When it comes to setting up your own business venture, there is one factor that you will need to pay special attention to above all others; that of your finances. Having your own business requires a large amount of capital to cover your operational expenses as well as payments for building lease, office equipment, manpower, and your personal expenses at home. As you will be investing your own money and credit towards your new business, it is imperative that you answer these five financial questions to help you assess whether you are financially liquid enough to stand on your own.

1. Do I have enough money saved to cover my expenses? One of the foremost questions you will need to ask yourself is whether you have enough money in the bank to cover both your business and personal needs. As you probably won’t be earning much during the first few months of your business, you will need to make sure that your savings can cover your needs for a good 6-12 months. Knowing how much you have also helps you control and prioritize your expenses.

2. How much debt can I take on? For many budding entrepreneurs, acquiring a financial loan is a necessity to help fuel their new business and give it a better profit margin. As such, business debt can do your new company much good, provided that you know how much debt you can take on. Always keep in mind, that although it is a business loan, it is still your name on the line and should your business fail, you will still be required to pay off your loan.

3. What options do I have for health insurance coverage? One consideration you would also need to take into account is that of your health insurance coverage. If you are presently employed by a company that is subjected to the Consolidated Omnibus Budget Reconciliation Act (COBRA) regulations, you can still have the option to keep your current coverage by personally paying for it while you scour the health insurance market for a more affordable option.

4. Do I have enough lines of credit to work with? While still contemplating whether you are truly prepared enough to set up a business of your own, you can also take the time to look at your home equity line of credit as this can provide you with the means to get a loan at a much friendlier interest rate then credit cards provide.

5. Do I have enough disability coverage? Resigning from your current post can mean the loss of your disability insurance which is essential if you intend to set up your own business. To give yourself enough protection, you will need to pay for your own disability insurance policy to prepare for any eventuality.

If you take the time to calculate these expenses as you develop your business plan, you are setting yourself up for a better chance of success. Know-how and effort are not what put a stop to most new businesses. It is almost always the finances that keep a new venture from being successful. Be smart, plan ahead, and enjoy the incredible difference of successfully becoming your own boss.

For those who are looking to start their own business, the trucking industry can be a great way to become your own boss. At TruckertoTrucker.com, we help connect new entrepreneurs with new and used daycab trucks at a great price. Whether you are searching for used Texas trucks or new California semis, we can help you make the step to business owner when you are ready.

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It’s a common question: What’s the best small business credit card? I hear that all of the time, along with the occasional, “What’s the most small business owner friendly bank?” The simple answer is that Bank of America is the best business credit card issuer (I have no financial interest in this recommendation, in case you’re wondering), but the best small business credit card strategy is one that takes advantage of two different cards. Before we get into the specifics though, you’ll need a little background.

Flickr photo by JMRosenfeld

Debt Stability

Most small business owners will have to revolve monthly credit card debt from time to time. According to the NSBA, credit cards provide more than 25% of the total financing for one out of three small businesses in the United States. However, the CARD Act, the financial reform law that took effect in February 2010, only applies to general-consumer credit cards. The implications of this are many, but the most important is the fact that most business credit cards do not enjoy protection from the CARD Act rule that forbids issuers from increasing interest rates on existing debt until payment delinquency reaches at least 60 days. That, in turn, means the possibility of sudden cost-of-debt increases that may come not only because your usage merits it, but instead simply as a result of a credit card company exec’s decision to raise interest rates as an easy way to boost profits and ensure a bonus check.

Bank of America

According to a Card Hub study, Bank of America is the only major business credit card issuer that has voluntarily applied the main protections of the CARD Act, including that which prevents arbitrary interest rate increases. A Bank of America business credit card will therefore provide both the debt stability of a personal credit card, making it possible to budget and allocate funds without the ever-present threat of increased costs, and the unique features of a business credit card account: cards with customizable limits for employees, the ability to earn rewards on employee purchases, and periodic expense reports that simplify tax season and evaluations of company spending.

So, what’s the issue; you should clearly get a BofA business card, right? Not necessarily. By limiting yourself to one issuer’s products, you’ll make it nearly impossible to BOTH minimize the cost of your debt and maximize your rewards. Not only will you simply have fewer options overall, but no single credit card offers both the lowest purchase APR on the market and the best possible rewards for your company’s biggest expenses. Instead, there tends to be a tradeoff with credit card terms; if one feature is exceptional, the rest usually aren’t so much.

Two Cards?

As a result, your other option is to get two credit cards for business use: a low interest card for purchases that’ll lead to a monthly balance and a business rewards credit card for everything else.

Low interest card: Whether you get a 0% credit card or a card with a low regular interest rate depends on your company’s needs, but in either case you should be looking for a personal credit card, since it’s unlikely that one of Bank of America’s business credit cards boasts either the longest 0% APR term or the lowest regular interest rate on the market. Plus, there’s no reason why you can’t use a personal card for business, especially since most major credit card issuers hold customers personally liable for business credit card use anyway.

Business rewards card: Since you will never revolve a balance on this credit card, the issuer from which you get it doesn’t really matter. Just look for the card with the best rewards on your company’s biggest expenses.

***FPT suggested no-annual fee business rewards card***

The Decision

So where do you want to take your small business talents, Bank of America or a two-card system. Ultimately, your decision rests on exactly how much you value simplicity. Many CEOs like Ehsan Bayat have stated that having flexible business credit that can grow alongside your company is essential for success. If you aren’t too keen on the idea of using more than one credit card for business, then by all means get a Bank of America card. Just know that the cost of doing so will be more expensive debt and less lucrative rewards. If that price just seems too steep or you don’t mind managing two credit card accounts, then a personal credit card/business credit card combo is for you.

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Phoenix small business loans professionals know that getting a business loan is no easy task, and that it is even more difficult if you have bad credit. And unfortunately, money is one of the first things needed to get a business up and running. Phoenix small business investing officials highly suggests that business owners in this situation try to establish business credit rather than get a bad credit business loan.

Establishing Business Credit
Phoenix small business investing experts state that there is a simple reason for this: your business credit, if properly established, is not connected to your personal credit. This means that your personal credit will not be checked if you apply for a loan under your business name in the future. It also means that if your business and business credit suffer, you will further damage your personal credit and finances. Here are simple tips on how you can get started building business credit.

Formalize Your Business
Establish an LLC, sub chapter S-corporation for your business. This will help lenders clearly identify your company as a business that is completely separate from your personal finances.

Business Phone Line
Next, Phoenix small business investing experts suggest getting a phone line that is in the formal name of the company. Call phone companies and make sure that you sign up with one that reports their customers’ payment history to the credit bureaus.

Business Checking Account
Establish a business checking account that is also under the formal name of the business. Make all business transactions with this account and not your personal accounts.

Vendor Credit
Set up trade or vendor credit by finding companies who are willing to finance you for supplies or equipment, for which you can pay them off over time. Find a company that does not need your social security number or any personal information that can be tied to your personal finances. Everything should be done with the business’ information and business finances.

Business Credit Cards
Finally, Phoenix small business investing officials state that you should get a minimum of three business credit cards–also under the company’s formal business name (see a pattern here!). It is important to ensure that the companies you go with also report their accounts, payment history, and so on to the credit bureaus. And just as with vendor credit, make sure that the cards do not have to be tied to you or your personal finances. It may take some hunting to find company’s that do not require this, but it is well worth it to search.

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In cases when a business cannot wait for a long time to be paid fully by its customers and there is already shortage of supplies, selling your receivables might not be a bad idea. The business owner will not have to worry about where he can borrow money to purchase another set of supplies because there is a factoring company who can give cash right away.

These financing companies will give a discounted amount of money according to the total amount of invoices that has been sold to them. Therefore, factoring invoices is very helpful to businesses to keep them running even in times of difficulties.

If a business is in need of capital to purchase new inventory, then business management can definitely enter into an agreement like this as long as they have invoices to sell to the factoring company. Basically, a Factor manages essential tasks, such as posting invoices, entering payments, depositing checks, and making computer reports. So, after a business has given its invoice to the company, all the related transactions will be handled by them.

The Factor will be the one responsible to collect all the remaining balances of the customers (in most cases). They will also get the interest if there are customers who did not pay on the said date of payment; hence the total amount of interest is part of the payment for the services given by the factoring company. The other part is the discounted rate at which they purchase the invoices from your company.

This is definitely an advantage for a business because they will no longer have to think of ways about how they can collect the remaining balances of their customers. Contacting and reminding customers of their payments may no longer be necessary in this type of transaction.

With the use of this kind of business strategy, a business could focus more on the flow of its supplies and how they can maintain a great amount of customers because the business management will not have to focus extensively on collections and how to budget around the long delays in payment.

The business will achieve an increased cash flow when there is factoring company that they can rely on. If this increase of cash can be maintained, the business will gain more customers. More customers mean more invoices and more cash.  This type of financing can really help a business grow.

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3. Medical Receivables Factoring Solutions

In a medical scenario setting, often times patients rely on their insurance and other health companies to pay their hospital bills, however these third party companies are often slow in paying these medical institutions and this affects the whole cash flow of the medical company. Even doctors and physicians are not paid in due time because they have to wait for the day when the bills will be fully paid. This scenario compels these medical practitioners to choose medical accounts receivable factoring as their solution to their unpaid bills.

This type of financing is done when the patient incurs a medical bill. Sometimes the patient will pay for these bills, but mostly the insurance companies pay for these unpaid bills. These insurance claims are then sold to factoring companies at a discounted price. Once the medical company qualify for the factoring services, then an advance payment will be provided immediately to them depending on the amount of these unclaimed bills. The company will have a fund for their cash flows without worrying about the bills that they are waiting to be paid for by the insurance companies.

These medical factoring companies often charge a fee for buying the insurance claims from medical institutions. They will pay the medical companies usually two to five percent less than the value of the receivables. The amount will also depend on the risk factors that need to be considered by the medical factoring companies. Usually, insurance companies that are not known by these factoring companies are charged with higher rates to ensure security and protection against the unpaid bills.

Even medical institutions and other medical service providers are not exempted from financial issues concerning their cash flow. Often times, the third party payers take a long time to pay the medical claims from these medical institutions; thus medical receivable factoring is the solution that medical companies often choose.

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The financial industry most likely became more complicated, with the recent passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Though the act places most of its emphasis on larger banks, products such as derivatives and swaps are now subject to regulation by the Securities and Exchange Commission and the Commodities Exchange Commission. New regulations will be forthcoming.

The jobs of compliance officers and compliance departments just became more complicated as it has for everyone in the financial industry. This is where financial compliance software will play a large role. To ensure compliance officers can thoroughly do their jobs, well integrated financial compliance software will become a necessity, if it has not been already.

The task of your compliance department will be demanding enough in preparing for new regulations; they cannot be tied down performing manual, repeated tasks for periodic filings without some form of automated software.

There are features that should be considered essential in any financial compliance software package:

Automated– the central purpose of any financial software is automation, to make the job of those from the financial compliance department to the data input department easier. It should make generation of forms to be filed with regulatory agencies be prepared as easily as possible.

Integrated– the software must be adaptable to your database, rather than your database becoming adapted to the software. Unless, your financial software is grossly outdated, the software should merge as seamlessly as possible with your present software.

Accurate– Since the purpose of purchasing financial compliance software is to insure correct regulatory filings, and with the cost of correcting mistakes, the software should be written by a reputable company, well versed in regulatory scheme of your particular financial service. Equally as important, the software should have a demonstrated history of timely updating as regulations change and regulatory decisions are made. This will be important in the near future as new regulations are written for the Dodd-Frank Act.

Self correcting- The software should have the ability to catch errors in both processing, as well as alert the user of when a transaction will be in violation of an applicable regulation. There will be those in the company, for instance those in the data processing area, who may not be familiar with all regulations, especially those which will come about in the near future. Alerts should be made noticeable to the user at first instance, with options available for resolution. An added option may be to send an automated notice to the compliance department, with a request for review.

Financial compliance software products may have once been considered merely a time saver in the past, a method of automation for repeated tasks. With newer regulations coming in the not too distant future, it can be used as a method of avoiding costly mistakes, of automatically integrating the newer regulations, minimizing the need for repeated seminars, meetings, conferences and other costly office training methods.

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There are various opportunities for you to develop into a full time business that can be conducted right from the comfort of your home. In fact, the range of businesses is so broad you may struggle initially to focus in on one clear opportunity that suits you. There are several home business ideas that you can follow and information technology is one area that is helping millions of people to achieve their goal of becoming self-sufficient through passive income streams.

Initial IT-related ideas worth pondering

If you are inclined towards IT and have necessary skills and determination to succeed in the field, you can set up an IT help desk service platform. With this kind of service you will be able to help people who need your assistance to solve issues related to IT. You need a phone and a computer with Internet connectivity to get started with this.

By working as a useful resource to help others with their IT related issues, you would start to feel good about the service you provide since you will be helping others through your knowledge and skills. When you interact with people and solve their problems, you get satisfaction that will just keep you going.

Going broader with the businesses you could start

A period of economic downturn may be the right time for you to make a career switch and work on your own home business ideas. Identify the skills you have from past experience, training or hobbies. These could inform consulting, training or blogging opportunities that others would be interested in learning more about.

Monetizing this key knowledge is all about providing a good quality information service to others, producing 1 on 1 mentoring, training workshops, e-books or other digital products

Benefits to You

With this kind of employment, you will get results beyond your imagination and satisfaction that you have always wanted. Moreover, this does not need a huge investment to start with as computer and telephone connection is available in almost every house.

You could even start the ball rolling while in full or part-time employment (e.g. setting up your website/consultancy service). This phased approach allows you time to build up your client base.

You need to gather the information and start implementing basic things. When you do things in the right manner, soon you’ll find that you have made the right choice.

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Sometimes, the amount of money is too much to ask from family and friends, but not enough to receive a loan from the bank or other financial institution. This is where an alternative lender comes into play, such as a payday loan business. This is an opportunity that many entrepreneurs take advantage of in order to help others out by offering instant payday loans and a payday loan consolidation while making substantial income.

Many business owners that already have businesses such as real estate, pawn shops, check cashing stores, and even car rental places and furniture stores, find that adding a little something extra is easy. Opening a payday loan business in conjunction with another company is becoming a very popular way of running this sort of endeavor. There are basically two different ways of starting one up.

First, a franchise can be purchased by those who do not have the capacity to build something of this magnitude from the ground up. There are many such places throughout this country, as well as internationally, and they are always willing to having someone new on board. The rules, regulations, hours of operation, and many other various factors are determined by the franchise office, and this aspect alone can cause a business owner to search out other methods of opening such a business.

The other way of starting up this type of business is to learn the particulars on how to begin and operate it, even without the need for experience. There are several resources that offer information in the form of booklets, manuals, and CDs that teach everything there is to know about a payday loan business.  A great example of a successful payday business is the Payday Loan Store. Many of these kits include forms for contracts and generic flyers to use for advertising and marketing. Purchasing a kit to get started is a wise investment; there is valuable information that otherwise might take years to learn by trial and error. Owners that are able to make their own rules and hours are generally more satisfied with their job.

If you’re interested in the payday loan business, you also may be interested in how to start a credit repair business to help individuals repair their damaged credit.

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1) Market Research
First be sure that you want to invest in buy to let mortgage deals, as there are better investment opportunities elsewhere. In these deals you will be locking you your capital in property whose value might fall. Proper market research and asking people who have done similar investments is a good idea.

2) Select the area carefully
Select areas where people are most likely to live irrespective of the cost. Find out if the area falls on a commuter belt or if there are good schools or the area caters to people of a certain age.

3) Calculate
First find out how much a house is going to cost you and the possible rent which can be charged. Usually most people who invest in buy to let mortgage deals expect a rent which will be over the mortgage payments by 25%. It is also wise to get a deposit of up to 15 to 25% to create a buffer for falling prices.

4) Evaluate the possible requirements of prospective tenants
You must be sure that tenants would actually like to live in your property. Consider the possible target tenant and their requirements. Are they going to be students, family, old people and so on, and then plan accordingly and consider taking out insurance for rent guarantee as well.

5) Over ambition can lead to disaster
The days when house prices used to rise in double digits are far gone and therefore avoid big portfolios. For calculations, compare the possible yield from rent against the purchase price and get the yield percentage. This yield should cover the full monthly mortgage payment and not just the interest, and there should also be some extra which is your income or can be made into an emergency fund.

6) Consider areas which are far as well
Many people investing in buy to let mortgage deals will only be considering areas near their residence. The logic is to keep an eye on the property, but you could employ an agent to do that and consider more lucrative areas which may be far.

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If you are a first time investor then there are a number of things you can do in order to avoid many of the pitfalls that new investors experience. First of all make sure you understand the potential risks and benefits that the buy-to-let market provides. Remember, an investment is not simply a license to print money, there is some risk involved.

Here is a checklist of important factors to consider when looking for properties to buy-to-let.

• Make sure you choose an area that people would want to live in, for instance where there are good schools to attract young families.
• Know how much your mortgage repayments are and how much rent you can charge. Typically rent should be 125% costs.
• Consider who your target tenant is and what they would want from a home. For example a young family would require extra bedrooms, whereas a professional singleton would most likely prefer a stylish apartment.
• Be realistic. The stories about buy-to-let investors who have build huge portfolios and netted millions hit the headlines because they are exceptional, not because they are the norm.
• Don’t restrict yourself to one area. Look for the best investment, not just the one that is most convenient to your own home or in the same area as any other properties you own.
• Negotiate the best price. The market is tough for sellers at the moment. You can take advantage of this and get a better deal
• Investigate the potential downside of your investment. For example, what happens if you can’t remortgage or can’t find a tenant?
• Consider using a management agency. This will cut down on the time you spend managing the property. They will also have access to reliable plumbers and electricians should they be needed, as well as advertising and legal services.

Armed with these tips above, you should be better equipped to invest in a buy to let mortgage situation.

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