Category Archives: Loans

Using Debt To Expand Your Business


It appears entirely counter intuitive to state it, however it is good for a company to have debt. Regardless of whether the business is an established SME or a local area startup, having a particular degree of debt is an excellent indicator of future development prospects.

Why is this so? To comprehend the seldom talked about aspects of financial debt, we need to first and foremost understand what financial debt is. Also covered in this article, we will be looking at how you can leverage financial debt to your business’s benefit.

What is Financial debt?

According to Investopia, debt can be explained as an amount of cash borrowed by one party from a different party. Usually, debt is used by individuals or companies to make large purchases or fund operations that they are unable to afford under typical conditions.

In return, the borrowing party has to pay back the amount at a later date, usually with additional interest. This interest is a form of compensation for the lending institution taking the threat of offering the funding while likewise functioning as encouragement for the borrower to pay back the debt asap.

Debt Funding Assists Small Companies Fuel Growth

All organisations need capital to keep up their operations, and constant inflow is needed for growth. Financial debt financing permits organisations to get a quick injection to their liquidity in exchange to repay the principal sum plus interest.

However, for small companies without the methods of offering collateral for a secured bank loan or who don’t have enough credit rating, getting debt financing can be challenging.

One alternative would be to search for thebest personal loan Singaporeoffer from a licensed lender. In this case, provided that you show the capability to make good on settlement, you ought to have the opportunity to secure a funding in relatively swift time.


Financial Leveraging Utilizing Financial Debt

Financial leverage involves borrowing an amount of money for an activity that will return profits a higher rate than the interest owed to the loan. When successful, the debtor is said to have achieve an excellent Return On Investment (ROI) on the financing.

For example, you may have a client who wishes to purchase 100,000 units of your product. Unfortunately, as your company is still young, your supply chain may just manage a manufacturing of 600,000 units. Just how then can you still utilize the opportunity?

The solution lies in obtaining a company financing to enhance your setup. Provided that the revenue of the deal is more so than the interest owed, you would certainly have earned money on an opportunity that was not possible without the loan.

In conclusion, by accepting financial debt at the right time, you can take advantage of upcoming business opportunities that you otherwise would not have been able to tackle.

The SECURE Act and Your Retirement

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How much have you saved for retirement? If you answered, “Not enough,” you’re not alone. According to Northwestern Mutual’s Planning and Progress Study 2019, 22 percent of Americans have less than $5,000 stashed away for retirement. Another 15 percent have no retirement savings at all. Fortunately, new legislation designed to make saving easier is currently working its way through Congress.

Known as the SECURE Act, or Setting Every Community Up for Retirement Enhancement Act, H.R.1994 was passed by the House of Representatives in May 2019 with overwhelming support. Many of its 29 provisions are tax-payer friendly and intended to help Americans boost their retirement savings. While not all of the act’s changes will affect everyone, there are several provisions which will impact many savers.

Required Minimum Distributions (RMDs)

People are living longer than they did a generation ago, putting many retirees at risk of outliving their savings. The SECURE Act will address this issue by changing the age at which you must begin drawing funds from a 401(k) plan or IRA from 70.5 to 72 years old. This gives savers an additional 18 months to take advantage of the tax benefits provided by these retirement accounts and should help stretch savings out longer.

IRA Contribution Age Restrictions

Currently, you cannot contribute funds to a traditional IRA if you are 70.5 years old or older. The SECURE Act will eliminate this rule, enabling savers to sock money away in their traditional IRA for as long as they want to regardless of age. We think it’s a significant change, as the study we mentioned earlier found 18 percent of Baby Boomers expect to work past the age of 74.

Employer-Sponsored 401(k)s for Part-Timers

Under current laws, employees who work less than 1,000 hours per year cannot participate in employer-sponsored 401(k) plans. This makes it much harder for part-time workers to save for retirement. The SECURE Act aims to eliminate this issue by guaranteeing 401(k) eligibility to part-time employees provided they have worked at least 500 hours per year for three or more consecutive years.

Annuities and Lifetime Income Options for 401(k)s

The SECURE Act will make it easier for employer-sponsored 401(k)s to offer annuities and other lifetime income options to employees and allow employees to roll over existing 401(k) annuities without paying surrender fees should they change jobs. Additionally, the act will require plan administrators to provide annual lifetime income disclosure statements to participants, not just their 401(k) balance. This change should make it easier for many savers to evaluate how much money they’ll have to live on each month once they retire.

Higher Automatic Contribution Rates for Employer-Sponsored 401(k)s

Under the Qualified Automatic Contribution Arrangement (QACA), employers are able to automatically enroll eligible employees in 401(k) plans and set automatic contribution rates up to 10 percent per year. While employees can opt out of enrollment, studies have shown that most don’t, which effectively increases the number of workers saving for retirement. The SECURE Act will increase the cap on automatic contribution rates to 15 percent per year, enabling employers to offer their workers the ease of greater automatic retirement contributions.

Retirement Plans for Small Business Employees

Historically, many small businesses have been unable to afford to offer their employees retirement plans such as employer-sponsored 401(k)s. The SECURE Act will try to change this by increasing the tax credit available to small businesses who set up a retirement plan from $500 to $5,000 and creating a new $500 tax credit towards start up costs for 401(k) and IRA plans that include automatic enrollment.

Of course, before any of this can happen, the SECURE Act must be passed by the Senate and signed into law by the president. As of late November 2019, the legislation is stalled. While some pundits say it’s still possible it may pass in fiscal year 2020, Senators may make changes to the law once it gets to the floor. But regardless of the timeline, we expect the SECURE Act to eventually make saving for retirement easier for countless Americans.

How a U.S. resident can receive tax-free alimony from a Canadian


While most people know that alimony is normally taxable income to the recipient and tax deductible by the payer, in the case of cross-border taxes, alimony can be received tax free while the payer still gets a tax deduction.

Let’s look at an example where this would apply.

Sarah is a U.S.Citizen who has been transferred to Toronto for a job opportunity.  While living in Canada, she meets and falls in love with John, a Canadian citizen. After a few years of dating, Sarah and John decide to get married and live together in Toronto. Five years into their marriage, due to irreconcilable differences, they decide to divorce. Sarah chooses to return to the U.S. to live close to her family.  As part of the divorce settlement, John must pay Sarah alimony.

Since John is a Canadian tax resident, he will be able to deduct the alimony payments to Sarah on his Canadian tax return. But with the right cross border tax planning, Sarah can exclude her alimony from U.S. tax. How? By including specific language required by the IRS in the divorce agreement. In our couple’s case, they would include language along the lines that John agrees not to deduct the alimony payments for U.S. tax purposes. Since John is a Canadian tax resident only, he is still able to deduct the alimony on his Canadian taxes and is not affected by the agreement.

While this is a very simplified example – the rules to make this legitimate are more complex – the fact remains that in Sarah’s case, a U.S. resident can receive alimony tax free for U.S. tax purposes. In John’s case, he also gets to reap the tax benefits from this strategy, unless he decides to take up a job in the U.S. and become a U.S. tax resident.

Tags: cross border tax planning, cross border divorce

Fast Auto Loan Financing Lets You Get Better Deals!

A need for fast auto loan financing isn’t always a sign of impatience. Getting a car loan quickly saves you thousands when buying a car. Walk into a dealership or third party sale with financing already lined up and you have the advantage in bargaining for a better deal and to act fast on it.

Online Fast Auto Loan Financing

Today’s best source for fast auto loan financing is the Internet with all the advantages of a traditional lender like no application fee, no down payment and negotiating ability of having cash in hand. Then there are additional advantages of an online service like easy application, nearly instant approval, 24-hour online access to your account and a money-saving automatic payment option. But the best is their interest rates being 1 to 2% lower than the national average.

Before making a commitment for an online auto-financing loan, consider the additional requirements. If you’re buying a classic car or motorcycle, loan products are limited, with more restrictions. Also online lenders are reluctant to fund loans under $7,000 or over $75,000.

Bad Credit Can Be An Issue

For fast auto loan financing online, credit problems are more of an issue than with dealerships. But credit problems can be overcome with lenders offering higher risk loans. These have more restrictions and slightly higher rates.

First of all decide on your figures. How much exactly are you willing to pay, how much do you give for down payment, how much per month? Be realistic in these assessments to accurately compare financing options.

Eventually the monthly maintenance and annual fee will end up costing you more than you want for credit. If you want a card, look for one that has one of the two but not both. To be better organized, make a quick comparison chart with the card names, set up fees, interest rates (variable or fixed), monthly and annual fees. Mention also if a single late payment can lead to increased interest rate. Cards may be expensive but worth reestablishing your credit with, if you look for the best deal around.

Differences On Interest Rates

With these issues settled, decide where you’ll find the best terms. As a general rule, the best interest rates are from credit unions, followed by banks and dealerships being the worst. As per specific promotions, dealerships and online auto financing establishments can also offer competitive rates.

Next, comes applying for the loan. Apart from information on the car, most lenders will inquire about income and expenses. Ensure you keep rent documentation, house payments, pay stubs, tax returns and other sources of income and assets with you.

There’s a world of difference between used auto financing and new car financing. While the former makes better deals than the latter, it doesn’t apply to used car financing there are quick loan finance available as well. Used cars being less profitable for lenders and more risky, there are a lot more restrictions and higher rates than new car loans.

Financing Loan – For What You Really Want

When talking of financing, it means you borrow money to pay for something that is valuable or has value. So a financing loan can be used by a person borrows money to financial institutional or bank. There are many types of loans, there is car or auto financing, home financing, business financing, student financing, etc.

When you are looking for financial institution to have your loan, it’s more important that you get the right reputable lending institution that will give you an access to a suitable loan. Every lending or financial institution has different terms in payments and has different interest rate as well.

The most common loan is the car, the business loan and student’s loan. For businesses, they might have financing loan to expand their businesses or need more funding to their capital. People who want to have a car can also avail the financing loan as well or people wants to have a house of their own. And if you want to go on with your study and lack of money, you can also avail this type of loan.

Financing loan has a higher interest rate compare to regular loans and one must be aware of that although there are some that offer low interest rate but that financial institution is you need find. That is why the best way to get the lowest interest rates on loans to shop around, get quotes and compare.

You can also find loans online through the internet where in you can get a free quote with easy access and convenient. Remember that in finding the reputable financial institution, one should be careful because even in the internet, there is still scammer. Shopping online is good for window shopping only and asks for free quotes since you cannot see personally the person online unlike when you go to their office.

Borrowing for small amount of money, financing loan is not appropriate since you can borrow that to your relatives or friend without interest. What is important is that you have to pay what you borrow in due time. Going to financing loan for just small amount of money is not practical at all since you have to pay for the high interest rate.

What is important when you go to financing loan, be sure you have a good credit record for them to accommodate you. Loan is good if you get profit from it and this is good for businesses and as well for home loan. Good planning is needed when you want to have a financing loan. Study it well and have some idea before getting a loan.

Most of the financing loan, they ask for an asset or collateral to be sure that if ever you cannot pay your loan, they have something to pull out and sell it to gain back the money you borrow. To borrow is easy but to pay back is hard since you don’t know what will be your future takes. So think it over wisely before getting a loan.

Think why other financial institution accept bad credit rating to have loan from them, it’s because the profit they will get is bigger, aside from the high interest rate, if you cannot pay on expiry date, they have to pull the asset which is the collateral and they have the power to do that. That is why one should read carefully the term and conditions before signing.

Personal Finance – Loans Worth Not Considering Whilst Fighting Debt

When it comes to improving your finances, easy answers and shortcuts just don’t exist. You’ve
just got to bear down and do it. Advance fee loan: Just as its name implies, personal check to the lender for the amount of money you want to borrow plus the amount of the lender’s fee usually a percentage of the loan amount or a set amount for every £50 or £100 you borrow and you agree to repay the loan on your next payday.

To get this kind of loan, you must pay money up front to the lender sometimes as much as several hundred pounds. Some advance fee lenders will take your money and run, but others will give you a very high-interest loan. Traditional lenders do not make advance fee loans.

Payday loan: This is a very short-term high-interest loan made by check-cashing companies, some finance companies, and businesses that do nothing but make payday loans. To get this loan, you write a

On your next payday when you repay the loan, you get the check back. If you can’t repay the loan on the next payday, the lender rolls over the loan until the following payday in exchange for your paying the lender another fee, which will probably be higher than the first fee. Over time, if you keep rolling over the loan and paying higher fees, the cost of the loan skyrockets and you have a harder time paying it off.

Finance company loan: Finance companies make relatively small high-interest loans.

Whilst some finance company loans are downright dangerous: The lender may be less than honest about all the fees associated with its loan, or it may mislead you into thinking that you’re getting an unsecured loan when the loan actually is secured by one or more of your household goods, such as your furniture, entertainment center, and so on. (This detail is usually buried in the fine print of the loan agreement.) If you default on the loan, you risk losing the asset(s).

Some finance companies encourage consumers to get a bigger loan than the consumers can afford
so they’ll end up in default.

Pawnshop loan: This is a short-term loan (no more than three months, in most states) with a very high interest rate. With this kind of loan, you give the pawnshop an item that you own, such as a TV, DVD player, piece of jewelry, or computer. The pawnshop lends you a percentage of the item’s value. At the end of the loan period, if you cannot afford to pay the loan plus interest, the pawnshop keeps your item and sells it.

Car loan: If you own your car free and clear, some lenders will make you a loan for a small fraction of what your car is worth. Usually the loan will be for no more than 30 days and will have a very high rate of interest. To get the loan, you must give the lender the title to your vehicle and a set of car keys. The major danger with this kind of loan is that if you miss a loan payment, you risk losing your car. Depending on the loan agreement, one missed payment may be all it takes.

Getting A Business Financing Loan

Business financing loans are a line of credit which help people who are in business. There are different kinds of business financing loans that are offered to different lenders either to raise funds or loan capital to your business in order to expand your company.

Although there are many ways also to finance your business and one should have sufficient cash flow within the existing business you have so that the lender will be able to finance the growth of your company by its own means or you can turn to a bank or other financial institutions that can provide different variety of loans.

Having a business financing loan is not as easy since they have some criteria or financing programs where in you meet the following criteria such as:

Your business must have commercial customers
Your business must be established and must have consumers or customers.
They don’t finance on real estate projects

Some of the business financing programs:

Business are available of every size
Easy to obtain
Have many advantages over conventional business loans
Can be set up in a few days

There are some business financial loans that don’t require you to have a good personal credit or showing countless financial statements since their financing program or loan allows being flexible to help your business grow but before looking for a business financing loan, you need to know how business loans work and used.

You can see that there are many sources of financing loans that are geared to types of businesses but the sources have certain criteria for investment and loan but that depend to the area which they participate.

These are some of the areas of Business Financing Loan:

Commercial Property
Start-up Financing for business
Loans for Government
Purchase Order Advances
Leasing Equipment
Commercial Financing
Invoice Factoring
Asset Sales Leaseback
Investment Banking
Angel Investor s which is known as informal investor
Venture Capital known as Private Equity Capital

But private money business financing loan is different since it includes equity loan, hard money as well as private money loans. They limit only to small business investment companies, private investors, business angels, ventures capital firms and commercial lenders.

The loans have two types for you to choose when in regards of terms in payment. There is the short term and as well as long term which suits your budget and you will notice also that there are lots of commercial lenders, business loan brokers and business financing companies had gone out of business due to global crisis and many people were having loans anywhere and everywhere in order to survive.

If you need financing for your business, you need to plan and study hard of it since financial institutions requires business plan that includes detailed start up cost, marketing plans, monthly expenses, projected profit, etc. Remember that having a business one should do hard work, passion, and determination and have dedicated workers who desired to have the business of their boss grow with success.

So If you think that your business is doing good and need some additional capital for expansion, then you need to plan for that and think it over to have a successful business.