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Posts published in “Finance”

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Watch Economic Trends as Well as Your Own to Avoid Being Blindsided

For small business owners, consumer confidence is a helpful indicator to keep an eye on because its movements can help you figure out what’s going on in the economy. Monitored since 1967, the Consumer Confidence Index is looked to by analysts (and businesses comfortable with analysis.) Upward and downward trends can influence tough decisions companies are forced to make. Similarly, because interest rates and tariffs can affect hiring and capex issues, these are looked at as well. It’s been over four months since the Trump tariffs began and there’s even been some recent uncertainty whether the next wave is on hold or poised to go into effect with higher levels for 2019. So have those tariffs affected consumer confidence? The consensus right now is No, not really if you look at various indices such as the U.S. Consumer Confidence Index, the most-cited measure, or even comments from White House National Economic Council Director Larry Kudlow earlier this month. The lows seen in this year’s University of Michigan consumer sentiment index are to date still higher than its 2015 highs. Fintech CEO Says Small Business Growth Won’t Last Forever A Fintech executive shares insights small businesses should remember while keeping an eye on trends. Small Business Trends interviewed co-founder and CEO Krista Morgan of P2Binvestor to get some thoughts on borrowers’ attitudes and consumer confidence in relation to the trade tariffs. P2Bi launched in 2012 with headquarters in Colorado, and Morgan has over 10 years of experience in operations management and digital marketing. Providing higher asset-backed lines of credit than most online lenders ranging from $500K to $10M+, the P2Bi platform was “built by entrepreneurs for entrepreneurs.” Risks for both lenders and borrowers are reduced through a marketplace of accredited lenders. If a young business isn’t profitable yet, in many cases, the team at P2Bi still can assist if it’s the right fit. * * * * * Small Business Trends: What do small businesses need to know about the international “trade war” the U.S. is having this year, if we can even call it that? Thoughts on current consumer confidence?…

Robinhood launches no-fee checking/savings with Mastercard & the most ATMs

Robinhood is undercutting the big banks by forgoing brick-and-mortar branches with its new zero-fee checking and savings account features. With no overdraft or monthly fees, a juicy 3 percent interest rate and a claim of more U.S. ATMs than the five biggest banks combined, Robinhood is using the scalability of software to pass impressive perks on to customers. The free stock trading app already used that approach to attack brokers like E*Trade and Charles Schwab that charge a per-trade fee. Now it’s breaking into the larger financial services market with a model that could put the squeeze on Wells Fargo, Chase and Bank of America. However, Robinhood may not be properly insured to do so. Today Robinhood launches checking and savings accounts in the U.S. with a Mastercard debit card issued through Sutton Bank that starts shipping December 18th. Users earn 3 percent on all the dough they keep with Robinhood, yet there’s no minimum balance or fees for monthly membership, overdrafts, foreign transactions or card replacements. That’s a pretty sweet deal compared to the other leading banks that all charge for some of that or offer much lower interest rates. The trade-off is that while customers get 24/7 live text chat support, they won’t be able to walk into a local bank branch. Users who want early access can sign up here. Robinhood expects to turn a profit thanks to a lean 300-employee operation, earning a margin on investing your money in U.S. treasuries and a revenue share with Mastercard on interchange fees charged to merchants when you swipe. The launch could be critical to keeping Robinhood worthy of its $5.6 billion valuation from when it took a $363 million Series D in March just a year after raising at a $1.3 billion valuation. The 6 million-user app invested in launching a free cryptocurrency trading exchange early this year only to see coin prices plummet and mainstream interest fall off. But with banks hammering users with surprise fees and mediocre user experience, there’s a huge opportunity for a mobile-first startup to disrupt how we store money. “Brick-and-mortar locations are costly.…

8 Business Leaders Who Trained as Accountants

Have you ever considered training or a career in accountancy? It can definitely be a daunting thing to think of, but accountancy can provide some of the most essential building… Read more » The post 8 Business Leaders Who Trained as Accountants appeared first on

3 Ways to Gain Control Over Your Business Finances

Finance management is perhaps the most delicate area of doing business, even more than marketing. One mistake and you could find yourself back on the drawing board or out of… Read more » The post 3 Ways to Gain Control Over Your Business Finances appeared first on

4 Amazing Benefits Small Business Owners Get from their Bankers

It’s easy to see why entrepreneurs are bonding with alternative lenders. What’s not so easy to see is why they’re leaving bankers out of the loop. However, with renewed trust in each other, both institutions are finding mutual benefits. What’s more — the B and B called “Business and Bankers” is finding a renewed comeback. Say you’re a small business owner feeling the squeeze. You could turn to a traditional bank that requires loan applicants to go through a rigorous review process for a 20 percent chance of approval. Or you could apply online with a peer-to-peer firm that approves more than 60 percent of applications and receive a decision in minutes. In those terms — it seems obvious why the American Bankers Association predicts non-bank lending will grow sixfold between 2015 and 2020. But there are plenty of reasons entrepreneurs should still put stock in their small business banker. More Than Money, Small Businesses Need Their Bankers As peer-to-peer lending grows and new bank lending declines across the developed world, it’s worth considering what entrepreneurs lose beyond better interest rates when they give bankers the boot: A High-dollar Business Planner When an entrepreneur asks for a loan — the first thing a bank lender looks for is a plan. That plan needs to include a market analysis backed by data — showing a need for the product or service. The plan will consist of: a summary of the entrepreneur’s and key employees’ experience in the field; a survey of potential challenges — not to mention strategies for avoiding or overcoming them. Better plans have projections of first-day and year-end balances — as well as the assumptions made in building them — along with and an explanation of how the money requested might be used. If that sounds like a tall order for a first-time entrepreneur, it is. Most small business bankers realize their clients aren’t finance experts. While they can’t and won’t do all the work — the experienced banker will review plans and provide advice about cash flow projections, marketing plans, and more. Because banks primarily offer debt financing rather than investment dollars, they can be trusted…

7 Startup Financing Solutions That Will Jumpstart Your Business

Jump starting your business is certainly difficult to tackle. While entrepreneurs in all stages of the business lifecycle are in constant financing crises, start-up owners need to work harder to… Read more » The post 7 Startup Financing Solutions That Will Jumpstart Your Business appeared first on

5 Top Budget Crunching Tips for Entrepreneurs

Do you find more money “runs out” of your bank account every month than is coming in? Do not fear. There are several simple steps you can take to better… Read more » The post 5 Top Budget Crunching Tips for Entrepreneurs appeared first on

Accounting Reports for Small Business Don’t Have to be Complicated, Read This

When it comes to small business accounting, most people know that it is important to keep your records updated for taxes. However, there are many more benefits from small business accounting that you can use to grow, improve, and expand your business. Accounting Reports for Small Business Here are some of the most important accounting reports for your small business that you should know about. Profit and Loss Statement/Income Statement The most important report for any business is the profit and loss statement, also called a P&L or income statement. This report tells you how much money a business makes, and a lot more. A well-run bookkeeping operation includes details for where you spend and where your money comes from. For example, I can look at my P&L for a quick summary of how much I make from writing, how much I make from advertising, how much I spend on business travel, and how much I pay for computer and internet costs. Each business would have different accounts for its own income and spending categories. Small business owners should look at this report at least monthly. It is also a good idea to look at trends, comparing current results to the same period in the prior year and comparing the most recent month with the last few months. This should tell you what’s working well, what isn’t, and help you focus on the most profitable parts of the business. This is exactly how I analyzed my business to help me reach $10,000+ in monthly income. Balance Sheet A balance sheet gives you a snapshot of what a business has and owes at any given time. For small businesses, assets typically include things like bank accounts, accounts receivables, and possibly an investment account. A balance sheet may also include assets like property, computers, equipment, and other saleable physical and intangible property. Liabilities generally include things like credit cards, business loans, and anything else your business owes. The accounting equation is based on the balance sheet. It tells us that Assets + Liabilities = Equity. The difference in what you have and what you owe should…

What Are Business Credit Cards and How can Small Businesses Use Them

Using a Credit Card to Start a Business Financing a new business using credit card debt is often considered when founders have few other options. In the 2017 Year-end Economic Report, the National Small Business Association (NSBA) reports that financing continues to be a challenge for small firms. Large banks dedicate only 15% of their financing to small businesses. Community banks, SBA loans and credit unions are even lower at 14%, 4% and 2% respectively. 31% of small businesses they surveyed stated that they are using credit cards as one form of financing. Because new small businesses are less likely to qualify for traditional loans, they may turn to the use of personal or business credit cards. Differences between Credit, Debit, and Charge Cards American Express charge cards are often used by small businesses. It is important to understand the difference between a charge card and a credit card. A charge card must be paid off in full every month while credit cards allow businesses to carry a balance. Charge cards may not have a known credit limit; however, issuers do set a soft limit based on what they feel you could repay each month. Debit cards often resemble credit or charge cards; however, they draw money out of an existing account balance. They do not extend credit or create debt. Personal and business credit cards also have important differences which we will explore. Advantages of Using Personal Credit Cards One obvious advantage of using your personal credit cards to start a business is that you probably already have some. New businesses use personal credit cards to start and fund operations at least until they can qualify for a business credit card. They may also continue to use personal credit cards because of the better consumer protections unless they wish to strengthen their business credit profile. Drawbacks to Using Your Personal Credit Card Keep in mind the risks of potentially maxing out your credit cards, damaging your credit scores (both personal and business), and being unable to cover emergencies. Think about what other purchases you plan for the future because…

How to Get a Sponsor for Your Event

Having a sponsor at your event can yield numerous benefits. First and foremost, one of the biggest questions you’ll ask yourself as you plan an event is how you’ll fund… Read more » The post How to Get a Sponsor for Your Event appeared first on

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