Finance

business-success

Small Business Success Stories

With the changing face of the economy in recent years and the number of businesses that have gone bankrupt, more and more people are turning to being self-employed, forming their own company or working as a freelancer. And while being self-employed can be challenging, there are plenty of inspiration success stories to show that with hard work, dedication and a good idea, you too can be a successful entrepreneur.

Success stories

Talk about successful entrepreneurs and people like Sir Richard Branson are always among the first mentioned and this is for good reason – an example of someone who has taken an idea, worked hard on it and gone from strength to strength. Other examples include the founder of the Foxtons estate agents, Jon Hunt, who had just £100 to his name when he founded the company.

But the question isn’t so much what these people did but how they did it? What are their secrets to success that meant they survived where others didn’t? While there’s no guarantee that any ideas or theories will ensure success, there are certain principles that the most success all follow that can help anyone starting a business.

Managing finances

Regardless of the type of business, cash flow is king and hanging your business’s finances can be a challenge. One of the key steps to starting a successful business is to get the right advice to avoid common financial pitfalls. Top of this list will always be tax – not anticipating that you will need to pay it and finding yourself facing a large unexpected bill is a common problem for many new businesses.

Getting an accountant is a good step that helps you start as you mean to go on, keeping good accounts from the start and ensuring that you don’t get caught out by the tax man when the time comes around. Good bookkeeping can also help see how the business is doing and if you are in the position to take on more staff or launch new products.

Managing staff

Sometimes you might need extra help but can’t afford to set someone on full time and this is where outsourcing can be great. Outsourcing can help your business remain flexible while gaining the services or skills that you need at the particular time. Using freelancers for anything from bookkeeping to software development to website design can get you the service you need without the long term commitment of taking on staff.

Managing yourself

The other big thing about being your own boss is the self-motivation factor. It can become tempting to relax, take the afternoon off or postpone a job until another day. Make sure you’re managing your time effectively and have some kind of regime or calendar to follow or you run the risk of getting nothing done and therefore making no income. One of the top reasons people return to work is that they don’t have the personality for working alone and there’s nothing wrong with this but if you are organised, motivated and controlled, then you can make it work for you.


organise-debts

Are We a Nation in Debt?

We keep hearing that we are a nation in debt, that even the government must borrow money to function and that it is all going to collapse at some stage. This is probably an overly dramatic view of the situation but it is a fact that more and more of us have debt of some form. So how do we know when it is a problem? And how do we manage it?

Take a step back

Manageable debts are a part of life – mortgages and car loans are two examples while credit cards are something many of use. There’s nothing wrong with having debt but the problem comes when having so much debt you’re worried about it isn’t great. If the debt you have is keep you up at night, then maybe you need to take a step back and look at the overall picture.

There are two common ways to know if you are in a debt crisis. One is that you are struggling to make the payments you need to make such as rent or mortgage, energy bills, credit card minimum payments and then have anything left for food. The other is if your debts (excluding your mortgage) are more than your take home pay.

Re-organising your debt

Maybe you aren’t in a debt crisis but you want to get a handle on things and look to tart proactively working to improve your credit score can help reduce the cost of borrowing. Going out and getting loads of quotes for mortgages and loans won’t do you any good so start by find out what interest rates you’re paying (lots of people don’t even know), and see if you can reduce them.

For example, your credit card may have offer twelve months’ interest free but you are eighteen months on and the APR is higher than other similar cards, it might be worth applying for a different card with lower or no interest rate and swapping the balance. Similar situations can arise with loans and store cards.

Taking new debt

Sometimes consolidating debt can be a good way to save money, improve your credit rating and stop all those little payments coming out of the bank. If you do have to borrow, look for ways to get the best possible credit deals so that you are saving money on what you were paying before as well as making your credit record tidier. Only consider a situation with a poorer interest rate if you are going to save money on monthly payments and this is your problem.

Other tips

Lots of people have claimed for things like payment protection insurance that they were paying and didn’t realise – and a lot of people haven’t done this yet! Make sure you claim back anything you are entitled to and then you can consider paying this off your debts or using the money to replace essentials like kitchen appliances, rather than using a credit card.

Finally, don’t forget all those voucher websites. There are hundreds now and you can save a lot of money with a combination of vouchers and clever shopping. This can ease the situation on your finances or mean you don’t need to use your credit card for something, saving you interest and an increased minimum payment.


make-money

Making Your Money Work When Interest Rates Are Low

Low interest rates have been a fact of life for a number of years now and anyone who is trying to save for the future will find their money isn’t making them a fortune. But how can you make your money work well when interest rates are low? And are there any benefits to those low interest rates?

Tax and savings

Due to low interest rates, tax doesn’t have to be taxing! Quite simply, the less money you make in interest, the less you will have to pay on that money. Currently, if you have a taxable income of less than £17,000, you won’t pay any tax on savings from interest and those with an income up to £43,000 a year can have a £1000 tax free Personal Savings Allowance. This means they can save up to £1000 each year without paying any tax on it. There is an allowance for those earning up to £150,000 but this just £500 a year. there is also a tax-free ISA allowance which for 2016-17 is up to £15,240.

If you are over £1000 and face paying tax on your interest or other savings, then getting good advice/assistance will help simplify your tax returns. Tax is always a complicated process and if you have a large amount of savings, say from an inheritance or from an investment you have made, then an accountant can help you with the tax implications of your investments. No-one wants to have to lose a big chunk of savings to the tax man but it is better to pay what is owed that face a worse encounter!

Should you still save?

For some, there seems to be little point in saving when the interest rates are so low. Effectively, you receive almost nothing in interest. But there is more to savings than just accumulating interest. By having savings, you are in a better position to make a change in your life, be it personal or business.

If you are self-employed or have your own business, those savings could help you expand your business, add a new product line or a new property. Even the experience you gain could help make your kids more entrepreneurial too when they realise that being careful and clever with money can have such benefits.

Shop around for products as even though rates are low, there are still variations out there and it is possible to get a better deal for your savings with a little work. Don’t forget that some current accounts also offer interest on money paid into the account so consider these when looking at options to deposit your money.

Don’t forget a good accountant is always useful to help you understand the implications of your savings, tax that it due and other issues. It is often better to invest a little money in accountant’s fees than to pay a big fine to HMRC for not declaring something or declaring something else too much – it does happen to people every day!