by Ajay Oberoi | Uncategorized
When it comes to profit & cash flow both the terms are different for a profitable and growing business. Yes, these two terms are completely different.
Both elements are crucial for any business to grow and flourish. Both elements function differently for a business. Let us learn about how these two elements are different.
Profit
Profit is the remaining amount after the deduction of all expenses from the revenue generated by the business. It goes without saying that any business should earn profits in order to sustain itself in the market for the long term. In any business, the expenses increase towards launching new products or any other investments for the business, and thus the business experiences fewer profits in a short span of time.
Cash flow
Cash flow means inflow & outflow of cash from a specific business. It is important to manage the cash flow properly to carry out daily operations, buying inventory, paying taxes, giving out salaries to the employees, and many other costs smoothly.
Basically, cash flow gives you a fair idea of the actual cash available for your business. On the other hand, profit will not help you get an idea.
Many businesses have this misconception that profit & cash flow are similar to each other. But, they are having no similarity. For any business to survive it should make profits and also maintain appropriate cash flow. The two elements reflect two different financial parameters but for any business to survive in the long run need to have a system that tracks both elements accurately.
The cash flow can either make or break a business. For any business actually cash flow decides its ability to survive and not the profit.
Why cash flow is crucial for every business?
Maintaining debt and bills
It is important to have a sufficient amount of cash in hand to run any business successfully. If you have borrowed funds to purchase equipment, inventory then you need a sufficient amount of cash flow to make repayments on time to avoid paying extra cash as penalty.
Buying inventory
When you have positive cash flow that means there is enough money in hand to buy inventory whenever you need it. There can be adverse effects on your business if you do not have enough cash in hand like negative customer experience, stock-outs and you may also land up in trouble when you have to borrow more funds to repay the existing debts.
Controlling high sales time
There can be an increase in demand thereby increasing your expenses in business-like staff expenses, warehouse space, inventory expenses, marketing efforts, etc. When there is the positive cash flow available you will be able to make important business decisions easily and will be prepared to encounter high sales periods by investing correctly which will directly help your business do well and generate profits during peak season.
Help your business grow
Expansion is necessary with time which also needs you to invest money in resources and in various promotional activities. All the activities need the money that again means your business should have required cash flow to expand and make necessary investments when the opportunity knocks.
Managing cash flow properly is essential
If your business is making profits in the short term, then it can sustain in the long run as well if you have enough cash to clear all your bills and make necessary investments in the business.
If your business is making high profit but the cash flow is low then your business will be called a profitable business that is not capable of paying the bills. On the other hand, if you are paying all your bills also doesn’t mean your business is profitable. If any business has borrowed funds to overcome cash flow issue the debt on the loan would automatically increase thereby increasing the cost per unit and in such cases, your business will not be profitable even after having enough cash available.
Irrespective of what business model you are using your business is at risk if you are not able to manage the cash flow well. All successful business maintains cash reserve and therefore they are profitable.
You can seek help from a financial planner to work out the cash flow. Positive cash flow control will not happen overnight. It needs proper planning and help from professionals. The professionals in the finance sector can help your business develop a positive cash flow by conducting analysis and then planning it right. They will help you learned the aspects that would help your business have enough cash in hand to help you make important business decisions smartly and invest in new opportunities.
The profit and cash flow are different elements in a business and they aren’t similar to each other. Both elements are important. You need to look upon each of the two elements closely and manage them properly. It is always better to seek help from financial consultants so that you know how to manage cash flow properly and invest in new opportunities wisely.
You can help your business become profitable with the right approach towards the management of cash flow and managing profits to avoid getting into high debts.
For any business to run smoothly having enough cash in hand is essential and towards the growth of your business, you can grab the new opportunities and make investments only if you have enough cash flow.
Again if your cash flow is positive doesn’t always mean your business is profitable and on the other hand, if your business is profitable and still you are not able to pay bills then again you are stuck. It means you have to take care of both components for a business to grow. Do not think about cash flow and profit as similar elements as they are different and affect the business differently. So they need to be taken care of equally. Make sure you consider the two important elements of business and manage them well. Any help for financial problems contact gtacredit.com or call 416 650 1100
by Ajay Oberoi | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair
If you are a parent with kids, filing for bankruptcy should be transformed into a family experience. Then you will be provided with the opportunity to minimize the hassle and frustration that you will have to go through. On the other hand, you will find it a convenient task to go through the process of bankruptcy as well.
You need to follow a unique and specific approach when you are explaining bankruptcy to your children. From this article, we will let you know about the steps that should be taken when you are explaining bankruptcy for the little ones. These tips can definitely help you to convince the message to the little ones without going through any hassle or frustration.
Explaining bankruptcy to preschool children
You need to think twice before you go ahead and explain bankruptcy to children who are younger than six years. Sometimes they will not understand anything that you say. But if you want to get rid of the stress that you are going through, you can go ahead and explain what has happened.
When you are explaining bankruptcy to preschool children, you need to be as simple as possible. In other words, you will need to convey the message in a way that your preschool child is familiar with. Then you will be able to convince the message in an effective manner.
Along with bankruptcy, you and your pre-schooling children will have to go through some significant changes in their day to day lifestyles. For example, they will need to move to a new home and change schools. When you are preparing for these changes, your kids will be convinced that something big is happening. That’s where you can go ahead and explain bankruptcy to your kids. Then the kids will be able to understand what’s happening. It can keep the kids away from assuming things.
You can use examples when you are explaining bankruptcy to the preschool kids. Then you will be able to convince the message to the little ones in an efficient manner. For example, you can let your kids know that you are moving to a new home so that you will be able to save additional money to take care of the family and to purchase food that you need. Then the preschool kids will be able to understand bankruptcy according to the knowledge that they have.
Explaining bankruptcy to elementary school children
As the next thing, you need to understand how you are going to explain bankruptcy to elementary school children. Elementary school kids are less than 12 years of age. Therefore, you will need to follow a specific procedure when you are explaining bankruptcy to them as well. However, it is possible for you to provide a bit more additional knowledge than you would explain bankruptcy to the preschool children.
When you are explaining bankruptcy to the elementary school children, you need to make sure that your little ones don’t start worrying about money. That’s nothing that the elementary school students will be able to do in order to help you get out of bankruptcy. However, you will still be able to receive excellent emotional assistance from the children. Due to this reason, you need to explain the facts accordingly, so that your kids are convinced to go ahead and support you emotionally.
You should also make sure that the kids don’t go ahead and blame themselves for all the financial difficulties that you are dealing with. You can tell your kids that you are filing for bankruptcy because you will be able to save some additional money for the family expenses. Or else, you can say that you are saving money to settle some of the bills that you have. To convince the message in an effective manner, you can share a goal that is related to your kids as well. For example, you can tell that you will be able to go on a family vacation to one of the best amusement parks when you settle all your debt. This can motivate your elementary school kids to go ahead and provide the emotional assistance needed.
Teenagers
Explaining bankruptcy to teenagers can be quite tricky. That’s because the teenagers are sophisticated and they have a better understanding of how money works. In addition, they are aware of the fact of how the economy can affect them. As a result, they start worrying about your financial situation as well.
Since teenagers have a good understanding of the financial situation, you can go ahead and provide additional information about bankruptcy to them. You can even tell your teenage kids about why you went into bankruptcy. It would be an important lesson that they will be able to learn during the teenage years.
It is also possible for you to encourage your teenagers to go for a part-time job, which they can do after school. Plenty of such job opportunities are available. It is up to the teenagers to go ahead and grab those opportunities. Then they will be able to make some money after school and help you with your financial difficulties.
You shouldn’t think twice before you allow teenagers to go ahead and take responsibility when trying to help you during a difficult situation in your life. This can deliver a better feeling for your kids as well and they will feel empowered.
Now you are aware of how to explain bankruptcy to your kids. You can keep these tips in your mind and proceed accordingly. Then you will be able to create a solid foundation, which can ensure a stronger financial background for you in the long run. You should never think twice before you go for it. Any help for financial problems contact gtacredit.com or call 416 650 1100
by Ajay Oberoi | Bankruptcy, Consumer Proposal, Credit Counseling
Bankruptcy is a nightmare and none of us want to end up in it. However, there are plenty of examples for individuals who survived bankruptcy and regained financial wealth. You will be able to discover a lot of famous names on that list as well. Here is a list of 5 famous individuals who filed for bankruptcy, but was able to survive it within a short period of time. If you are dealing with bankruptcy, you will be able to get inspired by these individuals.
- Abraham Lincoln
It is now possible for you to see the face of Abraham Lincoln on the penny. However, there was a time that Abraham Lincoln didn’t even have a penny on his pocket to spare. As a young man, Abraham Lincoln was engaged in a variety of occupations. While working as a shopkeeper, Abraham Lincoln wanted to start his own shop. However, it didn’t go well and he ended up with bankruptcy. In the meantime, the partner of Abraham Lincoln died and he got into bankruptcy. The bankruptcy laws that we can find out there in the world were not available those times to provide protection to him. As a result, the creditors of Abraham Lincoln took him to the courts. That’s where he lost his remaining assets, which included surveying gear and a horse. However, Abraham Lincoln didn’t want to give up. Instead, he started working hard and paying off all the debts that he owes. As a result, he was able to get rid of the debts by the 1840s. The challenges he went through this time period helped him to become the President of the United States as well.
- Walt Disney
Disney is there among the top 10 brands in today’s world. However, he was a victim of bankruptcy as well. Walt Disney started his career as a filmmaker. However, things didn’t turn out according to the way he expected. The first film company of Walt Disney was established in Kansas City back in 1922. That’s where he started making cartoons and short advertising films. He was doing well and he signed up a contract along with a New York company in order to distribute the movies that he was producing. However, this partnership didn’t turn out to be a good one. That’s because the distributor cheated on Walt Disney. In fact, Walt Disney didn’t receive cash for his work and he ended up with bankruptcy. While going through bankruptcy, he went ahead and created Mickey Mouse back in 1928. That was a milestone in his life. The cartoon character was able to earn him wealth and he was able to overcome debt and become successful again.
- Donald Trump
Donald Trump is the most powerful man in the world as of now. Therefore, you might be surprised to see his name on the list. As you already know, Donald Trump is a successful businessman. However, his companies didn’t go well and he had to file for bankruptcy six times in his life. In all those instances, Donald Trump has filed for bankruptcy personally. The first time where Donald Trump declared bankruptcy on behalf of his company was back in 1991. That’s where the Trump Taj Mahal Casino went bankrupt. After the incident, few additional hotels and casinos owned by Donald Trump went bust in on the following year. The same thing happened to him again in 2004 as well as in 2009. During all such instances of bankruptcy, Donald Trump was able to transform the existing laws of the country to his advantage. As a result, he got the opportunity to come out of bankruptcy in a convenient manner.
- 50 Cent
The world-famous rapper 50 Cent also went bankrupt back in 2015. It was a massive blow on him and he found it as a difficult task to get back on feet. At the time where 50 Cent went bankrupt, his total worth was around $155 million. In 2015, he was asked to make a payment of $5 million to the ex-girlfriend of Rick Ross, named Lastonia Leviston. That’s because Lastonia sued 50 Cent for posting a sex tape of her on the internet. He couldn’t make the entire payment at once but was making smaller contributions along with time. He was managed to pay off all the debt and settle off after a couple of years. 50 Cent was declared off from bankruptcy only after he made the full payment to Lastonia. 50 Cent is still struggling with the negative consequences that were associated with his bankruptcy. However, he is going strong and he definitely has a promising future ahead of him.
- Mike Tyson
You might never believe if I say that Mike Tyson was also a victim of bankruptcy. However, he became a victim of bankruptcy back in 2003, where he owed $23 million. This forced the legendary boxing player to go ahead and file for bankruptcy in the same year as well. Mike Tyson had an extremely successful boxing career for a period of two decades. During that time period, he was able to earn around $400 million. However, he was not able to protect the earnings for a long period of time. That’s mainly because he was forced to go for a divorce settlement of $9 million. In addition, he had to make a payment of $4 million to the British tax authorities and another $13.4 million to the IRS. Due to all these reasons, Mike Tyson was forced to declare bankruptcy. It took about one decade for the boxing player to overcome bankruptcy. However, it was not an easy journey and he even had to spend his time inside a rehab facility. However, he survived all the difficulties and now he is back in his life. Any help for financial problems contact gtacredit.com or call 416 650 1100
by Ajay Oberoi | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair, Debt Management
Using credit cards comes handy and you can buy what you want anytime. It doesn’t matter whether it is a need or a want when you have a credit card you are tempted to make purchases. As you know that you can easily pay back the credit card bill after getting your paycheck you end up spending more than required.
It is essential to avoid high-interest rates on credit cards so that you do not spend more on bills. Let us learn the ways to avoid paying high-interest rates on credit cards
Most of the credit cards set up a grace period for all new purchases. It is about the duration for which the grace periods last. It starts from the date you make a new purchase till the due date of the monthly billing cycle from the date you made a purchase.
There will be no problem as long as you make timely payments on a monthly basis which means the credit card company won’t charge any interest. When you end up paying a lesser amount than the due amount the credit card balance will be carried over and termed as unpaid credit to be paid in the next month.
Interest rates are basically applicable to balances that are due or unpaid. When the full due amount is not paid it is termed as revolving or carrying a balance. In case you pay even less than the minimal amount then it is treated as late fees.
High-interest rates on credit cards
You need to have self-control while managing your finances as you know the interest rates on a credit card are high which can make your spending on purchases even more expensive. Of course, if you are not having cash to pay for any purchases then you will not like the idea of paying more on interest by making a purchase even more expensive by paying through credit card. For example, if you buy any device for $1,000 via credit card and even after making the minimum payment each month, you will actually pay $175 extra as part of interest over a year. Moreover, you also owe $946 dollars against the purchase you made.
With the increase in revolving credit by 4.9% every year more and more consumers are getting credit cards that major issuers and banks offer. There is a significant increase in credit card interest rates and those having credit card debt should manage their spending by either paying back or pay a minimum amount to not get into a troublesome situation.
The hike in credit card interest rates boosts the APR to almost 17.10%. The credit cardholders who are following a standard pattern of paying the minimum payment on credit cards every month can find it to be quite expensive. If they fail to pay the debt there is no way they can overcome the difficult situation.
The minimum amount to be paid will reduce down every month with the collapsing balance. Remember, the figures would shoot up in case there are extra charges, late payment of fees, and hike in interest rates or other varied costs.
The consumers should get into the habit of self-control, the idea of I want it right away should be eliminated to avoid getting into trouble with credit card high-interest rates. The lifestyle should be maintained without falling under debts. With the increase in debts, the monthly payments shoot up which leads to problems for the consumers.
Make sure you cut on your unnecessary expenses and try to figure out what interest rates you are paying on every credit card you own. This will help you prioritize the credit card with higher interest rates. You can go for credit counseling to understand how the high-interest rates on credit cards can affect your finances without you knowing about it. Make sure you set a budget and also have some savings to pay off your credit card bills. Do not get into credit card debt that you can’t overcome. Over a period of time, it can lead to a number of problems. It is not that you can’t use your credit card to make purchases but make sure you pay the full amount in the balance every month. You can use it wisely for convenience and protection. You can also avail of the cashback rewards that come as cool offers with credit cards.
The idea is to not fall under credit card debts and use the self-control formula to avoid unnecessary purchases. Capital is something really important for businesses to run their business smoothly. Many people switch from job to business to execute their ideas that even lead to great business opportunities. When they plan to start a business the first thing that stops you for a while is lack of funds or capital.
Business Loan
The loan is the best option to raise funds for your business. You can get loans from many financial institutions or banks. You may find the entire process of getting a loan a little bit complicated than earlier. Now banks have set up new rules for lending funds for businesses, especially small businesses. Thus you should be aware of detailed steps to get a business loan from any bank so that you can get your loan approved without any hassles. Let us look at the basic and essential steps that will help you apply for a loan from the bank and get it approved.
Create a perfect business plan
When you apply for a loan, the banks want you to present a powerful financial plan which works well for your business. It includes an introduction about you and what the business you want to start is about. The business plan you present should be able to speak about your business goals and missions and also how the business will operate to achieve the goals and mission. A perfect and convincing business plan will help you convince the lender easily.
Explain the spending pattern for the borrowed finances
Banks are interested in knowing about how you are going to spend the loan amount borrowed from the bank. For example, if you are planning to buy equipment, you should seek an equipment loan. In another case, if you need funds to keep your business running prior to the debtors offer you money then make sure you apply for a suitable short-term loan. Hence it is better to explain what you are going to use the loan amount to help the bank assess whether the amount given will take care of all your business needs.
Mention the loan amount you actually need
Before applying for a loan makes sure you do all the calculations to find out the amount of money you need so that it is neither over nor underestimated. The reason is that if you seek less money than you need it can land you in financial problems in the near future. On the other hand, stating an overestimated amount can again put you in trouble as the bank will ask you whether you have made a perfect business plan after conducting thorough research. To put an end to all the doubts make sure you have a better business plan with a proper presentation and a budget.
Be determined about the credit score
Today, all banks verify whether a person who applies for the loan is eligible for the loan. When you apply for a loan make sure you check your credit scores and credit reports. It would be difficult to get a loan if your credit score is lower than expected. If your credit score is low you can try for a loan that is revenue-based. You can put in some efforts to increase your credit score before you apply for a loan from a bank.
Monitor your credit report
At times you could find some errors in the credit report and it happens when you are not attentive. It can pull down your credit score negatively. That is why you need to keep a check on your credit score by checking files of business credit and personal credit. In case you find any errors you can approach the credit reporting firm to get it corrected and increase the score after eliminating the errors. It is necessary to look into credit reports as a low credit score won’t fetch your loan from a bank.
Evaluate the available lending options
Once you check your credit report and find it to be fine, the next you need to do research and create a list of various banks that are feasible to provide the loan type you are looking for. Make sure you pick out the banks that provide loans at considerably low-interest rates and offer approval guidelines that are quite flexible.
Maintain accurate financial records
It is easy to get a loan from banks when you have correct and well-maintained financial statements. Banks check the balance sheets you have along with income statements and cash flow statements. Any help for financial problems contact gtacredit.com or call 416 650 1100
by Ajay Oberoi | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair, Debt Management, Portfolio, Social Media
Capital is something really important for businesses to run their business smoothly. Many people switch from job to business to execute their ideas that even lead to great business opportunities. When they plan to start a business the first thing that stops you for a while is lack of funds or capital.
Business Loan
The loan is the best option to raise funds for your business. You can get loans from many financial institutions or banks. You may find the entire process of getting a loan a little bit complicated than earlier. Now banks have set up new rules for lending funds for businesses, especially small businesses. Thus you should be aware of detailed steps to get a business loan from any bank so that you can get your loan approved without any hassles. Let us look at the basic and essential steps that will help you apply for a loan from the bank and get it approved.
Create a perfect business plan
When you apply for a loan, the banks want you to present a powerful financial plan which works well for your business. It includes an introduction about you and what the business you want to start is about. The business plan you present should be able to speak about your business goals and missions and also how the business will operate to achieve the goals and mission. A perfect and convincing business plan will help you convince the lender easily.
Explain the spending pattern for the borrowed finances
Banks are interested in knowing about how you are going to spend the loan amount borrowed from the bank. For example, if you are planning to buy equipment, you should seek an equipment loan. In another case, if you need funds to keep your business running prior to the debtors offer you money then make sure you apply for a suitable short-term loan. Hence it is better to explain what you are going to use the loan amount to help the bank assess whether the amount given will take care of all your business needs.
Mention the loan amount you actually need
Before applying for a loan makes sure you do all the calculations to find out the amount of money you need so that it is neither over nor underestimated. The reason is that if you seek less money than you need it can land you in financial problems in the near future. On the other hand, stating an overestimated amount can again put you in trouble as the bank will ask you whether you have made a perfect business plan after conducting thorough research. To put an end to all the doubts make sure you have a better business plan with a proper presentation and a budget.
Be determined about the credit score
Today, all banks verify whether a person who applies for the loan is eligible for the loan. When you apply for a loan make sure you check your credit scores and credit reports. It would be difficult to get a loan if your credit score is lower than expected. If your credit score is low you can try for a loan that is revenue-based. You can put in some efforts to increase your credit score before you apply for a loan from a bank.
Monitor your credit report
At times you could find some errors in the credit report and it happens when you are not attentive. It can pull down your credit score negatively. That is why you need to keep a check on your credit score by checking files of business credit and personal credit. In case you find any errors you can approach the credit reporting firm to get it corrected and increase the score after eliminating the errors. It is necessary to look into credit reports as a low credit score won’t fetch your loan from a bank.
Evaluate the available lending options
Once you check your credit report and find it to be fine, the next you need to do research and create a list of various banks that are feasible to provide the loan type you are looking for. Make sure you pick out the banks that provide loans at considerably low-interest rates and offer approval guidelines that are quite flexible.
Maintain accurate financial records
It is easy to get a loan from banks when you have correct and well-maintained financial statements. Banks check the balance sheets you have along with income statements and cash flow statements. Any help for financial problems contact gtacredit.com or call 416 650 1100
