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Cash flow is one of the biggest challenges that small business owners face. One of the reasons is because usually not enough attention is paid to managing it, until a crisis hits. Small business owners are often so focused on growing their businesses and making sales that they fail to see how their operational costs are eating into their profits. Suddenly, there are bills to pay and clients haven’t paid yet; as the business owner, you have to figure out a way to get cash in fast. However, if you are diligent about managing your cash flow, you can foresee and set up contingencies for situations like that. Here are a few tips that can help you to stay ahead of the game.

Know Your Operational Costs

Right from the start you should know what it costs to run your business on a monthly basis. Certainly, there will be some variable costs that change on a monthly basis but you should still have a rough idea of what they are so you can form a budget. If you do not capture all your expenses then you are quite likely to forget about some of them. A few hundred dollars here and there can quickly add up. The easiest way to do this is to draw up a simple spreadsheet. Capture fixed expenses such as rental costs and salaries first, and then have sections for income such as stationary, telecommunications and fuel. These operational costs should form the basis of your budget. They define your break-even point of your business. Bring in less income than that and your business will be in trouble. Always know the target that you need to reach in terms of turnover.

Define Your Payment Dates

Try not to have all your expenses payable at the same time of the month. Most landlords require that you pay the rent up front yet many insurance companies, for example, will allow you to schedule your debit orders for the 10th or 15th of the month. What this does is spread the load of your payments throughout the month. Instead of having to make sure that you have a lump sum of cash available at the end of every month, you need only a portion of your expenses to be covered then and have some more time to get in the balance of your cash before the next batch is payable. It may initially seem like a mission to split up the payment dates but it can make a huge difference to your cash flow.

Be Strict with Your Debtors

This is a trap that too many business owners fall into. They do not want to offend customers and potentially lose out on their business so they bend over backwards to accommodate them and let them get away with paying late on a regular basis. Large companies often use this tactic to help balance their cash flows. The longer they can stave off paying a small business, the greater benefit to them. You don’t have to be aggressive when chasing payments. From the outset with clients, make sure that you clearly communicate your payment terms. Ideally, small businesses should operate on a cash-on-delivery basis but in many industries, this is not possible. Try to have as short a period as possible for payment. Ideally, it should be seven or 14 days. At the outset, it should never be more than 30 days. If it is seven days then clearly state this on your invoice and when you make delivery. If after the eighth day you have still not received payment, make a phone call to find out if it has been processed. If it has but doesn’t yet reflect in your account, let your client know that you will call to confirm as soon as it does. This is a polite way of letting them know that you watch and manage your cash flow closely and that they cannot get away with delaying payments.

Make Sure You Have a Wide Customer Base

Many small businesses start with just one or two major clients. While this is great initially, think of what will happen if that big client delays payment or doesn’t pay at all. How will that affect your cash flow? It is much better to have lots of smaller amounts of cash consistently coming into your business than to depend on one or two large payments every month. To have large clients is great but make sure you can break even without their payments. That way, you will always have a strong cash flow.

Financially, one of the worst things you can do is to accumulate a large amount of debt. Unfortunately this can happen in a multitude of ways. Sometimes events happen that you cannot control, such as a medical emergency, or maybe you get laid off from work. Sometimes it’s just irresponsible spending on your part. But no mater which one it is, they all contribute to the financial situation you are in.

No matter how it occurred, once financial problems begin, you must take action . If you do nothing and allow your bills to accumulate each month you will only make the situations worst. This usually leads to repossessions, bankruptcy or even foreclosure on your home. You need to take action to get your spending under control and get your existing bills paid down. While this is a good thing, and most methods work, Some work better than others. You need to find the method that works best for you.

Debt consolidation firms are a good source for people who owe a large amount of money to creditors, but are unable to meet the monthly requirements. However, you must have the ability and be willing to pay some of the overdue amount each month. The Debt Consolidation Firm will pay off all your overdue debt and then set up a payment plan for the amount that was paid. Since this new loan can be paid down at a slower rate, it allows you to create a more stable monthly budget.

There really are not negatives to a debt consolidation loan once you have qualified. Late fees and other charges are elemitated as the creditors are paid and the amount owed will decrease as your payments are made. Because you will have no late fees or missed payments, you credit score should start to increase.

There is no way that taking control of an out of control financial situation could be considered bad. This action can only be perceived as a positive and mature economical thinking.

If you researching and compare the best debt consolidation services around, you will be able to find the one that meets your specific financial situation. However, it is advisable to go with a trusted and will known debt counselor before you make any decision, this way you save time through specialized advice coming from a experienced debt advisor. You will also save money by getting better results in a shorter span of time.

If you are looking for ways to lower your interest and mortgage payments, mortgage refinancing is a good choice. If you want to switch from ARMs loan to fixed rate mortgage now is the time to get your loan while market conditions are down. If you have the ARM or adjustable-rate mortgage, you are aware that when the interest changes, so will the amount of mortgage you pay each month.

Since interest rates shift regularly it is hard to say how much mortgage you will pay next month on an ARMs loan. Mortgage refinancing gives you the option to switch from ARMs to fixed-rate mortgage. With fixed rate mortgages, your monthly installments remain constant. Each month, you pay the same amount in mortgage payments.

The rates are steady and so are your payments each month when you have the fixed-rate loans. ARM interest rate shifts with the changes in interest, which means that your interest rates may increase later. With fixed-rate, your interest remains stable.

With fixed-rate loans however, if the monthly installments are in escrow for insurance and taxes, payments each month may change in time because the shifts in insurance, property taxes and the community-associated fees may change.

You can keep your ARMs loan and ask for better terms. If you struggle paying off your mortgage each month, mortgage refinancing can give you the option to change the terms of your ARMs loan. New loans may put you in front of lower interest rates to start, which can give you time to save money and prepare for the next month.

By changing the terms of your ARM loan, you may receive lower cap payments and interest rate adjustments, which in this case means that the interest amount will not exceed the set amount. If you decide to change your ARM loan to a better term, verify the full-index rates and initial rates before you sign the papers. Ask your lender about any interest rate adjustments that may incur on the loan. Ultimately, you can get cash from your equity that you have built up in your home. It is an alternative to refinancing your home.

Accepting credit cards is necessary for both off-line and online business. If you are having an online business and if you are not accepting credit cards, it means you are losing seventy percent of your business to your competitors. By not accepting credit cards, it is not only online businesses face loss, but the same applies for off line businesses too. The same figure of seventy percent is applicable for off-line business too.

According to a survey conducted, many Americans carry few amount say five or ten dollars. Almost all Americans pay their bills and shop only with their credit cards and debit cards. So if you are an individual having online or off-line business and do not accept credit card, you are sure to lose your sales. Accepting credit cards have become a necessity for increasing sales in both online and off-line business. Even the cost of product or service you sell is even less than five dollars; customers prefer to pay using their credit cards.

Many people prefer to pay using credit cards as it is not only convenient to carry with out the fear of theft but they also get reward points and incentives when they use their credit card to the maximum. So if any business, small or large, should get in to the method of accepting credit cards for increasing their annual turnover. There are many business people who give them offers or give them incentive when they use their credit cards. This make them buy most of their products or services using credit cards.

There are people who use credit cards on a compulsory basis are:

*Employees making purchases for their employers
*People who travel on company business
*People who make bulk purchases
*People who travel frequently prefer to book their tickets using credit cards

Accepting credit cards is compulsory in all sorts of business. If you do not accept credit card then you lose customers. Even very small business people are forced for accepting credit cards, in the fear of losing businesses. Even big companies, which purchase products or services for resale or for their internal use, make payments using credit cards. By not accepting credit cards, you are losing on repeated customers.

Above discussed points make clear that accepting credit cards is very important for increasing your sales, be it small or big businesses.

The average American carries over $9,000 in credit card debt. For many, it’s difficult to get out of the hole. Many people make late payments; some have delinquent payments; some file for bankruptcy; others even have to go into foreclosure. These kinds of things will inevitably affect your credit rating and, subsequently, your ability to get a mortgage.

There are many ways to avoid hurting your credit score, which is determined by a number of factors including your payment history, amounts owed, length of credit history, new credit accounts, and types of credit in use.

Ten Ways to Improve Your Credit Score:

1. Pay your bills on time. Even if you’ve had delinquencies in the past, over time, they will count less if your recent history shows timely payments.

2. Keep your credit card balances low. The higher your outstanding debt, the lower your score will go. Pay down high credit card balances, starting with the highest interest rate first.

3. Check your report for inaccuracies. You may have errors on your report that can easily be cleared up. You can request a free copy of your credit report every 12 months.

4. Pay off debt rather than move it around. Consolidating your debt onto fewer cards will not improve your score because you’ll still owe the same amount. It is better to work towards paying it off.

5. Have credit cards, but manage them responsibly. Having credit cards that are paid on time is better than having no credit cards. It shows that you can soundly manage your debt.

6. Don’t open multiple accounts too quickly, especially if you have a short credit history. This may look risky because you’re taking on a lot of possible debt. It also shortens the average age of your credit history.

7. Don’t close an account to remove it from your credit record. Accounts show up on your credit report for seven years whether they’re open or closed. Closing accounts can actually hurt your credit score if you’re not paying down debt at the same time.

8. Don’t shop for a loan from different lenders over a long period of time. Try to keep it to within 30 days or less. Credit bureaus disregard inquiries for your credit report made within 30 days of each other and consider requests made within a 14 day period as a single request.

9. Don’t open new credit card accounts you don’t actually need. This might backfire and lower your score.

10. Contact your creditors or consult a legitimate credit counselor if you’re having financial difficulties. If you’re having difficulty improving your financial situation on your own, seek help.

The sooner you start making timely payments and showing that you can be managing your debt responsibly, the sooner your score will improve. If you follow these guidelines, your credit score is likely to improve. By learning to better manage your debts, you’re likely to qualify for better mortgage options in the future.