First Financial Coach

Article by Richard Shaw

Shaw Capital Management and Financing sharing information, tips and advice on factoring and accounts receivable financing and factoring to avoid scams and other fraudulent transactions. Information focus on the importance of choosing the right firm and understanding the intricacies of this financing alternative and what pitfalls to avoid.There probably isn’t a day when Canadian business owners and financial managers don’t hear about factoring and accounts receivable financing as a method of financing their business in Canada. Despite its growing popularity and, we can say, relative importance in the Canadian business financing marketplace this financing mechanism is still somewhat understood.What information do business owners need to know in order to assess if factoring, also known as invoice discounting, is a viable transaction? Also, are there mistakes and pitfalls to be avoided when considering this financing strategy?Let’s examine the answers to some of those questions. You can be forgiven for trying to figure out why factoring has increased in prominence from a time when no one had almost ever heard of it! The answer to that popularity is more simply and obvious than you might think, and its simply that Canadian chartered banks are finding it increasingly more difficult to fund accounts receivable (and inventory of course) to the extent that their customers need this financing.When you have a situation where the actual need for financing is acute, and the benefits and flexibility seems significant it is not hard to see the rise in popularity of such a financing mechanism.First of all, 99% of the time, factoring provides your firm with a greater level of borrowing based on your accounts receivable levels. Quite of 90-100% of you’re A/R under 90 days can be financed.So is it all good news? Not necessarily, as we are always meeting with clients that have chosen the wrong type of funding or factoring, and, even worse, find them locked into contracts they cannot get out of. That is uncomfortable for any size firm as you can imagine.As with any newer type of financing the playing field is complex. You can be forgiven for not knowing how many factor firms are out there, how they run, what their own limitations are, and, even to a certain extent, do they in fact themselves have the funding to survive, let along finance your firm. For that reason we cannot over emphasize the need to work with a credible, experienced and trusted professional in this area.Lets talk about some of the nuances, we can call them potential ‘pitfalls ‘also, of picking the wrong factoring partner. For a starter if you choose a firm who itself is not well capitalized, as we said, you might find that the financing commitments made to you cannot be honored. Canadian business has never had to think that the Canadian chartered banks could be ‘out of money ‘but the Canadian landscape is somewhat littered with small and medium sized factor firms that do not have the financial wherewithal to support their funding commitments in all places. That just re – enforces our idea that a trusted industry expert will guide you to the best partner for your firm.Other issues, again, we can call them pitfalls, to look for include:- being locked into a contract- having the total factoring cost, or pricing, not reflected properly in your term sheet- advance rates which don’t make sense relative to the price you are paying for discounting invoices- Excessive notification and intrusion with your customers, which is very prevalent in the U.S. model of factoring (Many Canadian factor firms are branches of U.S. firms)So let’s recap. It’s simply that factoring is growing in popularity. It works because it is providing funding where banks often cannot. If you don’t understand who you are dealing with and the various nuances of this type of financing it becomes a burden, not a solution. Investigate this great financing mechanism, but ensure you know what you are getting into. Talking to an expert always helps – that’s just common senseStan Prokop is founder of 7 Park Avenue Financial. Originating financing for Canadian companies, specializing in working capital, cash flow, and asset based financing, the 6 year old firm has completed in excess of 45 Million $ of financing for companies of all size.

Article by Stan Prokop

Your worst business nightmare just occurred. You got the order/contract! Now what?!Purchase order financing is a great tool for firms that have unusual purchase order and contract sales financing needs but are potentially unable to access traditional financing via banks or their own capital resources within their firm. How does trade finance P O financing work, does your firm qualify, what are the costs, and how does it work? Great questions, now let’s explore some answers!Typically Canadian firms looking for this type of financing are distributors, manufacturers, or perhaps wholesalers. A variety of industries in Canada have access to this type of financing, but those certainly tend to be the typical firms needing assistance. Your need for purchase order financing arises out of what we call the classic working capital gap. What do we mean by that? It’s a case of your suppliers requiring payment either up front or within 30 days, with your firm unable to generate those funds for payment and therefore unable to fill large purchase order and contracts in your favor. Your supplier is asking your for payment in advance or 30 days, and you wont receive payment for at least 60-90 days, perhaps more depending on your build cycle, etc.Naturally you don’t want to turn down orders or lose competitive market position.The obvious solution for low cost large amounts of funds are Canadian chartered banks, but our observation is that many firms simply cant satisfy the banks requirements for this type of financing to occur. If your firm is growing, profitable, has a clean balance sheet and strong historical cash flows and history you of course have a solid chance of meeting bank requirements, however that typically is not the case, certainly in the amount of clients we talk to who are looking for alternatives to their growth challenge!When you access p o financing you can have comfort that your suppliers will be paid, and at the same time you generally have access to all the funds you need. Typical purchase order financing applications take anywhere from 2-4 weeks to complete and involve basic financial due diligence on your firms ability to fulfill the order, who your customer is (they must be credit worthy), and your proper supplier sources must be identified and vetted. It’s as simple as that. So what are the basic pre requisites for a solid P.O. Financing deal? Naturally your company must be in possession of a contract or order that is not cancelable by your client. The P O finance firm arranges to pay your suppliers directly, that alleviates all you cash flow and working capital concerns. The transaction is completed when you ship the goods and your receivables are generated on the sale. It is at this time the purchase order finance firm expects to be paid, and this is traditionally handled by your firms monetizing of its receivable via a bank or factoring facility. Factoring facilities are great partners to the P O financing strategy, because use of them guarantees payment to your P O firm.Let’s cover off a couple tips and secrets around the cost of purchase order financing – It generally is in the 2-3% per month range in Canada, and that means you have to have solid gross profit margins in order to be able to sustain the finance charges. But let’s be honest, let’s say your firm has been doing 750k of revenue for the last couple years and you finally get the large order from a major customer for 1 Million dollars. Wouldn’t you give up 2-3 % of your profit margin in order to make one sale which is the equivalent of your entire year’s business? We think you should positively consider that! Clearly the higher cost of this type of financing covers off the complexity and risk that the P O finance firm takes in paying for goods, waiting to get paid, and having the belief that your firm will fulfill the contract order. It has been our observation with certain clients that your successful completion of a purchase order finance deal typically significantly enhances your relationship with your major suppliers and of course customers, that’s a secret benefit that is intangible but invaluable at the same time. Is P O financing for everyone. Maybe not. Could it be possibly the solution to major working capital needs if your business is growing and can’t be financed traditionally – we certainly think so? Speak to a trusted, credible and experienced purchase order finance expert to explore your options.

The current national debt in the United States is starting to reach a staggering trillion. Households are borrowing more and more with mortgages and credit cards now accounting for a large proportion of a households debt’s. One of the reasons for this increasing debt is that we have come to embrace the consumerism lifestyle where instant gratification has become the norm. Instead of saving up as previous generations once did, the availability of credit has enabled many who are in a position to least afford it, to go out and live a lifestyle far beyond their financial means. So how can we turn things around if we have been caught in this endless cycle of debt. The first thing you need to do is realize that there are professional help available. If you want to turn your financial circumstances around then finding yourself a good financial advisor should be high up in your consideration.

With the abundance of financial advisors out there how can you know which one is right for you.

The first thing you should do when looking for a financial advisor is to ask family and friends for recommendations. The same way you would get a recommendation for a doctor or accountant. Try to ask friends and family who seem to have their financial lives on track. Otherwise if you don’t have any quality recommendations to work from then call up the financial planning association and ask for a few recommendations.

Then schedule a meeting with the financial advisor. With many firms the first meeting is free and its an opportunity for you and the advisor to meet each other and get to know a little bit about each other. Don’t be afraid to ask lots of questions on this first meeting. There are no silly questions and you can be sure that no matter what your question is that they have more likely than not heard it before and would be happy to answer it for you. You want to know how well you get along with this person and if you want to have them managing your finances.

Find out about their background, experience and credentials. You want to know if the advisor has the necessary background to be able to advise you suitably. Know who their general clients are. If you find that the first specializes in doctors and you’re a public servant then they may not be as suitable for you as managing high net worth individuals like doctors is very different to managing public servants. So you want to know who their typical clients are.

Ask about their fee structure and how commissions are charged. Find out if they are affiliated to any particular products and what commissions they are provided for selling these products. Some financial advisors are owned by banking institutions or the like and therefore may push their parent companies managed funds ahead of more suitable funds for your situation.

Once you’ve decided with your financial advisor the first step they will likely take is to find out your current financial situation and design a financial plan for you to follow and implement.

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Many of us are not familiar about the facts and aspects pertaining to Financial services like mortgages, insurance, investments, loans and other financial matters. Currently, there are no of Financial services providers available. But one should be very careful while seeking Financial Services. It is wise to seek professional advice from a financial advisor. To achieve your financial goals, it is important to choose a competent and experienced financial advisor.

In most of the cases, people get a financial advisor on recommendations from their friends, colleagues and relatives. Although these recommendations are always desirable, it is equally important to confirm about the particular financial advisor that whether he’s willing to offer you the best services tailored as per your needs. It’s advisable to talk to different financial advisors and compare their financial plans they offer. Here are a few valuable tips for choosing a financial advisor.

1. The first and the most important thing- confirm about the qualification of the financial advisor. Whether he has a certification as a legitimate financial planner or an accountant, or a bachelor’s or master’s degree in financial planning or business administration. Is he a Juris Doctor or an investment adviser registered. Educational qualifications are of paramount importance as the qualification signify that the person has undergone extensive training in his field and is therefore qualified to give financial advice.

2. Confirm about the type of financial services being offered. These services vary from planner to planner, depending on their qualifications, work experience, work permits, and financial literacy.

3. Verify whether the financial advisor a registered investment advisor with the Securities and Exchange Commission (SEC)?

4. Does he has a federal license Securities of the National Association of Securities Dealers. It is important if you will sell you securities.

5. Ask about a criminal record of regulation from the financial advisor. A sale of professional values will be a central repository for recording (CDR) file, giving its complete detailed work.

6. What is the Experience of the Financial advisor? It is very important to confirm that how many years of experience does the financial advisor has got in his respective field. Ideally, A financial advisor should with at least 5 years of business experience is ideal.

7. How many customers do the Financial advisor has? There should be enough customers to offer experience and respectability, and not as much as to indicate a lack of time to attend to your needs.

8. Try to know the category or type of clients. If there are other customers like you, the financial advisor will be better equipped to deal with your type of finances.

9. Confirm about whether that the Financial advisor will himself assist personally or will assign you a member of his office. Most planners have a personal finance good size to help with the work, then it should not be an issue. This will let you know that who will be handling your personal portfolio.

10. Do ask about some references from the Financial Advisor. He must give you at least 3-5 references.

Clarify all your queries that you do not understand, and take note of all the other things you want to know. Please do not hesitate to ask for. All the above mentioned tips will help you a lot while looking for a suitable Financial Advisor. You can also look for Medical Financial Services at  http://www.medicsfs.com/ .

Online financial services have become a popular way for people to take care of all their monetary needs from the comforts of home. Whether it’s planning for the children’s future, for your own retirement, investment planning, or simply managing your assets, utilising one of several reputable financial services who have set up shop online may be worth considering.

If you don’t already have a specific service in mind for your unique financial needs, ask family and friends for their recommendations and look online for reviews and comments from those already using the service or company.

Protecting Your Privacy First

Protecting your privacy should be one of your top priorities at all times, as while it may be perfectly safe to do things such as your banking online through a secure, protected site with a reputable financial service, the overall safety relies greatly upon you the end user and the choices you make. Remember your financial service will not send emails asking for your password or other sensitive information, and when it doubt, always contact the company via telephone before doing anything.

When it comes to handling your finances online, protecting your privacy also entails the important matter of keeping your passwords safe and secure. Don’t choose a password with your birth date or address and instead create one that’s completely unique and meaningless, writing it down and keeping it in a safe place and also changing the password every month or so.

Your computer should be equipped with the latest antivirus software and firewall protection in order to keep prying eyes away from your vital, personal information. Any financial services you deal with should also have a secure, encrypted website and those details should be easily visible on their website.

Also never access any of your accounts from a computer in public places such as a cafe, coffee shop, or library.

Online Investing

There are currently a wide range of solutions available for those looking to invest either for growth or income potential. It is a well known fact that people today are simply not investing enough for their retirement, and with longer than ever life expectancies it is imperative to fully plan for the years ahead.

Some online financial services to take advantage of include tax efficient investing, collective investments, and bonds. An online financial planner will be able to recommend the best course of action dependent upon your future plans and offer advice regarding potential returns as well as the level of risk involved.

Protecting Your Future

As we all very well know, life can often be unpredictable so it’s important to protect for the future, and not just in terms of retirement but in the event of an unexpected and expensive or life changing event.

With careful planning and attention to detail, safeguarding your family when it comes to matters such as bereavement includes preparing a will that will be tax efficient for your family and finding viable ways of reducing your IHT (Inheritance Tax) liability, all of which are possible with an experienced online financial service.

Also be sure to take advantage of your service’s resources on their website which often include helpful tips to read or download to print for later, or informative brochures, guides, and tools to give you everything you will need to make sound financial decisions.

With the entrance of the population of aging baby boomer in their 60s, our society is presently trying to enter a time where there will be test over the boomer generation’s financial planning and is put into correct action. Did they have been able to save sufficient enough? Did there plan operate in an appropriate manner? Is their financial home in proper order? And for those people that are in their 30s and 40s and planning to accumulate their fortune, they are also now starting to plan in an appropriate manner, or at least applying efforts to. And the profession of Certified Financial planners (CFP) or Financial Planning enters into this entire mix as they are more legitimately called.

Financial planners provide assistance to all types of families

A clear need is something that the financial planners exactly meet. These individuals gain talent and capability of supporting individuals, extended families, couples, and businesses with arrangement of their financial life for providing the prefect and best security as well as return on the investment. Of course, the financial planners are well-known particularly for their proficiency in financial products of numerous types. It’s necessary for them to be perfectly versed in bonds, estates, stocks, mutual funds, trusts, corporate structures, and wills. Numerous financial planners are also trained well in planning itself. Actually, it’s a discipline to know where to invest your money in order to gain some greater profit, and also gain knowledge regarding the order to do it, at which age, and in which amounts.

Criteria in Choosing a Financial Planner

It’s really an essential task to find out a financial planner that is skilled in planning activities, especially if you are just beginning out. When it comes to choosing the perfect Certified Financial Planner, it assists a lot for evaluating them on the objective grounds. You can access a bit more assistance with the resources available at website below. Most significantly, you will desire accessing their qualifications that are related to your specific requirements. Conduct proper research in order to find out whether or not they understand how perfectly they should support whey you’re in financial need. Another thing you need to consider about is their charging manner, how they are going to charge you? There are free and no-free planners, charging you either just for their counseling service or for commissions that they receive on any of their recommended products’ sale. Keep in mind that you should always consider the financial planner that makes the maximum sense for you. Lastly, don’t forget to consider about the level of your accessibility to your financial planner. It includes the detail information regarding their location, their actual and exact office hours, as well as whether or not their offered services can be accessed via the websites. If you’ll evaluate your future financial planner considering some criteria, you’ll be offered with assistance in long-term where you’ll be able to access the financial goals this is most beneficial for you and your family.

Certified financial planners are professionals who practice expertise in the field of finances. They can help you solve personal and business financial issues and assistance through proper planning. The areas in which a certified financial planner cover includes cash flow management, education planning, retirement planning, investment planning, and risk management.

In risk management and insurance planning, you will be given help in managing risks in cash flow through sound risk management and insurance techniques. In retirement planning, you can expect to have financial independence at retirement including the IRAs and 401Ks.

Tax planning involves the plan for reducing tax liabilities and to free up the cash flows for other purposes. You will also enjoy assistance in relationship management and understand the core needs of certain clients. If you have kids or planning to have kids, you can plan ahead for their education.

Certified financial planners can also help you with your insurance planning, tax planning, estate planning and business succession planning. In carrying out the function of planning, these financial professionals are guided by the financial planning process to create a financial plan.

A financial plan is a strategy with complete details styled after your specific circumstance, condition and business requirements. Having a financial plan helps you have a direction and meaning to your financial decisions.

If you are looking for financial investments, an investment financial advisor can help you a lot. He can help you make personal budgets, control expenditures, implement strategies for accumulation of wealth and set goals for savings.

Also, certified financial planners help you understand how each financial decision can affect the other areas in finance. In order to have security, a financial planner can help you adapt to life changes with more ease.

He or she may have working relationships with other Financial Advisors, Investment Managers and Mutual Fund companies, which can help you make the right decisions. In tax planning, financial professionals help you maximize tax deductions to reduce year-end tax liabilities, which may include estate planning.

To become such a professional requires extensive training and education from a college or university. A Bachelor’s degree from the field of accounting, accounting management, financial management, economics, banking and finance, and marketing is expected.

In addition, to become a certified financial planner and function as one, you may have to pass a licensure exam, even when it is not mandated by law in a State. Having a certification in financial planning enhances your credibility and marketability to your prospects, whether employers or clients.

The best results to expect from certified financial planners are many. One of them is to achieve the greatest probability of attaining financial goals within the target date. You can also expect to have a regular update on financial plans. Making intelligent financial decisions along the way is also crucial but possible with a good financial advisor.

To find good professional planner, go to the internet. You will find many experiences one that can guide through your own financial plans. Make sure to check the planner’s credentials.

Financial service providers are those who provide financial services to customers. Financial services are those which are provided by the financial service industry. This industry deals with a broad range of organizations which includes banks, credit card companies, consumer finance companies, insurance companies, investment funds, stock brokerages and many more. As it is a wide industry, there are different types of financial service providers available for the customer’s. Finding the correct one which suits your needs can be a difficult job until and unless done through the Internet. There are different mediums through which searching can be done to get the desired local financial service provider. Some of those mediums are:

Browse Web directories, Promotional Literature, Local Magazines

Web directories, also known as link directories, are directories present on the World Wide Web which enlists number of websites categorized under various heads. Here you can search for the local financial services by browsing through different categories related to financial services. In web directories finding of categories become much easier as they are listed in an alphabetical order. For example if you choose “L” then you can get different categories like Loan, Loan agriculture, Loan automobile, Loan brokerages, etc. This will make your search more specific.

Web directories has the provision to search by featured listings and popular listings. Many local financial service providers lists themselves under such featured listings so that the customers can look for them easily. The main advantage of the web directories is that, they provide direct link to the sites of the financial service providers so that anybody can collect detailed information from there.

Promotional literature distributed by the financial service providers like banks, financial consulting firms, finance professionals as well as advertisements in local magazines can also provide information regarding a trustworthy financial service provider.

Customer Referrals and reputation in the market

Often it is the word of mouth from long term customers that earns an organization its goodwill and credibility. One of the ways to find a local financial service provider is to gather news from the local residents and customers of a particular financial service provider. Those who are already experienced, can give the prospective customer a feedback to help them make the decision. For example, if it is the services of a bank or a finance professional that you need to avail, you can always inquire about the services, rate and fees charged, experience in handling financial matters or large business accounts etc. Information can also be gathered about the market value and position of the financial service provider. Though Internet researches can be helpful, it is always handy to refer to electronic telephone directories like online Yellow Pages and White Pages.

Social Networking Sites

There are different social networking sites available like Facebook, LinkedIn, Orkut, Twitter, etc. All these are popularly used by most of the people in today’s world. Therefore, many local financial service providers prefer promoting their business or bank or service through such sites. There are many options like groups and communities through which anybody can promote his or her financial services or business. This medium is also widely accepted because these are accessed by most of the people.

Business listings in search engines

Business listings in search engines are also preferred by many financial service providers. This is because, from there it becomes easier for the general public to gather information as well as the location of the service provider through the help of the map option. Such business listings are done mainly on Google Local, Yahoo Local, Bing Local Listing, etc.

Thus, these are some of the tips which can be followed to locate a reputed and top class financial service provider.

Choosing the right financial adviser can be a difficult process.  How can you find a professional with the expertise you need?  Someone you can trust to assist you in planning your financial future.   Where should you start?  What should you look for?

Here are some things you should consider:

your current situation - before meeting a financial planner, get a good idea of where you’re currently at financially.  You might like to use these free online calculators to help you get started: Free Financial Position Calculator  Free Budget Calculator
your goals – What are your financial goals in the short, medium and long term?
what do you want a financial adviser to do for you?  There are lots of options when it comes to financial advice.  Some people just want help with a specfic area of concern (eg divorce), or at a particular life stage (eg retirement).  Other people want to get financial advice in all areas to help them get ahead financially – the choice is yours.

You should take your time and do your research before you choose your financial adviser.  Some things you might like to think about before you decide on one are:

are they properly licensed?  In Australia, financial advisers should be the holder of or authorised under an Australian Financial Services Licence.
do they have appropriate experience?  Are they experienced in all the areas you identified you want financial advice in? 
are they recommended?  Do you know anyone who has had experience with this financial adviser?  Do they come recommended?
how do they charge?  Some advisers receive commissions from product providers.  Others charge the client directly for their time (known as fee for service).  Do you know and are you comfortable with how this adviser charges?  Be aware that financial advisers who charge commissions may have an added conflict of interest as they receive payment when selling you a product
who are they owned by/affiliated with?  Sadly in Australia, the overwhelming majority of financial advisers work for or are affiliated with larger financial institutions and banks.  This poses a problem where many of these groups impose restrictions on the types of products and advice that these financial advisers can offer their clients.  If this concerns you, you should seek out the advice of a financial adviser from a privately owned financial planning firm.  Remember that this information must be disclosed in the Financial Services Guide (FSG) so be sure to read the fineprint.

For more information on how to choose a financial adviser, be sure to download our free ebook Choosing a Financial Planner

If you want to make sure that you have secured your future as much as you can, you will want to find someone who can give you intelligent, unbiased personal<a rel=”nofollow” onclick=”javascript:_gaq.push(['_trackPageview', '/outgoing/article_exit_link']);” href=”http://retirementusa.com/financial”> financial</a>   advice.  There are many people around who claim they are financial advisors but you want to be careful who you hire.  You have to not only be able to trust them but you also want to be able to like them so you can work closely with them.

When you first start your search you should probably ask for a recommendation right at your local bank or credit union.  More than likely they can give you a referral.  One word of warning though, they will likely have many of their own products that they will try to sell to you.  That may not be bad but in order to make an informed decision make sure you ask a lot of questions and don’t buy any product or service, unless you’re sure it’s a perfect fit for what you are trying to accomplish financially.

Asking friends, family, and co-workers is another way you can get a referral to a good financial advisor.  You may be surprised at how many people you know actually enlist the aid of an advisor.  Many people mistakenly believe that only the rich have advisors.  A good advisor will be able to help you protect the assets you already have as well as find ways you can potentially grow those assets.

Once you’ve got a few recommendations go around to them and start ‘interviewing’ them.  Again, it’s your money you have the right to ask a lot of questions of whoever you’re considering asking  to manage your money.  Make sure you check the credentials of any advisors you are considering hiring.

Also find out if they are ‘tied’ or independent.  A tied agent is one who can only sell the products and services of one company.  They can still help you but it’s important that you know that they do have limitations of which products they can sell to you. That way you can make sure that the product they are selling you is the best product to help you achieve your goals and not just the best product their company has for achieving your goals.  There is a big difference.

An independent agent may sound like a better choice, but it can have it’s landmines too.  For example, even though an independent agent can sell products from many companies they will often push a product from the company that offers them the highest commission, not necessarily the best product for you and  your needs.

Knowledge is power, so now that you know what the potential issue can be for both a tied and independent agent you can ask questions and avoid them.

If you want to make sure you protect your future, hiring someone who can provide you with top notch personal financial advice can really help.  There are many elements to your money. Everything from insurance to estate planning.  Make the most of your money by finding a professional to help you navigate all the resources available to you.

http://www.retirementusa.com provides complete solutions for your lifestyle.