Additional Finance Tips

Money ManagementManaging Finances

Getting control over your finances is the first step towards
financial freedom. Managing finances might seem like a mystery to many people.
Juggling different bank accounts, haphazard household budgets and overloaded
credit lines without proper planning and organization may result in financial
disaster. However, with some tips on finance management, you can put your finances
in order and position yourself well for future prosperity.


For effective financial management, it is important to create
a realistic budget. The budget should cover your expenditure for each month. Budget
creation is done in three basic steps. First, take stock of all your earnings
each month from salary, investments, child support, stock and other sources.
Next, list all your monthly expenses, including rent, mortgage payments, grocery
bills, clothing expenses, utilities, debt payments, transportation costs and
entertainment expenses. Finally, compare your total expenses to your total
income. Ideally, the expenses should be far below your monthly income.

Cut Costs 

You need to cut costs so that your expenses do not exceed
your income. The best way to track your money is to keep a list of your
expenses. Identify expenses that are straining your pockets and then reduce
them or eliminate them altogether. Also, go over fixed expenses, like cable,
utility or internet service, to ensure you are not paying for unnecessary services.
You can then use this money to clear your debts or build up your savings.

Manage Debt

Credit cards can prove useful as long as you use them
properly. Nonetheless, they often lead to a debt trap. If you have any debts,
clearing them should be your topmost priority. You can start by paying off high
interest credit card loans and debts. If you have less interest to pay, you
will have more money to save. Next should be secured debts, like car loans,
followed by student loans and medical bills. After paying off these debts, you
can start to aggressively pay your mortgage; that is if you have one.

Finance PlanningPlan Ahead

As you begin to gain more control over your personal finances,
it is important to create a list of short-term and long-term financial goals
that can serve as a future road map. Examples of financial goals you may list
include clearing debts, saving for a home down payment, planning for retirement,
saving for a holiday or starting an education fund for your kids. When
determining your goals, ensure they are realistic and create an action plan for
attaining them. Frequently review your goals to ensure they fit your lifestyle.

Whether you are still in college or you have retired, there
is no better time to start learning how to manage your money than now. Being
aggressive in determining where your finances will go a long way in helping you
pay off your debts, increase your savings and plan your future goals. In
addition to the aforementioned tips, experts recommend that families should
develop strategies on how to talk calmly and honestly about finance management.
Focus on establishing financial solutions and strategies that can work
effectively for your family.

Business Financing

Business Finance InfoImportant Business Financing Information

So first when starting a task, the new entrepreneur must verify the possession of certain attitudes and personality-related features, such as: independence, want autonomy, vision, enthusiasm, ambition, motivation, pragmatism, creativity, self-confidence, attitude and acceptance of risk, leadership, decision-making capacity, ability to communicate, ability to communicate, ability to delegate and planning capacity. Now, it is normal for a person who decides to start a business from the very beginning, do not possess all these features in order to be a good entrepreneur. But nothing prevents him from having the desire to acquire them and make them his own with time.

Once you have verified the possession or otherwise of these attitudes, the aspiring entrepreneur must decide whether to start the activity alone or “in company” with other people who share the desire to do business. The entrepreneur who decides to start a business “by itself” (the so-called sole proprietorship) chooses, without doubt, the “road” simpler and less expensive, although more widespread. The sole proprietorship is characterized by the fact that the owner decides autonomously and does not require any special formalities for its management.

In case the entrepreneur decides to start its activities together with other people, then have to give life to a company. At this point the neo-entrepreneur, that remains is to choose the notary to go to set up her business. The notary, contractor entrusts the task of drafting the memorandum and articles of Association of the new company. It is with these two notarial acts that created the company.

But it doesn’t stop there! Because just as they do for an infant that, immediately after the birth parents make registration at the registry office, the same thing happens for “newly-born enterprises”, which must be registered in the commercial register of the Chamber of Commerce. At the time of registration at the Chamber of Commerce, the new company is given a number called the REA (Economic For Repertory) that identifies the company in its relations with the Chamber of commerce itself. After registration in the Chamber of Commerce, the entrepreneur must ask the Inland Revenue the tax code and Vat number for the new venture.

Managing Finances

Personal Finance TipsTips On Managing Your Personal Finances

If you’re like most entrepreneurs, it is likely that you’re balancing your time between managing your team, generating sales, improving client service, promoting your business and creating new products and/or services. The last thing you want to do is add the care of your personal finances to this mix. But if you don’t have your home finances in order, you are only adding more chaos and stress to your life – whether you know it or not. Here are 7 tips on managing finances. Note: if you believe spending the time getting your finances in order is impractical for you, hiring a bookkeeper to track all of your finances and create a plan for you is a great option.

1. Educate Yourself:

Take the time to educate yourself about various personal finance topics. Calendar appointments titled ‘money’ each week for yourself and spend some hours managing your personal finances and reading books, magazines, websites or blogs about finance. Know more about your own finances, greater confidence will help immensely when managing your money in the long run.

2. Check your credit regularly:

Your credit report is like a file about you and your credit history. Basically tells lenders how as risky you are – and whether or not to lend you money. When it comes to buying a car or a house, you want that your credit report is in its best form, so that you can qualify for better rates.

3. Make a budget:

Although this sounds very basic, many entrepreneurs do not have a budget to monitor your income and monthly expenses. You can use systems such as to monitor your personal finances or simply a document in Excel. No matter what you choose, make sure that it works for you and your lifestyle.

4. Automate your finances:

This technology makes it easy to manage finances every day. Set your finances so that most of the process is automatic. You can use automatic transfers online or pay online bills every month automatically. This strategy can help relieve the stress of paying your bills on time.

5. Pay debts:

Make a plan to pay off all your debts as soon as possible. Start by making a list of all your debts (credit cards, car credits, education credits, etc.). It includes the current balance, the minimum payment per month and the interest rate. Then check your budget to determine how much money you can add to debt payments. Star with the smallest first! Each time you knock out a debt you can put those payments towards the next smallest. Then the next smallest, and the next… Until you’re debt free!

6. Build your own cushion:

Having a cushion of money is an essential part of your finances. It allows you to use the money to pay for unplanned expenses or emergencies that may appear in your day to day, rather than increasing your debt or long-term investments.

7. You spend out of your business:

Although it is very important to always invest in yourself and in your business, you should not have “all the eggs in one basket”. Diversification is extremely important because it will decrease your risk of investment in the long term. Working with a financial planner to create a portfolio of investments in the long term that includes stocks, bonds and Cetes that align with your own financial goals and your risk tolerance.

What is an ROI?

Finance Return on InvestmentWHAT IS A ROI?

ROI is the acronym for Return On Investment and it is a percentage that is calculated based on the investment and the benefits obtained, from the ratio of return on investment. The ROI is a value that measures the performance of an investment, to assess how efficient is the spending that are planning to do. There is a formula which gives us the value calculated based on the investment made and the benefit earned, or are planning to get.

We can set an example. Suppose that in our company of Bicycle accessories we decided to spend $200 in advertising on Google (source of attribution) and 100 in Yahoo (source of attribution). At the same time, we established that we would reverse $300 only in campaigns that deliver us a return on investment over a 40% in a month. We decided to invest $200 in Google and $100 in Yahoo. 30 days later, we noticed that by advertising on Google, we recover only $70 in sales, or a 35% ROI (70/200). While Yahoo, we recover $45, with an ROI of 45% (45/100).

In total, we invest $300 in our campaign, and recovered 115, which gives us a whole campaign of 38% ROI (115/300). Not meet our goal to invest above 40% return. But if we had invested more in Yahoo, it would have been a different case. And this is what we will do next month to achieve the goal of having one greater than 40% ROI. As the example explains, thanks to the ROI we can make better decisions and optimize our budget.

ROI is a popular metric in terms of finance and is used primarily for the evaluation of the financial consequences of a particular investment and the actions that follow. The cash flow metric of ROI compares the timing of investment gains with the timing of the costs involved. A higher the rate of the return on investment is, the gains are more in comparison to the costs of the investment.

ROI For Measuring Profitability 

The financial metric of ROI has gained significant popularity over the years for the general purpose of measuring profitability in relation to investments, business acquisitions, programs, initiatives and stock exchange investment. The financial analysts and decision makers have been using ROI for a long time to determine the profitability of a particular business undertaking. In the field of general economics in relation to business organizations, ROI has been used to effectively use the funds for maximum profitability.

Business Investment returnsConcept Of ROI 

The simple form of ROI compares the cost of investment with the return on investment by deriving a ratio or percentage. A result that is more than zero, means that the return on investment is greater than the cost of the investment (positive ROI). When the cost of the investment is greater than the return on investment, it is regarded as a negative ROI.

However, financial analysts must realize that ROI figures are not entirely sufficient to provide a validated profit or loss scenario. Since the market trend can change the profit or loss margin of the business or investment, the ROI figure can constantly change and are not completely dependable for accurately depicting the profitability. The concept behind using return on investment calculations is to provide a clear picture of the financial condition of the investment. The decision makers and financial analysts use the figures to help in improving the ROI increasing gains, reducing unnecessary expenses, accelerate the growth rate of the investment.

Calculating ROI 

Financial analysts derive ROI from an action as “return” (incremental gain) by dividing it by the cost of the action. In order to calculate the simple version of the RIO, you must divide the net gains from the investment by the cost of the investment. The result of this division is noted in percentage and is regarded as the RIO of the particular investment.

Simple ROI = Gains – Cost Of Investment / Investment Costs

For example: If your investment is to be $500,000 with the estimate of delivering a profit of $700,000 in the next 10 years, your ROI should be:

700,000-500,000 / 500,000 = 40

Hence, the return on investment you could expect from your investment of $500,000 in the coming decade should be 40%.

While ROI has become one of the most commonly used financial metric for calculating profitability of a business investment or program, most financial analysts and decision makers must look into other additional financial metrics for a dependable forecast of the financial future. Since the financial and marketing trends are constantly evolving with good and bad alternations all the time, the return on investment figure must be used as a supporting metric for profit analysis, and not be depended on completely.