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Personal Financial Planning – Risk Management

Risk management in financial planning is the systematic approach to the discovery and treatment of risk. The objective is to minimize worry by dealing with the possible losses before they happen.

The process involves:

Step 1: Identification

Step 2: Measurement

Step 3: Method

Step 4: Administration

Risk Identification

The process begins by identifying all potential losses that can cause serious financial problems.

(1) Property Losses – The direct loss that requires replacement or repair and indirect loss that requires additional expenses as a result of the loss.

(For example, the damage of the car incurs repair cost and additional expenses to rent another car while the car is being repaired.)

(2) Liability Losses – It arises from the damage of other’ property or personal injury to others.

(For example, the damage to public property as a result of a car accident.)

(3) Personal Losses – The loss of earning power due to death, disability, sickness or unemployment and the extra expenses incurred as a result of injury or illness.

(For example, the loss of employment due to cancer and the required treatment cost in addition to normal living expenses.)

Risk Measurement

Subsequently, the maximum possible loss (i.e. the severity) associated with the event as well as the probability of occurrence (i.e. the frequency) is quantified.

(1) Property Risk – The replacement cost necessary to replace or repair the damaged asset is estimated by a comparable asset at the current price. Indirect expenses for alternative arrangements like accommodation, food, transport, etc, needs to be taken into account.

(2) Liability Risk – This is considered to be unlimited as it will depend upon the severity of the event and the amount the court awards to the aggrieved party.

(3) Personal Risk – Estimate the present value of the required living expenses and additional expenses per year and computing it over a predetermined number of years at some assumed interest rate and inflation.

Methods Of Treating Risk

A combination of all or several techniques are used together to treat the risk.

(1) Avoidance – The complete elimination of the activity.

This is the most powerful technique, but also the most difficult and may sometimes be impractical. In addition, care must be taken that avoidance of one risk does not create another.

(For example, to avoid the risk associated with flying, never take a flight on the plane.)

(2) Segregation – Separating the risk.

This is a simple technique that involves not putting all your eggs in one basket.

(For example, to avoid both parents dying in a car crash together, travel in separate vehicles.)

(3) Duplication – Have more than one.

This technique requires preparation of additional back up(s).

(For example, to avoid the loss of use of a car, have 2 or more cars.)

(4) Prevention – Forestall the risk from happening.

This technique aims to reduce the frequency of the loss occurring.

(For example, to prevent fires, keep matches away from children.)

(5) Reduction – Minimize the magnitude of loss.

This …

What’s in Your Record of Achievement Folder?

At 16, each child leaving school gets a Record of Achievement folder. The National Record of achievement or NRA is recognised throughout the UK and can be used as evidence of the holder’s achievements whilst at school.

The NRA can be taken to job interviews, colleges, apprenticeships or whatever route you plan to take on leaving school. It shows other people how you’ve spent your time in education and the positive things that you have to offer. The NRA is also a useful way to see what you’ve achieved so far in black and white and think about what to do next.

Before the NRA

There are a number of processes that lead up to you receiving your NRA.

Throughout your time at school you’ll be required to take part in a number of activities relating to the National Record of Achievement Folder, these will include:

  • Keeping evidence of achievements and building a portfolio
  • Assessment of your progress through reports and examination
  • Planning your next actions and setting targets to improve your NRA

What does the Record of Achievement Folder Look Like?

The NRA is generally presented in a burgundy folder, but your school may have chosen a different type of folder for their students. A number of standard sheets should be placed inside the folder including:

  • Your name, address and personal details
  • A summary of your educational achievements
  • A personal statement

You can also include any other records that could be useful when applying for a job, apprenticeship or college place, such as:

  • Credits and qualifications
  • Work experience history
  • Employment history
  • Awards
  • Attendance records

In addition the NRA will include an Accreditation Certificate which demonstrates that your school has monitored and organised the processes of achievement correctly.

Now What?

You should be preparing your Record of Achievement folder throughout year 11 as job and college interviews can happen quite quickly. In most cases if you’re planning to attend college, interviews will start around Christmas time so your NRA needs to be prepared by then.

Take evidence of anything you feel may be relevant to what you want to do. For example, if you want to study English then take photocopies of your most impressive essays. If you’re planning to find an apprenticeship in the building trade then take photos of the things you learn or anything you make at school which could support your application.

However, it’s also important to tailor your NRA so it’s fit for purpose. In other words be selective about what you include when you’re showing it to different people. For instance, if you’re planning a practical apprenticeship your interviewer will want to know your GCSE grades and see evidence of your practical achievements, they won’t want to read your essay on Richard III.

During year’s 10 and 11 you’re entitled to lots of help with your NRA. Your personal tutor should have at least three meetings with you to look at your folder and help you get organised. In addition, you’ll get help writing …

Stay Safe – Practice The Three A’s

Would you pass a safety test? As a woman, do you feel safe while traveling, going to the supermarket, getting in and out of your car, or even sitting at home watching TV? Do you live your life in a safe mode or do you believe that nothing untoward will ever happen to you? It behooves us all, women and men alike, to develop our own personal safety plan.

I like to live my life by following what I call the Three A’s…be Alert, be Aware and Always be at the ready. The following tips are mostly common sense but always bear repeating. We can no longer enjoy the luxury of safety. We must take the initiative and look out for ourselves.

Staying alert to our surroundings, to everyone in our immediate environs, is of utmost importance. Too often we walk by people with our head down, totally ignoring who is coming our way or walking past us. This is a mistake and could lead to a fatal mistake. Pretend you’re a law enforcement officer. What do they do when they’re out in public? They are alert. They look people in the eye, noticing their movements, their facial expressions, making a mental note of their facial characteristics, how they’re dressed. The majority of the time this may turn out to be an exercise in futility but we never know when this information that we’ve assimilated may come in handy. We never set out for the day thinking that we might be a victim of a crime or a witness to a crime.

Here are some tips to Always keep in mind:

· If your big concern is rape, remember that most rapists (according to the rapists themselves) look for women with hairstyles that make it easy to grab them – a long ponytail or braid or any hairstyle that can easily be grabbed. Rapists like women with long hair. I’m not advising that women cut their hair off, but just be aware of your hairstyle as you go about your daily activities.

· Keep your cell phone easily Accessible so you don’t have to search through your purse looking for it, thereby being distracted from your surroundings.

· Be especially Alert in parking lots, even at your neighborhood grocery store. Public restrooms are other places where we’re particularly vulnerable.

· If you’re confronted by someone you feel is suspicious, talk to them, ask them a question, look them earnestly in the face, studying their looks. This will let any potential rapist know that you could identify them in a police lineup.

· If you feel that someone is approaching you in a threatening manner, hold your hands out in front of you and yell “Stop.” Let them know you will not be an easy target. Rapists don’t want anyone who is going to be a problem.

· Always carry pepper spray with you and make sure it is handy at all times. You don’t want to be searching through your …

MLM Vs Cooperative Marketing – Which is the Best Home Business Opportunity?

If you are considering starting any new business venture, or getting into MLM/Network Marketing in particular, you owe it to yourself to read this article — particularly if you are a newbie.

These days, most people are familiar with MLM/Network Marketing. However, most have never heard of Cooperative Marketing. Those that aren’t may find the content herein to be shocking and amazing, if not revelatory and potentially life-changing.

Cooperative Marketing has been around for a long time in the mainstream business world, but it is relatively new to the “home-based business” world. The term can mean many things, but in general it means that the retailer is receiving marketing assistance from the manufacturer, supplier or other large-scale enterprise. Such advertising “co-ops” are common in many brick-and-mortar industries, including the grocery, insurance and publishing businesses.

In the case of a home based business, it means the company you are working with is taking on a major burden that normally would fall to you: the marketing of the product. In fact, the better Cooperative Marketing companies do much more than this, including actual selling, distribution and customer service. To date, only a relative handful of companies use this business model (compared to the hundreds of MLMs out there).

More’s the pity, because a growing number of “work at home” authorities consider it the far superior business model — both for the companies in question and for their individual representatives. Though the two business models have many similarities, they are more clearly defined by their differences, which are explored in this article.

MLM (MULTILEVEL MARKETING)/NETWORK MARKETING

As you probably know, the MLM/Network Marketing business is a huge industry. Many household names (Amway, Avon, Mary Kay, Herbalife, Shaklee, etc.) have had tremendous success using this business model, and many thousands of representatives (also called associates or distributors) have built profitable businesses in the industry. A smaller but still sizable number have built successful enough businesses to live very, very well indeed.

The MLM/Network Marketing business is based on the idea that reps are responsible for just about everything in their business, other than producing the product and handling commissions and bonuses. The company does these last chores, while the representative must undertake tasks which many find difficult and even onerous.

First, reps must find their own customers. Second, they must find new people to join their businesses with them. This is known as building a downline, and great success in the industry is predicated on having a large and thriving one. Specific business plans vary from company to company, but generally speaking you will not reach the top of the leader boards by selling alone. Third, reps may be required to order certain minimal levels of product every month, warehouse those products, distribute them, handle returns, etc.

While it is true many people have had great success in MLM/Network Marketing, it is also true that a far greater number have had little or no success. The plain truth is, not everyone is cut out …

The 4 Levels of an Insurance Career Path

You may see many newspaper ads tying to hypnotize a prospective agent stating how easy it is to make $100,000. Moreover, they emphasize it can be done in the first year. Please give me a nickel for the 1,500,000 licensed life and health insurance agents that cannot achieve that. ($75,000 if you are calculating). Before $100,000 of income can be reached, most agents must achieve at least the third if not fourth level.

LEVEL ONE This is the insurance trainee, just starting out and continuing the first 12 months. This level is actually more about survival than it is about earnings. Many insurance trainee agents deplete savings accounts, ask relatives for loan assistance, and even take out a second mortgage on their house. Either they should have never applied for the position or the insurance agency has provided inadequate assistance to ease the agent’s burden. In the majority of cases, it is the later. Only 20{4917788a0bd7aa7369c2a945027b4fe6c9853cda4150a24fe1255b18ce3083dc} of agents struggle by, only to encounter another enduring battle.

LEVEL TWO This is the insurance rookie, who will be facing three more years of uphill challenges. Again, survival appears in the picture, along with enough income to keep from going under. The life preserver is based on both the agent’s attitude and selling skills. Selling skills start with finding the right people to focus your attention on. People that fit into your comfort zone and have a need for an insurance product you are familiar enough selling. This leads to giving a sufficient quantity of appointments. However, company provided scripts are a hard way to go when doing a presentation.. Of the appointments made, can the still inexperienced agent produce enough sales for a decent income? Only 8{4917788a0bd7aa7369c2a945027b4fe6c9853cda4150a24fe1255b18ce3083dc} of the starting agents now remain.

LEVEL THREE These are the insurance innovators with over 4 years experience and under 8. Why are they innovators? To survive the have broken just about all the career company rules of the plan to success. First, they have tossed out the insurance company presentation book, sometimes in favor of a plain yellow legal pad. The company presentation speech has been discarded in favor of a friendly conversation. The insurance innovator uses a lead acquisition system that quickly brings out the highest qualified prospects. This agent has stopped becoming an insurance seller. He now helps guide the prospect to a tailored plan that turns the prospect into a buyer. In addition, the insurance innovator has a valuable base of built up clients for additional sales.

As insurance is now officially a career, few of these agents drop out. Many start to specialize in selling fewer products. A lot now are semi-independent and some even have their own firms. For others they make take a new direction, with a different company or firm that seems much more promising. Incomes are often comparable or higher than the national average.

LEVEL FOUR The true insurance professionals. Numerous pros are fully independent. They have often signed contracts with six or more independent life …

What Is Your Style? – 8 Style Quotients And Their Traits Explained

The guy that is so “Sporty”. She is so “Classy”. We often hear such remarks. But have you wondered what exactly these styles means? Have you wondered, what traits, dressing styles go along with each of these style quotients? Read on to know more about 8 different such style quotients:

Frumpy:

Your life is over burdened with work commitments to even spare time for your looks. Appearance is secondary or tertiary in your list. You prefer easy and comfortable clothing over the fashionable ones. You generally do not co-ordinate what you wear, more so in such a hurry or dislike to check your reflection on the mirror. You pick up the most comfortable pair of clothes on display and do not mind walking out in slippers. You generally window shop without much personal interest. Whatever glitters does not catch your eye. You priority is your work and practicality and feasibility and the comfort that it offers. You love who are, and have no qualms or regret about it!

Casual:

You like to let your hair down at most of the times, are extremely comfortable in your skin and value comfort over anything! You don’t fancy products in vogue always; it has to suit your personal taste to land up in your wardrobe. You prefer to chill out with your peeps over cold coffee or beer (if you are within the permissible limit), gossip, catch up with latest releases in your shorts! You are laid back when it comes to fashion, so you mellow your style to keep the fun factor intact while making yourself an easy combo to slip on! You love colors and free-flowing silhouettes. You love wavy prints and strut around in your shorts with your sport shoes or casual t-shirts on!

The Girl/Boy Next Door:

Your sparkling eyes and dimpled smile do all the talking! You have easy, uncomplicated and appealing way with others; traits which are easily recognizable by your baggy jeans, sweat-shirts and carelessly ruffled hair! You have an easy-going air about yourself which is reflected by your gestures and attire alike. You love to share a laugh with everyone around you, eat out with your girls and also occasionally gossip/ bitch about other girls. You love to receive and give flowers, chocolates make you go weak in the knees and you love your old and faded jeans way more than anything in your life! You are recognized around for your pony tails and the cute ear piercing and did we stress on the fact your “cute” smile!

Sporty:

You are extremely active and like to reflect the same from your sense of dressing. Functionality rules foremost than fashion and a colorful closet is also your asset! You love your track pants and drool/ window shop every time you pass by an Adidas, Nike, Puma or Reebok store. Cool Athletes have influenced you enough with their athletic looks in shorts or mini-skirts to make you take notice of yourself. Sport-stars and their sporty style appeal …

Vending Machine Business Record Keeping Basics

Keeping good records of the status of each of your vending machines when you service them is both a critical and very easy practice. Even for those who strongly dislike record keeping and struggle with the practice, the process is not overly taxing. The benefits, after all, far outweigh the small inconvenience that it presents. After all, by keeping records, you will be able to see how you are doing over time so you will know exactly which machines are offering the best performance, how many of what product is being sold, and what profits you can anticipate in the weeks and months to come.

As a business owner, this is information that you need. With even the most basic record keeping, you will have a much more thorough understanding of your business and how it is doing from one machine to the next. This allows you to continue what you are doing right with some machines, and consider the relocation of other machines that just aren’t performing as they should be.

That being said, you will also greatly appreciate your efforts to keep accurate records when tax time comes around. Nothing is more painful than trying to scrounge together exact numbers from records that are either sketchy or non-existent.

The two kinds of records that you will want to consistently maintain within your vending machine business are a basic ledger and a report of all of the locations on your route. The basic ledger is essentially your general bookkeeping. It should document all of the income and expenses totaled from all of the locations on your route. You can do this on paper, but it is much easier and faster if you use a simple bookkeeping program on your computer. If you save all of your receipts and keep a good route report, you will be able to update your ledger quickly and easily each time you complete a service route.

While on your service route, you should keep a record of the status of all of your machines at each location. Each machine should have its own page where you take notes from each servicing. This way, you will be able to flip to the page for any given machine to observe its performance including expenses, income, the placement of products, and the popularity of each of the products.

When your business is still small enough for you to do all of the routes yourself, you will be responsible for all of the record keeping for both the ledger and the route. However, once your business gets large enough that you need to hire someone to run some or all of your routes for you, you will need to make sure that that individual is also keeping the detailed, accurate records that you need to make all the difference in understanding the success of your business.

The same thing goes if you wish to hire a bookkeeper to keep track of all of the income, expenses, and other …

The Importance Of Continued Personal Development

We are all unique individuals having different personality types. Some are more enthusiastic when it comes to learning new things compared to others. However, we are all capable of motivating ourselves to face challenges as well as gaining new experiences for our continued personal development.

In terms of career opportunities, outstanding managers endeavour to improve themselves so as to be ready to face this fast changing world. They are aware of the significance of continued personal development.

Continued personal development helps in improving the knowledge that you have. This is mainly because continued personal development is an experience wherein you can achieve self-awareness as well as self-improvement.

If you want to engage in self development, you should be open to changes and challenges from people around you. You might as well ask yourself these questions, What is my comfort zone? Am I ready to let go of it for the sake of self-improvement? Am I willing to accept and learn new things as well as listen to fresh ideas from other people?

Then, ask the help of those around you, your employees or team members, to motivate and encourage you by asking challenging things and question your decisions in order to compel you into considering other perspectives. Do not forget to thank them for helping you out in your quest for self improvement.

To learn more is to gain more knowledge and skills. The skills and knowledge you have gained may be a big help to be successful in your line of work. Keep in mind that past experiences and knowledge are slowly becoming obsolete. For this reason, self development is needed for you to succeed and come out on top of your field.

The most valuable assets that you have are the knowledge you have acquired from your experiences as well as the action that results from it. By cultivating these assets, you can be on top. Improving your knowledge with the help of self improvement techniques can give you the success you desire to have in your life.

You earn more by learning more. Engaging in continued personal development could make you live your life with confidence. When you commit and dedicate yourself to continued personal development, you are continuously developing your knowledge, skills and abilities which could pave the way for your success. You should not be afraid of change, for change is the only constant thing in this world and only continued personal development can make you face these changes.…

Merits and Demerits of Debt Finance

Debt financing means to borrow funds or to arrange for investments from external sources. Large scale businesses and organizations are not able to run all their affairs from their own capital so it is usual for them to take loans. The most prevalent example of this type of finance is the loans taken from banks. The amount of the loan is to be repaid in agreed installments along with interest at a specified rate.

Merits of Debt Finance:

Following are the merits of debt finance:

(i) Scope for Expansion: Debt financing allows business to expand its operations. New branches can be opened in other cities and countries. New lines of business can be adopted to increase revenues. The easy availability of credit encourages entrepreneur to take new risks and float new products. It also enables businessmen to increase the scale of their operations and to upgrade their products in time.

(ii) Research and Development: Debt financing allows the process of research and development. Loans taken from banks can be used to accelerate R & D activities. Earning potential of the company increases when the research hard products are floated in the market. The new innovation, besides increasing companies reputation, also reduces its cost of production.

(iii) High Profit: Due to expansion of business and use of new techniques the revenues and profits of the business also grow. Huge revenues means that there will be a room for further expansion of the business. Higher profit can also be used to repay the bank loans. Thus increasing the solvency of business.

(iv) Ease of Working Capital: Debt financing helps in maintaining adequate working capital of the business. It also provides a room for making regular payments easily.

(v) Revival of Sick Units: Debt financing may be used to give a breathe to the sick industrial units. The organization’s loans can be rescheduled and new credit can be taken for such units so that they can start their production. Besides providing finance, proper supervision and guidance should also be given. All this will rehabilitate the sick units and can help them to be successful and profitable units.

(v) Saving from Insolvency: Debt financing may be used to save the business from insolvency. In case any essential payment is to be made and there are not enough equity funds then a loan can be taken to make payments and to save the business from insolvency.

(vi) Tax Advantage: As the interest charge is subtracted from net income before applying tax rate, so this leads to lower tax liability.

Demerits of Debt Finance:

Following are the demerits of debt financing:

(i) Interest Payments: Very huge amount out of net profit of the business have to be paid on account of interest on borrowed capital.

(ii) Depression: If a business comes under depression and losses occur, then the payments of interest could become a great problem due to inadequacy of funds.

(iii) Suit Against Business: Creditor can file suits against business if business fails to make …

Check Cashing Business in Florida

Starting a check cashing business in Florida is a process that requires several steps that must be planned before filing for the license, and risking a loss of money and time.

The check cashing business in Florida is profitable but at the same time it is a risky business which must be minimized through the adoption of special measures and procedures.

It is important to obtain proper advice from experienced and qualified professionals to avoid expenses and delays to obtain a check cashing license.

Obtaining a check cashing license in Florida, also known as FT3 license, requires several steps:

The first step is to register with the federal government as a Money Service Business (MSB). This process is done electronically, and in order to file said registration any new applicant must set up an account with the US Treasury Department's Financial Crimes Enforcement Network, commonly known as FinCEN. The registration is done through form FinCEN 107.

Registration with FinCEN places the company under the Bank Secrecy Act (BSA) laws and regulations. Those regulations imposes several requirements on the company. One of those requirements is to develop and implement an Anti-Money Laundering (AML) program which must contain policies and procedures that the company will implement as part of their check cashing operation. Some companies tend to use AML programs devised for other type of financial services such as money order sales or money transfer services. However those programs are inadequate for check cashing and they do not meet the requirement of the BSA for a check cashing operation. Another requirement is to design a compliance officer. This person is liable to ensure that the AML program is being thoroughly implemented. There are other BSA requirements which must be met, and therefore the compliance officer and employees of the company must be aware of said regulations.

After the FinCEN registration has been confirmed, an application with the Florida Department of Financial Services, Office of Financial Regulation (OFR) must be filed. This application contains several parts, and must be filed electronically. As with the FinCEN registration, the applicant must set up an account with the OFR's Real System for thie purpose. It is extremely important that all information requested will be provided in a complete and accurate manner to avoid delays in the process. In our experience the vast majority of delays in obtaining such a license come from errors in the original application form. Several documents must be attached to the application, among which is the anti-money laundering program which must be previously drafted. Another form that must be submitted is a fingerprint card for each of the individuals included in the application, which will be used for a background verified by the Federal Bureau of Investigation.

Once the license is obtained it is important to keep present that the State of Florida has multiple requirements that must be met by check cashers. Also the check casher is subject to audit examinations to verify that the company is operating with the parameters …