Hiring A Financial Advisor

The College Loan Scandal ? Evolution & Solution

What started out as informative Financial Aid Nights every fall and evolved into College Goal Sunday in January has now transformed itself into the largest student loan scandal in history!

Evolution

In the fall, when seniors begin applying to colleges, thousands of guidance departments present informative evenings where parents are introduced, often for the first time, to the financial aid process. While most find the system complicated, confusing and intimidating, for far too many this is the only lifeline available in their struggle to afford the escalating costs of a 4-year college education.

Guidance counselors often invite speakers from local colleges including financial aid officers (FAO’s), trusting they will put the best interests of the students over the financial interests of their schools. Unfortunately, however informative these programs may be, what is noticeably absent on the menu is how a family can legally qualify for maximum financial aid and in any other way reduce the cost of college.

Held far in advance of the filing deadlines, it is at such assemblies that parents are lead, or actually mislead, to believe they will receive all the financial assistance needed to send their sons and daughters to the college of their choice. So begins the journey of every college-bound family, innocent and naïve as to the perils that await them.

The plot thickens at College Goal Sunday, a program usually held one week after the Super Bowl at countless locations in over 40 states. Here, FAO’s are teamed with state officials as the main participants to help families file the dreaded FAFSA – but little else. As few financial aid applicants have a clue to where to turn for help, they end up putting all of their trust and faith in these very accessible and obliging agents of the system.

While it is certain their assistance will help guide families through the financial aid filing procedure, showing them how to apply precise and effective legal strategies to ensure their qualification for maximum financial aid will certainly not be one of their goals now or any time soon. The stage has now been set for the annual fleecing of America’s lower and middle income families in what is tantamount to the foxes coming out of their dens to prey on an untold number of unsuspecting chickens!

Considering that the not-so-well hidden agenda of America’s colleges and universities is to enrich their billion dollar endowment funds at the expense of their applicants, is it any wonder that we are currently witnessing a student loan scandal involving several of our most prestigious pillars of higher education?

It is not yet known how widespread the corruption is or how long it has prevailed, but at the University of Pennsylvania, New York University, Columbia and Johns Hopkins, to name a few, families placing desperate calls for help to financial aid offices have, without their knowledge, been rerouted to loan companies under the smokescreen that they will “help” secure the necessary funds to pay for college – but at a price far exceeding what any family should pay.

Unwary borrowers are being pushed down a slippery slope paved with some of the nation’s greediest and most devious loan sharks who have been kicking back referral fees to college financial aid officials for years! But pity not our poor, under-funded institutions of higher learning whose combined endowment funds currently exceed 25 Billion dollars; rather curse them for stooping this low!

Solution

The good news is there is a light at the end of the tunnel. The simple solution to being victimized is to make a nominal investment for professional counseling from a college funding expert. Such specialists are comprised of academics, authors and other financial advisors who, after years of dealing with the system, have developed the expertise to beat the colleges and the federal government at their own game!

While this option has been available to families for many years, ironically, most never considered it. Yet, every year, those very same families think nothing of hiring a tax consultant. This makes absolutely no sense whatsoever when you consider the cost of just one year of college far exceeds the average family’s tax liability! Imagine if you will, an Income Tax Goal Sunday sponsored by the IRS. What do you think are the chances they would offer tax planning strategies to reduce your annual tax bill? Absolutely none!

Prescription for success

Step One: Beginning in the 9th grade, parents should work closely with guidance counselors on the inside while working even closer on the outside with a college funding professional. This combined effort will ensure the student obtains that all-important edge absolutely essential in today’s intensely competitive admissions process.

Step Two: By implementing specific income planning and asset repositioning strategies, any family can legally qualify for maximum financial aid. With the expert counseling of a college funding professional, students will be able to appeal unappealing financial aid offers and negotiate for the best possible financial aid package.

In no other way will the happy ending of cap, gown and sheepskin be realized at a cost significantly below what most families ever imagined. Once again, it is simply a matter of making a decision to take the road less traveled; a decision made even clearer by the despicable behavior of many of our colleges and universities…

Money Management Tips For Working Women

Ever wondered why there are numerous articles written about women and money management. The reason is working women find themselves in unique situations – home maker, mother, caring for the elderly. Working women experience greater disruption in earnings in their life as they take career breaks for different reasons – relocation due to marriage, to raise children, tend to their elders or accommodate family contingencies et al. Statistically it is found that women generally spend seven years out of the work force to have and raise children. In the long term however, such disruptions hurt the family’s wealth creation and though a woman and a man may have started their careers at the same time, she ends up earning far less when they both retire.

Also, studies across the globe show that periodic income disruptions make women risk-averse. This means that they invest in lower-risk and fixed-income investment options such as fixed deposits and bonds for fear of losing money due to factors such as stock market fluctuations. The outcome of the preference for fixed-income assets is obvious. The woman’s savings will not suffice in her old age, and she’ll have to depend on the retirement funds of her husband, or other sources. And then there is the reality of a divorce which can be even more painful for dependent spouses. Regardless of how modern the majority claim to be, studies indicate that they lag significantly behind in one area compared to their male counterparts -   that area is financial planning. Most women leave the management of their finances to their fathers/husbands. Failure of marriage, unequal inheritance of wealth, non avoidance of old age, etc all the more necessitates us to be self reliant.

However, taking into consideration the above factors, women need to have a holistic financial plan, that too from a very early age in order to make good the time lost in such career breaks . In the current scenario, personal empowerment and financial independence are the need of the hour. After all financial independence is true empowerment. You know you are empowered when you do not need anyone to tell you how to live your life or spend your money. Also, whether or not a woman has her own income, she still needs to know how her family’s money is invested. Therefore, all women need to step up and learn how to play with the boys. There is no longer a justification for you to not participate in the financial planning that will lend itself to your future.

The following are money management tips (though not exhaustive) which will help women mange their finances better:

Begin Early: One should take managing their finances early on. There is some magic to be found in “compound interest”. The earlier you start the smaller amounts you can invest for a higher gain. Also, when you start early (and continue to invest) you can take greater risks (like investing in equities, equity mutual funds). But remember that compound interest can only work its magic if you give it time. So, start saving now, if you have not started yet! Inflation and interest rate risk eat into the purchasing power of your money if you parked your money in lower risk investment instruments. So investing early in growth assets like equities and equity funds is imperative. Don’t limit yourself to conservative investments such as money market accounts and CDs. Use asset allocation to diversify your portfolio.Build an emergency fund. Ideally 6 months’ monthly expenses could be put in a liquid fund. Without one, losing your job or incurring a large unexpected bill could force you to take on heavy credit card debt, and could put you into a financial hole that will be difficult if not impossible to dig your way out of.

Cut down Expenses: Cutting down on impulsive expenses and spending money prudently and training the same to children goes a long way in sensibly managing your money.

Invest in Insurance: Insurance is a must investment to protect yours and your family’s health costs and your physical assets. Also to provide financial security to your dependants in your absence. Insurance helps transfer the financial risk from one party to another, i.e., from you to your insurer.

When together, plan your finances together: Invest jointly with your spouse. Share expenses. Ensure expenses are covered by one income, try maximum to avoid loans to help you quit your job if needed. Ideally all money matters should be discussed by couples. Be prepared for the worst; even if you don’t want to take complete charge of your financial future, try and understand where the money is coming and where it is going.

Educate yourself: Personal financial planning and management is not complex. All you need to do is to understand your life goals and plan as per your requirement. You could read some useful books to educate yourself about the subject. Then even if you hire a financial consultant due to lack of time to self manage, you would understand what he/she is doing with your money. Suggested books are given at the end of the article.

Become aware of benefits given to women under different laws: The following are the benefits given to women under different laws:

Income Tax Act, 1961 – Total income of up to Rs 190000 per year is exempted for woman assesses (below 65 years of age)

The rates of income-tax for FY 2009-10 (AY 2010-11):

Married Women’s  Property Act, 1874: Under MWP the spouse can assign his life insurance policy in the name of the trust created for the benefit of his wife and/or children. The money set aside in this form is free from creditors, court or tax attachments (even in case of insolvency) forever, provided that the trust under MWP has not been effected to defraud the creditors. The MWP Act, 1874 creates a ring fence protecting the interests of the beneficiaries and safeguards the family against uncertainty of future and possibility of adverse financial conditions. Alimony: The purpose of alimony is to avoid any unfair economic consequences of a divorce, even after property is divided and child support, if any, is awarded. For example, a Muslim woman would be entitled to maintenance from her divorced husband as long as she doesn’t remarry.

Estate planning (Wealth Transfer): An effective estate plan can be made by the couple jointly. As the surviving spouse (generally the wife) is likely to end up being the executor of her husband’s estate plan, so ignorance cannot be afforded. It is useful to keep a record of inventory of assets and their beneficiaries for smooth transition of assets to the intended beneficiaries.

These are some important things to consider in your financial planning that are not very different from how a man may approach the same subject. The key is to start early and continue being invested. As a woman, you have a longer life expectancy than a man does. Therefore, your financial planning must encompass the fact that you have more years to fund. Having your finances in order is just one way that you can move toward your ideal lifestyle. Maybe your goal is purchasing the home of your dreams, or going into business for yourself. An active and independent retirement is also a goal. Many people no longer feel confident that they will be able to rely on pensions or social security checks after they have retired. Most goals take more planning than just a savings account and good intentions. Financial Planning involves long term strategic involvement … but it is worth it.

By sticking to your financial plan you can avoid excessive spending and unmanageable debts. You will have a sense of freedom from financial worries that comes with lack of planning, so that you can use your spare time in activities you desire to do but don’t have the time for.As quoted by Diane Ackerman, an American poet, “I don’t want to get to the end of my life and find that I lived just the length of it. I want to have lived it the width of it as well.”

You can take the help of a good financial planner to manage your money. To streamline the paperwork and administrative work of financial planning, many of today’s best advisors turn to technology. Investmentyogi provides you with a personal financial software that aggregates all of your financial investments, savings, accounts, etc. onto one easy-to-use web page – giving you 24/7 access to all of your financial information in just a few clicks of a mouse. Check it everyday, check it once a month, check it once a quarter, it’s up to you. The point is that it is there, organized and at your fingertips, when you need it.

For more information go to investmentyogi.com

Is the Flight Attendant Flying the Plane? Mismatching Skills Causes Many Businesses to Crash

In this article I’d like to present what I consider to be a major flaw in thinking that occurs in many small businesses.

The first time we meet with a prospective client to review their accounting & financial matters, we have an informal “needs analysis” discussion. A variety of common issues come up in these discussions — cash flow, lending relationships, profitability, clarity/accuracy of financial reports, to name a few. Most business owners I talk to are experiencing one or more of these issues, but they don’t all share the same problems. It’s generally a combination of a few different things.

Except for one.

Before I share it with you, let me ask a couple of questions:

? Would you hire the office manager from your brokerage firm to oversee your investment portfolio?

? Would it be sufficient to use a paralegal to provide counsel on important legal issues?

? Would you be comfortable if the nurse or intern performed your surgery?

? On your next business trip, would it be OK if the flight attendant took over the cockpit controls and flew the plane?

These sound like ridiculous questions, right? But consider this all-too-common, real life business example.

I spoke to the owner of an $8 million dollar business that was struggling. Cash was tight, margins were thin, and the bank was giving them pressure. The person responsible for accounting at this company was transferred into the position from Human Resources. . . because they had some prior experience. . . years ago. . . working in. . . accounts payable.

How is this real life situation any different from the “crazy” questions above?

The One Common Problem

The one issue that many small businesses have in common is this: the primary financial person in charge of overseeing the owner’s biggest investment (i.e., the company) is in most cases a bookkeeper with little or no formal training and no real experience in accounting beyond day-to-day transaction processing. And often times, even that is hit-and-miss.

The financial oversight of a multi-million dollar business is done–intentionally or unintentionally–by a clerical bookkeeper.

How is this person going to help you build value in your business?

Mission Impossible?

Many businesses today have a Mission Statement. A typical mission statement might read something like this:

?”We strive to be the recognized leader in the ________ industry.”

?”To be the premier provider of ________ products.”

A lot of lip service is given to mission statements these days, so let’s view our bookkeeper situation through the lens of the mission statement.

Do “industry leaders”. . .

? Use financial statements that are inconsistent and inaccurate from month to month?

? Wait 3-5 weeks after month end just to get their inaccurate financial statements?

? Operate without a budget, or projection, or any written plan?

? Have uncertainty as to whether or not they’re going to make payroll next week?

? Rely on clerical people to assist them in building value in their business because it’s “cheaper”?

Obviously, not every business can be the industry leader. . . and not every business wants to be. But if we substitute the words “Well run businesses” for “Industry Leaders” in the above set of questions, the answers are the same.

It’s going to be very difficult to be the leader in any industry if you don’t know more about your numbers than your competitors know about theirs. And you’re not going to get there by relying on a clerical bookkeeper.

And, it’s not the bookkeeper’s fault. They were hired to be a bookkeeper. Not a financial advisor. Not a Controller. Not a CFO.

A Critical Competency

To build value in your business it is critical to know your key numbers inside and out. It is critical to know what happened (past), what is happening (present), and what is likely to happen (future). . . and plan accordingly. Without this critical competency, you’re merely “hoping” things are going to work out.

If you’re not planning you’re hoping. And in the words of best-selling business author Dan Kennedy:

“Hope is not a strategy.”

The Seven Steps to Torpedo Your Estate and Tear Apart Your Family

If you currently have a trust, or are thinking of setting one up, this checklist from my book, The 7 Biggest Mistakes Trustees Make and How to Avoid Them, will show you what the most common and serious mistakes are and how to avoid them.

Each one of these seven mistakes has the potential to ruin your financial plans and to turn family members against each other. Here they are in brief:

Mistake #1 – Failure to Communicate: Failing to communicate properly with all the parties involved with the trust is, perhaps, the biggest mistake trustees make. From my experience, parents must deal with three important predicaments before considering advanced planning:

Do we have enough money to last the rest of our lives?

Do I want my spouse to know all the financial details of the estate?

Do we want our children to know all the financial details of the estate?

I have also found that once planning takes place, children must also deal with two common reservations:

1.      I don’t feel I should interfere with my parents’ finances.

2.      If I take an interest, will I be perceived as being greedy?

 Through my experience, families that avoid mistake #1 have a foundation that is able to withstand almost any type of problem in the future.

 Mistake #2 – Failure to Hire the Appropriate Advisors: Estate planning is a growing sector that is becoming more complex with its constant changes. Every year laws are revised and added. It’s important that when it comes to making important financial decisions that you consult professional advice from a team made up of: attorneys, accountants, and financial planners.

Mistake #3 – Failure to Follow the UPIA: This mistake is more legal in nature than the previous two. It involves the UPIA, or, more specifically, the lack of knowledge of it. UPIA stands for Uniform Prudent Investor Act. Do not ignore this new law! Ignoring this law increases your chances of being sued. It provides an easy way for a disgruntled heir and a slick lawyer to prove that a trustee is unfit to manage the trust, and owes significant amounts of their personal money back to the trust.

Mistake #4 – Failure to Follow the Terms of the Trust: The most important part of estate planning is the trust. The trust is something that should not be taken lightly. It must be well thought out and written to express your exact desires. There can be no ambiguity in a trust. There can also be no assumption that your heirs will know what your intentions are. You must be as specific as possible when writing this document.

Mistake #5 – Failure to Minimize Liability and Risk: The trustee has many duties and responsibilities to the beneficiaries. The trustee is the protector of the assets. He is responsible for not only maintaining the current level of investments, but also ensuring that the investment will grow at a reasonable rate of return over the years. When planning for future finances that involve minimizing liability and risk, there are three areas to be considered: long-term sickness, taxes, and general lack of knowledge.

Mistake #6 – Failure to Review Regularly: A common mistake among trustees is the failure to review the trust regularly. Your life changes over time. So it is necessary to keep on top of these changes. The review process is divided into three critical areas: investment strategy, trust assets, and advisors.

Mistake #7 – Failure to Treat it like a Business: As a trustee, you need to think of yourself as a manager. You have a finite number of assets to manage, and your long-term goal is to make them grow. This is your business. Separate yourself from the beneficiaries, even if you are one. Think of them as shareholders, and it is your job to maximize profits without taking on too much risk.

You are accountable to the beneficiaries for your actions. It is your job to protect yourself and do the best job possible. You are taking on a great liability, so you need to make sure you get good advice.

There are many decisions that need to be made over the life of the trust, many which are not pleasant to make. Some even have absolutely nothing to do with assets or money. Yet, they must be faced. The more aware you are of the potential problems, the better trustee you will become.

CFO – They Can Help In Many Ways

Deciding to hire a CFO might seem like a major decision but really it is more of a common sense decision. No matter what type of business you own, chances are good that you could benefit from a CFO. They can help your business in many ways including helping you obtain cash. In this tough economy today, many businesses are struggling and the help of a CFO can be instrumental in surviving these tough times.

If you are not able to obtain cash and financing on your own, hiring a CFO can help you. In many cases, a CFO knows what specific lenders and banks will want to see from you before you are able to get financed and they can help you do the things you need to do first. If for some reason you are not able to get financed through traditional means, they can also help you find financing through private investors or taking cash out of your business equity if that is possible.

Do you want your business to be a success? Of course you do! If you are considering hiring a CFO they can give you more benefits than just helping you obtain cash. They can also perform functions as a business and financial advisor. One of the greatest things about having a CFO come into your business is that they bring with them years of experience and knowledge in all aspects of running a successful business. Not only do they have their own experience to work from, if you hire them from a company that partners with them and other CFO’s then they have all of that extra help and advice from them as well.

It is normal to worry about what the effects will be when you are making changes to your business and whether or not the choices are the right ones. If you decide to hire a CFO you won’t have to worry about that because hiring one is a choice you won’t question. Getting your business headed in the right direction is something they can help you figure out. If your business is already healthy and headed in the right direction they can also help you to come up with the right decisions for growth too. See what a CFO can offer your business, don’t hesitate any longer. See what your business has been missing, now is the perfect time.

Make your money work for you ? Get the best finance and investment deals

Money is a commodity which is common with everybody across the world. All of us need to have an adequate amount of it and manage it well. In a broader sense, managing finances is imperative to everybody. Be it a single person or a household or a business house. It’s importance is equal everywhere. And looking at today’s economy with soaring prices of commodities, increased cost of living and prevailing inflation, it becomes all the more important to manage our finances well so that we live wisely and secure our future well financially. Financial planning needs a pro-active approach from your side.

Simply, because the money involved is yours to spare or spend. There are many companies catering especially to this need. They have experts in financial management who analyze and take stock of your finances and draw out possible ways to invest your money in the right places. You need the best financial advice for this purpose. One way to ascertain this is by using various online tools which assist you in evaluating your finances. You can opt for this option if you think you cannot afford to hire a personal financial advisor.

There are many financial laws which protect you from any fraud and malpractices. So, the best financial advice is always there for you, provided which option you choose to work with. A good finance advisor will never want anything more from you except your time and the legitimate fees. It always works good in the long run, since your finances are completely organized and well managed. So, act today and make a wise decision in giving yourself the gift of the best financial advice you have always been looking for. It’ll ensure you get to plan your finances the right way, spend wisely, save enough and invest your hard earned money in the right places. Log on to www.financedealandinvestments.info for more information.

Learn How to Make Your Money Work for You!

Do you consider yourself financially fit? Are you able to manage your finances properly, focus on wealth creation and enjoy financial freedom? If not, you are certainly not alone. Statistics reveal that consumer and mortgage debt has reached record highs. More people are declaring bankruptcy, sinking into debt and struggling to make ends meet than ever.

Poorly managed finances and limited investment education can cause intense stress, strain on personal relationships and constant struggles. On the other hand, if you discover the secrets to creating wealth, you can enjoy more disposable income, reduced stress and a healthy retirement income. You can purchase that dream car you always wanted, take a much-needed vacation or spoil your grandchildren. With the help of a financial coach, you can learn how to make your money work for you!

* Hire a Financial Coach

One of the first steps to managing your money and building wealth is to hire a financial coach. Talk to family and friends, conduct research online or call local resource centers to find a reliable individual. Don’t be ashamed to ask for help. Seeking financial coaching can be the wisest decision you ever make; an experienced financial coach can help you regain control of your finances and achieve financial independence.

* Create a Budget

If you don’t know how to create a financial budget, you need to start now. One of the secrets to wealth building is to keep track of all your income and expenses. If you don’t know where your money is going, you can end up in serious financial trouble in a relatively short period of time. Many people who begin budgeting are very surprised to learn just where their hard-earned money is being spent each week. Those fancy lattes from Starbucks and frequent restaurant dinners can really add up over time. You will gain better control of your finances by making minor adjustments to your budget and controlling exactly where you are spending your money.

* Organize Your Financial Documents

The way to wealth also involves organizing your financial documents. Are you guilty of scribbling important financial notes on the back of scrap paper? Do you toss your financial statements all over your home? Well, it’s time to stop! If you don’t already own a filing cabinet, purchase one. Create individual folders for your various financial categories, bills and expenses. Then, make it a habit to file any financial documents as soon as you receive them. You will never have to worry about losing or misplacing an important paper again.

* Learn To Interpret Your Financial Statements

Does your financial statement appear foreign? You may not even read the document before tossing it aside. Well, it’s very important to learn how to interpret financial statements. These papers can make the difference between financial freedom and a life of debt. If you don’t understand the information on your statements, don’t be afraid to seek help. Talk to a financial advisor or your financial coach so you can learn how to interpret your statements correctly.

* Discover Your Net Worth Number

Successful wealth creation also involves a very important number – your net worth number! Surprisingly, most individuals have never even heard of this. It’s essential that you learn this number so you understand your current financial situation and can seek suitable financial investments. Calculating your net worth number incorporates your cash and cash equivalents, tangible, fixed principal, debt and equity assets and liabilities. There are online calculators that will help you determine your net worth number. However, a financial coach can simplify the process and help you interpret the results more efficiently. Once you know your number, you can take steps to improve your situation that will lead the way to financial independence.

* Create a Diverse Investment Portfolio

Investing in different areas is one of the keys to achieving financial success. You need to diversify your investment portfolio to maximize your wealth creation opportunities. Talk to your financial coach to see which investments best suit your situation. Factors such as the amount of your disposable income, your desired risk levels and your financial goals all play an important role in determining the most suitable investment options. Consider various areas such as real estate investing, RRSPs and stocks.

If you want to enjoy financial freedom and successful wealth creation, one of the most important secrets is to hire a reliable financial coach. An experienced and knowledgeable individual can help you create an effective budget, organize your financial documents and interpret your financial statements. A financial coach can also help you calculate your net worth number and choose a diverse investment portfolio that works best for you. With some assistance, dedication and determination, you can learn how to make your money work for you!