When you take out debt, or use the credit line, that influx of cash does not show up in the profit and loss statement. Neither does the repayment of said debt. This is true for bank loans, owner loans, and credit cards. As business picks up, and cash is used to repay this debt, you may show a solid profit on your P&L, but not have anything in the bank. Not to worry, your overall asset picture is better (but that’s on your balance sheet).
Then, there is Robert G. Allen who wrote ‘Multiple Stream Of Income’ and in it he listed down ten recommended money habits which includes managing money. He goes to the extent of asking for a receipt every time you make a purchase and by the end of the month, you make an inventory of it. If there is a leak in your financial boat, you want to know where it is so you can plug it, right?
Getting financing to rehab houses is harder now than before the crash, but can still be done. The preferred method to buying houses for rehab is cash or using an equity line of credit. This way if you are dealing with a motivated house you can close right away without the hassle of jumping through a lenders hoops. If this isn’t an option, you can find a private lender to fund your real estate deals. By offering friends, family, and anyone you know 8-10% interest you should be able to raise the money. You can set it up to defer payments to them until the rehab is complete and you sell the property. You will give them a first mortgage and personal promissory note in exchange for the money. This means they get the house if something goes wrong and can come after you personally.
If you only have staff and not team, you’re working for your staff for free! Staffs are simply reactive people on your payroll that you need to continuously ensure that they do their work, especially when you’re not around. Team are those that work as though they’re working for their own company. You need to build winning teams or you’d end up with losing money.
Make no mistake about it, the only reason why franchisees are about twice as successful as independent start-ups, is that they have a clear and proven Business Plan. Their plan contains all the elements that you must know before you begin your journey on the road to business ownership.
Have you taken a draw from the business? Unless you take it via payroll, it does not show up on the profit and loss statement. It is also a balance sheet item, down toward the bottom: Equity.
I like to compare my financial situation to making a journey. The cash flow examples is a way of indicating how fast I am are going, but the net Worth statement tells me where I am on the map – how close I am to my destination. So, what is this journey? It is the financial journey of life. It is pretty obvious that most of us start our adult life with little or no money at all. In fact, many of us start our adult life saddled with student loan debt. But we all need to save money for our retirement. Each dollar we add to our Net Worth is a mile-marker along the financial journey of life.
Get a consume in each and every a single and take notes on what you like and what you do not like. Just take an appear also at the active time and then come back later on at a tranquil time. Familiarise with the laws, rules and other specifications in the location wherever you desire to open up your bar.