Hear Robert Kiyosaki and Kim Kiyosaki
Hear Robert and Kim Kiyosaki on Doing It Right Radio™. Click here to hear Robert speak on entrepreneurship and Kim on the importance of financial literacy for women.
Hear Robert and Kim Kiyosaki on Doing It Right Radio™. Click here to hear Robert speak on entrepreneurship and Kim on the importance of financial literacy for women.
The Entrepreneur’s Almanac: Fundamentals, Facts and Figures You Need to Run and Grow Your Business by Jacquelyn Lynn is a treasure trove of advice for business owners and managers on how to start, run, and grow a business. It’s designed to be something you can read for just a few minutes each day and get ideas and inspiration that will help you boost profits, increase productivity, and improve efficiency. You’ll find words of wisdom from real-world business owners, including names you’ll recognize—such as Russ Whitney, Robert Kiyosaki, Kim Kiyosaki, and more.
The Entrepreneur’s Almanac belongs in your own personal library and will make a great holiday gift as well. It’s available online and in all major bookstores.
More and more baby boomers are going to work for themselves rather than retiring. Some are enjoying tremendous success, others are failing, and still others are just treading water. A lot of things contribute to the differences, but one thing is sure: knowledge is essential to a successful operation.
AARP Magazine recently published a good piece, “Are You Ready to Start Your Own Business?”
If you’re ready to start your own business, consider a business in real estate investing and/or stock trading. Then invest in the education you need to make your effort profitable.
Jackie
The Internal Revenue Services (IRS) has introduced a weekly news service, e-News for Small Business, that will contain timely, useful tax information for businesses and the self-employed. It’s free and scheduled for weekly distribution on Wednesdays. To subscribe, go to http://www.irs.gov/businesses/small/content/0,,id=154826,00.html.
Jackie
The Life and Health Insurance Foundation for Education (LIFE) recently released some interesting statistics on disability. LIFE commissioned a study to analyze disability trends in the United States. In looking at the results, LIFE points out that it’s important to keep in mind that this study examines the individually insured population, which is more affluent and healthier than the population at large. What that means is that the risk of disability is even higher among the general population, a finding supported in other research studies.
Some key points:
Continue reading "What will happen to your business if you become disabled?" »
Regardless of how much—or how little—investment property you own, as a real estate investor, you’re in business. Whether your business is new or established, you can get some great information from the Business’ Owners Playbook, published by The Hartford Financial Services Group, Inc. Click here to order a printed copy or download a pdf file.
Jackie
Florida’s Attorney General (and soon to be Governor) Charlie Crist has issued a consumer alert cautioning Florida business owners against variations of a scam that involves deceptive marketing of corporate minutes services. The scammers try to lure corporations into buying corporate minutes documents.
Click here to read the full text of the news release.
It’s likely this scam is occurring in other states as well. If you have a corporation or an LLC, you are required to maintain files that include corporate minutes (laws vary by state, of course) but you don’t have to buy them from an outside source. If you get pitched by one of these scammers (and their pitches often look extremely credible), check with your attorney or your state’s division of corporations to be sure of your particular status, then report the scam to your state’s attorney general.
Jackie
It’s an unfortunate fact of our litigious society: Most people are, at some point, going to be involved in litigation of some type. It could be personal, such as a divorce, custody dispute, or challenge to a relative’s will. It could be business, such as breach of contract. Or it could be one of thousands of other situations that drive people into court.
Certainly you should take all the necessary steps to make sure you stay out of litigation, but you should also know what you’re going to do if you find yourself in a situation of either suing or being sued.
Here’s what I did to make sure I have the best litigators on my team: I found out who the top litigators in my area are. In talking with the clerks at the courthouse, I asked who files the most foreclosures, who files the most lawsuits, and who are the bulldogs who have a reputation for fighting hard and winning. I asked these same questions of other investors at my local real estate investors club meeting. I asked my own attorney who he preferred not to face in court.
When I had identified the top five or so litigators, I made an appointment with each of them. I explained that I am a real estate investor and that I periodically need legal assistance with issues such as owner-financing, leases and other contracts, evictions, and foreclosures. I gave them a $1,000 retainer that would allow me to call on them whenever I need to.
Because of that retainer, they are legally and ethically bound to not represent anyone who is opposing me in a legal action. It would be a conflict of interest.
There are still plenty of attorneys out there for other people to hire if they need to consult a lawyer regarding any situation involving me, whether it’s a simple contract review or a lawsuit. But the best ones are on my team.
Amy Smith
Trainer, Wealth Intelligence Academy
Foreclosures, Lease Options
Think about what would happen if you lost the data on your computer or PDA (personal digital assistant). Frightening, isn’t it?
Maxell, a manufacturer of digital and analog data storage products, has designated Friday, Oct. 27 “Fall Back-Up Day” to coincide with the end of Daylight Saving Time—although with Halloween just a few days later, the campaign might also be “avoid the horror of a data loss by backing up.”
The point is to remind you of how critical it is that you back up your data on a regular basis, and store your backups in a secure place.
Continue reading "Maxell announces Fall Back-Up Day: backup your data on Oct. 27" »
One of the first things you learn when you go into business is that you can’t do everything yourself. You need help from other people, but not just anyone and everyone. You need expert help from professionals, such as an accountant, a banker, an insurance agent, a mortgage broker, a title company, and, of course, both real estate agents and brokers.
How do you find all these experts? The best way to find the right people for your team is through networking. Networking may come naturally for some entrepreneurs, but for many it has to be learned. In a recent CareerJournal.com article, Harvey Mackay lists six techniques to overcome the fear of networking:
1. Practice “let’s pretend.”
2. Adopt a role model.
3. Take lessons.
4. Keep taking lessons.
5. Join up.
6. Have a little faith in yourself.
Unless networking is “as natural and instinctive as breathing,” you should consider taking a class like Intensified Real Estate Training that will show you how to network while you learn the ins and outs of real estate. In this hands-on training class, professionals just like the ones you’ll need for your real estate investing business actually come into the classroom to help you understand what they do and how to network with them.
Another article, written by Kelley Robertson in About.com, lists the five strategies to make your networking profitable:
1. Choose the right networking group or event.
2. Focus on quality contacts versus quantity.
3. Make a positive first impression.
4. Be able to clearly state what you do.
5. Follow up after the event.
These are great strategies and exactly what the Mentoring Program does for you. A mentor will target the professionals with the required expertise in your community who can help you have a successful real estate investing business. Then they will guide you through the process of meeting with some of these potential power team experts, like a banker or a broker.
You may be asking yourself the next obvious question, “Once I find the expert, how do I get them to help me for little or no money?” I like what Zig Ziglar, a famous author and motivational speaker, says, "You can have everything in life you want if you will just help enough other people get what they want.” In other words, the people on your power team will help you succeed because they understand that in return you will be helping them succeed. For example, when you develop a relationship with a Realtor, he or she is willing to accept a lower commission while working hard to exceed your expectations so that you will bring them more business and make them more successful. It’s a win-win for everyone, which explains why it always works.
Many factors should be considered when choosing the type of entity for your real estate investing business. You have to look at the initial costs, the ongoing costs and requirements of maintaining the entity, and the liabilities associated with the type of entity you select. There are several options available, each of which comes with both advantages and disadvantages.
Sole Proprietorship
A sole proprietorship is the easiest and least expensive option. The set-up costs may include a fee to register a fictitious business name, local newspaper advertising costs, and the cost of either a county or city business license. Disadvantages for this simple choice include an unlimited amount of personal liability, no benefit from business income tax rates, and the inability of the business being sold or passed on to any heirs.
Partnerships
Two or more legal entities or individuals normally create this form of entity with a written agreement specifying the purpose, duties, transferability, and management of the partnership. The big disadvantage is that each general partner has unlimited liability. Also, since each partner is self-employed, the partner’s share of income is shown on their individual tax returns. A limited partnership reduces liability since most of the partners are limited partners, which means they have limited liability. These limited partners, however, do not usually take part in the management of the partnership.
“C” Corporation
A “C” corporation has an unlimited number of shareholders, each of which may consist of any type of legal entity. Limited liability and tremendous tax benefits offer great advantages; however, “C” corporations are the most complex type of entity to set up and to maintain. There are also strict requirements that must be followed, so as not to risk losing the limited liability benefit of the corporation. Another disadvantage of a “C” corporation is the double taxation associated with dividend income.
“S” Corporation
An “S” corporation differs from a “C” corporation in that the corporation’s income directly passes directly to the shareholders’ personal tax return, eliminating the double taxation problem. However, “S” corporations are generally limited to a maximum of 75 shareholders, which makes going public practically impossible.
Limited Liability Company
A limited liability company (LLC) is a hybrid corporation and partnership entity. It has the tax and liability benefits of a corporation with the management structure of a partnership. Articles of Organization are required and the members must establish an Operating Agreement.
Making the Right Choice
Since the entity you choose affects all aspects of your business, including advertising and marketing strategies, the legalities of running a business, taxes, and asset protection, you need to choose the one that best suits your situation. There are many books, software programs, and web sites available concerning business entities; however, none of these products offer the experience and knowledge of professionals who specialize in the real estate investing business.
To move beyond the planning stage you have to set up a business entity. The best way to do that is to take the time to learn the concepts and seek the qualified professionals who can help set up your entity. A great way to accomplish both at the same time is to find hands-on training with in-house experts in Asset Protection and Tax Relief. This will ensure that you take the steps necessary to set up your business for success from the very beginning of the business process.
Even with the recent popularity of real estate investing and the acceptance of it into the world of academia, many still see it as a get-rich-quick scheme. That mindset paralyzes both potential and existing investors, resulting in them giving up before they even begin to develop a business. Many investors narrowly miss the opportunity of success because they fail to realize that if you know and apply proven real estate investing techniques the profit potential is unlimited.
As with any business, deciding on the type of business is the first step. Once you’ve decided on real estate investing, you know you have to learn the business of real estate and how to make money at foreclosures, property management, wholesale buying, etc. It is obvious that you have to know the strategies and continue learning to stay current with these strategies. However, many forget the other side of the equation that involves how to set up and operate a business.
All businesses, including real estate investing, begin and operate on similar principles using a business plan as a road map. Also, the majority of business plans have some version of the following four components listed by the Small Business Administration
1. The mission, purpose, or vision of the business.
2. A description of the business including marketing strategies, competition, and operating procedures.
3. Financial information including start-up capital, loans, loan applications, inventory sheets, balance sheets, profit and loss projections, and cash flow projections.
4. A statement about the management of the business.
In addition to the Small Business Administration, there are books, software programs, trained professionals, and web sites that address business plans. The disadvantage of using these tools to develop your business plan is that you lack the experience to know how to develop your plan for success. This is one of the advantages of using a Mentoring Program for your real estate business. You have an experienced business owner that also knows how to assess your finances and goals, based on your own unique situation, and help you develop a successful business plan.
You must have a business plan! Businesses without a plan fail because they have no target to aim for and no direction to move in, so they just stagnate and eventually fail. Utilize the resources available to learn the concepts of business planning, prepare a draft of your plan, and then find a mentor.