Tag Archives: Loan

Four Ways To Fund A Buy-Sell Plan

Business Briefs

July 6, 2016

FOUR WAYS TO FUND A BUY-SELL PLAN

There are FOUR ways to fund a buy-sell plan at an owner’s death:

1. Cash Method

The purchaser(s) could accumulate sufficient cash to buy the business interest at the owner’s death. Unfortunately, it could take many years to save the necessary funds, while the full amount may be needed in just a few months or years.

2. Installment Method

The purchase price could be paid in installments after the owner’s death. For the purchaser(s), this could mean a drain on business income for years. In addition, payments to the surviving family would be dependent on future business performance after the owner’s death.

3. Loan Method

Assuming that the new owner(s) could obtain a business loan, borrowing the purchase price requires that future business income be used to repay the loan PLUS interest.

4. Insured Method

Only life insurance can guarantee that the cash needed to complete the sale will be available exactly when needed at the owner’s death, assuming that the business has been accurately valued.

If you had died or become disabled yesterday, who would own and manage your business today?

MESSAGES
from the Masters…

The Four Emotions That Can Lead to Life Change

by Jim Rohn

Emotions are the most powerful forces inside us. Under the power of emotions, human beings can perform the most heroic (as well as barbaric) acts. To a great degree, civilization itself can be defined as the intelligent channeling of human emotion. Emotions are fuel and the mind is the pilot, which together propel the ship of civilized progress.

Which emotions cause people to act? There are four basic ones; each, or a combination of several, can trigger the most incredible activity. The day that you allow these emotions to fuel your desire is the day you’ll turn your life around.

1) DISGUST

One does not usually equate the word “disgust” with positive action. And yet properly channeled, disgust can change a person’s life. The person who feels disgusted has reached a point of no return. He or she is ready to throw down the gauntlet at life and say, “I’ve had it!” That’s what I said after many humiliating experiences at age 25, I said. “I don’t want to live like this anymore. I’ve had it with being broke. I’ve had it with being embarrassed, and I’ve had it with lying.”

Yes, productive feelings of disgust come when a person says, “Enough is enough.”

The “guy” has finally had it with mediocrity. He’s had it with those awful sick feelings of fear, pain and humiliation. He then decides he is not going to live like this anymore.” Look out! This could be the day that turns a life around. Call it what you will, the “I’ve had it” day, the “never again” day, the “enough’s enough” day. Whatever you call it, it’s powerful! There is nothing so life-changing as gut-wrenching disgust!

2) DECISION

Most of us need to be pushed to the wall to make decisions. And once we reach this point, we have to deal with the conflicting emotions that come with making them. We have reached a fork in the road. Now this fork can be a two-prong, three-prong, or even a four-prong fork. No wonder that decision-making can create knots in stomachs, keep us awake in the middle of the night, or make us break out in a cold sweat.

Making life-changing decisions can be likened to internal civil war. Conflicting armies of emotions, each with its own arsenal of reasons, battle each other for supremacy of our minds. And our resulting decisions, whether bold or timid, well thought out or impulsive, can either set the course of action or blind it. I don’t have much advice to give you about decision-making except this:

Whatever you do, don’t camp at the fork in the road. Decide. It’s far better to make a wrong decision than to not make one at all. Each of us must confront our emotional turmoil and sort out our feelings.

3) DESIRE

How does one gain desire? I don’t think I can answer this directly because there are many ways. But I do know two things about desire:

a. It comes from the inside not the outside.

b. It can be triggered by outside forces.

Almost anything can trigger desire. It’s a matter of timing as much as preparation. It might be a song that tugs at the heart. It might be a memorable sermon. It might be a movie, a conversation with a friend, a confrontation with the enemy, or a bitter experience. Even a book or an article such as this one can trigger the inner mechanism that will make some people say, “I want it now!”

Therefore, while searching for your “hot button” of pure, raw desire, welcome into your life each positive experience. Don’t erect a wall to protect you from experiencing life. The same wall that keeps out your disappointment also keeps out the sunlight of enriching experiences. So let life touch you. The next touch could be the one that turns your life around.

4) RESOLVE

Resolve says, “I will.” These two words are among the most potent in the English language. I WILL. Benjamin Disraeli, the great British statesman, once said, “Nothing can resist a human will that will stake even its existence on the extent of its purpose.” In other words, when someone resolves to “do or die,” nothing can stop him.

The mountain climber says, “I will climb the mountain. They’ve told me it’s too high, it’s too far, it’s too steep, it’s too rocky, it’s too difficult. But it’s my mountain. I will climb it. You’ll soon see me waving from the top or you’ll never see me, because unless I reach the peak, I’m not coming back.” Who can argue with such resolve?

When confronted with such iron-will determination, I can see Time, Fate and Circumstance calling a hasty conference and deciding, “We might as well let him have his dream. He’s said he’s going to get there or die trying.”

The best definition for “resolve” I’ve ever heard came from a schoolgirl in Foster City, California. As is my custom, I was lecturing about success to a group of bright kids at a junior high school. I asked, “Who can tell me what “resolve” means?” Several hands went up, and I did get some pretty good definitions. But the last was the best. A shy girl from the back of the room got up and said with quiet intensity, “I think resolve means promising yourself you will never give up.” That’s it! That’s the best definition I’ve ever heard: PROMISE YOURSELF YOU’LL NEVER GIVE UP.

Think about it! How long should a baby try to learn how to walk? How long would you give the average baby before you say, “That’s it, you’ve had your chance”? You say that’s crazy? Of course it is. Any mother would say, “My baby is going to keep trying until he learns how to walk!” No wonder everyone walks.

There is a vital lesson in this. Ask yourself, “How long am I going to work to make my dreams come true?” I suggest you answer, “As long as it takes.” That’s what these four emotions are all about.

QUOTES
from the Masters…

On Networking

“Networking is simply the cultivating of mutually beneficial, give and take, win-win relationships. It works best, however, when emphasizing the ‘give’ part.”

— Bob Burg

“Network continually — 85 percent of all jobs are filled through contacts and personal references.”

— Brian Tracy

“Expand your network by one quality person a day, forever.”

— Mark Victor Hansen

On Opportunities

“We are continually faced by great opportunities brilliantly disguised as insoluble problems.”

— Lee Iococca

“The golden opportunity you are seeking is in yourself. It is not in your environment; it is not in luck or chance, or the help of others; it is in yourself alone.”

— Orison Swett Marden

“Opportunity is a haughty goddess who wastes no time with those who are unprepared.”

— George S. Claso

Celebrate Mother’s – April 29, 2016 Newsletter

Top Ten Mother’s Day Gift Ideas

collection

 

 

America’s Financial Literacy Crisis—and How to Fix It

By Scott Gamm

Could your local high school use an expert speaker on finance? Could your clients’ college-bound kids use a lunch and learn on financial literacy?

Far too many Americans are in the dark when it comes to how best to manage their finances. In honor of National Financial Literacy Month in April, we asked two experts to weigh in on the financial literacy crisis in America.

Both agreed schools need to be doing more to teach kids about finance. “This country has a real lack of understanding of how important it is to get the financial education in as early as possible with our children and as much as possible,” said Carmen Rita Wong, a personal finance author.

Only 10% of states received an A grade when it comes to how best they teach personal finance in schools, according to a report from Champlain College, and 23.5% received an F grade. A-grade states required students to take a finance class in high school in order to graduate.

“It’s just not enough,” Wong said. “The rest of the country needs to understand that this is really vital—just as vital as all of the other classes kids take because this is actual utility.”

Tina Powell, CEO of SheCapital, an investment management platform, said schools are too focused on testing. “There’s a saying in schools that if they don’t test it, they don’t teach it,” Powell said. “While the emphasis right now is on SATs, ACTs, and getting into college, there’s only so much margin that a teacher has that he or she can actually integrate these lessons in the classroom and that’s why we’re not seeing it.”

Wong said parents need to step in and fill the gap that schools have created by not teaching personal finance. “[Parents and teachers] also need education,” she said. “Not all parents have the right advice, and teachers also need to be educated on how to teach this.

Wong said parents engaging in basic money conversations with their kids, such as discussing allowances or explaining credit-card statements, can have a significant impact. “Sit down and practically show them how this all works,” Wong said.

The No. 1 concept to teach kids is limits, Wong said.

“It’s discipline, but it’s also just understanding that if you have $1, this is what it can do,” she said. “It teaches how much you can do with what, and if you want to do more, you’re going to need to borrow more.”

Powell said the practice of delayed gratification is fundamental. “You have to make sure your wants and needs are within reach,” Powell said.

Meanwhile, Powell pointed to compound interest, or interest on interest, as another important concept for parents to teach kids. The powerful effects of compounding interest can be seen when one starts saving early and has decades of time on their side. “Let your money work for you,” Powell said.

Both Wong and Powell agreed that stock-market investing is a critical component of financial literacy and wealth creation.

Quick! Easy! Thoughtful! For a mother, sister, dog mom, aunt, grandma. Buy jars, filling the ingredients and printing out a note card.

Or as a DIY Mother’s Day family project from kids to Mom’s.

The result is a simple, cherished, momento.

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