How to Boost Your Personal Finances

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StrategyDriven Managing Your Finances Article |Personal Finances|How to Boost Your Personal FinancesThere are many things in life that rely heavily on your personal finances. The nature of your accommodation is determined by your income, while your ability to get loans and credit opportunities is hampered by a poor credit rating. In short, your personal finances, if healthy, can promote your overall wellbeing – and if poorly managed, your personal finances can cause you a great deal of discomfort. This article is all about making your bank balances and financial health that bit better, helping you achieve more in your day to day life.

Budgeting

It goes without saying that you should be careful, if you wish to be responsible with your cash, to spend within your means. The best way to ensure you’re doing this responsibly is to draw up a budget which allows you to keep track of your monthly, weekly and even daily spending.

This used to be a drag – involving the laborious filling in of spreadsheets on your computer – but nowadays it’s a simple task of downloading one of the world’s leading budgeting apps and allowing your spending data to fill in from your banks automatically. Some of the new, digital-era banks also provide this service, breaking down your spending to show you which spending habits are costing you cash.

Understand Your Options

Now, it’s never worth getting a loan unless you actually need one. Of course, a loan can help you get a business off the ground, or can help you meet your bills if you have a particularly costly month that means you’re out of cash before your wage comes through. But they’re something you should be careful not to over-indulge in, as debt can completely scupper your great plans when it comes to your personal finances.

All that said, there are some terrific short-term loan options to keep you out of trouble when it suits you most – like when the landlord’s knocking and asking for your rent. Check out providers like MaxLend, who can provide modest but much-needed same-day loans to keep you ticking over when you feel most concerned that you’re not quite going to keep your financial boat above water for the month. Just make sure that you’re able to keep up with your loan repayments before borrowing any funds.

Income Streams

Most people rely on a job to make their money, while others have two and sometimes even three jobs. This is usually enough – just – to keep you in decent financial health. But to boost that health, you should consider some different methods that might make you money.

The options available here will likely reflect your experience, skillset and expertise. For instance, a bid writer at a construction firm might well be able to write freelance for extra cash. A graphic designer can do personal project work on the side, selling designs on the internet, while others can make handicrafts and sell them on their own personal website. Some individuals even choose to start a small e-Commerce business online, letting it tick over while they’re at work to the point at which their personal finances are much improved.

These three tips are perhaps the most crucial to help you make the most of your personal financial situation as you move through life.

What Do You Need to Get a Payday Loan: A List of the Requirements

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StrategyDriven Managing Your Finances Article | What Do You Need to Get a Payday Loan: A List of the RequirementsIf you’re in a financial bind and need a little cash before your next paycheck, a payday loan may be just what you need.

Payday loans, also known as a cash advance, are gaining in popularity as a fast way to get quick cash for an emergency situation. Even so, many people don’t understand how this type of loan works and what you need to get a payday loan.

So if you are thinking about getting a payday loan and are unsure of what you need to get one, keep reading to learn about what do you need to get a payday loan and how much money you can borrow now.

What Are Payday Loans?

Let’s start by explaining what payday loans are and how to utilize them best.

Simply put, a payday loan is a short-term loan that is intended to be repaid in full with your next paycheck. These loans are usually for a small amount between $300 and $1,000. They are a popular loan option for those with no credit or a bad credit score.

Note that the cost of a payday loan can be very high, which is why it is so important to pay them off with your next paycheck. The costs can rise exponentially with each pay period that passes without paying the balance in full.

It’s good to know all the benefits and risks of payday loans so you can make an educated choice that’s in your best interest.

What Do You Need to Get a Payday Loan

Many states regulate payday loans differently resulting in different qualification requirements depending on where you live. But typically, you only need to meet a handful of criteria.

You must be at least 18 years old and you will need a valid government identification, your Social Security number, proof of income (pay stub) and an active checking account. If you are applying in a payday loan store, you will need a personal check. If you are filling out an application online, you must enter your email address.

When you get a payday loan, you must submit a personal check for the entire balance to be paid on the date of your next payday.

Even if you meet the above requirements, you can be denied a loan for a number of reasons. For example, you may not earn enough to borrow money. Most lenders want you to earn at least $500 per month.

The lender also considers are the length of time you have been at your job and how recently you opened your checking account.

They may also reject your applications if you have a recent bankruptcy or bounced checks. And most companies will not issue you a loan if you already have an outstanding loan.

How Much Money Can I Borrow?

The amount of money you can borrow also varies state by state and in how each state regulates loans. Most states limit how much can be borrowed, which usually falls between $300 and $1,000.

Lenders determine the amount you can borrow the same as other lending institutions assess risk for other loan products. Payday lenders take into account your income and expenses along with your lending history to determine an amount they know you can reasonably expect to pay back.

The Bottom Line

So what do you need to get a payday loan? Not much, really. You must be at least 18 and meet the handful of requirements listed above.

Before you get a payday loan, make sure you will make enough on your next check to repay the full balance while also meeting your other obligations. If you are unable to repay the loan for a few more pay periods, the resulting interest gains could result in a debt trap for you.

Payday loans are best used when you need emergency funds, and you have more than enough to repay the loan with your next paycheck.

Keep browsing our site for more valuable and helpful articles.

Business Plan Development: Know your Finances

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StrategyDriven Managing Your Finances Article |Business Plan|Business Plan Development: Know your FinancesA great business plan is the foundation of every great business. It sets out what your new business will do, how you will overcome the challenges of starting up and, most important of all, how you will make money.

But your start-up business plan is all just wishful thinking until you start filling in the financial figures.

Your marketing plan and SWOT analysis are interesting – but they don’t mean a thing if you don’t have realistic figures on your bottom line. Your financial forecasts and statements make up the most essential section of your plan. You need it – not just to set the financial targets you will work to, and as a blueprint for running your business – but to secure funding from investors or lenders. They are going to want to see numbers that show your business has the ingredients to thrive and grow and that they can be repaid, with interest.

What should be in the financial section of your business plan?

Your financial projections need to include the key figures that business accounts will show. These are the profit and loss, balance sheet, and cash flow.

These will be similar to the detailed accounting statements your business will eventually generate – but with one important difference. You will need to make projections of the figures your business will achieve, rather than report on those you have.

This means that you have to take an educated guess about the future performance of your business. It may be easier to make your estimates if you have experience of running a similar business – and if you have, say so!

Keep it real

It may be tempting to be over-optimistic – but the more realistic your estimates are, the more professional you will look – and the better your chances of securing the funding you want.

Everyone wants to set up the next Google or Twitter, but not every business can enjoy exponential growth – and plans that suggest it will, can be a red flag for investors.

One way to ensure your figures are credible is to base them on an existing business that you know well, and to use the following structure:

Start with a sales forecast. Set up a spreadsheet projecting sales over the first three years. Set up different sections for different lines, with columns for every month for the first year (you might want to change to a quarterly basis for subsequent years).

Don’t just include units. Have columns for unit sales, unit costs, pricing, one that multiplies units times price to calculate sales, and one for sales costs. This allows you to demonstrate gross margin: sales revenue less sales costs. Plus it’s a useful number for comparing with different standard industry ratios.

Create an expenses budget. Differentiate between fixed costs, such as rent and payroll, and variable costs, such as advertising and delivery. Include contingencies and variations based on different sales figures.

You may have to estimate things like interest and taxes.

Develop a cash-flow statement. This shows the cash moving in and out of the business. It is important to remember when compiling your cash-flow projection to show how many of your invoices will be paid in cash, 30 days, 60 days, 90 days and so on. Some business planning software programs will help you make these projections.

Income projections. This is your profit and loss forecast for your business for the coming three years. Use the numbers that you put in the other sections. Remember:

Sales – cost of sales = gross margin

Gross margin – expenses, interest and taxes = net profit

Include assets and liabilities. Start with assets and estimate what you’ll have on hand, month by month for cash, money owed to you, inventory, and your substantial assets like land, buildings, and equipment.

Then work out your liabilities or debts – the bills for suppliers, finance and loan repayments.

The breakeven point. If your business is viable, at a certain point your revenue will exceed your costs. This is a key point for potential lenders, who want to know that they are lending to a viable enterprise.

Do you need help?

The financial section of your business plan is so important that it is worth getting help with. Your accountant may be able to provide some input, and, remember, that you may be able to find templates for businesses like yours online.

Some accounts software may have helpful modules – and some will have the ability to translate your figures into graphic form to create pie charts or bar graphs that you can use to highlight your financials, sales history, or projected income over three years. And don’t be afraid to include visuals in your business plans – they can make complicated data much easier to understand!

How to Minimize Loss of Profits

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StrategyDriven Managing Your Finances Article|Loss of Profits|How to Minimize Loss of ProfitsIf a business is to grow, it needs to make a profit, and it needs to make more profit all the time. Losing profits is a sure way to damage your business, and eventually, if it keeps happening, the business will have to fold – you cannot sustain losses year on year and not be affected by it. Here are some simple but effective ways to minimize the loss of profits to help you stay on track and continue to grow as much as possible.

Don’t Launch Too Soon

In order to make more profits, every business needs to innovate and come up with new and exciting ideas. However, launching those ideas too soon can be a disaster; if the product is not ready, if there are problems with it, if no one is actually going to buy it, or if it is simply not cost-effective then you will waste money and not make any profits.

This is why testing your products with Digivante is important. When you do this, you will receive feedback that you can act on and ensure you make the necessary changes to help your product sell. You will also be able to fix any issues before launching to the general public.

Make Use Of Technology

They say that time is money in business, and therefore if there is anything that can be done to save time, you are likely to be saving money too. Using the latest technology to help complete tasks more quickly and effectively is a great way to stop losses from occurring. If you or your team are able to save time by using a machine or computer program, for example, you can use that time to be more effective elsewhere, maximizing your chances of selling.

Not only that, but you won’t need so many staff if a lot of your important tasks can be automated or done more quickly, and again this will help to save you money. Quite often, staff costs are the most expensive part of running a business.

Price Correctly

It may seem a simple concept, but pricing your products and services correctly will stop you from making a loss when it comes to your profits. If you haven’t calculated the prices properly, you run the risk of not making a profit at all, and therefore losing money.

This is why you need a budget before choosing to sell any kind of product or service. You must know what your bottom line is and what you are spending if you are going to be able to price your products in such a way as to make a profit but not alienate your customers. This can be a difficult balancing act, but it is well worth the effort to make sales and minimize losses.

Take It Seriously

Many people run their new businesses as a sideline while working a full or part-time job. This can mean that it is not taken as seriously as it should be, and you might not be pushing the business as hard as you would if you were running it full time.

In order to minimize losses, you need to take your business seriously, whether it is your full-time concern or not.

3 Key Benefits to Automating Accounts Payable

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StrategyDriven Managing Your Finances Article |Accounts Payable Automation|3 Key Benefits to Automating Accounts PayableThe accounting department is one of the most important in a business. It’s therefore vital that it runs smoothly and that errors are kept to a minimum. Usually tasked with reducing costs and improving business performance, a key tool in delivering these objectives is accounts payable automation software. Some of the key benefits are outlined below.

Eliminate Manual Data Entry and Reduce Errors

Accounts payable can use a lot of business resource because it is traditionally a very manual process. Usually it requires someone transferring or inputting invoice information from one system to another be it from an email or a paper invoice. This kind of manual data entry often leads to errors, especially when dealing with large amounts of data.

In accounts payable in particular it’s especially important that mistakes aren’t made as they can have a huge impact on business. An additional zero or a decimal in the wrong place can disrupt other departments and in smaller businesses can lead to cash flow problems.

Implementing accounts payable automation software will help to reduce common errors and will free-up employees to work on higher priority deliverables. One key feature of good accounts payable software is AI driven invoice capture. This will automate the capture of data within invoices that are received via mail, email or fax and input it into the system. Manual data entry and errors are therefore almost completely eliminated.

Streamline Business Processes

All businesses will have an accounts payable process in place to ensure that invoices are paid on time and that the correct approvals are sought. However, usually employees rely on each other to know their part in the process. This becomes a problem if someone leaves the business as it can cause a breakdown in communication, key parts of the process to be missed and payments being delayed.

One way to overcome this is by setting up workflows and processes within automated accounts payable software. Having a visual representation of the procedure and a digital sign off process means that everyone is kept in the loop. It also means that invoices are logged and processed on time and efficiently.

If your business gets discounts for early payment of invoices this can be especially valuable.

Take Advantage of Holistic Reporting

Being able to generate and access reports that give an indication of the health of your business is vital. Typically accounts payable might be using spreadsheets or other software that isn’t linked to other systems in the business. This can lead to data quickly becoming out of date as it’s captured at a single point in time.

Connecting automated accounts payable software to existing systems will give you a holistic view of your business. Real-time dashboards and reports, as opposed to snapshots of data, will ensure that everyone is kept in the loop and that decisions are made based on the most up to date data.

Having this insight will help across the business and deliver on key objectives including:

  • Increasing responsiveness to customers
  • Being pro-active about any emerging cash flow problems
  • Providing a better service based on data-driven insights