Category: Wealth Management

Stock Market 101: A Guide To How Things Work

By | December 12, 2018

By Jack Benson

In a nutshell, the stock market is a market place for business people. Goods are sold to the public in a public market. However, in the stock market, the public is sold share. Shares are the form in which company stock is sold. When a person purchases more shares in a company, they have a higher ownership in that company.

In the stock market, there is the primary market and the secondary market. In the primary market, companies sell shares to investors to raise financing for their operating expenses. In the secondary market, investors buy and sell shares in companies to other investors. Constantly changing market conditions are the basis of those buy and sell decisions.

A stock market operates much like an auction house, with a systematic way of buying and selling. The system in the stock market involves a great deal of bustling activity. Often there are people running around frantically, shouting and gesturing at one another.

The purchase and sale of stock starts at various places. A broker is contacted if a person wants to buy stocks in a certain company. The broker will take the investor’s money to the stock exchange to coordinate with a floor broker.

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In most cases, the floor broker works for the company selling stock. Right on the stock exchange floor, brokers buy the desired stock for the investor. Once the deal is made, it is communicated to a broker and the investor then becomes a stockholder of that particular company.

Investors may decide to sell their stock. Usually investors want to sell their stock when the price per share increases so they can realize a profit on their investment. For example, a person may purchase 100 shares at the price of $25 per share. When the price increases to $35 per share, the person can sell the 100 shares and make a profit of $1,000.

The driving force behind the stock market is the basic economic principal of supply and demand. The number of stocks open to the public is the supply. The number of shares that investors what to purchase affects the demand of the stock in a certain company.

The constant change in the cost of stock is a result of conditions in other markets. For example, if people feel that the economy is growing they are apt to purchase more stocks. However, when the economy is in a decline, the majority of investors tend to sell off their stocks. On the flip side, some investors use this time to buy because the stock prices are usually at a discount.

There are quite a few business people who make long term investments in the stock market. In some situations, stocks go down in value and a stockholder loses money. There is no guaranteed profit when investing in the stock market. Thus, when a person is flexible and able to handle the constant changes of the stock exchange they are more likely to experience a profit.

So this is how the stock market works. In the end, patience, education and experience usually equals greater long term success.

About the Author: For more information on “how does the stock market work?” — including a growing collection of tips, strategy and advice — visit:


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Ground Rules For Successfully Selling Your Business}

By | November 5, 2018

Ground Rules for Successfully Selling Your Business


Grover RutterSooner or later you are going to exit your business. The question isn’t whether or not you will be ready. The sixty four thousand dollar question is whether or not your business will be ready. It is estimated that seven out of ten privately held businesses have no succession plan to transfer the business to the next generation of owners. What does that mean to you? It means that if you do not currently have a plan in place to transfer your business to family members, existing partners, management or employees, someday you will think about selling your business. That day might come sooner than you anticipate. Don’t make the mistake of thinking that just because you are not currently ready to retire that you have plenty of time to prepare your business for sale. As a business broker, I have been involved in a number of transactions (and potential transactions) where the business owner wanted to sell, or in some instances, was forced to exit the business earlier than expected. In fact, retirement is NOT the number one reason why businesses sell. Here is a list of the most common reasons why owners sell (or otherwise discontinue) their businesses: Burn-out (the number one reason for selling) Health issues Personal diversification Retirement/semi-retirement Death Divorce/partner disputes Business growing too fast Second generation not up to the task Loss of market shareTAKE GOOD CAREThe sad truth is that many business owners do not take good care of their most valuable asset: the business. They don’t groom someone to continue the business in their absence, and do not keep the business in salable shape during the time they operate the business. Business owners tend to get too bogged down in the day to day business operations to worry about–or plan for an event that they perceive won’t occur until sometime in the distant future; selling the business. Unfortunately, fate sometimes dictates circumstances beyond your control, and tough decisions must be made. If your business isn’t ready to sell when the time comes, what are your alternatives?1.Liquidation of business assetsmay be a solution, but one that usually returns very little money to the business owner. If the business had been an operating business, the underlying assets (except for real estate) may be outdated and of little use to anyone. At auction, the assets will bring only what the attending bidders are willing to pay. In some instances, underlying assets are sold to liquidators (or scrap) for only pennies on the dollar. Liquidation of a going business often occurs where the owners have become ill or disabled, or need to retire and have not planned adequately for their exit from the business.2.Closing the businessis even less attractive than liquidation. That is because many who find themselves in this situation have a tendency to put off” liquidating the underlying assets in hope that maybe someone will come along to buy this business. This almost never happens.BUILD WEALTH NOW BY PLANNING FOR THE SALE OF YOUR BUSINESS Okay, so you think you have enough to do without throwing more onto the pile. Am I right? That is why I have written this article for you. It provides a down and dirty” overview of things that you ought to begin thinking about and planning for right now. Doing so will provide you with an additional safety net that will help safeguard your valuable business asset. Here are just a few of the benefits of planning now: A planned sale allows for your goals and objectives on your timetable You may begin to identify potential buyers You may be able to create an attractive acquisition candidate You can begin to understand why a buyer may want to buy You might learn why buyers would not want to buyand be able to fix the problems You may begin to realize the worth of your business now, and learn how to increase the value as part of your retirement planningBUSINESS VALUE HOUSEKEEPING CHECKLISTRecord All Sales Business owners often invent remarkable ways to beat the tax collector. But the taxman can be a business owner’s best friend when it comes to selling one’s business. Income taxes are a great investment in the years immediately preceding an anticipated sale of the business. Paying income tax proves to the buyer AND the banker that your business operations have been profitable. Nobody wants to pay more income tax. But consider this example: Ronald Bunk systematically underreported business income by an average of $20,000 per year. Assuming a combined tax rate of 40%, Mr. Bunk saved $8,000 in taxes per year. But, the underreported income also reduced the company’s earnings base by $20,000 per year. If, for example, the business could be sold for a multiple of 5x the company’s reported earning base—the company would sell for $100,000 less ($20,000 average earning base not reported times the price multiple of 5) than it is really worth! Without considering the time value of money, it would take in excess of twelve years of (illegal) tax savings to make up for the loss of $100,000 in business value. The lesson: In trying to screw the government, business owners often find themselves on the short end of the stick; often in more ways than one.Eliminate co-mingling of business and non business assetsA common practice among closely held companies is to co-mingle non business assets and expenses with business assets and expenses. I have seen businesses owning motor coaches, boats and airplanes; all reported as business assets. The costs of maintaining and operating the assets were expensed as regular business operating expenses. It is true that those businesses (not audited by the IRS) are saving a certain amount of income tax, and providing an extra fringe” benefit for the owners of the company. Wise business owners should endeavor to separate non business assets from the business in the three to five years before a planned sale of the company. Doing so will make it much easier to accurately measure and reflect the true earning power of the business, as it will be unfettered by the capital investment in non business assets and the associated costs. Buyers of your business are generally purchasing future income and benefit streams that will be produced by your business. The leaner and more productive your business isthe more it is worth. It is never too early to begin segregating non business assets from your business, as it may take some planning and time.Do your own due diligenceSome executives of both public and private firms get a physical check-up once a year. Many of these same executives think nothing of having their personal investments reviewed at least once a year, if not more often. Yet, these same prudent executives never consider giving their company an annual physical, unless they are required to by company rules, regulations or some other necessary reason.Anyone interested in purchasing your business will perform due diligence” procedures on your business before closing on the purchase. All too often, sellers are surprised at the skeletons purchasers can find in the closet. These skeletons can reduce the value of your company, and in some cases, kill any chance at closing a sale. What skeletons are your company’s closets? Why not give your business a periodic physical? In essence, I am suggesting you would do well to treat your business as if someone else owned itand you were the potential purchaser. What problems would you discover that could cause you and your advisors to reduce or withdraw your offer? Spending the time and money to discover and fix your company’s problems now will pay huge dividends in the form of increased company valuewhich is exactly what you want when it’s time to sell.Compliance with taxing and regulatory authoritiesMountains of regulation often seem to impede a company’s growth and profitability. Some regulations might seem rather easy to slight” or ignore. Take for example one of my recent sellers who swore to me that the business had no regulatory violations of any type. I reminded the seller that anything hidden in the closet” would most likely be discovered in a buyer’s due diligence (investigatory) process. Nopeno problems of any kind” I was assured. Well, guess what the buyer’s due diligence turned up? Seems the seller had a couple of shipping/storage containers sitting behind the buildingwhich the sellers KNEW were in violation of local zoning ordinances. How did they know? They had received four previous reminders” from the trustees about the containers, and the need to remove them. Why didn’t you mention that to me, or disclose that fact on your disclosure statement?” I asked. Gee, nothing ever happened and the township never did anythingso we just figured it was no big deal.” Was the seller’s reasoning.No big deal, except when the purchaser turned up the non compliance issue, it threw a few extra wrinkles into the mix. In that case, the issue was easily resolved (yet, much to the additional cost and chagrin of the sellers). But, sometimes known violations are not so easily remedied. In those instances, a seller runs the risk of blowing a good deal. What’s the bottom line? Clean up any tax, industry, OSHA, EPA or zoning issues with which your company does not comply. Organize and keep records available. One never knows when opportunity might knock. If and when it does knock, will you be ready to strike while the iron is hot? How many times have you heard someone say something like, I’d sell anything, including my business for the right price?” Maybe you have even said it yourself. But would you know what paperwork and documents a serious buyer will immediately need in order to pursue the purchase? When a qualified buyer is ready to begin serious due diligence, they will need a variety of company documents. Following is a partial list of things a buyer will ask for:Three to five years income tax returnsCopies of one to three years quarterly payroll reportsThree to five years CPA prepared financial statementsCurrent year to date financial statementsDetailed depreciation schedules listing each fixed asset owned by your companyCorporate Minute Book with updated minutesRecent aged accounts receivable trial balanceRecent aged accounts payable trial balanceCompany organization chartCopy of the Summary of Insurance Coverage (provided by your carrier)Information about Employee Benefits provided by the companyInformation about Employee Retirement PlansCopies of labor contractsCopies of other contracts to which the company is a partyCopies of licenses, registrations for patents, copyrights, trademarks, etc. The foregoing list is an example of the types of records your company should have up to date and on hand at all times. These records are extremely important to speed the sales process along. Though this advice sounds basic, I often encounter companies whose records are not complete and up to date. This situation can dramatically affect a potential sale. I suggest using a three ring binder to keep the basic updated records available at all times. This also makes other business needs for the documents much more manageable. CONCLUSIONYou can increase your wealth by knowing a few simple ground rules for successfully selling your business. Just like other owners of closely-held businesses, you know how to operate your business on a day to day, month to month and year to year basis. But your experience in running the business has not prepared you to know how to sell your business. While the information I provided in this article is not all inclusive, it should help you get started in preparing your business for a successful saleno mater when the business might be sold.

Grover Rutter has over 30 years’ experience advising business owners. A sought after business broker and consultant, Grover is a CPA, Accredited Business Valuator, Certified Valuation Analyst, Business Valuator Accredited in Litigation and an Empire Certified Business Broker.

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Vintage Jewelry

By | June 13, 2018

By Mary Lorainne

As kids or even as adults, we may be fascinated to look and try on our grandmother’s or great grandmother’s jewelries that have been carefully stored and handed down to our mothers and to us. For all we know these vintage jewelries may be worth something so don’t just throw them out just because they look old and out of style. Besides, you have to admit that the fashion of yesterday is slowly coming back again and people are always looking for trinkets that are old and antique. They do look great and unique.

Since we may not be experts when it comes to dating vintage jewelry that may have been handed down to us, it is important that we do some research about it. The first thing that you could do would be to look for some designer marks or maker’s mark. Though not all vintage jewelry always have this mark and it doesn’t follow that without a designer’s mark your vintage jewelry has no value. You could locate this at the clasp or at the back of the piece.

You could also ask the person who handed it down to you like your grandmother or mother especially if they are still alive to have an idea of its history and when it was probably made. They are most likely the ones to know how old this piece of jewelry is. If it has stones on it, examine them if they are real or fancy. It would be better though to have it really examined by a jeweler especially if you are not that knowledgeable when it comes to these matters.

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To find out more about your vintage jewelry you could always visit your local library for resources and materials. You could also find a lot of websites online dedicated to vintage jewelry. If you were able to find a maker’s mark, search for it. You could even bring along your jewelry to be able to compare it with similar pictures that you will find.

Vintage jewelry in one way or another especially if kept in good condition has some value. It is important that if you intend to clean them, you clean them carefully to preserve and not to destroy its antique look. Utilizing a baby toothbrush is ideal since these are made with very soft bristles. It is best to clean dry and not use wet solutions if possible. If you want to remove smudges or marks on rhinestones, you can utilize a cotton swab dipped a bit in a mild solution of water and liquid soap. Of course, you need to gently do this since rhinestones would be more damaged with moisture and wetness.

Take your time, to ensure that you preserve your vintage jewelry for more generations to come.

About the Author: Mary Lorainne writes about

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Long Term Care Costs By State And Other Factors That Affect The Rates Of Ltc Policies

By | April 6, 2018

It is nice to know that more and more people are now encouraged to purchase long term care policies for their needs in the coming years. The initiatives and other programs developed by the government with the help of some private insurance providers are now paying off and people are now aware, not only of the benefits, but also of the other facts such as long term care costs by state and other pertinent facts in an LTC plan.

People are now informed of what they should consider and look for in an LTC policy. Included in these considerations are the three mandatory features that all LTC policies must have in order to be considered valid and authorized. First of these compulsory features is the so-called minimum daily benefit amount. This determines the price limit or quota of an insured person for every time he uses his policy benefits. Depending on the type of LTC policy that he has, he might be given reimbursement of the exact amount that he has incurred, or might also be given the whole amount of his price cap. But regardless of the plan type, he will be responsible of paying the remaining balance or any amount that will exceed his quota for the day.

The minimum benefit coverage period sets the duration or validity of a certain policy. Usually, an average length of stay in a nursing home facility lasts for three years. But for some cases wherein an individual’s health condition requires more medical care and treatment, he may try to apply for Medicaid benefits. He may be granted eligibility to its benefits given that he meets the set of requirements and standards.

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Inflation protection, regarded as the most important of all LTC plan features, may also affect the long term care costs by state. It has the ability to adjust and make the value of certain policies updated according to the current costs of LTC services. The adjustment is automatic, regardless if the policy was originally acquired at a much cheaper price, years prior to the actual usage of the person’s plan benefits.

The levels of inflation protection are based on the age of an individual when he applied and purchased his LTC policy. Higher levels of inflation protection are given to those people who acquired policies at age 60 or younger. This is the reason why some insurance industry experts strongly suggests that LTC policies must be acquired when the person is still young, and has stable financial income to sustain the payment of his plan’s monthly premiums.

In order to get more accurate LTC insurance quotation, the person must provide truthful and important personal information like his real age, his health condition, his family’s medical background, if he smokes or not, and some other details that may be asked in order to generate LTC insurance plan quotations.

If an individual is still hesitant and might still need more information, the online LTC assessment tools provided by some private insurance companies’ websites may help them find out about long term care costs by state and other helpful facts that may get them purchase their own plans soon.

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A lot of Americans will surely need help with their failing health in the future; thus, long term care planning is a must these days. If you are hitting retirement or you simply want to protect yourself and your family’s welfare, it would be best to secure a long term care quote.Author: Graeme Harris