Vision

What is your vision for your financial future? That might be a tricky question for many people. First we must describe vision.

My definition of vision is the vantage point from where we see a particular thing or situation.

If someone were to walk out the front door of a home in a densly populated city they might see buildings, people and other housesm. But they might not be able to see much further or more than that.

If that same person were to sit on the roof of their home they would be able to see a lot further. The other thing that would happen is the object near to them will appear slightly smaller.

If the same person were to sit in a air balloon about eight hundred feet directly above his home, his line of sight would change drastically. Everything that he looks upon would appear very small.

Those of us who live for the moment are viewing our positions from the first area - the front of the house.

Those that who are able to put their gratification for a few months have a roof top view.

Those who have a long term view are those who sit high atop things and are able to see a bit more.

What perspective do you currently have about your financial future? Think about it before you answer. If you need assistance take a look at your last bank and credit card statements. What percentage of those expenses is helping to build your financial future?

Making Money During Cramped Times

Many say that this is a time to save all that you can before the financial conditions get any worse. That is good advice for those who have no money to risk but it is not the best advice for those that do.

If you have some money to risk, the best thing to do now is invest some of those dollars in the stock market right now. That's right I said the stock market.

You might think I am crazy but this is great advice.

If you find quality companies that have a relatively low stock price right now, you should buy stock in those company. You must however look to hold the stock for the next 3 to 5 years though.

The stock market now is like giving birth to a premature baby. You will go crazy attempting to check the progress of the child everyday. Doctors say that progress of the premature child's growth should be evaluated from month to month. This holds true for your stock purchase, look at the month to month development of the stock.

Another bit of advice is to buy stocks that pay dividends. The idea here is to see yourself holding that stock for the next 3 to 5 years as well, but reinvest the dividend into purchasing more shares of the same stock.

Check up

I want you to think about something for a second. How do you know if the money you have authorized your employer to withhold from your check for retirement purposes is actually being invested in your retirement? Although against the law it is very possible for your employer to delay payment to your retirement account.

Let’s say your employer did make the payment to your retirement account in a timely manner. How do you know if the company holding your retirement account actually invested those funds correctly?

With the recent fall of Lehman Brothers and some of the other financial giants it is quite possible that some of your retirement funds were not invested properly and your retirement funds could be lost.

Although we trust that the financial institutions are doing the right thing, it is good to check up on them periodically. How do you do that you may ask? That is a very good question. The first line of defense is your statements showing the amount in your retirement account. The second line of defense is to sit down with a financial planner and have that professional look over your retirement assets as well. At the end of the day you don’t want to be surprised, you want to be informed. A periodic check will help you stay informed!

Can You Swim?

When I was a teenager I nearly drowned in a pool. I knew I couldn’t swim very well, to be honest, I couldn’t swim at all.

The pole had a rope that separated the deep end from the shallow end so that summer I always stayed on the shallow end of the pool. The shallow end went from three feet to five feet. On the deep side of the pool the notation were six feet, eight feet and then 12 feet.

One day while playing a game in the pool, I ventured out from the three foot marker just beyond the five foot marker. Because the game so was exciting and my head was still above water; I continued to venture further onto the deep side of the pool. Now remember I can’t swim!

All of a sudden I began to drown. On my very next step past the five foot marker I no longer felt the pool base under my feet. Instead I began to plunge to the bottom, as if I stepped off a cliff. It was very scary because I was just above water and in an instant drowning. Thankfully someone came to assist me.

This is what I believe has happened to many with their debt. When they initially purchased the home, the car or obtained the credit card everything was fine, the debt was able to be maintained. Then some ventured out a little more and added another supposed asset without adding any more income and the next thing you know, you are in over your head. Do not allow your emotion to overshadow wise decisions.

The next time you are in a position to obtain anymore debt, ask yourself can you swim?

The Age of Terrorism

Terrorism officially was experienced by many Americans seven years ago on this very day. September 11, 2001 was a terrible day for many Americans, some lost family members, and friends while others were never the same after this tragic day. On that day, America entered what I’d like to coin as “The Age of Terrorism in the US”.

Never before did we have to take as many precautions entering a plane, building or opening something as simple as a bank account. Although The Age of Terrorism placed many of us in awkward positions, there were a multitude of individuals who have benefited from this new age. Think about all of the security and technology oriented companies that begin to sprout up after September 11th. The security / technology industry is a multi billion dollar industry (even if you exclude giants like Google and Microsoft).
What does that mean for you and I? Markets are constantly changing due to circumstances that are some times beyond our control. We have to be ready for these shifts and be able to take advantage of such shifts.

A good business person will get himself or herself into position to take advantage of shifting markets. Are you in a position to take advantage of shifting markets or are you stuck in what you are currently doing?

Take some time to contemplate the following:

Are you using your “downtime” to increase your knowledge of a particular area?
Are you saving some reserves to be in a position to take advantage of potential shifts?
Are you keeping your eye on the state of the economy or educational system?
Have you assessed your skills to see how they match up with the way the market is currently going?
What are you currently doing to make yourself better?

There will be more shifts in needs to come, will you be ready?

What you need to know about your network marketing income

Many people these days are apart of at least one network marketing company. This article is not meant to discuss which of these opportunities is the best, but it is to speak about the income derived from network marketing.

If you are in network marketing and you are serious about your business, it is important that you continue to read this blog.

Networking marketing companies do not give this level of information because it is not there specialty, but I will alert you of this right now. If you are serious about your network marketing business, even if you aren’t making your desired income right now, you need to incorporate. That’s right, you need to INCORPORATE ASAP!

Why you might ask? There are three major reasons why:

(1) As an independent business associate, or a sole proprietor, your net income from network

marketing is subjected to self employment taxes. Self employment tax comprises Social
Security and Medicare that you are liable for if your net income from network marketing is
over $400 annual. A corporation is not subjected to the self employment tax.

(2) There are several deductions that you are able to take as a corporate entity that you may
not be able to take as a sole proprietorship.

(3) Many of the top earners in your network marketing companies are utilizing this same
strategy, you just don’t know about it.

There are other reasons as well. If you are interested in forming a corporate entity send an email to info@mrbizcoach.com and some from our staff will assist you with this process.

Everyone is entitled to their opinion

I can not believe this. While reading an article the other day I came across a law professor say that we shouldn’t try to teach people about money. The professor beliefs that offering a financial education doesn’t work and continuing to teach on the subject is a waste of money. Wow, that was unbelievable.

Everyone is entitled to their opinion, but everyone can change. Teach financial literacy may seem like a waste of time for some but not everyone. There are many people who have learned a great deal about finances and applied it to their lives, resulting in the ability to make better financial decisions.

Wherever you are in increasing your financial literacy continue on, don’t stop. You will be better for it.

Choices

As we go through our daily lives, there are many decisions to make. Should I have coffee or tea today? Should I vote for Obama or McCain? Do I turn left or turn right at the intersection? Should I invest a portion of my earnings or should I use a portion of my earnings on entertainment?

The choices that we make affect our lives. However, while some of our choices affect us temporarily, many of them affect us for an extended period of time. The choice between coffee or tea may not have as dramatic of an effect on our lives, as our choice of the next president. Likewise our choice of direction at the intersection can have a temporary impact, while our decisions regarding our finances can affect us for a lifetime.

The difficult choices how we spend our money are experienced by everyone from teenagers with new summer jobs, to an executive who needs to trim the payroll. The question is simply, “WHAT, DO I SPEND MY MONEY ON?”

In order to make this difficult decision we have to prioritize what is most important to us. If you are one who lives for now then certainly saving for a “rainy day” is not high on your priority list. If you are one to “save for a rainy day” then investing in a vehicle that has a reasonable return is probably not too high on your list either. Maybe you are looking for a “good investment” then entertainment or other self-indulging activities would not find their place on the top portion of your list.

Before we can make wise decisions with our money we must first acknowledge our philosophy on spending. What motivates you to spend money? Are you merely spending more than you are investing? If so why is that the case? What was your family’s philosophy on spending and investing?

Make a list of your spending or investing practices for the past three months. Be honest about the amounts, where does the major portion of your spending lie? Is it in entertainment such as dining, clothing and other miscellaneous items? Is it in sound investing such as your education, real estate, your business or retirement? Is your spending mostly to pay off debt from entertainment items? When you discover your philosophy on spending you will be able to make wiser choices.

A Little Action Everyday Will Keep Poverty Away

There is an old schoolyard saying which goes something like this, "an apple a day will keep the doctor away". I am not sure if that has any truth to it, although it may. But today's blog entry certainly has some truth to it.

If you do not take a little action everyday then poverty will eventually catch up to you. This applies to every level and area of life. Let's take a potential business owner for example. This person has a wonderful idea but does not commit to any activity. he or she will not network, will not research their potential industry and finally he or she will not start the business (not good so far?). If none of these actions are taken at some point he or she will experience poverty.

What is poverty? According to the Cambridge Dictionary, poverty is defined as the condition of being extremely poor and the lack of something or when the quality of something is extremely low.

Both definitions share the same word, extremely. As individuals it is important that you and I take some type of action everyday to be successful, even if does not seem as if is working. Make those prospecting calls today even if you make 40 calls and get 40 "No's". It is OK, eventually you will get 40 people to say yes.

Just a little action everyday will get you closer to your destination known as success. But if you do nothing then one day you will realize that there is an extreme lack of something, this could be money, quality of life or lack of opportunity.

"A little sleep, a little slumber, a little folding of the hands to sleep. So shall your poverty come on you like a prowler, and your need like an armed man. " - Proverbs 6:10-11 NKJV

The Table

Have you ever seen a table before? That is a silly question for most people because the answer is most certainly yes.

Now let's think about the table, any table, for a moment. What is a table good for? Well it provides a stable platform where one can rest something on making it easier to handle certain objects. Would you agree that it is easier to go to a restaurant and eat at a table than to have to hold your plate in your hand and eat from an elevated position? If you would agree to that then maybe you would also agree that it is easier to utilize a table as a support while signing contract and writing any other documents?

What makes the table steady? It is the legs or supports under the able and the surface those legs or supports rest on.

It is the same with success. We all look at success and can benefit from it but what is it that supports success? We can not take success for granted, but we must peer underneath success and see what in fact is allowing success to be realized.

I submit to you today that the table of success is supported by the following legs: (1) education, (2) planning, (3) execution and (4) timing.

Education - you must be knowledgeable in certain areas and build a team of people around you who are also knowledgeable in many areas as they pertain to your business or life. It is always helpful to have a mentor who has either ran a succcessful business or life and possibly is still running something successful.

Planning - anything that isn't plan has a 90% rate of failure. There must be a plan to anything that is done - marriage, business, family, budget, etc. This plan will surely evolve as time passes, technology advances and you as a person change but you must have a basic plan in place for every area of life.

Execution - planning is absolutely no good without doing it. Nike coined the phrase best - "Just Do It". How will you know if it really works or not until you just do it. Your education including your team and mentor along with proper planning will make the execution part a bit easier if you are scared. And it is OK to be a bit scared - we all were scared at one time or another, but many of us took action to balance out our fears. You must do the same.

Timing - someone once said that the "T" in timing is more important than the "T" in talent. Timing is essential, you want to know that you are engaging something within the right timeline for the situation. For instance you would not want to open an landscaping business in the northeast US in the middle of December. Nor would you want to sell winter coats in California in the middle of the summer. Timing is everything. Again this is where you leverage the knowledge base of your team and mentor to determine the timing of a matter.

Success has support and it is education, planning, execution and timing.

Remember that you might bump into Failure on the way to Success, they are neighbors. Make sure you go to the right house.

Building and Assessing Your Financial Team

Coming up to the end of the trade deadline in the NBA the past two weeks there were some major trades that changed the landscape of many teams in the West and one team in the East, in particular. Each of these trades were made in order to make each team better now in the case of the Suns, Lakers, Cavs, Spurs and Mavericks. While the Grizzlies, Heat, Nets, Sonics and Bulls made moves in order to prepare for a successful future.

Even if you know nothing about the NBA or do not like basketball a point can be drawn from the activity over the past two weeks.

Each team's general manager assessed his team and made a move either to go for the "gosto" now or position the team for future success, two to three years down the road.

How is your team looking today? Your financial team ........ when was the last time you sat down with your financial planner and gone over your plans again? When was the last time you sat down with your accountant and developed a plan for your taxes as well? As a business owner, no matter how big or small your business is NOW, you must create a deadline for yourself and assess your financial team and situation.

If you are in a position where you've been in business for three years or more it might be wise to assess your team right now, see if you need to add a person or two to your team. It will cost some money, but so what, you are going to spend that money on something else less beneficial to you and your business anyway.

If you have been in business less than three years then you need to assess your financial team and your situation. Maybe you are two to three years away from winning it all, position yourself now.

What constitutes a good financial team? I am glad you asked .... you should have a financial planner on your team, someone who is sincerley out for your best interest and will work with you. You also need an accountant who can keep watch over your financial records and guide your through the mindfield of taxation and tax law. You will also need a marketing consultant to assist you in developing a plan to expose your business to the masses. You might need a business consultant who will assist in suggesting upgrades to areas where the business maybe lacking, possibly customer service. And of course you will need an attorney to ensure that you are protected legally. Yes an attorney, he or she is part of your financial team as well. Another team member, especially for those sole business owners that wear more than one hat, you will need a mentor or coach. This person is vital because they are usually successful people who do not mind encouraging you to push ahead at all costs and succeed.

Wisdom Can Lead to Wealth

There is a level of wisdom that each of us has to offer. Maybe you have been working in a particular industry for quite some time and you can do certain things "in your sleep". That area could be parenting or some other vocation. Why not utilize that knowledge to benefit others and benefit yourself at the same time? As an expert in a particular area many can benefit from your knowledge.

This could be the start of a stream of income for you to make you debt free, buy a new home, put your child through school or anything else you might think of. The wisest man ever to live, Solomon recieved annual income because people from other regions wanted to sit at his feet in order to hear his wisdom. If you have the expertise, security and the patience to share your knowledge with the masses then why not and unleash this stream of revenue that has been cut off to you until now.

You can share with the masses through ebooks, blogs or face to face consulting. Of course you want to consult with an expert before putting yourself out there! Just a little wisdom for you, I hope that you can EARN from it!

Discipline

Discipline has six meanings according to the Merriam Webster’s Dictionary. I would like to focus on three of them:

(1) training that corrects, molds, or perfects the mental faculties or moral character
(2) control gained by enforcing obedience or order; orderly or prescribed conduct or pattern of behavior
(3) a rule or system of rules governing conduct or activity

Ok what does discipline have to do with money? It has everything to do with making and saving money as it takes discipline to do both.

It takes discipline to stop impulse spending – spending money on an item(s) you see often, think you need or would like the item and discover after purchasing the item that it lacks in several areas particularly in the area of need and desire.

It takes discipline to make serious money because there has to be a level of persistence in whatever business activity you are engaged with in order to experience any level of sustained success.

How disciplined are you with regard to making and saving money? If you answer is that you are not very disciplined when it comes to these two areas you are not alone. I have found that most Americans are not disciplined in these areas either. But the great thing is that these disciplines can be learned.

We learn how to be disciplined when it comes to making and spending money by education and association. The right education (read books referred to in my other blogs) and associations (those who are already disciplined in these areas) will assist us in training our minds about these matters thus allowing us to control our spending behavior and establishing a standard to govern our financial picture by.

If you are not disciplined when it comes to making and spending money your financial picture will always look ugly with moments of beauty. Get disciplined now!

How Good of Financial Weather Person Are You?

If most of us really admit we only know it's raining when we look outside and we see drops of water falling from the heavens. We really never knew the rain was coming. Why is that? Most of us have not been trained in the methods needed to analysis weather patterns nor have we been trained to utilize the equipment needed to do this either. The price for not listening to the weather man or not being able to predict the waether yourself will only cost you wet clothing or hair. But if you are not able to predict the "financial weather" it can cost you everything.

How do you become a good financial weather person? I am glad you asked, here are some easy steps on becoming more financially savvy:

(1) Begin to listen to financial news channels like Bloomberg TV, CFNN, etc. All of their talk might sound like another language and make your head hurt but it will begin to make sense as you follow the other steps below.

(2) Begin to read books and magazines about wealth building and finances. This will build your financial IQ quickly and greatly decrease your learning curve. Good books for you here are Mad Money, anything by Mr. Warren Buffet or Rich Dad Poor Dad.

(3) Review key figures in the US like the unemployment rate, be abreast of the DOW Jones Index daily, Fed interest rates, etc. The US economy hinges on the attitude of the stock market, interest rates and unemployment. These numbers tell a story.

(4) Form a team for yourself which should consist of a financial planner and an accountant. If you find the right combination they will assist you in forecasting the financial weather as well. Make sure that your financial planner and accountant know each other and are on the same page though.

It is important that we all understand the financial weather that we face. In seasons where the money is flowing well we should be able to pay down debt and save bountifully. In seasons where the money is not flowing as well we can fall back on some of the savings we built up in order to survive until there is a point where the money is flowing good again.

Bottomline, we must determine whether we are in our:

Financial summer (everything is just marvelous, some rain and wind at times but nothing to worry about)

Financial winter (we need to be as frugal as possible because it is very cold and bare outside)

Financial fall / spring (transition times where we see both summer and winter conditions)

Strategies

Everyone has a strategy for something, some successful while other strategies experience little to no success. In the 80s and 90s Michael Jordan was a problem for every team in the NBA and many teams established a strategy of how to stop him or slow him down. At the turn of the century, Peyton Manning came onto the scene and every team in the NFL has devised some type of strategy to slow him down.

What is your strategy concerning retirement? Will you have enough money to provide for your family? Or will you need to continue to work well past the age of retirement? Well our government’s strategy for retirement seemed to have been working for the past thirty to forty years. But it also appears that their strategy (social security, Medicare and pensions from corporate America) is quickly fading and failing. It is predicted that by 2010 both social security and Medicare will be bankrupt. That is an amazing and discomforting thought being that 2010 is only three years away.

What have you done to ensure that you will be able to stop working at the age of retirement if not earlier? If you are like most people the answer is, nothing. It is not too late though, no matter the age, you are able to get on the road to financial security and independence.

In the coming entries to this blog I will share some thoughts on “righting the ship” in your life.

Until the next blog…..

Home Based Business

So everything is good in the land of home based business. You have started your business, you are meeting clients, making some connections, hopefully generating revenue, but definitely creating a lot of expenses, you file your Schedule C and all is well.

Think so? Think again.

Did you know that the IRS can disregard all of your home based business expenses? Well they can, even if your business is legitimate.

Here are some steps to prevent that from happening or to show proof that the home based business is legitimate:

(1) If at all possible develop written agreements between your business and your clients.

(2) Develop a written business plan that shows how you plan to make money, identify your target market, identify the products or services you plan to provide and possibly a price list.

(3) Document all business expenses and revenue (an accounting system of some kind would be great to have here).

(4) Open a separate bank account for your home based business that way your personal funds and the funds of the business are separate.

(5) Engage in working the business on a consistent basis.

(6) Be sure to follow these five points of advice and if you need further assistance visit www.thetowlesgroup.com.

Are you leaving money on the table?

Could it be that you are leaving money on the table? In may cases it probably is. This blog will allow you to find out if you are leaving money on the table.

How many income streams do you have working for you in some way?

If you have less than four income streams then there is some money being left on the table.

If more than two of those streams of income mean that you must work then there is money being left on the table.

Let's go a little deeper, shall we?

Take some time and list your strengths (no matter if you are using them or not).

Now review that list and determine if you are earning any income based on your strengths,

Now look at your monthly budget and determine how much money would be left at the end of the month if you cut out all of your unnecessary expenses. By the way necessary expenses are as follows: housing, transportation, food and anything that is helping you make money.

How much of that money are you investing in yourself via personal development or funding realistic investments? If it is the percentage is not over 30% then there is some money being left on the table.

If you want to know how to get your money off the table contact me at accountant@thetowlesgroup.com once you have followed the steps above.

Look forward to hearing form you,

Frederick O. Towles

Accountant

Rule five:
YOUR OUTLOOK WILL DETERMINE YOUR SUCCESS OR FAILURE.

What separates a successful entrepreneur from another that fails? Is it simply one entrepreneur had more startup capital than another? That could impact an entrepreneur's outcome to a point, but that isn't the reason.

What dictates an entrepreneur's success is how he or she views their business idea. Each of us believes our idea is wonderful and that is great, but it is not nearly enough. We have to see our idea succeeding in our minds first. We must see a client or customer being able to benefit from the product or service we are offering. We must visualize what our clients or customers will say about our product or service. We have to believe in the ideas that come to our minds, if even after doing this we still must go one step further.

This is an exert from a business e-book entitled, “It All Begins With A Thought”.

Download your copy today at www.mrbizcoach.com.

“You’re Fired!”

If you are a viewer of the reality show ”The Apprentice”, then these words are familiar to you. These words are meaningless to you and I, as we know this is merely Mr. Trump’s explanation point at the end of the show. What happens when you or I are face to face with our superiors and the phrase “You’re Fired” is directed at us?

As many startup companies develop exit strategies in case of potential disaster or overwhelming success, the everyday person needs to develop an exit strategy as well. What happens if your main source of income all of a sudden collapses or you get to a point in life when you are no longer able to do what you currently do?

Here are some good exit strategy steps:

Make sure that you and your loved ones are covered with a life insurance policy.

Save, Save, Save! Health insurance rates are increasing all of the time. You will need money to get adequate coverage unless another family member can cover you.

Develop a business on the side. Do something you are good at or invest in an asset that is going to produce money for you. This will go a long way if it is in place now.

Begin to hone skills that may be a bit outdated (i.e., enhance your computer and communication skills). If you are let go after years of service, the way you communicate may have to change because you will be in a different environment. In today’s society, if you are not computer savvy, your world becomes very small.

Get out of debt! The quicker you are able to do this the better off you will be if you were to be fired.

Fund the retirement plan. Does your company offer a 401k or a 403b? Are you a participant? If not, get in it right away! You may be able to use this money if an emergency arises upon your termination.

Rethink your lifestyle. Ask yourself what is it that I can do without right now? Could it be going out to dinner every night or are you spending too much money on clothing? Whatever it is, you may need to alter your lifestyle a little.

Look at the trends in your occupation. Research what is going on at your company’s competitors. If your company’s competitors are trimming the department that is equivalent to yours, then it may not be long before your department is trimmed as well. Is there a salary freeze in your occupation (no or very low raises)? Is your position being outsourced out of state or overseas? The handwriting is normally on the wall. We just don’t see it sometimes.

If you don’t have an exit plan in place, you are looking for trouble. Even the highest paid persons who work for Fortune 500 companies are susceptible to being fired. They normally are able to walk away with a plan in place until they are able to secure a position somewhere else.

INVESTMENTS

The term investment is defined by Merriam Webster’s Dictionary as the outlay of money usually for income or profit. This would mean that you can invest your money in a number of things in order to gain a return on your investment (ROI) which can include: real estate, 401K, 403B (for the non profit workers), IRAs, stocks, businesses and the list can be endless.

Many of us have been taught to save money by reducing our spontaneous spending or by “setting aside something for a rainy day” – which is Investing 101. But very few of us have been taught to invest our income in something which is going to return a profit. With the uncertainty of Social Security benefits existing within the next twenty years or so, it is important to learn to invest now in vehicles which will provide you with an income to sustain you and your family in the future.

You may ask yourself, what can I invest in that will allow me to gain profit? My answer to you is that there are numerous vehicles out there for you to invest in. Below you will find a list of a few of these vehicles:

(1) Real Estate
(2) Stock Market
(3) Your business idea
(4) Someone else’s business idea

How much of your take home income are you investing? When should I start? How do I start? Why is investing in vehicles such as the above (in addition to others) so important? What should I do?

My advice to you is to simply educate yourself in regards to the different investment vehicles. Each vehicle has a different ROI and each vehicle has its own amount of risk. Read books on investing, go to financial info websites and speak to professionals.