Bancte’s Weblog

Do you feel like you are in debt prison? Are you in financial turmoil wondering how you can continue to keep everything from imploding on you? Did you know that there were actually debtor prisons in America before the Revolutionary War? Robert Morris, a signer of the Declaration of Independence, was imprisoned in the 1700’s for failure to pay debts. The bible also warns against borrowing more than we can afford to pay. Proverbs 22:26-27 says do not be a man who strikes hands in pledge or puts up security for debts; if you lack the means to pay, your very bed will be snatched from under you.

Credit card use has continued to grow in leaps and bounds. From 1996 to 2005, the total number of bank credit cards almost doubled. In 2004 alone, credit card companies generated $43 billion in fee income from late payment, over-limit, and balance transfer fees. The Federal Reserve reports that the total US consumer revolving debt reached 2.46 trillion in 2007. This large increase in card usage has created a “fee feeding frenzy,” among credit card issuers. The whole credit card industry has really evolved for the benefit of creditors in recent years, with the industry imposing fees and increasing interest rates if a single payment is late. Penalty interest rates usually are as much as 30-39%, while late fees now often are $39 a month and over-limit fees are as much as $35. If you consider how that can add up over just one year, it could be very expensive. Consider this: late and over-limit fees alone can easily rack up $900, and a 30 percent interest rate on a $3,000 balance can add another $1,000. Read the rest of this entry »

Becoming a first-time home buyer is a tremendous step in life. The sense of personal accomplishment, pride, satisfaction, and joy is irreplaceable. It is not without it’s challenges, though. Because of the huge number of options available to you as a potential buyer, you need to take the time to become familiar with an overview of the buying process, the terminology used, and how to best approach buying your first home.

My strong suggestion to you as a first-time home buyer would be to seek competent, professional financial guidance. It is relatively inexpensive, and could save you from making a costly mistake. Buying a home is not right for everyone. Even if it is a good choice for your financial future, you may need to take the time to save money for a down payment, or to fix any issues with your credit. Be patient, and make your preparations carefully…

Below is a list outlining the buying process. Review it to become familiar with the steps involved. Oh, and one last, very important bit of information before you get started…Everything, and I do mean everything, in real estate is negotiable. Repeat that over and over to yourself and never forget, everything is negotiable… Read the rest of this entry »

One frustration all risk managers experience is being brought into the contract process when it is too late to reduce the risk. Only yesterday, I was asked to review a contract for the acquisition of health equipment. When I sent my recommendations back to our contract negotiator I was told “But it’s too late – we already told the supplier that the draft they approved was the final version.”

The best time to negotiate contract terms and conditions is before the contract is signed!

Contract law is complicated, involving numerous federal, state and municipal laws (not to mention internal policies, procedures and protocols!) that apply different conditions depending upon the type and cost of the item under consideration. Read the rest of this entry »

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In today’s litigious society, no profession can escape the cost and aggravation of legal claims and suits. Design Professionals, architects and engineers, are no exception. One important and distinct type of claim or suit is the professional liability or malpractice claim.

A variety of other types of claims and suits may be made against the design professional, such as claims for ordinary negligence, such as automobile liability cases, or slip and falls on the company’s property. There are suits for wrongful employment practices such as discrimination, sexual harassment, or wrongful discharge. Finally, there are suits for commercial disputes over contracts, trade secrets, and patents.

Professional liability claims are unique and distinct from other types of claims because they are made against the professional in relation to the performance of professional services and the specific duties owed by professionals which are not applicable to the public at large. As a result special rules and standards apply to these claims that do not apply to other types of negligence actions. Read the rest of this entry »

Your business plan is typically the first impression potential lenders of investors get about your business idea. Even with a great product, team, and customers, and you are unable to convey to properly convey your image, it could be the last impression if your plan has some of the following, common mistakes.

Lenders and investors review hundreds of business plan every year and with every plan, lenders and investors become more cynical because the same mistakes pop up with regular frequency. With so much competition for a limited amount of capital, it is imperative to not make these mistakes.

1. Financials

Unrealistic Financial Projections - Simply saying that you are going to do $100,000 in sales is not enough nor can you simply say there is no way of knowing. Everyone knows there is no way to accurately come up with financial projections over the next three years, especially in a start-up. But, what is required in your plan is that reasonable assumptions are made and supported with research. By incorporating a detailed list of assumptions and how you arrived at your numbers, the lender/investor can judge your analysis and decision making process. If you are projecting to generate high sales outside of industry norms, explaining how you arrived at this conclusion is a must. Lenders and investors have seen many, many plans that claim sales are going through the roof once funded and as a result are very jaded at statements like this. Financial data that is inconsistent with industry averages and overly aggressive sales figures will raise flags. Explain every number.
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Those of you who’ve been following my articles know that I advocate a different approach to this process: Step 1) Learn whatever you can from last year’s results - something many of us forget to do. For example, make 1998 the year you act on the knowledge that it takes six months to train your field reps, not the six weeks you used to allocate. Step 2) Set targets which will excite you and your team and get you out of bed every morning; Step 3) Figure out how to reach the targets in Step 2. Whatever time of the year it is, you have probably set a working direction for the rest of the year, including clear-cut objectives. Your first-iteration plan to reach them should be in place. This now (whatever time it is - if you are thinking about it) seems like an ideal time to rethink the whole thing, doesn’t it? In our sped-up 21st century world, plans are subject to change just as soon as - or perhaps even before - they are written. Read the rest of this entry »

Those who are “do-it-yourselfers” know that the best and least expensive way to accomplish a task is to pull out the work gloves and get after it. But does that include projects that require construction equipment? There are several things to ask yourself before you decide whether to rent (or buy) construction equipment or to call in the pros.Two of the most important things to consider are cost and size of the project. Have you always wanted a pond? There’s really nothing stopping you from building one if you have enough land and there are no zoning laws restricting it. That’s going to be a pretty big project and you might be surprised how much earth has to be moved to create even a small pond for watering livestock. Read the rest of this entry »

Do you ever wonder why fire truck manufacturers offer prepayment discounts? And the financial implications of prepaying your fire truck? This article helps you understand why they offer discounts and how to analyze them.

Why fire truck manufacturers offer prepayment discounts.

The first question I get asked from hundreds of fire departments is: Why do manufacturers even offer a prepayment discount? It seems like they are losing money. Well, they’re not and I’ll explain why in this article. Read the rest of this entry »

Many enterpreneurs like the glamour of starting a limousine business but the road to their success may be a little bit more complicated than one might anticipate. This article will concentrate on the financing side of the startup investment and try to give the want to be limo entrepeneur a reasonable assessment of what is in store for them.Today, most typical lenders aren’t interested in lending money to a start up business for a limousine service. They consider it a high risk type of business and feel that their investment dollars can be better spent somewhere else in their portfolio. However, there a few lenders out there that feel comfortable in the transportation industry and will lend accordingly. Their bankground might be exclusively in this industry and will cover not only limousines but additionally limousines and shuttle buses, coach and tour buses, ambulances and hearsts etc. Read the rest of this entry »