Category: Business

Money Advice Gone Wrong

Money Management

Sometimes the best intentions can lend themselves to producing the worst results. While many friends and family members may offer quick solutions to your financial anguish, often times, the best education, is understanding those lessons first hand. At Raccoon Valley Bank we’d like to showcase several of the most common pieces of advice we hear, and what you can do to remedy these particular miscommunications.

 

Bad Advice #1: You have to go to college to get a decent job.

While a college degree does open additional doors, it is not required for many well-paying jobs available around the nation. Social figures like Mike Rowe, have made it their personal mission to spread the message that you can earn a living without having to sink into debt. Whether you’re interested in IT, manufacturing, grocery management, or other skilled work, you can find numerous positions through technical training or management programs, and avoid the majority of debt most four year college students incur.

 

Bad Advice #2: Having debt is okay if you pay your minimum payments.

While it is important to make installments on your loans or debts, eliminating them all together should be the desired end goal. Did you know that when credit reporting companies review your credit score, there are five factors considered? The two most important factors are your payment history and your debt to income ratio. If your monthly debt payments require more than 43 percent of your income, that may raise a flag to any future potential lenders.

 

Bad Advice #3: To build your credit score you need to purchase everything on your credit card.

While it certainly helps to have a long and healthy track record associated with your credit card usage; having an on time payment history is far more important. This payment history represents the largest factor of your credit score, which the reporting bureaus track. By never spending more than you have, you can make certain you are able to pay your bill in full each and every month. This action may have the potential to help foster growth for your credit score.

 

Bad Advice #4: Retirement savings can wait.

Contrary to what many young adults think, right now is the most important time to start saving for retirement. While later in life you might have more disposable income to save, you’ll also have less time before you need those funds. Once compound interest enters any equation, time becomes the most valuable commodity for growing your wealth. For instance, if you saved the Roth IRA maximum of $5,500/year starting at age 25, you’d have $1.17 Million by the time you’re 65. Who wouldn’t want to capitalize on those kinds of savings?

 

We think you can tackle any piece of advice with a few grains of salt. If you’re curious what your next financial move should be, stop by Raccoon Valley Bank and speak to one of our dedicated personal bankers. Our team of financial experts is here to help you and your family succeed; get started today!

The Basics Behind New Business

Commercial Lending

A mouthwatering dish your grandmother made you, a leaf falling across the park, or one of the endless questions your preschooler has begun to ask you; the truth is great ideas can come from anywhere. If you have a concept you are itching to turn into a reality, there are some key components you’ll need to make it happen. At Raccoon Valley Bank, we were founded upon our commitment to small and medium sized business, and we are thrilled to help you transform your inspiration into a live entity.

 

To complete the process from conceptualization to implementation, there are ten key components to ensure your business has all the legal qualifications necessary. Simply follow these helpful prompts, and if there are any components you’d like further clarification on, never hesitate to reach out! Our experienced team of commercial lenders is here to answer any questions or inquiries you or your business partners may have.

 

  1. Write a business plan. Your company’s business plan should detail the purpose and differentiators associated with your business. SBA.gov is an informative resource to help you determine all the required components for your proposed document.
  2. Register as an LLC or Corporation. An LLC is the most common choice for new business because the Corporation classification does mandate a $10,000,000 revenue requirement.
  3. Finance your new business. There are a variety of ways to finance your business. Whether debt or equity based, our dedicated team can help you determine which route is best suited for your business.
  4. Determine your business location.  Keeping your budget in mind, purchase or lease the space you’ll be using for your location. If you’ll be working from home be sure to take advantage of the associated tax benefits.
  5. Register for EIN and determine payroll structure. Before you hire any employees,  you’ll need to register for your Employer Identification Number for federal taxation purposes.
  6. Register your business name. You can choose to register your business as a DBA, or Doing Business As, or you can choose to register your company name and/or logo as a trademark. Both options will allow you to operate under your desired business name.
  7. Open a designated banking and credit card account. Separating your personal finances from your business is imperative in keeping accurate accounting records. Additional tools such as Quickbooks Self Employed can help you manage all aspects of your finances at home or on the go.
  8. Complete registration for state and local taxes. Business taxes are set up differently than your personal taxes. Be sure you’re accounting for all the variables before you open the doors.
  9. Receive business licenses and applicable permits. If you plan to sell alcohol or firearms, you may need federal licenses in addition to the various state requirements.
  10. Structure and start a marketing campaign. Marketing is an ongoing effort, but to get customers in the door, they’ll need to know you’re an option. Get the word out with a strategic marketing initiative, and make a yearly plan on to keep new clients coming in.

10 Steps to Opening Your Own Business

Business Banking

Creating the foundation of your next enterprise can be a challenging process. For everything from ideas to permits, it takes a lot to get a new business up and running. At Raccoon Valley Bank we would like to help you make your dream a reality, and offer these ten steps to opening your avant-garde operation:

 

  1. Write a business plan. Creating the sound reasoning behind what you want to do and how you want to do it, represents the building blocks to a good business. There are many tutorials to help you develop a plan and to accompany them, we recommend researching information for each section of the document.
  2. Select the best location. Location can make or break a business. In conjunction with your plan’s market research, we suggest scouting out the best potential locations. Adding this element to your proposal can help you create the optimal visualization when describing your concept.
  3. Build a marketing strategy. Great service and great promotion go hand in hand. Unfortunately the old adage, “If you build it they will come,” no longer applies. Now, in order to get clients through the door, you’ll need a structured and continual marketing plan to ensure customers in your area are aware of your business.
  4. Plan your finances. These not only refer to the funds you need to open your business, but also the additional costs to help support the initial years of operation. This extra capital will help ensure your business doesn’t topple while building its ongoing customer base.
  5. Meet with a commercial lender. Once you have the core of your business planned and calculated, it’s time to meet with a small business lender to evaluate your risk. He or she may require a percentage down, or that certain criteria are met before loan signing.
  6. Fulfill any requirements. Whether it’s saving additional funds, offering up collateral, or obtaining designated permits, it is best practice to meet and exceed the requirements that your lender has suggested, in order to maximize your lending potential.
  7. Close on a business loan. After securing the funds for your business, be certain they’re placed within a business account, instead of a personal one. To help ensure your funds are separated, we also recommend creating an LLC for your business prior to opening.
  8. Purchase or lease space. Using the money you’ve budgeted, move forward with purchasing or leasing the space for your new enterprise. After space has been secured you’ll need to acquire equipment and supplies from another portion of your predetermined budget.
  9. Structure and hire your team. Another old saying goes, “If you take care of your employees, they will take care of your customers.” This is a great adage to stick by, as more often than not, people are what makes a business successful. Decide your role within the company, and then craft detailed job descriptions for the rest of your potential employees. Start building your team with the best people for the job, and add further help as needed.
  10. Open and continually promote. The big day has arrived and the doors are officially open. Continue to keep them open through constant and innovative marketing efforts. By pushing your products and services to the public you can ensure that they’re aware of your offerings and consider your business a valued option.

 

We look forward to meeting with you about your next corporate venture. If you have any questions on how to complete the steps above or have additional inquiries on commercial lending, please don’t hesitate to reach out.

Low-Cost New Business Ideas

Small Business

Creating a new business is an exciting journey filled with a constant flow of ups and downs. When deciding which industry to invest your time and money, consider these cost-effective options, courtesy of Raccoon Valley Bank:

 

Virtual Assistant: Needing a basic set-up of only a desk, computer, and phone, this affordable opportunity allows you to work from home, and establish your own hours. Start slow with one or two clients, and work your way up to a full-time schedule.

 

Medical Reporter: Quick typing skills and a high accuracy is all you need in this quick start-up. Speak with area hospitals and gain contracts for their on-location reporting. The higher your words per minute, the better!

 

Pet Groomer: Keeping dogs squeaky clean may sound like a lot of fun, but it can be tough work! With minimal startup costs, you can start your own service straight from home. By focusing your business on smaller dog breeds, you can minimize your cost, and maximize the number of clients you can maintain!

 

Freelance Writer or Photographer: Put your skills to use in this nomadic and highly flexible field. With an increasingly high amount of online publications, many magazines are searching for additional content and imagery to accompany them. Search the web for opportunities, and begin to build your digital content portfolio.

 

Event Planner: If arranging holiday parties and birthday celebrations sounds like fun to you, this could be your ideal career! Get started planning events for families and friends, and begin building your network of clients at each function. Once people start to see what you can do, you can begin to build your client list, and slowly fill your calendar with events and your pocketbook with revenue.

 

Wherever your passions take you, Raccoon Valley Bank will help you arrive safely! With our trusted business financing, we can help you and your budget stay on track. Stop by today to speak with one of our commercial lenders, and discover how to create your ideal cash flow.

True or False: Catch Me if You Can

Check Fraud

Starting in 1963, Frank Abagnale began his criminal career. Made famous from the film, Catch Me if You Can, this mastermind of forgery made a name for himself at a young age by impersonating pilots, lawyers, and doctors. Throughout these impersonations, Frank found new and inventive ways to defraud the United States and at least eight other countries. When he was  captured at age 21, he had defrauded multiple nations upwards of $1.3 million dollars. After serving five years of his twelve year federal sentencing, he agreed to work with the FBI to help investigate and proactively protect the United States from further check fraud.

 

As Frank’s history with the FBI began to grow, he started to share the distinctive patterns and signatures behind the best of check fraud criminals. See if you can determine which of these check fraud facts are true and which are just cinematic magic:

 

True or False? Big corporations such as Pan Am had a much higher risk of check fraud than small mom and pop shops.

 

FALSE:  Although Pan Am was depicted as the start of Frank’s larger check fraud scheme, large scale business models face less risk than most small businesses. Did you know one in four businesses have fell victim to fraud? While larger companies have internal security and protective insurances for such instances, most local businesses rely on their employees and their customers to ensure an honest and accurate transaction.

 

True or False? Paper check forgery still is prominent today.

 

TRUE: With small businesses as the largest targets, paper check fraud is still a relevant issue, even today. Often times, the culprit can be employees who write a business check to themselves. Other instances can be a vendor who is able to alter the ink on the check to reflect an amount that they would prefer. While there are many additional cyber fraud crimes possible today, the threat of a paper check fraud is still imminent.

 

True or False? This movie largely encourages check fraud and teaches criminals how to hone their craft.

 

FALSE: While this movie does display many techniques in producing fraudulent checks, the premier intention of the film is to educate both banks and businesses in what to look for concerning false checks. There are many simple markers and signs that a check may be a fake, and while the storyline depicts the various lifestyle choices of a criminal, it reveals in the end, that Frank Abagnale began to help the FBI identify these markers to prevent future check fraud.

 

What to look for in fraudulent checks straight from Frank Abagnale:

 

  • Keep any checks, deposit slips, or check re-orders under lock and key in a secure location. Many times those close to your business are the culprits in a check fraud crime.
  • Use Remote Deposit Capture from Raccoon Valley Bank. This service ensures that the check is treated just like a debit. If there are no funds in this account or it represents a false account, you will know as soon as the transaction completes.
  • When receiving a check in a transaction, scan the check to make sure it has a perforated edge, marking where it was torn from the checkbook.
  • Never cash a check you are unsure of. If something does not seem right, it is always safer to ask for further identity verification, or simply deny their request to cash the check.

If you’re curious how to keep your small business secure against check fraud, come by Raccoon Valley Bank today and speak with one of our local commercial lenders.

Start a New Business in 5 Easy Steps

Business

Getting your business off the ground isn’t always as easy as it seems. With a laundry list of to-do items, it can be hard to prioritize which needs have to come first. Luckily, Raccoon Valley Bank is here to help! By following these key stepping stones, we’ll help you get on the path to success with your new business venture.

 

  1. Develop a business plan. Determine what it is you want your business to do, and how you want to do it.
  2. Capital. Capital. Capital. Make sure whether you’re working with investors, securing a business loan, or putting up the money yourself, you have all the funds you need in addition to a large cushion for overhead and operating expenses.
  3. Get it in writing. With options such as an L.L.C, Corporation, S Corporation, Nonprofit or Cooperative, you’ll want to protect your personal finances with a legal structure for your business.
  4. Make it official. After registering with state and local tax agencies, you’ll need to obtain the appropriate permits and licenses to make your business compliant with local laws and regulations.
  5. Get people in the door. Ensure you have an effective marketing strategy, or list of transferred clients to get your business off the ground. The old saying, “If you build it they will come,” no longer applies. Make sure everyone in your area knows you’re opening, and offer a valuable incentive to help encourage them to stop by!

 

Local businesses are the backbone of small town America. If you’re looking to set-up your own new shop, Raccoon Valley Bank is eager to help! Our experienced business lenders are here to find you the best business financing option for your needs!

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