Tag Archives: finance

Business Planning for the Self Employed

“I work in the financial industry, but my real love is teaching. However, I don’t want to become a regular teacher because of the low pay. I have some innovative ideas on starting a business in education but I am unsure how to proceed with them. Some of my concepts have never been tried before in Jamaica and I need some assistance in making them into a reality.”

Successful self employment and business ownership are two ideals which most people with unfulfilling nine-to-five jobs dream about. Some wish there was some way to make their hobby or passion make money for them, but never have the courage to give it a try. Others launch out into entrepreneurship with the enthusiasm of the eternally optimistic, thinking that being in love with a business idea is enough for it to be profitable.

The majority of small businesses established in Jamaica generally get started without a plan of action to guide the operations. People tend to think that they already have the skills to succeed, especially if they had gained experience in the business area when they were working for someone else.

The typical excited entrepreneur thinks- “How hard can it be to run a wholesale shop? I just need to buy the goods, price them right and the people will come!”

Continue reading Business Planning for the Self Employed

Student Loan Lessons

“Years ago I borrowed J$80,000 from the Students’ Loan Bureau. I had some difficulties paying back the loan as scheduled, but in all I have repaid about J$50,000. I’m trying to make a deal with the Bureau to clear my debt, but I don’t understand why my balance is in excess of J$120,000. There must be something wrong with their calculations!”

The Students’ Loan Bureau provides a revolving loan scheme which has given many persons the opportunity to improve their income earning potential by attaining higher education. However, despite the benefits that thousands have received, there are some persons who complain that the student loan has been more hassle than help to them.

I have heard comments like “I am just working to pay my student loan,” or “I would not encourage anyone to take a student loan.” The negative emotions are usually accompanied by a declaration that they don’t understand how the payments are calculated or why interest for students should be so high.

Even worse, the high level of loan delinquency indicates that some persons are taking advantage of the unsecured credit to get their higher education without feeling an obligation to repay. Continue reading Student Loan Lessons

What a Difference a Loan Makes

“I’m a little confused about the difference between loans that are paid back on the reducing balance and loans that say add-on. I’m comparing mortgages from different companies in order to buy a house, and I want to ensure that I get the best deal. Please advise me.”

It’s not an easy task for the average consumer to comprehend how loans are calculated. You could probably call four institutions and ask for the same quote and receive four different repayment amounts, depending on how they compute their loans.

When you are looking at loan options, it’s important to ensure you are comparing apples with apples. The true cost of a loan can include commitment fee charges and insurance costs, which would vary across the companies. Continue reading What a Difference a Loan Makes

Practical Help for Entrepreneurs

“I read your column last week about the perfect business and I think that I have a great idea which would make a profitable venture. The problem is that I don’t know the best way to get started. I want to establish my business properly but I need some guidance to make sure I’m doing the right things. Do you have any advice for someone starting a new business?”

One of the biggest challenges facing prospective business people is not a shortage of creative ideas, but the lack of know-how to transform their dreams into viable opportunities. Sometimes, bridging the distance between a great idea and its realization may seem as difficult as climbing to the top of the Blue Mountains.

I can relate to the difficulties that face a new entrepreneur who is trying to start out with little more than a Big Idea. Many years ago I had an inspiration that I was sure would revolutionize the tourist-wear market and make me a lot of money. I secured some financing, went into production and brought my dream into reality. Continue reading Practical Help for Entrepreneurs

Can There Be a Perfect Business?

“Success in business requires training and discipline and hard work. But if you’re not frightened by these things, the opportunities are just as great today as they ever were.” – David Rockefeller

Everywhere I go, almost everyone I speak to wants to make more money. Their heart’s desire is to have some earning potential outside of their regular nine-to-five job.

Some people wish to find a way of making ‘big money, fast’ and are not are willing to consider options that require slow and steady growth over time. Some are scared of the risk of losing money, and will dismiss any idea that would require a large capital outlay to start. Others want a chance to make money while utilizing their talents, in order to feel truly fulfilled.

Although their business ideas might be diverse and unique, there is one common denominator that floats through the minds of prospective business owners – they all want a business that’s perfect for them. But is there really anything such as a ‘Perfect Business’? Continue reading Can There Be a Perfect Business?

More Money Values for Kids

“Recently my teenaged daughter begged me to take her shopping for clothes for a party. All the outfits she wanted would have cost at least J$15,000, and I refused to spend that much money. Although I told her that I couldn’t afford it, she insisted that I use my credit card and pay for it later, as her friends’ parents do. I’m very worried about her attitude towards money. What can I do to correct this?”

Last week we looked at how many of our children were getting caught up in the massive spending spree that has overtaken Jamaica. They are heavily influenced by the ‘bling’ culture that’s portrayed daily in the media, and they can feel inadequate if they are not able to buy the latest fads.

Unfortunately, some parents are helping to feed this consumer spending habit by accommodating their children too much and giving them everything they want regardless of the price. It sometimes seems that the adults are trying to make up for all the things they didn’t have as children, by overspending on their own kids.

In order to raise financially savvy and independent children, it is very important that we teach them the right values about money.

Continue reading More Money Values for Kids

Money Values for Kids

“My nine-year old son is always asking me for the latest video game, shoes, or DVD, with no thought about the cost of these things. I know I spoiled him when he was younger by buying too many toys and clothes for him. Now I’m worried that he’ll grow up without a clue how to manage money and live within his means. What can I do to teach him about money?”

Just like many adults, today’s children are riding high on the massive wave of consumerism that’s taking over our society. It’s easy for them to succumb to peer pressure and feel that they are not ‘with it’ if they don’t have the latest gear- Heelies, Crocs, Motorola flip phone, Playstation Portable, IPod, and more.

What can parents do to combat all these negative spending influences? Our challenge as care-givers is to substitute positive values that teach children about money – how to earn it, keep it, and make it grow.

To be successful in re-programming our kids, we must first be good role models by practicing successful money management too.

Continue reading Money Values for Kids

Make Time to Make Money

“I want to start an investment plan for my retirement, but the problem is that I really can’t find the time to concentrate on making money. My job takes me all around the island and I have very little opportunity to focus on my own affairs. Can you advise me how to start an investment plan with the least amount of time and effort on my part?”

“I don’t have the time to learn how to make money!” If I had received one hundred dollars for every time I heard clients complain that they can’t find the time to plan how to save and invest their money, I would have discovered a fast-track method for becoming rich.

With only 24 hours in any day, the reality is that time is limited. However, the perceived lack of time to do any endeavour is really a factor of where your priorities are placed. What you achieve in life is determined by what you desire to find the time to do.

How many times have we complained of an inability to find time to an undesirable chore like housework, but as soon as some exciting event comes around, we have all the time in the world to attend? Continue reading Make Time to Make Money

Breaking Free of Debt

“After reading your article about bad debt last week, I realized that I’m trapped in a cycle of debt. I have been taking our loans over the past six years. Each time I clear off an old loan, I borrow even more money which typically is used to purchase some unnecessary household item. I now owe about three times what I did when I originally started borrowing. Please help me to break free of this debt!”

The current growth in consumer debt has its pros and cons. On one hand, it’s great for the economy, as profits of the lending agencies and retailers increase when people’s appetite for debt grows. However, on the other hand, there are more reports of consumers who are suffering under a debt burden that they find hard to bear.

As we have been discussing recently, there’s ‘good’ debt and ‘bad’ debt. Debts that are financially beneficial are those that can provide you with some monetary advantage in the future; while borrowing to sustain a lifestyle that’s beyond your means will definitely lead to financial challenges.

So if you’re stuck in a cycle of spending and debt, what can you do to break free? Follow the steps below to start your journey towards freedom from debt. Continue reading Breaking Free of Debt

Bad Debt

“I work in the payroll department of a large organization, and I pay out millions of dollars each month to different loan companies. I know that some of these lending agencies charge exorbitant interest rates. My concern is that many of the employees are taking home little and nothing from their pay cheques. How can we get them to realize the dangers of too much debt?”

Consumer debt is on the increase in Jamaica today. The rapid demand for debt could suggest that we’re not able to meet our needs from our income, so we’re forced to borrow to make ends meet. Or it could be an indicator that many people are not willing to defer their desires until they actually earn enough to fulfill them.

With a high appetite for debt comes a resultant growth in alternative lending agencies. ‘Rapid Financing’, ‘Same-Day Loans’, ‘Quick Advance’, declare the advertisements from agencies that offer a fast track loan service. Reports from traditional credit facilities also point to the increase in credit card usage and loan portfolios.

It seems that Jamaica is now ‘debt-crazy’.

Continue reading Bad Debt