daily blog

There is currently a genuine state of confusion regarding commercial loan rates. The confusion is not just restricted to borrowers, either. Brokers, lenders and professional investors are all struggling to get a handle on what is going on with commercial loan rates.

Borrowers are under the impression that we’re at historic lows. They hear about the feds lowering rates and also hear national banks quote ridiculously low rates. What these national banks aren’t advertising is that their decline rates are at historic highs. Is difficult to be able to track a statistics like this but my friends and associates that work at intuitions like Bank of America, CITI etc tell me that there decline rate are at 95% or so.

So what that means is that they are cherry picking to an incredible degree (can you blame them?). The low commercial loan rates that they are advertising are only relevant for 5% of the borrowers that apply. Think about that for a moment, for every 100 people that fill out those 6 page applications, provide their tax return, etc, 95 of them are getting declined. As a comparison the decline rates are normally more like 50%.

The confusion is not just restricted to borrowers but to professionals in the industry as well. The spreads or margin are varying from one lender to the next more than we have seen. People in the business are struggling to understand why. Normally if you were to get 10 quotes on the same deal the commercial loan rates would be within .25 -. 35% of each other. Perhaps a few would tweak the prepayments or term, etc but their rates would be close. Now we are seeing commercial loan rates on the same deal varying between 2% -3%…

Part of the problem is that some of the lenders and banks themselves are having their cost of capital increase. Some of their credit rating are being lowered, as their balance sheets are scrutinised. So despite the Feds lower their rates, the margins that the banks charge (in order to cover their costs, risk and make a profit) go up as their cost of capital go up. So as one bank is more financial healthy than the next its costs of capital varies.

So what’s the happy ending? We currently don’t have one. If you’re thinking of buying or refinancing a commercial property in the next few months we would suggest getting it done now as in maybe a while before things re-stabilize and commercial loan rates become more universal.

Jeff Rauth is President of Commercial Finance Advisors, Inc out of Birmingham, Michigan. He has a STORE for commercial loan brokers. Contracts, spreadsheets, books, etc. Products starting at $4.95! Check it out commercial mortgage broker store or commercial loan rates

Tax reduction and tax deferral are the primary benefits of obtaining a cost segregation study. Income taxes are a substantial burden for most real estate investors. Tax deductions help with this burden. While some level of taxation is necessary, it is both inappropriate and imprudent to pay more than your fair share.

Income tax is based on net profit or taxable income. The basic formula for calculating taxable income is revenue less expenses (tax deductions). Expenses can include both direct payments to third parties (labor, rent, supplies, etc.) and non-cash deduction. The primary non-cash deductions are depreciation and amortization. Tax reduction (tax cuts) are a direct result of increasing tax deductions.

The tax deduction benefit real estate owners gain from cost segregation is a higher level of depreciation. This non-cash tax deduction reduces taxable income and income taxes. For example, if the amount of depreciation increased by $100,000 (as result of a cost segregation study), taxable income would decrease by $100,000, and the owner experiences a $35,000 reduction in taxes (based on 35% tax rate).

Most real estate owners depreciate real estate based upon splitting the cost basis between land and improvements. The property owner or tax preparer typically estimates the portion for the land and attributes the balance to long-life improvements. Long-life improvements depreciate over 27.5 years for rental residential property and 39 years for commercial property

While this simplistic method is lawful, it cheats the real estate owner of tax deductions. A cost segregation study identifies up to 130 short-life components. (Cost segregation is different than component depreciation, which was available until the early 1908s. However, the result of both is to increase depreciation and tax deductions during the early years of ownership.) These short-life components typically comprise 20-50% of the improvement cost basis and are depreciated over 5 years (20.0% per year), 7 years (14.29% per year) and 15 years (6.67% per year).

Depreciation effectively changes the character of income from ordinary income to capital gains income. While the maximum income tax rate for ordinary income is 35%, the maximum rate for capital gains is 15% (less than half the ordinary income tax). This affects substantial income tax reduction.

Increasing depreciation also affects deferral of payment of income taxes. Instead of paying taxes (at the ordinary income tax rate) in the year income is earned, taxes are paid (at the capital gain rate) in the year the property is sold. Cost segregation effectively generates an interest free loan (until the property is sold) and reduces the tax rate (from 35% to 15%).

Cost segregation produces tax deductions and reduces federal income taxes across the country and in every size market. Below are just a few examples of where cost segregation generates meaningful tax deductions.

City:

• Miami, FL
• Bridgeport, CT
• Washington, DC
• San Francisco, CA
• Atlanta, GA
• Dallas/Ft. Worth, TX
• New Orleans, LA
• New York, NY
• Baltimore, MD
• Hartford, CT
• Indianapolis, IN
• Wichita, KS
• Detroit, MI
• Charleston, SC
• Providence, RI
• Grand Rapids, MI
• Jacksonville, TN
• Boise, ID
• Santa Rosa, CA
• Columbia, SC
• Columbus, OH
• Oxnard, CA
• Greensboro, NC
• Allentown, PA
• Harrisburg, PA
• Louisville, KY
• Fresno, CA
• Akron, OH
• Chicago, IL
• Portland, OR

Cost segregation produces tax deductions for virtually all property types.

Property Type:

• Manufacturing/processing
• Tennis club
• Retirement home
• Auto service garage
• Mini-warehouse
• Single-tenant retail
• Medical facility
• Hotel
• Retail
• Vacant land

Almost every industry, including the following, can generate cost-efficient tax deductions by using cost segregation.

Industry:

• Wood product manufacturing
• Warehousing and storage
• Truck transportation
• Transportation equipment manufacturing
• Textile product mills
• Textile mills
• Real estate lesser
• Publishers
• Printing activities
• Plastic and rubber products manufacturing

O’Connor & Associates is a national provider of investment property consulting services including cost segregation studies, due diligence, insurance valuations, tax reduction, property tax, market research,expert witness,private bond activity,taxes,residential property appraisals,Tarrant Central Appraisal District,Tips and Tricks for Appealing Your Property Taxes in Dallas,Dallas county appraisal and Federal tax reduction. Our appraisers are competent to appraise virtually all types of property including land, neighborhood shopping centers, warehouses, bowling alleys, motels, mobile home parks, self-storage units, retirement homes, multifamily housing, movie theatres, veterinary clinics, single-tenant retail centers, funeral homes, bars, amusement parks, hospitals, schools, night clubs, apartments and medical facilities.

Have you ever wondered how much a part of your investments will be worth 10 years from now? How about 20 years? You can easily figure it out without using a financial calculator. Just use the Rule of 72, your financial calculator in investment.

Let’s say you invested $10,000 in a fixed annuity earning 6% a year. In 24 years, your assets will be worth about $40,000. Then how does it work?

And the Rule of 72: Divide the number 72 by the interest you earn, and it will give you the number of years it will take for your money to double. Using the above example, 72 divided by 6 equals 12 years for doubling. Pretty simple-hah! Since there are two doubling periods in 24 years, the original $10,000 would be worth $20,000 in 12 years, and $40,000 in 24 years.

Using this same Rule, an investment earning 8% would double in about 9 years, and a 12% investment would double in 6 years.

You need to remember that a 6% interest rate in a Certificate of Deposit would not work as well as a 6% annuity. A CD earning 6% would leave an investor approximately 4% after taxes. The Rule of 72 would only apply to an after-tax yield. A 6% annuity would be tax-deferred; therefore, the entire 6% would be counted.

The Rule of 72 works best with fixed investments, or those with a fairly stable return. Also, it only works if you reinvest your assets. The Rule does not apply if you withdraw any funds.

You can even use this Rule in reverse. For example, you are 38 years old, and you’d like to know how much you’d have to invest today to retire a millionaire.

Using the same Rule, assuming a retirement age of 65, and an average annual return of 8%, here is how it would work:

Step One: 72 divided by 8% would signify that your money would double every 9 years.

Step 2: At age 65, you want your assets to be worth $1,000,000, so…

Step 3: You work in reverse, going back 9 years for every doubling period.

$1,000,000 at age 65 (your goal)

$500,000 at age 56 (9 years earlier)

$250,000 at age 47,

$125,000 at age 38 (lump sum)

If you invest $125,000 at 8% until age 65 (before taxes), you would have about $1,000,000 at retirement. This amount would change, of course, if you invested more than $125,000, or if the interest were higher, or better still, you started investing a little sooner than age 38.

Depending on your goals, and your age, you could retire earlier or later than age 65. You don’t have to invest a lump sum to retire comfortably. Just have a goal, and a systematic investment plan, and your retirement needs will be accomplished.

Kaushik Adhikary operates http://www.myinsuranceinsiderinfo.com, a blog all about fresh and quality content on personal line of insurance and finance field. He loves giving away Free Stuffs and now giving away Free Memberships to his Newsletter,Special Reports,E-Course,E-Books et. all absolutely free.

For more more valuable informations, Click Here-http://www.myinsuranceinsiderinfo.com

As the credit crisis deepens, many borrowers are realizing that working with a commercial mortgage broker makes a lot of sense and is more important than ever. Virtually all banks and lenders have severely tighten their credit standard to the point that most borrowers are having a very difficult time finding any banks that will even consider their loan request.

Bottom line, 95% of all commercial mortgage loan requests are being turned down cold. So one of the keys here for the borrower is to figure out which banks are still really funding deals and how to structure the loan request so that it has the highest likely hood of closing. And good commercial mortgage brokers knows both.

Tapping the experience and resources of a commercial mortgage broker is an excellent way to do this. A knowledgeable commercial mortgage broker is in essence shopping banks and lenders everyday and everyday for years. The good ones know what is going on behinds the scenes with banks as they have long term relationships with associates that inform them of any internal issues. The folks in the bank know how important the broker is to their personal success and will not miss lead the commercial mortgage broker, in fear of destroying future business. So a commercial mortgage broker worth his “salt” should be able to take you to a bank or lender that’s in a valid position to fund your loan.

An important point here is that commercial mortgage brokers are in essence on the same side of the table as the borrower. They get paid when the loan closes. Most do not make hourly consulting fees, etc. They invest their time, effort and resources into your deal and are betting they can get it done. If they are experienced, they will only take your deal to a bank that can really close it.

Keep in mind one of the annoying problems out there for borrowers shopping banks on their own is that many bank loan officers have many quotas besides closing loans… most of these quotas go against the borrowers goal of closing their loan. For example, bank loan officers have weekly meeting and loan application quotas. So they may try to schedule a meeting with you and get you to fill out a loan application and send in all tax returns/financials even though they know they can’t get the loan funded.

They are trying to save their job. Again, they get to justify their job with their manager at your expense and your time.

Good, experienced, commercial mortgage brokers can save you a lot of time and energy by taking you right to the most viable banks from the beginning. And, believe it or not, they can also save you a lot of money as well.

Jeff Rauth is President of Commercial Finance Advisors, Inc out of Birmingham, Michigan a national commercial mortgage brokerage firm. 248 885-8797. He also has a STORE for commercial loan brokers. Contracts, spreadsheets, books, etc. Products starting at $5. Check it out commercial real estate loans or commercial mortgage brokers

The Foreign Exchange markets (Forex or FX) were deregulate in 1997 allowing the private investor access to markets banks, brokerage firms and other large financial institutions once had a monopoly on. The novice FX traders quickly entered the market and just as quickly they realized they were in for a long learning curve if they were ever going to make this a profitable transition and thus a market was created for Forex Course Trading. Numerous types of educational programs where produced, refined and marketed to the public. Today there are so many courses it can be a mind boggling task attempting to select the one best suited for you particular needs. I will attempt to clarify this a little bit for you and make the decision making process a little simpler.

The first point I want to make is that the majority of the course are extremely inexpensive usually running $100 to $200. I know you saying to yourself that is not inexpensive. But, when you take into consideration that one small trade of a currency can easily make up the purchase price of the course then it is VERY inexpensive. The next subject is the types of courses. There are wide assortment of curriculum available covering extremely varied topics. The major segments the courses can be broken into are the following; comprehensive or covering everything A to Z, profiting quickly through mentoring, make money starting with small amounts, and very specific to the developers own experiences and how they profited using them.

If I was a complete novice to the markets I would start with a comprehensive course that provided an education on all aspect of the markets. After all, education is the corner stone of success in what ever field you attempt to enter. Are you really going to purchaser software and start trading something you know NOTHING about? This is a real bad idea, unless of course you need the losses to reduce you capital gains made else where to decrease your tax burden.

A few of the comprehensive courses you could try would be the following. The Peter R. Bain course titled Forex Mentor which has been around seemly forever and has had thousands of satisfied customers. This course covers everything and has been refined a thousand times over. Another class you could take would be Fap Winner which offers a great education and a personalized mentoring program. Those are just two of the TOP TIER rated courses and there are a few more. Just read the reviews of the courses which are available everywhere and the home page of the course and determine which one you think will be best for you.

The next step you could take would be to enroll in a course like The Forex Brotherhood or Forex Trading Made E-Z. The Forex Brotherhood is run by Jason Alan Jankovsky a professional Forex trader who essentially allows you to copy his complete trading portfolio. In other words you are virtually assured to be profitable immediately with this course. But, then again you would have NO idea of how and why you were making money for an extended time as you are just coping his ever move. But, it is a great place to start if you want to make money fast and you don’t really need to know how. Or you are willing to take your time learning, because he will teach you, it is just not going to be too quickly. The Forex Trading Made E-Z program was developed by an ex pilot who has found a very specific way of trading currencies and making money at it, which of course he teaches you.

After reading this article it is easy to see there are many different types of courses available, only a few were mentioned above. If your out to make a fast buck and you are not concerned with why or how you are making it then there is a course for you. If you want to turn this into a career and want financial independence, then there is a course for you. If you want to buy a piece of software and turn on the automatic trader and start making money, well there really is NOT a course for you, but you will have losses you can use to offset you gains made else where to reduce your tax obligation.

We have researched, tested & reviewed 100s of Forex Courses, Software Systems and Brokerage Firms which we only list our TOP 10 to help you LEARN FOREX TRADING

For 100s of FREE FOREX TUTORIALS please visit LEARN CURRENCY TRADING Good Luck! I look forward to seeing you on the trading floor making money!

PT, for those of you who are not familiar with the initials, stands for many things. Some of the more popular are Perpetual Traveler or Permanent Tourist. Others are Prior Taxpayer, Privacy Thinker, or Prepared Thoroughly. But what is PT all about?

In a nutshell, a PT arranges his or her business and personal affairs as a Sovereign Individual, by unfurling various ‘flags’ or country bases and by treating governments as service providers instead of rulers. For example, there would be a citizenship flag (“second passport”), an official residence flag, a banking flag and so on. Each of these would be from different jurisdictions. That way, you are not bound to any particular country.

The ultimate PT goal is not to be resident anywhere! That is how you become a Permanent Tourist, at least on paper. You might for example spend five months of the year in one home, five months in another, and a couple of months vacationing, visiting friends or taking a cruise in between. That way each country treats you as a tourist and does not consider you a tax resident. You then keep all your assets stashed safely offshore, earn your money over the internet in other countries, and live totally tax free completely legally. If you drive cars, own real estate etc they are all held in company names, or simply rented or leased. So you don’t appear on any government ‘Big Brother’ style databases.

PT is based on the theory that most countries treat tourists better than citizens.

In fact, the beauty of this idea is its simplicity. As a ‘PT’ wherever you are, you always appear to be from somewhere else!

You can usually live and travel in better style and for less money than it costs to remain where you are. You can also chose to enjoy places that encourage the lifestyle and social norms you have always wanted to live.

PT will appeal to a wide spectrum of people who dream of being able to disappear when events and times in life make it convenient to do so. As a PT, a Perpetual Tourist, you run your own life. Using freedom tools such as the flags theories you can put a significant distance between yourself and bureaucrats that want to determine what is best for you, ‘for your own good’ of course!

A Brief History of the PT Theory

The PT theory was, according to urban legend propogated in the books, inspired by Harry Schultz, a Monaco-based newsletter publisher of North American origin who first coined the “three flags” theory back in the 1960s. Schultz’s claim to fame is that he is quoted in The Guinness Book of Records as the world’s highest paid investment consultant.

Later, a writer using the pseudonym W.G. ‘Bill’ Hill wrote a series of books including PT1, PT2 and The Passport Report which were published by Scope International Books in Hampshire, England. This same company published books by authors including Adam Starchild, Reinhard Stern and Jon Golding and Bob Beckman, also under the imprint ‘Milestone Publications.’

Scope went out of business in the mid nineties and was absorbed by an American direct marketing company who are still using much of the material today. The majority of it however has been toned down somewhat, not surprisingly as it is published from within the USA.

Other writers have taken up the PT theme in books like The International Man by Doug Casey, The Internationalist by Nicholas Pullen, and most recently in 2006 by a group mysteriously calling themselves “Grandpa and Others.” They wrote an attractive-leather bound three-volume set of limited edition books known as Bye Bye Big Brother. Or simply “BBBB.”Bye Bye Big Brother is also available in an abridged, paperback version from Vera Verba, a Chicago-based imprint. But hardcore readers should be aware that the abridged version has edited out some of the more cutting edge, controversial material included in the original.

From Three Flags to Six Flags

 The original theory espoused by Harry Schultz and Harry Browne (“How to Find Freedom in an Unfree World”) talked about three flags:

• Have your citizenship somewhere that does not tax income earned outside the country.  
• Have your businesses and speculations in stable, low or no tax countries.
• Live as a tourist in countries where what you esteem is valued, not outlawed.

Later W.G. Hill added two more flags – business havens where you make your money, and playgrounds where you spend your time, as a separate flag to your official residence – thereby creating a five flag theory – the level of complication or sophistication is up to you! Finally, in Bye Bye Big Brother, a sixth flag was added – cyberspace, where all the other five flags come together, a place where you can be everywhere and nowhere at the same time!

Shortcomings and Concerns about the PT Theory – and the Dangers of Camouflage Passports!

View on the PT theory is that it’s a great idea, provided you treat it as what it is: a slightly tongue in cheek knock at the establishment with a wicked sense of humor. A client of mine recently read it and said it was riveting, like reading a novel.

PT is a well thought out idea to break free and escape, especially if you like international living and the traveling lifestyle. It’s probably aimed more at those with well over a million safely tucked away in a Swiss bank seeking the kind of asset protection arrangements that their lawyers would not tell them about… while being less useful (but nonetheless interesting reading) for those who are just starting out on their quest for offshore wealth building opportunities.

PT is certainly not a step-by-step plan you should follow blindly. Indeed, it’s clearly not for everybody. We say, “by all means read the literature.” It’s an idea you can read about, absorb and enjoy… and then adjust to your own situation.

 always had a slightly different vision, and still do today.  What’s the difference? Well it’s not easy to live out of a suitcase, or to have to worry about counting the days you are in a certain country due to limited tourist visas or the concern that you will become a tax-resident. There are more sophisticated plans available today, and we write about them in our newsletter for members. We also tend to focus more on opportunities for creating wealth.

An Important Warning about the Legalities of the PT ‘Six Flags’ Theory

Here’s an important warning. Some of the tactics in the original PT books might have seemed like harmless fun back in the eighties, but in today’s world they could get you into hot water.

By way of example, one of the products frequently promoted was the so-called camouflage passport. Camouflage passports are booklets that look like passports from countries that used to exist but don’t any more – the intention being to fool anyone who might have learned about countries like Ceylon, Dutch Guiana, British Honduras or the U.S.S.R. in their school history classes, but who didn’t know that those countries today are called Sri Lanka, Suriname, Belize and Russia. Camouflage passports were promoted as a way to avoid terrorist attacks, by confusing terrorists in a hijacking situation into thinking that you came from a neutral country rather than a target country like the USA, UK or Israel. However in the current environment merely having a camouflage passport in your possession is more likely to get you labeled as a terrorist than anything else!

Indeed, it has been said that ‘Big Brother’ thinks PT stands for Potential Terrorist!

Peter Macfarlane is an author and lecturer on offshore finance, investment, due diligence and wealth creation matters. He is joint editor of The Q Wealth Report http://www.qwealthreport.com

In order to increase the avenues for investment abroad, Indian mutual funds were allowed to invest in rated securities in countries with fully convertible currencies, within the existing limits. Earlier such investment was only permitted in ADRs/GDRs issued by Indian companies in overseas markets.

A road map for developing Separate Trading for Registered Interest and Principal of Securities (STRIPS) has been prepared. The Reserve Bank is actively pursuing the creation and development of the STRIPS market which, in addition to providing more flexibility in managing interest rate risk, would help in addressing the asset-liability mismatch problem of banks/institutions.

Banks with typically short maturity funding can hold short duration STRIPS (i.e., coupon STRIPS) while the longer duration STRIPS can be held by insurance companies and pension funds, etc. To facilitate the market for STRIPS (which are essentially zero coupon bonds (ZCBs), the tax anomaly that existed in respect of ZCBs has been removed by Central Board of Direct Taxes (CBDT) in a notification issued in February 2002. Accordingly, ZCBs are now to be taxed on a total return basis by treating the marked-to-market gains to the holder during the assessment year as taxable.

Issues of Foreign Currency Convertible Bond were allowed under the automatic route up to US $ 50 million. The Indian companies were permitted to raise the 24 per cent limit on Foreign Institutional Investors investment to the sectoral cap/statutory ceiling as applicable. As announced by the Finance Minister in his Budget speech for 2002- 03, FIIs’ portfolio investments will hence forth not be subject to sectoral limits for foreign direct investment except in specified sectors.

After accumulation or distribution takes place, a stock moves into new territory, either high or low, showing that the stock has been absorbed or distributed and that a new move is starting. The big profits are made in the runs between accumulation and distribution. Therefore, you make more money by waiting until a stock plainly declares its trend than by getting in before it starts. It is just like a race. It often takes fifteen or twenty minutes to get the horses away from the post, but once “they’re off” the race is over in two minutes. It is the getting ready that takes the time, the run is soon made, once the firing line is crossed. What difference does it make whether you buy a stock 10, 20 or 30 points above the bottom so long as you make profits? The same with selling short. It makes no difference how much the price is down from the top. Wen it breaks out of the distributing zone, it is a safe short sale and you will make quick profits. Get the idea of prices out of your head. Forget about the bottoms and tops; trade to make profits, not to try and catch the bottom or top eighth. The insiders do not do it, and you can not hope to do better than the man who makes the market.

Get the best stock market recommendation, free tips, e-books, and start making money from online trading. Trading easy through http://www.5minutetrader.com/

Here’s how I plan to turn the $1,000 per child that the Rudd Government is giving to my family on 8 December, 2008 into a gift that lasts for life.

For those readers who are either not Australian, or who are not aware of the recently-announced financial assistance the Australian Government is offering to families; here is a brief of what is on offer.

The Australian Government, which happens to be in Surplus (given the amount of debt per capita, I am not sure what this is a Surplus “of”…), announced recently that if you have children and you fall within the “Family Benefits Tax A” bracket, then to help ‘boost’ the economy, the Australian Government is offering families a cash payment of $1,000 per child, to be paid on 8th December 2008.

There is a whole swag of other payments being made right across the country to Age Pensioners, Disability Pensioners, Carers, and others, on the same day. The media had a field day, rejoicing in the announcement, saying that families will be able to spend this on Christmas presents and will boost Christmas sales and the economy. People everywhere are plotting how they will spend the unexpected booty.

Not me! I have bigger ideas than that and will actually be applying the cash handout to remedying – at least within my own family – the underlying cause that’s behind this whole sorry mess in the first place.

That is to say, I will be putting this money to work. I will use it to create more money for my children, which will, in turn, be reinvested to create recurring incomes, from a number of sources.

What’s more, I have found a way to do this in a risk-free environment – outside of the stock market, and outside of the property market – yet which allows me to invest small amounts in carefully selected businesses by purchasing their products and receiving profit-share from sales. More on this in a minute.

First off, I will open a bank account in each child’s name to accept their windfalls and start their Investment/Savings plans for the future.

Of the $1,000 each receives, I will put into action what every Investment book out there tells me to do. Invest 10% of all money received into growing more money.

So, $100 per child will be invested and put to work using the strategies set out in the free book “How To Let Your Money Make More Money Online… While You Are Busy Doing Other Things,” by Taylor Adams.

This has taught me exactly how to use subscriptions to online companies from just $5 per month as profit-generating investments. Money Buddy Alliance (MBA) offers a free service, so I am not paying any money to them. The money I pay is to my own subscription account, in return for which, I receive the product I subscribe to, along with a profit-share in the form of commission income. How cool is that?

$100 will more than cover a 12-month subscription to my children’s first Investment. So I can just pay the annual amount and not even have to think about it for the next 12 months.

All of this I have already had set up in my own name for some time, and know from my own experiences that it works a treat. So I will simply create a subscription in each of the kids’ names, and basically set them up for life.

There is a reinvestment strategy for when income reaches successive levels that will pay for a series of additional investments from profits, one after another. It’s so easy.

MBA just lets me know when my profits are sufficient to add the next investment position. I then take a look at it, and if I like it, I commence reinvesting in that one too. So far I have 8 different investment vehicles at various stages of development, from well established to very new. It’ll be fun teaching the kids how to do this as they grow.

Sometimes I still am amazed that for as little as $5 per month I can set my kids up for life in this way. And anyone can do it.

So what am I going to do with Kevin Rudd’s Christmas bonus – the $1,000 per child ‘windfall’ that the Australian Government has given to my family…??

I will teach my children how to invest just 10% of that money. I will show them how to purchase their “Money Tree seedlings” – an annual subscription to an online gardening club; which costs just $5 per month and pays out 90% of its subscriptions to its members.

This will dovetail very nicely with the gardening that we are teaching them in our own suburban backyard, where they now have a thriving worm farm and lush crops of organic fruits and vegetables.

I will teach them how to set up their online money processor which will collect their commissions, and pay their subscriptions from profits when renewal time comes around next year.

Everything at Money Buddy Alliance is kept so easy and straight forward, it’s just like following the “bouncing ball.”

This is the first step of a program that will teach my children how to invest their Christmas bonus money and put it to work while they are busy being kids; and I can monitor and watch my children’s investments grow, while I get on with being “MUM.”

For a free report called “The $5 poverty Cure,” send an email to Leanne with “$1,000 Family Tax Benefit A” in the Subject line. A detailed report will be sent to your inbox outlining how to start putting YOUR money to work, so that you will be ready to help start your kids’ investments when you receive Kevin Rudd’s Christmas bonus in December 2008.

Leanne Cane
leanne@moneybuddyalliance.com

The stock market is crashing. Government bailouts are rampant. The political climate is uncertain. Credit has all but disappeared for ready buyers if you can even find one. Yet, your dreams of retirement remain. What can you do? There is an answer that you may have overlooked. By understanding the power of an ESOP you could be well on your way to your retirement in the next 90 days.

An ESOP (Employee Stock Ownership Plan) is a tax-advantaged vehicle that enables you to sell your business to your employees. This program was established by Congress in 1974 and today there are about 12,000 ESOP owned companies. Many business owners have either never heard of an ESOP or have a misunderstanding of how it works. Here are some common misconceptions along with solutions to your dilemma.

My employees can’t afford to buy my company and they are not “ownership material.” In reality, an ESOP doesn’t cost your employees anything. The ESOP is created which buys your stock. Your employees are beneficiaries of the ESOP. The ESOP distributes stock to your employees’ ESOP accounts each year based on their percentage of the overall payroll. The employees continue to perform their regular duties and answer to management as they currently do. They do not have general voting power or control of how the company is managed. An employee’s ESOP account is like a free retirement account that they earn by loyal service to the company. When they retire or leave after becoming vested they take the value of their account with them. Many companies with “blue-collar” employees are ESOP-owned.

I want to retire in the next few years. Who is going to run the company? The beauty of an ESOP is that you can “have your cake and eat it too”. An ESOP allows you to create a definite exit strategy while letting you remain in the control of the company for as long as you like. As Trustee of the ESOT you continue to run the company as you do right now and you continue to draw a salary. You are still the boss even though you don’t own the company. Your goal will be to work yourself out of a job so you can begin your retirement. That is accomplished by either grooming one of your senior employees to take your place or by hiring a qualified replacement as a manager. That can happen within months if you’re anxious to leave or you can stage the transition over several years. The bottom line is that it is always your choice.

Who is the buyer? That’s the great thing about selling to an ESOP. You don’t need a buyer. The ESOP is the entity that is created to buy your stock. You can create your exit strategy today by enlisting the help of Dynasty Capital Advisors. They specialize in setting up an ESOP and they take care of all the details.

Where does the money come from? Now we’re getting down to the real purpose of this article. Typically, specialized ESOP lenders would fund the entire transaction and you would get a big check at closing. One downside was that a portion of that check was pledged back to the lender to help secure the loan. One of the main benefits of an ESOP is that you can take that cash and reinvest it in stocks and bonds and defer the capital gains tax on your sale indefinitely. But, who wants to put their money in the stock market these days? And, since credit has tightened so much in the last year, it’s very difficult to find lenders who will fund 100% of the transaction. Financing is still available for a portion of the transaction depending on the collateral position of the company, but in most cases it’s more attractive for you to be the banker yourself and avoid all the red tape that goes along with dealing with banks these days. This structure allows you to collect the interest income rather than paying it to the banks.

Why should I finance the sale of my own company? Typically, if you were dealing with a third party buyer, it would not make much sense at all. It would be like loaning several million dollars to someone you don’t know and also giving up control of your company. But, with an ESOP, you still control the company, and by remaining in control you can assure that you get paid in a timely manner. You can structure the loan terms however you want, and if the company should have a bad month you have the ability as the lender to delay or defer a payment rather than risk a default on a bank loan. The biggest question to ask yourself is “What would I be doing with the money if I got cash?” If you are truly selling to retire you are likely going to put it somewhere safe to generate retirement income. You could put it in the bank and maybe get 5% interest, but banks aren’t doing so well these days as we have seen in the news, and the FDIC only insures accounts up to $100,000. By leaving your money invested in the company that you have spent a lifetime building, you know that as long as you are in control it is secured by something of value. And, by properly structuring your finance package to include trustee compensation, stock options, and other perks, your rate of return can exceed 30% rather than 5% at the bank.

How long does it take to set all this up? As the banker, you would avoid a great deal of time and expense by not dealing with an outside bank. Dynasty Capital Advisors will analyze your company, prepare a Feasibility Study for the ESOP, prepare all plan documents, coordinate outside professionals such as an independent valuation expert and the Trust attorney, and close the sale to the ESOP in less than 90 days.

Will I get my price? A sale to an ESOP is always at fair market value as established by an independent valuation. This means that you will receive the highest price possible that can be supported by factual data. You don’t have to deal with buyers who will try to beat you down on your price. Dynasty Capital will provide you with a valuation that will come within 5% of the final price for your review at no cost.

How can I find out if this is right for me? Dynasty Capital Advisors will prepare a Pre-Feasibility Study at no cost for you to determine whether an ESOP is right for your company. You will receive a free stock valuation to help you decide if the money is right. You will also receive an Investment Analysis that will show the benefits of financing the transaction. There is no obligation for you to explore the benefits of an ESOP transaction.

Selling your business doesn’t have to be an uncertainty that is dictated by a weak economy or the woes of Wall Street. By using an ESOP as your exit strategy, you can control everything from the buyer to the banker by eliminating both of them. And, you protect your employees at the same time while leaving your company in the hands of the people that have helped build it. This is a process that leaves you in complete control of every decision. Now you can design your retirement on your own terms without having to haggle over the price or play the games so typical in a business sale. Call Dynasty Capital Advisors today and find out how quickly you could be experiencing retirement freedom. For more information about how an ESOP could be the solution to your exit strategy, call Myron Goodrum, Vice President of Dynasty Capital Advisors at 603-785-4331 or email at mgoodrum@dynastycapital.com.

How to buy property in Spain has been a popular question for UK buyers for some decades. Now US investors are catching on. Spain has a magnetism that is hard to explain and that few other countries possess. It’s not only the spectacular scenery, fantastic beaches and year-round sunshine. It seems to be something about the easy, relaxed pace of life and the exuberance and happiness of its people, that draws people back year after year and makes them reluctant to leave. Plus, of course, it has the lowest cost of living in Europe!

But of course it’s exactly this magical quality that you need to beware of when it comes to buying property! It’s fatally easy to fall in love with a house that’s bathed in sunshine, with a sensational view, and let all common sense fly out of the window – as thousands of British buyers have discovered to their cost. Stranded with no property and no money, many are wishing they had never heard of Spain.

So if you are serious, you need to understand how to buy property in Spain in a way that will enhance your lifestyle, and won’t leave you out of pocket. Here are ten suggestions to point you in the right direction.

1. Once you have chosen an area, book into an hotel for some days and explore. Ideally, do this at the least attractive time of year weatherwise. Pretend you are a journalist and try to find as many downsides as you can. If it’s in a resort area, would you fancy it when most vacationers have gone home? If it’s in a rural location, would you feel cut off in the winter months? If one of its attractions is that it’s near an airport, how would you feel if your airline stopped flying to that airport? (This does happen and makes a huge difference to the property’s usefulness as a vacation home.)
2. This one’s a biggie. Hire an attorney whom you can really trust and who really understands all aspects of Spanish real estate law, including planning/zoning laws. Your consulate may be able to provide you a list of recommended attorneys. Do you know how many people have been left bankrupt, with their dreams in shreds, because they didn’t check planning regulations? Either they didn’t check that they had full title to the land, or they failed to ensure that the property they were buying was legally built on that land. If this happens, the authorities will simply demolish the property, leaving you with nothing. And this has happened to plenty of people.
3. Remember also that in parts of Spain, even if the property is legally built on the land, the authorities can take back the land if they decide they want it for municipal development. And there is nothing you can do about it. This is known by English speakers as the “land-grab” and has happened, for instance, in areas of Valencia including the Costa Blanca. Although this was declared illegal under European law, many foreign property owners are still threatened with loss of their property. So do take very clear and thorough legal advice before proceeding.
4. Before you start your search for a property, write down your budget and keep looking at it. In the Spanish sunshine, after a few glasses of Rioja, it is easy to be seduced by a gorgeous property that you really can’t afford. Be clear about your budget and stick to it.
5. When you have started in earnest on your property search, view the properties as often as you wish. If any owner wants to restrict you to a single viewing, walk away. Be careful to check such details as telephone connections, and broadband if this is important to you. After your initial viewing, plenty of questions will occur to you so write them down before next time. Try to visit in different weather conditions and at different times of day.
6. For financing, the easiest way to raise a mortgage is often by going to a Spanish bank. You can usually get up to 80 percent of the purchase price that way. Alternatively, you may prefer to re-finance your existing property.
7. Don’t forget that in Spain there are initial charges that have to be paid up front. These include transfer tax, stamp duty, fees to the notary public, and name changes to the deed. You should allow about 10 percent of the purchase price to cover these.
8. When you have finally got to the point of purchasing your property, the first thing you do is sign a “reservation” agreement. This means the vendor has to withdraw the property from the market. Once the lawyer’s search is complete, you and the vendor sign the “sale and purchase” contract. This is legally binding and all the details of the property have to be correctly entered.
9. On completion day, you and the vendor, both with your lawyers, attend the office of the notary public to sign the final contracts. The process is now complete.
10. Relax with a glass of wine (or three) and enjoy your new property!

These tips about how to buy a property in Spain should ensure that the process goes smoothly – and that you don’t fall into any of the pitfalls which many expatriates have encountered. Just make sure that you have covered all the legalities, that you can trust your lawyer/attorney, and that all the paperwork is correctly filed. It seems a hassle at the time. But it will enable you to enjoy and profit from your new property for the rest of your life.

Elaine Berry is the owner of the Bizwrite Real Estate Service. For a wonderful selection of the best properties in Spain, come and visit http://www.bizwrite.co.uk/realestate/propertyabroad.html If you would like to find out how to refinance your home in order to buy your Spanish property, visit us at http://www.bizwrite.co.uk/realestate/lending.html