examples of client bad-habits you should consider cutting loose:

• Non-paying or Low-profit Clients
If they’re not paying you for your services, then they are obviously not worth working for. There is, of course, an exception to this rule. If a client is generally appreciative and can’t afford their entire bill, make payment arrangements that work for both of you. If they still won’t pay, even after you’ve given them a break, then drop them and consider suing them for the unpaid balance.

Continue Reading: “Fire Bad Clients to Increase Profits”


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By Michelle Cramer
Sunday, May 7th, 2017 @ 12:00 AM CDT

Money, Operations |

Pulling Your Teen Out of the Financial Hole

Regardless of how old your child is, it’s never too late to teach him how to properly handle his money. The lessons that you can teach your teenager are vitally important. He is on the verge of being on his own. If he doesn’t know how to handle his money the right way, you are going to have to watch him endure years of financial woes. Take what little time you have left as an authority in his life and show him how it’s done.

Checking and Savings
Start by opening checking and savings accounts under your teen’s name. Whether she have a part-time job or just does some babysitting on the weekends, use the opportunity to show her that its better to use a checking account so that you can keep track of where the money goes.

Sit down with her each month when the account statement comes in and be sure she understands how to balance her checkbook. Explain the importance of recording every transaction in the register and figuring the current balance after each purchase or deposit.
Be sure that she understands the ATM balance shown after a withdrawal is rarely accurate and to never depend on it.

These tasks may seem common sense, but many people have no idea. I have a close friend who works in banking and she could tell you crazy stories. For example, she has many people who have bounced checks and swear by the fact that they thought there was still money in the bank just because there were still checks in their checkbook (Hello!)

Establish a Budget
Help your teen come up with her own budget to determine how her personal earnings will be spent. Determine whether she will be responsible for paying the insurance on her car, what she will be putting in savings each month, if she will be responsible for buying her own new clothes, etc. Compare her budget to the family budget so that she gains an understanding of how easy she really has it at this stage in her life.

Make a chart, indicating each spending category and how much each is allotted every month. Have your teen keep tabs on how much is left in the budget by writing down what she spends in each category and how much remains after that purchase. This will help her to know where she is overspending and to see how she can stick with it. It may be difficult for her in the beginning, but she’ll get it eventually.

Teach Real Debt
Nothing gets me more that parents who buy their teen a brand new Mustang for their 16th birthday… and, when he totals it, a Mustang convertible to replace it. Grrr. Those parents aren’t teaching their kids anything except that they can always count on daddy to get them whatever they want.

If you want your teenage to understand the real world, then teach him what it means to really be in debt. Go ahead and buy him a car, if you have the means, but get something more reasonable (say, less than $5,000) and have your child pay you back, with interest.

Make a monthly payment plan — something that is feasible based upon your teen’s income. Predetermine a percentage rate that won’t overwhelm him, but will convey the weight interest bears to him. Five percent is a good number.

Put the entire matter in writing, and be sure to include what the consequences will be for a late or missed payment (loss of driving privileges, TV time, etc.). Having a written document as a reference point helps to eliminate excuses. Also, map out a “loan payoff” chart, showing when each payment should be made and what remains on the loan after its application, all the way to zero. This will help your teen to see how much they will really be paying in the end and just how long it takes to get out of debt.

I also recommend you show them how long it would take to pay off (and how much more it would be) if they purchased the car on a credit card with the average 18-21% interest rate. I would imagine this would deter your teen from ever wanting to use a credit card for anything they couldn’t pay off each month.

In my opinion, this method is far more effective than the “prepaid card” that many parents use because the prepaid card is not teaching them the reality of debt. All it teaches is that prepayment is different from debt, but not the consequences and hardships debt can bring. Many teens end up getting a credit card anyway when they move out, without the proper education on how to handle one.

Truthfully, the possibilities are endless for teaching your teenagers about money. Anything you can do to help them understand being on their own (anything comparable to what you do) will help tremendously. Just don’t give up and don’t get frustrated. It will be well worth it to see them succeed.

Related Readings:
• BusinessWeek.com: Teens, young adults need money skills
• About.com: Teach Your Teen Financial Responsibility
• FamilyEducation.com: 5 Steps to Teach Your Teen to Budget
• FinancialLiteracy.com: Teaching Your Teen About Money


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By Michelle Cramer
Wednesday, May 3rd, 2017 @ 12:07 AM CDT

Family Business, Money |

Teaching Your Child About Money

For most of my life I knew very little about how to handle money. My examples growing up were usually of living paycheck to paycheck, and, when finally on my own I followed suit for a long time. The only advice I ever received was from my grandmother who told me regularly to “save, save, save,” but never told me how to get to a point where I could actually do that.

Unfortunately, my story is all too common. Today’s children are tomorrow’s business owners and many of them will go through years of financial struggles because they were never taught by their parents how to properly handle money. I firmly believe that teaching our children about money from the moment they are able to count (around 2 years old), is vital to their future happiness and survival.

The Boxes Method
When you’re little one can count to 10, she can begin to understand money. Remember, kids learn by observation and repetition. Give her a small allowance in increments that can be divided. I recommend starting with three pennies each day. I know, pennies sound small, but that is about all that will hold their attention span at a young age. Provide her with three small boxes and label them: spend, save and give. Show her each day that she should put a penny in each.

The “spend” box is, of course, the money that she gets to spend. Buy some stickers and new barrettes or, for your little man, a packet of baseball cards or bubblegum. Give him the opportunity to buy a piece of gum immediately, or wait until tomorrow so he will have two cents to buy a baseball card. What seems like an insignificant process will help him to understand how spending works.

The purpose of the “save” box is obvious as well. Give him ideas of things he can save for and buy at the store within the next month, such as a matchbox car. Tell him how many pennies it will take and remind him how close he is to buying it each day.

Avoid the temptation to help him along by adding extra funds. At such a young age, he may get the idea that mommy and daddy will always help him get what he wants. You want him to learn personal responsibility, not dependence on you.

Using the “give” box depends on your preferences. I am a firm believer in giving to charity, whether it be offering at church or donating to the local shelter, so it’s part of my teaching strategy. I believe that giving will eventually produce a return.

For example, the Rockefellers are an extremely well-known and wealthy family. What most don’t realize is that from John D. Rockefeller on down, the family has always been predominately givers. John Rockefeller gave over half of his $1 billion fortune during his lifetime, and the tradition continues through the generations.

Get Them Involved
As your child gets older, expand the financial lessons (and the amount of allowance) accordingly. Make her aware of your family’s position on finances – explain where your money goes.

Too many parents feel that it’s none of their child’s business how their money is spent, but that attitude is all wrong. You child learns by watching you. Your attitude about finances will become hers as she gets older. Openness will only help her to learn more and be more responsible with her own money down the road.

Let your child have input on what the family saves for, such as a family vacation, summer camp, or new family bikes. Map out how much you will need to set aside as a family each month in order to reach your goal, and have the kids contribute some of their allowance savings (such as $5 a month). Show them how even a small amount helps you to get there that much quicker.

Teach Debt Early
It’s also important to start teaching your child the shackles of debt. When you child begins to ask for a luxury item, such as an X-Box, agree to purchase that item with the understanding that your child will pay you back out of a portion of his allowance (Christmas is an exception, of course).

You may even consider adding a small percentage of interest, say 2%. Seem harsh? Well, it might be to some, but it’s highly effective. He will soon realize that it’s better to save up for something big and be patient than to spend money that you don’t even have yet. This will also begin to teach him the difference between needs and desires.

But what if your child is already a teenager and you are starting to witness the repercussions of not teaching her earlier about finances? Don’t worry, it’s not too late. As long as she is still under your roof, you still have ample opportunity to teach her how to handle money correctly — before she gets in trouble out on her own.

Tomorrow I will cover how to reach a teenager about finances, even when it seems impossible.

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• FamilyEducation.com: 15 Ways to Teach Kids About Money


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By Michelle Cramer
Tuesday, May 2nd, 2017 @ 12:05 AM CDT

Family Business, Money |

Why Trump & Kiyosaki Want Us to Be Rich

We all know who “the Trump” is, so he needs little introduction. To summarize his expansive money-making career, he is a graduate of Wharton School of Finance and prosperous real estate tycoon. He’s the star and co-producer of the ever popular reality show Apprentice and author of seven bestsellers.

Robert Kiyosaki came from a small sugar plantation town in Hawaii, only to move to New York for education. He is an investor and a mining and real estate entrepreneur. He is best known for his book on financial philosophy called Rich Dad, Poor Dad. Published in 1997, and selling over 26 million copies worldwide since that time, this book has been translated into 46 different languages and is available in 97 countries.

These two financial gurus teamed up to write and publish “Why We Want You to Be Rich,” which hit bookstores on October 10th. To the disappointment of most, this is not a book of specific advice on how to make or invest money. It is a book of philosophy, with the intention of providing the middle class with means to change their attitude about money and obtain a financial education.

In a video available on Amazon.com, Trump claims that he is not afraid of failing. “What is there to be afraid of?” he says, further stating that, when one considers all the turmoil in the world, nothing else really matters. Kiyosaki follows with the fact that he and Trump are better people because they have both failed and made a comeback from that failure, which provided them with a sound education about money that the two wanted to share. Because, “financial education is more important than ever before.”

The central principal of this book is that Trump and Kiyosaki firmly believe that, within the next decade or so, our country will be a two-class system — rich and poor. They believe that the middle class is deteriorating rapidly due to the falling value of the dollar, rising national debt, lower wages, higher oil prices and baby-boom retirement. It is time for everyone to learn how to “think big” and “think rich,” otherwise your other option will be the poorhouse.

The introduction of the book states that “saving is obsolete and bad financial advice.” For example, Trump and Kiyosaki believe that the 401(k) savings plan will not be adequate for approximately 80% of all workers to provide for their future. They support investments such as real estate and starting your own business as the best means to building personal wealth.

Trump claims that this book will provide the reader with a “better life.” He contends that money isn’t everything but it “makes life easier.” It is about “attitude” and “creation of wealth.” He also advices that everyone needs to “know your subject.” Investing in real estate without understanding it can lead to your downfall.

Kiyosaki admits that their book is different from the traditional financial book that says to live below your means, save and invest. He and Trump’s advice is that one should learn how to expand his means, like they do. Also, watch long-term trends — see where the money is going so that you know what to invest in.

So what do you think? Have you read the book? What are your thoughts on Trump and Kiyosaki’s financial philosophy? Some believe it is just another way for Trump and Kiyosaki to make more money — do you contend? Or has their philosophy worked for you?

Sources:
• Amazon.com: Why We Want You to Be Rich
• Kiplinger.com: Book Review
• Kiplinger.com: Q&A With Trump and Kiyosaki
• Kansas City Star: Trump book contradicts standard advice

Trump/Kiyosaki Resources:
• WhyWeWantYouToBeRich.net: Book Website
• Trump.com: Donald Trump’s Website
• CashFlowTech.com: Rich Dad Website
• Wikipedia.org: Info on Robert Kiyosaki


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By Michelle Cramer
Monday, March 27th, 2017 @ 12:00 AM CDT

Money |

Debt Collection Strategies that Work (2 of 2)

PART 2 OF 2 – WHEN CLIENTS STILL WON’T PAY

We covered strategies to avoid “deadbeat” clients in part one, but inevitably someone is going to slip past your tactics and still be noncompliant with payment. What then?

It is best to take action when 30 days have passed with no payment or contact from a client. First, enclose a personal letter with their next invoice. Restate the written agreement regarding payments (consider enclosing a copy) and that they are in violation of that agreement.

If a client cannot afford the entire balance due, they may get overwhelmed and simply ignore the bill, hoping it will disappear on its own. Where the logic is in this, I’m not sure, but it is reality. Consider offering to make monthly payment arrangements with the client in your letter, especially if the balance due is rather large.

It is important, however, that you suggest the monthly payment amount, which should be approximately ten to twenty percent of the outstanding balance, and specify their first due date. Provide the client with the option to contact you if the suggested amount will not work on their budget. If they do so, be sure to negotiate an amount that is not too hard on them, but will serve to get the whole balance paid in a timely manner.

Once you have made payment arrangements with a client, continue charging interest on the outstanding balance for the first couple of months. If the client makes her payments consistently during that time period, consider waiving all future finance charges so that her bill will diminish more quickly. This will also give the client an incentive to continue making payments.

—-
Before venturing any further, this is a disclaimer that I am not an attorney, however, I have three years experience working for collections attorneys and I am very familiar with collection law. From this point on you must tread lightly when attempting to collect a debt from a client. I recommend that you examine the Fair Debt Collection Practices Act (FDCPA), which is Federal law regarding what is required of any debt collector, even if you are not a collection agency or attorney.
—-

Many articles I’ve read on the topic of collections, including those listed below, recommend that you write and call the client a number of times and be persistent, increasing your directness and determination gradually. However, I DO NOT recommend writing and/or calling the client more than once. There are precise laws in place that protect a debtor from what can be deemed “harassing” contact. If you contact your client more than twice about an unpaid balance, you risk being sued for harassment, and no bill is worth that.

Give the client until the next statement cycle to respond to your letter. If they have not, call them, but only once. Even if you get a voicemail, I recommend that you leave a message but do not attempt to contact them by telephone again. If you get no response, then you must first determine whether the balance due is worth pursuing further. This is the point where you may begin to incur expenses to collect the debt owed.

If you decide that the unpaid balance is worth pursuing, you have a few options to proceed with:

1) Turn it over to a collection agency.
Keep in mind that collection agencies will keep 10-50% of anything collected on your behalf. Their primary means of collecting a debt are letters and telephone calls. Personally, I do not think a collection agency is your best option. More or less, they do what you could do on your own, except that they will report the debt to the credit bureau and are willing to risk a more threatening tone with the debtor if necessary.

2) Take the debtor to Small Claims Court.
Providing that the balance owed to you is within the limitations set by the court (you will need to check with your local clerk), small claims court will cost less than $100 to pursue and you can represent yourself. This saves the added expense of hiring an attorney. You will need to have a paper trail to validate the debt before the judge. Your strongest piece of evidence is the agreement you and the client initially signed. However, it is also helpful to have photographs or examples of the services you provided, copies of invoices, and notes from telephone conversations, etc.

Before you can pursue a case in Small Claims Court, you will have to send the client a demand letter. This is a requirement under the FDCPA and is different from the letter suggesting payment arrangements you may have sent to the client earlier. There are specific legal requirements for a demand letter. Please refer to Section 809 of the FDCPA, which lists those requirements in detail.

Typically, if you provide the necessary information to prove that the client owes you money, the Small Claims Court will find on your behalf and there will be a judgment entered against the client. However, it is still up to you to collect the debt. This can be time consuming and difficult, as your options for doing so are limited.

3) Hire a Collections Attorney.
It is important that you know upfront that a collections attorney will either take a percentage of what they collect (usually around 25%) or will charge you an hourly rate. However, unlike with a collections agency, some of your attorney fees can be offset, if you took the correct steps in your initial agreement with the client.

If your agreement stipulates that the client would be responsible for attorney fees should a lawsuit be necessary, then you will be able to collect reasonable attorney fees (usually 15% of the debt) as a part of your judgment. This an advantage to hiring an attorney yourself. Collection agencies will not pursue a judgment without hiring an attorney, and, if they do so, your fees would not be reimbursed.

Collections attorneys file a Petition in the Associate Circuit Court of the county where the debtor resides. The debtor is then served with a summons to appear in court. If they do not appear, the a judgment is entered against them automatically. If they do appear and admit to owing the debt, a judgment is still entered. Only if the debtor disputes the debt in court will the case go to trial, and it has been my experience that only 10-20% of the cases do so. Even if the case goes to trial, it is likely that you will still get a judgment against the debtor, especially if you have a contract and a paper trial to prove your case.

It is also much easier for an attorney to collect the debt once a judgment is entered. They have the means to file a garnishment on the debtor’s wages, bank account, even business. They can also file a lien against real estate the debtor owns or confiscate personal property, such as a vehicle, as payment for the debt. These options are not readily available to you if you have a judgment through small claims court.

An attorney will do everything legally possible to collect every last penny of what is owed to you, and then some, such as attorney fees and interest. They will do all the work, including the demand letter, and you will be free to continue business without the added burden of trying to collect an unpaid debt. It has been my experience that an attourney can provide the best results in the shortest amount of time.

Always consult with an attorney before pursuing any debt collection strategy. The opinions in this article are not to be taken as official guidance but rather as an informational supplement to your overall debt collection strategy.

PART 1: Avoiding Deadbeat Customers

Sources/Related Readings:
• SeniorMag.com: Bill Collections
• About.com: Collection Letter Secrets
• FindArticles.com: Collecting Payments Due
• BusinessKnowHow.com: Small Business Collection Strategies


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By Michelle Cramer
Wednesday, March 22nd, 2017 @ 12:00 AM CDT

Money |

Debt Collection Strategies that Work (1 of 2)

Part 1 of 2 — AVOIDING THE “DEADBEATS”

It’s inevitable that any business owner, big or small, is going to encounter clients that are just not willing to pay. This is especially prominent in the service industry, as services are an ongoing process and not a one-time product purchase.

It is no surprise that many small businesses do not survive the first two years, and the inabilities to collect from nonpaying clients are likely a large contributor business failure.

The first realization a small business owner must come to is, no matter how nice a client is or how much business they bring you, if they do not pay then they are not a good customer. It is never a good idea to continue doing business with a client who ignores an unpaid invoice.

Despite what you may think, a non-paying client is typically doing so on purpose, not because it slipped their mind. Yes, there may be strenuous circumstances in some instances that provide an exception to the rule, but until your client notifies you of such, and his reasons are legitimate, you can assume that he is avoiding payment.

When you first start your business, there are certain strategies you can implement that will help you to avoid the burden of non-paying clients.

Establish Payment Guidelines
Let clients know from the start what your guidelines are. Explain on your brochure, website, order form, etc. the available payment options for the services you provide. Once you’ve established these guidelines, it is imperative that you stick with them. If a client senses that you are lax in collecting the payment as set out, they may take advantage of it.

Consider Upfront Payment
When providing a service, business owners have a tendency to do the work first and bill later, which can result in collection problems. Your safest bet is to require full or partial payment upfront. If your business provides a short-term service, such as carpet cleaning, payment in full upfront is not too much to ask of your customer. If your business provides a long-term service, such as computer programming, then it is more than reasonable to obtain partial payment upfront.

In fact, you might consider requiring one-third of the payment upfront, another third at the halfway point of the project, and the remaining third within two weeks of completion. If you adopt this rule, or something similar, be determined to not continue or finish the project until the payment due is received. Inform the client of this payment plan in the beginning and, chances are, they will be sure to pay on time because they want the finished product.

Develop an Accounts Receivable Department
Some small business owners are tempted to allow the sales department to also deal with accounts receivable. If your business has the ability to hire the employees, establish a separate accounts receivable department or put someone in charge of collecting payments. This will insure that someone is always aware of what clients have paid and what clients are behind.

Put it in Writing
Make this your policy with every new client. Legitimate clients understand that you need the terms of your business relationship in writing in order to protect your business. Be sure your agreement covers what product/service you will provide, when you will provide it and how much and when the client is to pay, including any interest/finance charges applied to late payments. If a potential client refuses to sign the contract, then they likely won’t pay you and are not worth your time.

It is also important to state in the contract that, should the client not make payments as agreed, you reserve the right to pursue action through the court. Also state that, should court action be necessary, the client would be responsible for paying court costs and your attorney fees. Let the client know that this is simply a precaution and you have no reason to believe that court action will be necessary. However, if the unfortunate occurs and you have to pursue a lawsuit to collect what is owed to you, you cannot collect attorney fees to offset your expenses if it is not stated in your original agreement.

Have Clear and Concise Invoices
Your invoices will need to be systematic and dependable. Again, if you are lax in sending invoices consistently, then the client will get the impression that payment is not a high priority. Be sure that your invoices are numbered, that the billing terms and due date are visible and clear, and that they are sent to the correct person. I highly recommend using invoice software, such as Tabs3 or Billing Tracker. Google search “invoicing software” and find the program that best fits your needs.

Provide Incentives for Prompt Payment
Give your clients a reason to pay their invoices as soon as they receive them, whether positive or negative. Some options are:

Take credit card payments. Often this will give the client the ability to pay their entire invoice at once. Keep in mind, however, that, with each credit card transaction you accept, a percentage of that sale goes to the credit card company. Make sure it is an expense your business can handle.

Give a discount for payments made promptly. Consider offering, say, a ten percent discount if the client pays their invoice within 15 days.

Charge interest on overdue accounts. Consider charging your client interest on the unpaid balance if payment is not made within 30 days of invoice. A common interest rate is 18 percent per year, which equates to 1 ½ percent per month. Most invoicing software will calculate interest on an unpaid balance automatically.

What if they still won’t pay?

Working as a legal assistant to collection attorneys for three years, I have some helpful advice to share. Part two of Debt Collection Strategies that Work covers what steps you should take when a “deadbeat” client slips past your guard dog tactics.

Always consult with an attorney before pursuing any debt collection strategy. The opinions in this article are not to be taken as official guidance but rather as an informational supplement to your overall debt collection strategy.

PART 2: When Clients Still Won’t Pay

Sources/Related Readings:
• SeniorMag.com: Bill Collections
• About.com: Collection Letter Secrets
• FindArticles.com: Collecting Payments Due
• BusinessKnowHow.com: Small Business Collection Strategies


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Debt Collection Strategies that Work (2 of 2)
How to Improve Your Credit Score
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By Michelle Cramer
Tuesday, March 21st, 2017 @ 12:04 AM CDT

Money |

Managing Business Cash Flow

Cash flow can be the lifeblood of any company large or small. Unfortunately many small business owners neglect to manage their cash flow properly.

Here are some tips from PowerHomeBiz.com on how to manage home business cash flow:

• Collect Payments Quickly
• Deposit Checks Fast
• Have a Super Tight Accounts Receivable Policy
• Disburse Your Money Slowly
• No Extra Money in Your Bank Account
• Get an Account Analysis Statement
• Inventory is Not Cash
• Don’t Forget Continuity Sales
• Licensing Agreements

Recommended Reading:

• Entreprenuer.com – How to Better Manage Your Cash Flow
• Inc.com – Cash Management Basics
• C.P.A. – Understanding, Planning & Managing Cash Flow


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By Chris Brunner
Saturday, March 4th, 2017 @ 12:02 AM CDT

Money |

Personal Savings in Decline

Image Source: St. Louis Federal Reserve

This is a little off the topic of small business but I think it affects each and every one of us.

An interesting discussion is taking place over at Vox Baby about personal savings.

According to the GDP Report, consumer confidence in the economy is up, yet personal savings is down.

In fact, the U.S. Personal Savings Rate has not been positive for the U.S. since March of 2005.

Some argue that this has to do with baby boomers funding higher education for their children.

Others suggest looking at income quintiles. “The topmost quintile is very, very confident that their income will stay high come what may. So why save?”

The personal savings rate does not include capital gains on investments as a method of saving.

William Gale, a tax specialist at the Brookings Institution in Washington, D.C., says the situation isn’t as bad as it seems and it’s a mistake to look at the personal savings rate and think it correlates with wealth accumulation.

“For wealth accumulation you need capital gains. … it is [important] to look at the right measurement. The personal savings rate is good as a national income accounting measure.”


“I wonder how it can be that with the Baby Boomer generation in the high-income and presumably high-saving part of its economic life cycle, we can possibly have negative saving rates for the population as a whole, if we are making decisions with any attention to the amount of consumption … in the future.”

Vox BabyThe End of Personal Saving?


Despite a favorable outlook, there are at least three widely acknowledged areas of near-term concern that could pose risks to the economy going forward: a spike in energy prices, a decline in home prices, and a retrenchment in consumer spending arising from record consumer indebtedness.

The public’s increase in debt in 2005 was far greater than its increase in after-tax income.

FDIC.govScenarios for the Next U.S. Recession


… research suggests that a group that includes approximately 10 percent of U.S. households may be at heightened risk of credit problems …

Not only do many borrowers in this group have pre-existing credit problems, they may also be more vulnerable than other groups to rising interest rates because of their reliance on interest-only and payment-option mortgages.

Gary North – The Next Recession


More Discussion and Information:

The Glittering Eye – Why is the savings rate so low?
Investment U – U.S. Personal Savings Rate
Bankrate.com – Savings in America: Retirement picture not as bad as it looks


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By Chris Brunner
Friday, March 3rd, 2017 @ 12:04 AM CDT

Money |

Investing in Energy

Energy — in a variety of forms — has a continuous and direct effect on our daily lives from top to bottom.

At present, fossil fuels account for 86 percent of world energy consuption. By 2020, global demand for energy is expected to outpace current world production by nearly 40 percent.¹

Here’s my energy portfolio:

IGNAX – Ivy Global Natural Resources Class A
IGNCX – Ivy Global Natural Resources Class C

…and a new fund that I will be investing in today:

WEGAX – Waddell Reed Energy Fund Class A

…and I’m considering buying into this new fund:

GAAEX – Guinness Atkinson Alternative Energy Fund

I predict that industrialized nations will witness an accelerated use of fossil fuels for another 10-20 years. The price of oil and gas will soar and supply will diminish rapidly.

Within 5 years, I see focus moving to renewable energy and alternative energy research, development and infastructure on a large scale basis. This will set up another energy investment opportunity for lucrative returns many years down the road.

¹ EIA; BP Statistical Review of World Energy


Consult with an investment professional before taking part in any investment scheme.

Recommended Resources:

• Forbes.com – Forbes Energy News
• Evergreen Solar – National Council for Solar Growth
• Market Participant – A Balanced Energy Portfolio


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By Chris Brunner
Wednesday, March 1st, 2017 @ 12:00 AM CDT

Money |