How to Build A Successful Business or Qualities Of An Entrepreneur?
Starting a business and becoming successful is often part of the American Dream. But there is a difference between starting a business and building a successful business. Many businesses fail within the first few years of existence due to the lack of planning for the long-term. Qualities Of An Entrepreneur in Rating there is not enough vision and there is not enough done to strengthen the business properly from the ground up.
If you want to start a business there is an easy way to get a better understanding of why some businesses fail and others don’t. When starting a business think about it similar to building a house. If done right it is protecting you against any kind of storm or danger of the outside world and will last for a long time. It offers shelter and protection. For you and your business that could be translated to that you want to have a business that is able to weather economical ups and downs (=storm) and that will provide income to pay the bills (shelter and protection).
When building a house there are several different steps you need to follow to have the house build. You know you want a house, but you got to pick a location and get an architect to plan everything out. In the business world that would be: you know you want to start a business, but you have to come up with a business idea and work out a business plan. The next thing for the house would be to build the foundation (and eventually the basement) for the house. In the business world – you got to build the initial infrastructure (example: connecting with vendors, find a manufacturer for your product, create a sales team, rent office space, get a delivery truck, etc.). Once that is in place you able to actually do business and earn some money. But you are not completely done yet. You need to build a frame, put in windows and you also need a roof on house. For your business this means that you pay off debt, improve business processes and get professional help when needed (example: find a tax accountant, select a payroll service, etc.).
Once the house is build you probably want to fill it with furniture and make it livable for the future. Nobody wants to sleep on the floor, right. Again translating this to the business world it could mean that you invest money you earned back into your business. You buy machinery instead of leasing it. Eventually you buy a building, hire more staff, develop more products, move into new markets, build up a high cash reserve, and buy other businesses and so forth. This is often the step where winners and losers separate. Re-investing money into the business is a key factor for success. If you go and spend all the money on your own salary to buy things you have nothing to go back to when the economy slips into a recession or if disaster strikes.
The successful business owner has build up a cash reserve or can borrow money from bank – securing loans with the assets of the business. Going back to building a house this pretty much matches the same efforts. You pay off your mortgage and have equity available to eventually borrow against when emergency arises. Emergencies do not include paying off credit cards to use them again or to buy a car. Financially responsible you should be looking at the long term and not finance short-term goods with long-term debt.
Interesting Facts About Qualities Of An Entrepreneur in Rating:
About Qualities Of An Entrepreneur in Rating:
April 15th The Day of Reckoning! Every year, millions of Americans get ready to pay taxes to Uncle Sam, or get ready to collect a tax refund from Uncle Sam; when did this become the great day that it is for taxpayers, and when are we actually required to file a income tax return? Lets take a look at the beginnings of the income tax date of April 15 and why it was chosen?
The first known income tax that Americans were legally required to pay was enacted during the early 1860s, and the Presidency of Abraham Lincoln. The Civil War was proving very costly to finance, and the President and Congress created the Commissioner of Internal Revenue and enacted a law requiring citizens to pay federal income tax. This could be considered the start of our modern day income tax. This income tax was based on principles of graduated or progressive taxation and of withholding income at the source. The commissioner was given authority to assess, levy and collect federal income taxes. The authority to enforce tax laws by seizure of property and income and by prosecution.
Originally, the deadline for completing and filing your individual income tax was not April 15th. In the beginning, it was first set for March 1st. Then, during 1918, Congress pushed the date out to March 15th. Then, in the great overhaul of 1954, the date was once again moved forward to April 15th, and this is where it remains today. Why April 15th? The main thought from most scholars say the reasoning is that the date gives the IRS more time to handle the work load and more time to hang on to your money before offering a tax refund. This date has only been set this way for a little over 50 years. Thats not very long, in historical terms, and it could possibly be changed again.
If you are an individual taxpayer, you are required to file either a return or an extension of time to file (Form 4868) by April 15th. Corporate and other legal entities are required to file their federal income tax return by March 15th, and if not, they also must file an extension of time to file. What this extension does not do, is to extend the amount of time you have to pay any taxes due the government. So, if you are unable to ready your personal or business financial information in a timely manner, and have no reasonable estimate as to the amount of tax you may owe, you can expect to pay some form of penalty.
In the years following WWII, the burden of tax responsibility was shared fairly equally by the corporate world and the individual taxpayer. Today, however, the shift has been toward more responsibility on the part of the individual, and less on the business backs. To demonstrate how special interests have begun to overtake American politics, during 1867, public opinion was so strong, and the outcry of the general public so loud, that the President and Congress abolished the income tax law in 1872, and from 1872 until 1913 almost all of the revenue for government operation came from the sale of liquor, beer, wine, and tobacco. Although the income tax did make a small come back in 1894, it was found unconstitutional in 1895 by the U.S. Supreme Court because it was not apportioned among the states in conformity with the Constitution.
An interesting time during the formation and eventual taxation of America occurred during 1918. Until that point in time, the vast majority of tax revenue for government funding came from alcoholic beverage sales and high tariffs. In 1919, Congress passed an amendment to the Constitution that made it illegal to manufacture or sell alcohol; what would replace the revenue? American federal income tax was the proposed solution, and weve been paying since. Although during the great years known as Prohibition, many revenue agents spent their days tracking down moon shiners not tax evaders, the American citizen, the individual taxpayer took on the heavy burden of supporting government revenue, and it has become heavier with each passing year. On a side note, although moon shining was illegal, the moon shiners still had to pay taxes on the moon shine so they were incarcerated for tax evasion and not moon shining. Taxes seem to always come into play when looking for a way to prosecute someone.
Then, during 1942, the Revenue Act of 1942 was passed and the New Deal era was begun. Since that point in time, government control, power, and expenditures has continued to increase at a phenomenal rate, and today the American taxpayer supports a trillion dollar giant known as the United States government. This ravenous beast consumes more than 10% of our earned income each year, and if the Social Security Administration has their way, will continue to consume even more of our weekly earnings. We can foresee no other relief in sight.
Currently, all the tax regulations for this country are the responsibility of the Internal Revenue Service, and there are four major divisions of this government office: the Wage and Investment, Small/Business Self-Employed, the Large and Midsize Business and the Tax Exempt and Government Entities. Each division has responsibilities as they pertain to their individual specialty.
There continues to be talk on the hill to change the way taxes are calculated and collected. The most common themes are the flat tax and the national sales tax. Until Congress actually has the courage to step up to the plate and change it, taxes will remain as cumbersome as always.
Qualities Of An Entrepreneur in Rating
My husband and I work together on cutting wood for our heat source for the winter months. I enjoy helping him as much as he enjoys the help. I am an entrepreneur and he is a man who enjoys the comforts of a 9 to 5 job. Both of us take pleasure in being out doors in nature. It may be the only thing we have been on the same page about during our 20+ years of marriage.
One particularly nice morning my husband asked me to go into the woods to collect the logs he just finished cutting. I joyfully agreed but when I got out there he was already returning to the house to tune up his chain saw. "No problem", I thought, "I'll just keep busy until he comes back."
As I looked around the parameter of the forest I couldn't see the log he said he had cut up. Going deeper into the thicket of tall brier's and spindly trees, my clothes were being pulled and torn, thorns were cutting my shins and my unhealed broken ankle began to throb from stepping into holes.
I eventually found the log he had cut up and looked around for a better path to get back to the road. "Surely he cut one for me." I thought. "We just discussed this yesterday. Does he really expect me to lug this hard wood such a distance with a hurt foot and without a path?" Within seconds of looking around it became obvious there was no path to get back to the road besides the trail I had just made.
By the time I had taken out two arm loads of wood, I felt beat up, my skin was torn up and I was totally focused on my husbands lack of consideration. "This is how he does everything!" I exclaimed exasperated. "He needs to understand that the way you do anything is the way you'll do everything and this is why we're never on the same page!"
By the time he returned I had spewed all the negative thoughts in to the wind and I couldn't speak. I no longer wanted to lay into him because I knew my thoughts had shifted to an epiphany. I realized the truth. In the years I've wanted him to be involved in my business, I had never once made a clear path for him either. I want him to enjoy helping me in my business, but I have never actually shown him the possibilities of how it could be done. How would he know what the joys or pitfalls could be unless I cut a clear path for him to?
I used this wood cutting experience because as entrepreneurs its important that we allow our spouses paths to be easier to journey through. If you desire to be on the same page then ask yourself one simple question: If I could cut a path for my spouse to understand my work, what would that path look like? If you really give this some thought I think you will find ideas you've never thought about before.
Entrepreneurs - Want To Start A Business But Not Sure What Type?
Why should you consider refinancing real estate investments instead of selling them? Maybe you've owned a rental property for years, you've paid down the mortgage, the value is up, and you want to cash in on that equity. You will do better to refinance. Here's why.
There are two problems with selling. First, selling means paying a large capital gains tax. You can avoid this if you reinvest through a 1031 exchange, but then the point is that you want your money, right? Second, you'll be giving up your inflation-indexed retirement plan. A good rental property generates more income as rents go up.
Refinancing Real Estate Investments Is Better
If you refinance, you can get much of your gain out of the property, without paying a penny in taxes. You see, borrowing money is not a taxable event. Take your loan proceeds and spend them however you want, and still keep your rentals. Doesn't that sound better than losing a big chunk of your equity to taxes?
Now, let's look at an example. We'll suppose you have owned a small apartment building for several years. Let's say you bought it for $340,000, with a down payment of $80,000. Interest rates at the time were at 9.5%, giving you a payment of $2,106 monthly on the balance of $260,00 (30 year amortization).
The property is now worth $560,000, and you owe $220,000. Your cash flow is around $2000/month. Now, how do you get at some of that equity? If you sell, you will give up the income, AND pay a big part of the profit in taxes. What happens if you refinance?
If a bank will loan you 70% of the value, that would be $392,000. Pay off the first mortgage, and you are left with $172,000. You can spend it any way you want, and no taxes are due.
It gets even better, especially when interest rates are low. If the new interest rate is 6.5%, your new payment will be $2295. In other words, you get $172,000 to spend any way you want, and you still have over $1,800 cash flow each month, from an inflation-indexed retirement plan.
Here is an even better scenario: Spend $50,000 of the loan for high-return upgrades to the property, such as carports and a laundry room, and raise the rents. You could have $122,000 left over to spend any way you want, AND have higher cash flow than before! Isn't that sound better than selling your retirement plan? When you want that cash, consider refinancing real estate investments.
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