Money
Question: How much money should our 8-year-old son get as allowance? Should we tie allowance to chores?
Answer: Allowance is the most important tool parents have for teaching their kids about money management, yet, only 60% of all parents give their kids a regular allowance. Parent’s reluctance to dole out the weekly dough might be one for any of the following reason:
• They’re uncertain how much money to give.
• They don’t know whether to tie the money to household chores.
• They don’t know much about money management themselves.
Fortunately, there are some generally accepted guidelines and suggestions to help answer these money questions.
Most advisers fall into one of two camps on the amount of money is appropriate for kids. Some believe the best solution is to give a child one dollar for each year of age. Every three or four year old kid who ever sat in a shopping cart or in front of a television is ready to learn elementary lessons about money, but $3 or $4 a week is enough to teach them at first.
By the time children are in elementary school, there needs to be a mutually understood agreement about how that money will be spent, with a parental insistence that a specified percentage of the money goes to spending, savings and sharing. Kids also need to know what expenses they’ll be responsible for. Will they pay for school lunches, or will their spending money be for only discretionary purchases?
By the time the kids are tweens, the savings portion should be further divided into short-term and long-term savings. Some parents agree to match their kids’ long-term savings dollar for dollar.
Parents who try linking money to household chores, though, learn pretty quickly that the system doesn’t work. First of all, once kids have enough money for the things they want, they no longer have an incentive to do chores. Secondly, children should be taught they have basic responsibilities to care for their own belongings and contribute to a smoothly running household. If that lesson is tied to financial remuneration, it’s seen as a reward and something they can decide whether or not to do.
That doesn’t mean, however, kids should never be paid for working around the house. For instance, when children want or need extra money to buy Christmas gifts or attend a special event, it’s not unreasonable to demand they do extra chores to earn the money by babysitting, doing additional lawn work, preparing meals or helping with errands. Younger children who want the latest and greatest electronic games can be required to wash the dog or car, or sort through the games they already have and trade them in at a used game store. By doing so they learn the value of thrift and simpler living.
Startup business loans
Startup business loans becoming more available
New business owners looking for startup business loans knows it’s been all but impossible to get credit since fall 2008, when Lehman Brothers crashed and burned. There are, however, signs that things are getting better, and several things would-be borrowers can do to improve their chances of getting startup business loans.
The Small Business Administration (SBA) processed 12,393 loans in the final quarter of 2009, a total of $3.8 billion; that’s a 200% increase over the number of loans processed in the same period of 2008. While the SBA only guarantees loans, the increase means lenders are again willing to make loans, including startup business loans.
That’s the good news; the bad news is that the final quarter numbers from 2009 are still only 60% of the numbers from the same period in 2007. In other words, things are better, but still very competitive, and acquiring startup business loans is going to be a lot of work and require a lot of investment.
- First off, banks will turn a cold shoulder to applications for small business startups if the owners haven’t already invested everything they have: personal real estate, savings, life insurance and credit cards.
- Scrape together money wherever possible. Young entrepreneurs have opportunities to participate in student competitions with cash prizes. Award winners impress bankers who would rather make startup business loans to winners.
- It might be painful to take on partners, but doing so brings more assets and talents to the table, while reducing risk. And remember, banks want to see a lot personal asset investment before they’ll commit to startup business loans.
- Business plans have to be magnificent and accompanied by polished and professional presentations and personal pleas.
- Start small, startup business loans aren’t awarded to businesses without track records. Wait until the revenues have accumulated to show stability and promise.
Personal lines of credit
When are personal lines of credit a better idea than loans or credit cards?
Personal lines of credit are perfect for those times when you’re uncertain what your total expenditure will be, for instance home renovation projects. Ask anyone who ever remodeled a kitchen if the projected expenses matched the final costs, and you’ll begin to understand one of the advantages of personal lines of credit over loans.
Personal lines of credit lines of credit allow you the convenience of writing a check or using a bankcard to draw on the account whenever you need it. Personal lines of credit are revolving credit accounts similar to credit cards; as you pay down the balance, you’re replenishing the pot of money you might need later
You make payments only on the portion of the credit limit you’ve used. If you have a $35,000 credit line for a kitchen remodel, but have only spent the first $5,000 of it to take out a wall, your payment is based on the $5,000 expenditure rather than the $35,000 loan.
In contrast, most loans are paid out in a lump sum. That means that if you take out a $35,000 loan, you have to begin paying on the full amount right away whether you’ve spent the money yet or not.
One of the biggest factors in choosing personal lines of credit over credit cards is expense. Personal lines of credit have lower interest rates than credit cards. Because of the lower interest rate, more of the payment goes toward the principal of the lines of credit, unlike credit card payments that can go on seemingly forever. Since the principal gets paid off faster, there is always a greater pot of money to draw from as the project proceeds.
Everyone loves the convenience and lower interest rates, of course, but most people opt for personal lines of credit because of the tax breaks they offer. When personal lines of credit are secured with borrowers’ home equity, the interest paid is tax deductible, just like the interest on mortgage payments. An added bonus: home equity lines of credit have even lower interest rates than unsecured personal lines of credit.
So, let’s see … borrowers take out personal lines of credit; secure the credit with home equity to get the lowest interest rates; write off the interest; use the money to increase the value and enjoyment of their homes; and pay off the debt faster.
Personal lines of credit for home renovations are a pretty sweet deal. Let American Unsecured help you sort through your personal lines of credit options and find the credit line that best suits your situation. American Unsecured is a loan-consulting firm and has helped millions of people find the money they need, and they can help you, too.
Small business loans for women
Filed under: Small Business Loans For Women, Uncategorized
Loans for woman-owned businesses
Small business loans for women have always been hard to come by because women often have fewer personal assets than men. That’s not to say it’s impossible to find small business loans for women, but that making the right choices can help get the loan, avoid excessive debt, increase business and decrease stress.
Scaling back on the amount of loan requested so it’s more proportionately in line with personal assets is one to increase the likelihood of obtaining the necessary loans. But how can business owners do that without sacrificing perceptions of professionalism?
- Even though it’s easy to use a free package to design a business website, hire a professional instead. The investment is minimal for an advertisement that has the potential to reach millions of potential customers. Besides that, this is an essential component of a marketing plan that can yield small business loans for women.
- Hire a free-lance blogger to continually update web content and drive traffic to the website. The cost will be roughly $5,000 a year for one or two new posts a week.
- Pay for a virtual assistant to answer phone calls, forward messages, make travel arrangements, maintain appointment schedules and create basic correspondence. It’s cheaper than hiring a full-time employee and boosts professional image and productivity.
- If the goal is small business loans for women-owned home-based business, improving workspace is a tangible use of money that bankers like, whether it’s a business loan or a home equity loan. Private entrances are essential.
- Rent a conference room on an a la carte basis to avoid conducting presentations and high-level meetings in a spare bedroom. Consider women’s centers or local nonprofits if their mission is appropriate to your product or services and will help project a desirable image.
Whatever the intended purpose of small business loans for women, the most important element to the business loan application will be a very detailed business plan that plays up the creativity and resourcefulness it took to find ways to grow the business while achieving maximum bang for the borrowed bucks. Contact American Unsecured for more tips on acquiring small business loans for women.