Financial Independence

Financial independence: the act of creating and maintaining a sustainable living

Entrepreneurship

I remember when I decided to dive into entrepreneurship. I left a full time job for no guarantee of a pay cheque. What was I thinking?

After sharing with a couple of people of my move, I heard the following:

  1. Make sure you have contingencies in place (didn’t have any)
  2. Are you sure about doing this in this current economy? (no time like the present I thought to myself)

From a little girl growing up I knew I wanted a company of my own. I always saw myself as a manager.

The transition from employee to business owner was a challenging one. I had to have a vision and think of ways to make money. The opportunities did not fall into my lap. I had to create them. It wasn’t easy at first, but I soon learned if I wanted to see money going on the business bank account, I had to go get it.

Well almost four years in operation and another business later, I am happy I made that transition.

Financial independence means to me fulfilling my unique calling. Doing what I love and what I was designed to do. And to fulfill my potential. I am sure there are many more ideas to be unearthed.

Financially Independent Generation

What about the next generation? Shouldn’t we be inspiring them to be financially independent?

Some children fall through the cracks of our educational system due to a perceived “lack” of their intelligence. They are basically ignored and left there without of sense of who they are.

These children are just as brilliant as any child who enters school from the age of 4. It may be the school system is not adequately equipped to readily recognise their unique gifts.

While it is important for every child to have that solid foundation, the ability to read, write and perform mathematical functions, the ability to be financially independent should be ingrained in their impressionable minds.

From learning to budget, children can develop the ability to generate several sources of income. They would not be despondent that they don’t fit in the educational system, but they would have the ability to create ideas and make money with the natural abilities they are born with.

Multiple Streams of Income

It is honourable to find employment within an organisation. I am in no way disregarding those who chose to work for an employer. It is a definite way to earn a salary and to develop professionally. Remember, entrepreneurship is not designed nor meant for everyone to dive into.

However, did you consider should your job be taken from you, what would you have to fall back on?

Or do you consider the money you have, could be used to generate multiple streams of income for your household?

We are currently facing times of uncertainty and take it from me as someone who has experienced three job losses in my family, you need to have more than one  source of income.

I am not encouraging you to quit your full time job, I am encouraging you to start a side business. It could be hair braiding, blogging, writing a book or even raising chickens. It amazes me how the mothers of old were able to maintain a household with close to ten mouths to feed. These women were women of many trades and they made their money stretch.

Having skills does not make you less intelligent, it makes you more profitable.

It may be a sure way for you to get out of debt and generate wealth.

Financial Planning

I would like to speak to financial planning in the midst of the economic challenges we are facing as a nation.

While it may not be conducive at present to save for retirement, find other vehicles for deferred current consumption, that is setting aside money for spending later. You do not want to be left wanting in your old age. It would not be a pleasant experience to have to be dependent on someone. Ensure your financial independence in the long term. The longer you wait to prepare for retirement, the more expensive it will be to achieve that goal. Those of you in your twenties, this is prime time. Do not allow the removal of tax incentives for Registered Retirement Savings Plans (RRSP’s), as happened in Barbados earlier this year, to deter you or set you back from saving for those later years. Plan now!

I would like to take this opportunity to wish everyone a Happy Financial Independence from all of us at Astrape Finance.

Melinda Belle is the visionary and founder of Astrape (As-strap-pay) DSC_0051Finance, the caring, knowledgeable, trustworthy, financial company guiding you to financial stability and prosperity through education, sound planning and advice. Melinda sees her role as that of an architect and is committed to the shaping of financial landscapes of businesses. She also crosses over to the personal side of finance, teaching families and individuals to manage their money and create wealth.

EMAIL her at: melinda@astrapefinance.com

FOLLOW her on Twitter:www.twitter.com/MelindaLBelle

LIKE her Facebook Page:www.facebook.com/AstrapeFinance

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Tips to Plan a Successful Client Meeting

meeting

As a business owner client meetings are an essential part of my business. Not only do I meet with potential clients, which is extremely exciting because of the opportunities that exist to build new relationships but I also meet regularly with my exiting clients to ensure that their needs are addressed and to continue to be an advisor of choice.

But what does it take to make a client meeting successful? Here are my best tips for planning client meetings:

  1. Prepare, prepare, prepare

I cannot emphasise this enough. Preparation is key to any successful meeting. In preparing for a meeting you need to ensure that you know:

  • why you are having the meeting;
  • where and at what time the meeting is at;
  • how to you intend to address the matters to be discussed; and
  • who are meeting participants.
  1. Have an agenda

Always set an agenda for your meeting. By setting an agenda it ensures that the most important matters are addressed and provides a point of reference for everyone in attendance. I have also noticed that agendas have improved my productivity because I can easily identify what needs to be done next and by whom.

If you are responsible for hosting a meeting, I suggest that you send the agenda to all the meeting participants at least 2 days before the start of the meeting. This provides an opportunity for those attending to adequately prepare.

meeting 2

  1. Do your due diligence

The process of reaching and understanding a potential client or the matters to be discussed at a meeting should never be ignored.

When I conduct due diligence on a potential client I try to understand as much possible about their business – products, services, locations, management. For my clients, the purpose of my due diligence is to provide solutions to their existing and potential problems.

  1. Look the part

Always ensure that your look is professional but also keep in mind your audience. Having a good understanding of your client’s corporate image and environment goes a long way in guiding your professional appearance.

With these tips, plan your next client meeting successfully.

rashida

Rashida Parasram is a freelance accountant and business consultant with a passion for seeing small businesses thrive. She is a member of the Association of Chartered Certified Accountants as well as the Institute of Charactered Accountants of Barbados. She has gained over 10 years experience in the fields of audit and business advisory with the accounting firms of KPMG and Ernst &Young.

Email: consultmpr@gmail.com

How to spend less on fashion without feeling like you are depriving yourself – not just about sales

Let’s start with a few principles that I had to embrace in order to get to the point where I could decrease my spending on fashion and style.

Less is Indeed more.

Even with my wardrobe at its largest, at any one time I always gravitated to a core of no more than 12 outfits per occasion.

I kid you not that for work I rotate about 8 out fits for my workplace. Now, as far as I’m concerned each of these outfits is the bomb, but it’s still only 8 outfits!  This also happens for casual events, formal events, etc.

So no matter how much clothing I had, I was never inspired to wear all of it routinely. I just stuck to my favourites.

Realising that less is more – taught me about my personal style and what not to buy

For work, my personal style has evolved into a love for work dresses with small details that stand out.  For example, a structured black dress with an exposed zip in the back, a high waist turquoise dress with a satin covered waist line, and so on and so forth.

Because I could definitively see what I liked, I stopped buying too much of other types of clothing that I would never wear, like pants.  I can probably count the number of times I’ve worn pants to work on one hand. In general, I keep a very limited amount of separates like skirts and shirts, that have to be absolutely stand out for me to purchase them.

The Trash one Replace one rule

I try not to buy any new clothing until I have trashed the same amount of clothing.  It keeps my clothing collection in check, and within a manageable number.

It also helps remind me that I have more than enough, so there is no need to spend on clothing that I might never wear!

I make a wish list.

I’m a chronic list maker. Keeping lists of my fashion wants keeps me from succumbing to impulse shopping by keeping me focused.

It also gives me time to think about whether I really need new clothing. More often than not the answer is no and I get to keep my money in my pocket.

I shop used and I swap

I know wearing used clothing isn’t high on the list of things to do for everyone. However I’ve gotten to try new styles of clothing that I might have otherwise never spent money or would have wasted too much money on through swapping with similarly sized friends.

At some point or the other most of us are ready to give our wardrobe a purge. Why not link up with friends, and trade clothing. Just like shopping, each swap won’t be successful, but unlike shopping, swapping is free!

I do it a little less often these days because I’m trying to downsize at the moment, but swaps are definitely at the top of my list of things to do when looking for clothing and keeping my money in my pocket.

Cost per wear

There is one area in which I’m not likely to go the cheaper route when it comes to cost of clothing. If the item is going to be one where I can calculate the cost per wear as less than one dollar, I will prepare myself to spend a little more.

A good example is my work clothing and shoes. I own work shoes on the higher priced side of what I would consider spending on any piece of clothing and this is because I need them to be comfortable, and to last a significant amount of time.  So because I wear these shoes approximately 47 weeks in the year 5 days a week, I definitely am willing to spend a little more on them. The upside to this is that when I calculate how much they ‘owe’ me over the 2-3 year span that they last, it generally works out to cents.  In comparison cheaper priced, more poorly made shoes would need to be replaced much sooner and equate to a much higher spend.

In general I’m trying to move toward towards a more minimalist life in every aspect and luckily that fits in to more conservative money management practices.  I know this seems as if it would be counter intuitive for a fashion and beauty blogger, but believe me, it has served me well in recent times.Kim Roberts

What are your tips on how to keep your fashion spend in check?

Kim Roberts is an accounting professional, currently in the field of international development finance. She is a
makeup lover, ACCA qualified and committed to all things Caribbean especially Soca music. You can find out more about her love of makeup athttp://bajanbeautyblogger.com/ where combines her love of makeup with a need to write opinion based pieces.

Trust the Planning Process

planSo you’ve made the decision to take the plunge to start your own business. Congratulations! I’m very excited for you. But after coming up with your big idea, what do you to do next? I am sure the question has crossed your mind several times.

The journey of entrepreneurship has no hard or fast rules however those who are successful followed and trusted a simple process of planning. This process ultimately turns your business idea into a viable business. Any plan or strategy should should include the following key areas:

  • Business definition
    • define the problem you will solve
    • identify who you will sell to
    • define how you will make your product or service
    • define how you will reach your intended market
  • Industry analysis
    • identify trends affecting your industry
    • define your main competitors
    • define how will you compete in the industry
  • Market analysis
    • define who you will serve
    • define the characteristics of your customers including habits and lifestyle
  • Financials
    • determine how much you will need to start your business
    • determine what your projected sales will be
    • identify where you will obtain capital and funds for your business
  • Product pricing
    • determine whether your products/services will be sold at a premium or discount price
    • identify typical prices charged in the market by your competitors
  • Networking
    • identify the trade associations you will join

So your next step should be to prepare a business plan. I strongly suggest that you take the time and trust the planning process because it will help you to better understand, test and defend your business idea. More importantly this process increases your likelihood of running a successful  business.

rashidaRashida Parasram is a freelance accountant and business consultant with a passion for seeing small businesses thrive. She is a member of the Association of Chartered Certified Accountants as well as the Institute of Chartered Accountants of Barbados. She has gained over 10 years’ experience in the fields of audit and business advisory with the accounting firms of KPMG and Ernst &Young.

Email: consultmpr@gmail.com

What Steps Can I Take to Protect My Money?

Dannielle Brathwaite

When you’ve worked hard to accumulate money and other assets, you become extremely protective of what you have. People protect their assets in different ways, but the end goal is usually the same – to keep assets safe from the many risks that exist. Protecting your money can be as simple as educating yourself about the threats that exist and being knowledgeable about what you can do, or as complex as seeking professional advice from legal or finance professionals. The truth is that everyone is vulnerable to these risks and protecting one’s money should be a priority that requires some advanced thought and action.

TYPES OF RISKS

There are several risks which exist that can threaten assets or the value of assets. Most people’s assets consist of cash, property and investments. From a banking perspective, these assets are susceptible to financial risks which include market risk, credit risk and liquidity risk. A market risk arises if there are movements in the prices of a financial instruments like interest rates. Credit risk is the risk of a borrower defaulting on its obligations. Liquidity risk refers to the risks that arises when there are difficulties in selling or buying assets.

Fraud is another type of risk which we are faced with. There are thousands of scams which aim to get your assets from you under false pretenses. Everyone is vulnerable to fraud, which exists in various aspects of our lives. Theft comes in many forms and is not just limited to someone running up to you and stealing your purse or wallet. Theft can be as simple as someone stealing a dollar from your bank account, or even a more elaborate method such as a Ponzi scheme.

Unfortunately, fraud is always evolving and scammers always find new tactics to get at your money. Some of the more popular ways used to commit fraud and theft are identity theft, internet scams (via emails and websites that use false scenarios to solicit funds from victims), lottery scams, communications from fraudsters (telephone calls and letters), get rich quick investment seminars and through friends and family.

Damage and destruction are risks that can destroy one’s assets. These can come in the form of natural disasters such as storms, flooding and landslides; negligence by failing to maintain the asset or malicious acts which consist of damage or destruction which are done on purpose. Property, vehicles and boats are the assets which are most often affected by these events.

HOW TO PROTECT YOUR MONEY

So, what are the some of the methods that can be used to protect one’s money? The easiest thing that you can do is to simply keep track of your finances. This includes monitoring your expenses and savings by keeping an eye on your spending habits and bank accounts. A simple excel spreadsheet can be used to create a simple budget in which you can record what you’ve spent money on. You can also check your bank accounts online at any time via internet or mobile banking. This gives you the convenience to access your account so that you can check account balances or perform transactions.

Keeping your personal information and financial documents safe is another way to protect your money. Fraudsters can use your name and an identification number, bank account number or social security number to steal your identity and your money. Do not give out your personal information to anyone. Your financial institution will never ask you for your personal information over the telephone or via email, and you should never volunteer to give out this information.

Another step that you can take to protect your money is to make copies of your financial documents and keep them in a safe place. Where possible, keep cheque books, bank account documents, passports, credit cards and debit cards in a safe place. Older adults should confide in a trusted family member who has their best interests at heart, about where these items are kept, in case of an emergency.

Insurance is a popular tool that can be used to protect assets in the event of a catastrophe. There are different types of insurance policies, but the more popular types which are designed for assets are home insurance, car insurance and home contents insurance. The policies are designed to reimburse you for the assets which have been destroyed. Although there is a cost attached to insurance, knowing that you are protected can be comforting.

Before you make any big financial decisions, make sure that you read and understand the contracts before signing and ask questions.  Even though it might seem unimportant, too long to read or the initial terms might seem inviting, that contract will define the relationship that you have with the product or service provider. Ask questions if you are not sure about something or if you need more information.

We all have to be responsible for the decisions that we make when it comes to protecting our money. Sometimes being vigilant and making smart decisions are the only types of protection needed. If you are faced with a situation and your gut tells you that it’s not right, chances are it might not be. If you need help or advice, consult with a trusted family member, friend or professional advisor. If you, or someone you know is a victim of fraud, theft or any financial crime, please contact the Royal Barbados Police Force or Crime Stoppers Barbados.

Bio: Dannielle Brathwaite is a banking and project management professional, who possesses a Diploma in Accounting and Business, a Bachelor of Science degree in Economics and Management and a Master of Business Administration. In her spare time, Dannielle contributes to the Odd Cents and Endless Caribbean blogs, creates surface designs and illustrations and researches project management and international business issues in the Caribbean.

Multiple Skills, More Money

The world we live in today is vastly different from what we were prepared for through our journey from childhood to adulthood. Our parents encouraged us to work hard at primary and secondary levels of school, to achieve the opportunity at a tertiary level education which would inevitably lead to a secure job, where you work 40 hours a week for 40 years, retire and be merry. That notion is now quite far from reality to most of us in the working world today and for our children to come after us. The reality is, there’s no guarantee that a university education will result in a job offer and even when the offer does come, the notion of job security no longer exists. Lay-offs, pay cuts, business closures have been rampant in most societies over the past 5 years and as some individuals keep saying “Everything has gone up other than their salaries”. And so you aren’t lost in translation, that basically means, standard of living has risen rapidly without that pattern being followed by our regular salaries. So with these occurrences, our upbringing shattered by reality, how does one survive?

The answer is simple. In this day, to survive financially, one must, without question, have multiple skills. Brian Tracy the Chairman and CEO of Brian Tracy International, a company specializing in the training and development of individuals and organizations said “Invest three percent of your income in yourself (self-development) in order to guarantee your future.” In simpler terms, the man who spends every day developing himself, will never be broke.

In a conversation with my peers, I pointed out that many of the individuals who weren’t as successful academically as we were; seem to be doing better than us in terms of earnings. From observation, I gather those individuals who realized academia was not their strength decided and in some cases were forced to strengthen themselves in other areas; and what resulted was well rounded young men and women who can put their hands to the plough in many areas. So along with their base salary at their 40 hours a week job, their additional skills have allowed them to have additional earning power. From part-time deejays to cosmetologist, technicians to musicians, they all have the means to earn extra. Those of us who followed what seemed to be the blueprint of success of going through school with honourable grades, have found ourselves in jobs that pay us just enough to get from one pay cheque to the other and just enough to for us not to quit; while we work hard enough not to get fired, and for many of us, it may not even be a job that we like!

So what, can it hurt to invest in yourself a bit, can it hurt to join a class, develop that skill of speaking, hair styling, baking? Think about how much wealth you would be missing out on by not developing that second, third and fourth skill!

This is not the time to solely rely of what was once considered the blueprint to success but to understand fully that success is the maximum utilization of the ability that you have. Robert Kiyosaki, who is best known as the author of “Rich Dad Poor Dad”, famously encouraged anyone who currently has job but looking to start a small business, to start the new business while you are still employed which allows you to make years of mistakes until you get it right. Zig Ziglar an American author, salesman and motivational speaker says “you don’t have to be great to get started, but to be great you have to get started”

Make 2015 the year you promise to develop yourself, if you haven’t begun that already. Look around and there are many examples of the skillful individuals who are easing themselves out of the rat race; simply put, people will pay you for services they can’t perform themselves!

So go on and tackle 2015 with gusto, develop yourself and be the best you can be, and most importantly, earn some money!Romelle

REMEMBER THIS:- WE ARE ALL SELF-MADE BUT ONLY THE WEALTHY WILL ADMIT IT.

Romelle Greenidge is a University of the West Indies graduate with a Bachelor’s degree in Economics and Management. He entered the insurance industry right after completing university and has been there for the past 5 years. He is now at Sagicor as an advisor and is the process of pursuing his advisor designations.

When paying off debt early is a bad idea

Living a debt free life sometimes feels like a fantasy, an ideal life that anyone would want to achieve.

So paying off debt as early as humanly possible seems like it makes sense right?
The hard truth is that it’s not that simple.

Here are a number of scenarios when paying off debt early doesn’t make sense:

Scenario 1: Savings, what savings?

If you don’t have any savings, paying down debt prematurely should probably not be your first priority.

Savings are your cushion against the unexpected challenges in life.

What would happen if you lost your job tomorrow or if you fell ill? Do you have savings to help you deal with that?

If you lost your job tomorrow, you’re likely to be more concerned with your next meal than your zero income to debt ratio.

Similarly if you fell ill, the zero debt is unlikely to buy you medicine.

Bottom line:  Work on your savings to debt payoff ratio.  Get a good little nest egg, and then think about paying off your debt prematurely

Scenario 2: Is there a penalty for premature settlement of debt?

Sometimes, paying off debt early, can incur a penalty from your financing company!

Financing companies make money from interest. That is their main revenue generator, so sometimes in an effort to protect their revenue, they include a deterrent from early repayment!

If you have such an agreement, it might be best to consider the cost benefit analysis of paying off your debt prematurely vs the interest that incurred.

Bottom line: Read your contract to make sure you understand the costs vs the benefits of early payoff.

Scenario 3: Could your money earn you more money than you pay in interest?

Is it possible that you can invest your money in an activity or savings accounts that would allow you to earn more than the interest on your account?

A very simple example.

If you are given the opportunity to place your money in an investment vehicle that earned you 8% compound interest vs paying off a loan that cost you 4 % compound interest.

It may be wise to reconsider paying off the debt prematurely.

Bottom line: By paying off the debt prematurely you could be sacrificing the opportunity to make money.

The Bigger Picture

Debt can be troublesome for many of us. If your level of debt is at a level you are uncomfortable with consider refinancing your debt to a lower interest rate.

Or alternatively making the determination that sometimes your peace of mind may be worth sacrificing the benefits mentioned above.

Financial security is never a one size fits all situation.
Kim Roberts

Kim Roberts is an accounting professional, currently in the field of international development finance. She is a makeup lover, ACCA qualified and committed to all things Caribbean especially Soca music. You can find out more about her love of makeup at http://bajanbeautyblogger.com/ where combines her love of makeup with a need to write opinion based pieces.