If you’ve been in business for any length of time, you’ve certainly earned your right to a healthy dose of skepticism. Most business owners have endured more than their fair share of eye-glazing, brain-numbing sales pitches and vendor-sponsored events. They’ve been pushed to try numerous products, procedures, and systems; many of which have failed to deliver anything but mediocre results.That’s why, even though you might be near retirement and more than ready to start the process of selling your business, solutions presented to you that promise a better, more financially lucrative, and less stressful way of doing so might you on the immediate defensive.”Too good to be true.” “Heard it before.” “If this works so well, then why doesn’t everyone do it this way?” are a few of the familiar, yet understandable, responses that Baby Boomer business owners give when urged to look into alternative selling strategies.Business owners over 50 are looking to sell their businesses without encountering adverse tax consequences and without having to pay commissions and unnecessary fees. They also want to sell within a more reasonable time frame than is usual and they want the fairest price for the business.Perhaps most importantly, sellers fear outliving the proceeds from the sale of their businesses and seek a way they can create a lifetime income which they cannot outlive.These are concerns which, unfortunately, the old school method of selling a business is simply unable to address.Pre-retiree business owners are slowly coming to grips with the consequences of a huge demographic shift, not just in the United States, but in the entire world.For many years, there has been a dwindling supply of qualified business buyers. That lack has been exacerbated by the simple fact that the generations following the Baby Boom are getting smaller and smaller.Unfortunately, the shrinking pool of buyers, coupled with economic uncertainty and tighter credit, has created an untenable situation for boomer sellers.Increasingly, they are having to make tough choices when it comes to retiring.Boomer business owners who are not leaving the company to their heirs are often finding themselves:
Running the business for a lot longer time than they ever planned.
Selling the business in hurry at a bargain basement price, thus increasing the odds that they will not have enough money to retire comfortably.
Resorting to using a business broker and having their companies on the market for months, perhaps even years.
Closing down and walking away- even though the business is still profitable.
Within a few years, the number of business owners ages 55-75 who want to sell, or who must sell due to health or other adverse life circumstances, will double.For many of these owners, the successful sale of the business is the cornerstone of their retirement plan, comprising the bulk of income they expect to receive in their later years. Most of these pre-retiree entrepreneurs have just one shot at selling their companies. A small mistake could cause them to run out of money in retirement or have to drastically alter their lifestyles to accommodate limited income.Unless there is an actionable exit plan in place at least two years before they want to retire, boomer owners could face a truly painful situation when the time comes to leave.After all, the current “old school” sales process has a lackluster 3% success rate right now. It’s not a stretch of the imagination to suggest that this rate could go even lower as the critical mass of pre-retirees wanting to sell builds.If you are a business owner over 55 who is planning on selling a business to fund your retirement, then you need to find a qualified mentor to help guide you through the complexities of the exit process.Business brokers should always be the LAST resort if you are serious about selling your business for more money, with less stress, and with a view to creating a stream of income you can’t outlive. Most brokers cannot do that for a seller, even if they want to. It’s better instead to seek guidance from an experienced business owners who has been in the trenches and understands what selling a business is all about.If you do, however, decide to use a broker, or if you seek the advice of a business acquisitions mentor, you must exercise due diligence or risk an adverse outcome.Be certain you thoroughly check out the qualifications of these advisors.Always insist on someone who:1. Has a minimum of 10 years experience in the real business world. An MBA is nice, but ask your mentor about actual businesses he or she has bought and/or sold. Theorists and philosophers have zero value when the time comes to actually SELL a company. Look for solid, quantifiable experience.2.Can produce verifiable client testimonials. Any worthwhile mentor or broker ought to be able to produce real clients with whom you can speak. If the only thing he or she is willing or able to give you is some vague written testimonial from “Sam S.” (who may or may not be a real person) then you should avoid that consultant.3. Asks you important questions about your desires and goals for the sale. Part ways with any so-called expert who doesn’t want to hear your wishes, concerns, and ideas.4. Has the knowledge, tools, and business acumen that are essential to a successful business transition. This is no place for hobbyists or dabblers. Demand someone who specializes in buying and selling successful businesses. Don’t be afraid to ask the question, “How many deals have you personally done?”5. Knows how to structure the sale proceeds so that you get a predictable, reliable stream of income for life. Ask potential mentors the question. “What can you do to help me ensure that I never outlive my retirement income?”There are several other important factors to consider when partnering with an expert, including some less tangible, but nevertheless important factors that should be present.For instance, is it easy for you to tell that this person actually enjoys what they do? Does he or she seem to radiate genuine enthusiasm for helping retiring business owners build a prosperous, successful life after business? Are they truly grateful for the opportunity to work with you? Does this person respect your achievements in building the business and seek to preserve its’ legacy of success?Pairing a worn-out, frustrated seller with a mentor who is equally burned out, distracted, or just not that in to helping others, is a recipe for failure. You need a fresh pair of eyes focused on the most important transition of your life- not someone with a cynical, jaundiced view of things.Any expert you hire to help you transition out of your business must be capable of crafting a workable blueprint for selling success that is the direct result of their own experiences and passion for business. They must be able to translate this real life experience into a plan of action that does not frustrate or confuse you. They must also be 100% committed to your vision of success, whatever that vision may be.Remember, you probably only have one chance to sell your business the right way. It pays to plan, prepare, and partner with an expert on whom you can rely until the deal is done.. and after.
What Baby Boomers Must Know Before Hiring Someone to Help Them Sell Their Businesses
Student Loan Default Rates on the Rise
Updated statistics released by the U.S. Department of Education show that student loan defaults are rising. According to the latest figures, the default rate for government loans that entered repayment in 2008 is 13.8 percent, up 2 percent from the default rate for federal student loans that entered repayment in 2007.The current official national student loan default percentage, which stands at 7.0 percent, measures the percentage of borrowers who default on their federal education loans within the first two years of repayment. But when the calculation is expanded to take into account defaults within the first three years of repayment, the national student loan default percentage jumps to13.8 percent.The New College Grad: Unemployed, in Debt, and DefaultingUnder new rules implemented by the Higher Education Opportunity Act of 2008, the three-year calculation will soon be used as the standard measure of student loan default percentages. Beginning in 2014, colleges and universities whose default percentages rise above 30 percent will lose access to federal financial aid – government-funded grants and education loans – for incoming and existing students.Current federal regulations cut off a school’s eligibility for federal student aid when the school’s default percentage exceeds 25 percent, but that guideline uses the more forgiving two-year default rate. Officials at the Education Department attribute the rise in student loan defaults to the soft job market and the ballooning number of recent graduates who are finding themselves unemployed and with a pressing need for debt relief.Education Department officials also point to the growing amount of college loan debt being accumulated by students, particularly at pricier for-profit colleges and private nonprofit four-year universities. Among undergraduates who leave college with debt from school loans, the average student loan debt load is $23,186, according to FinAid.org.Using the three-year default rate calculation, the default rate for students of private nonprofit colleges and universities is 7.6 percent, compared to a 4-percent two-year default rate. Among public university students, the three-year default rate is 10.8 percent, versus a two-year default rate of 6 percent.The biggest jump from two-year to three-year student loan defaults is seen among students from private for-profit colleges. Using the three-year measure, the default rate among these borrowers is 25 percent, more than double the two-year default rate of 11.6 percent.New Rules Threaten Schools’ Access to Financial AidAccording to an analysis conducted by The Wall Street Journal, nearly 9 percent of higher education institutions would lose their ability to offer federal student aid if the new default rules on college loans were in full effect today. Under the current rules, only 1.6 percent of schools lost their eligibility for federal grants and college loans due to excessive student defaults.A 2003 report from the Inspector General for the Department of Education charged that some for-profit colleges had become so concerned about the rise in student loan defaults among their former students that the schools were masking their true institutional default rates. Two high-profile cases in 2008 and 2009 charged two for-profit school with paying off delinquent student loans in order to avoid having to report the defaults, a practice that violates federal financial aid regulations.In response to these and other barrages of accusations being fired at for-profit colleges, the Department of Education is considering other regulations that would prevent the for-profits from misrepresenting the financial health of their graduates by manipulating student loan default percentages.In one proposed measure, termed the “gainful employment rule,” the Department of Education will not only look at student loan repayment rates but also graduates’ debt load from school loans as a percentage of the income these students earn after they leave school. By tying a for-profit school’s eligibility for federal student aid to gainful employment following college, the Education Department is hoping to stem the spiraling levels of student loan debt at for-profit colleges, which historically have produced the highest default rates.Student loan default rates have garnered new attention from the Education Department not only because the default rate is rising but also because the department is under Congressional pressure to produce a more cost-efficient student lending process with fewer losses from defaulted loans. The Department of Education is expected to issue the finalized gainful employment rule later this spring.
Should I Learn to E-Mini Trade Through an Educational Course, a DIY Book, Or a Trading Room?
I don’t think I would be exaggerating in saying that I answer the question posed in the title at least once a day, if not more. There is no doubt that a successful individual in e-mini trading enjoys the kind of freedom most hourly workers would envy. But there’s of small problem that must be overcome before a trader can enjoy consistent and profitable trading; you have to learn how to trade e-minis and the market, as it stands, is a bit dodgy. There is reluctance by the e-mini trading educators and traders to disclose anything about performance and e-mini trading methodology. Some of this reluctance is understandable as traders are notoriously averse to disclosing anything about how they trade. In the past year, several review sites have uncovered some unsavory facts about trading rooms; and educational courses are difficult to evaluate my shoe have an extensive knowledge of the e-mini trading.In short, if you don’t have a good working knowledge of trading it is very difficult to evaluate which option will provide the most expedient route to trading success. On the other hand, if you have a good working knowledge of trading you probably don’t need any of the 3 offered options. It’s a real dilemma and I talk to traders every day who have been in unsuccessful trade rooms, tried to learn to trade with unethical e- mini educators, and bought a stack of day trading texts that were of little use in the long run.How do you learn to trade then?The honest answer (and this is coming from an e-mini educator/trader) is that the path to success is fraught with all kinds of problematic issues that take careful analysis. With a couple of wrong steps, you may well find yourself parting with an excessive amount of hard-earned cash and very little to show for it. I don’t really know how long some of the unsavory characters in this business have been working, as I retired from institutional trading and after several years began teaching and trading in the futures markets. In short, I have only been training individuals for about 5 years.My opinions are not too complicated on this topic; in my opinion it would be very difficult to learn to trade profitably by reading a “how to” sort of textbook. I use several textbooks in my trading course and have found that they are wonderful to augment basic principles of trading but there is so much more to trading that is learned through experience (and not in a textbook) that textbooks merely provide a structural framework from which to build a trading system.It is highly unlikely you’ll ever learn to trade in a trade room because the room moderator will make calls based upon his or her personal trading methodology and it is not in the moderators’ interest to disclose how he/she is making trading decisions. Additionally, performance issues have come to light regarding several trading rooms and documentation concerning past performance. I’m not going to elaborate on this touchy subject, but any perfunctory search on the topic will show scads of rumors, facts, and mass confusion regarding performance documentation.Finally, we come to e-mini education and the horizon tends to get even muddier, if not downright insane. You can only become as skilled, at least initially, as the sophistication of the educational system the vendor has to offer. Unfortunately, many if not most systems are just recycled techniques from dozens of identical systems. My advice is to thoroughly interview any potential trading educator and ask pointed questions about his/her experience. As a retired institutional trader, I am prejudiced towards people who have been on the floor or in the back room of one of the major investment houses because they have learned to handle pressure and succeed. I don’t get too upset when I trade because I have seen quite a few different trading dilemmas and have figured ways to rectify problems and stay detached emotionally.I have outlined some of the problems you are bound to encounter in your search for the proper methods of learning to trade e-minis. Walk lightly and do your homework on whatever choice you deem best for you.
Are You Choosing the Right Stock Market Advisory Company
What do you do if you want to learn driving a car? You will try to find an expert teacher, isn’t it? You do not want to avail the services of a novice individual to help you out, but a professional person can provide you the vital tips and most importantly guide you efficiently. Similarly, when it comes to investing in the stock market for the first time, you require a knowledgeable advice to attain your financial goals and get profitable returns.
If you are a beginner, then it is quite obvious that you may be having no information about the process of buying the right shares in the market. In such a situation, getting the right tips from an experienced financial advisor or a registered advisory company will truly prove to be a great blessing in disguise. However, there are some of the important things that have to be kept in mind while choosing the top stock market advisory company, which are as follows:
How much assistance do you actually require?
Before you make up your mind to hire an advisor, it is imperative that you must first decide about the kind of service you require from them. You may need their help at the beginning or during the time of any issues. This is because an advisor has to formulate a map according to your requirements. Hence, it is suggested to ascertain your needs first and then take further action.
Choose a top ranked advisory company
It is a very important point that has to be taken into the consideration. Availing services of the well known advisory company or a financial advisor is an absolute necessity. Make it a point to carry out a proper background or research work about the company. Check out their credentials, reputation, experience, etc before hiring them.
Asking for a sample financial plan initially makes sense
When hiring a financial advisor, then do not forget to ask for sample plan first. It is imperative to note that there is no such thing called the perfect plan. A sample plan will help you to determine whether an advisory company is actually making sense according your requirements or not.
Conclusion
The financial planners or advisory companies can really turn out to be the greatest asset for you if you choose the best one. They are just like the professional sailors who can help you out to sail through stock investment related problems quite efficiently.
Deepak is a financial advisor who likes to provide quality tips to the people facing any issues with regard to investing in the stock market. He likes to keep himself updated about the stock market by reading articles, news and blogs, etc.