Published on: 02 November 2018
Last Updated on: 30 October 2024
There is no magic button that can help you manage your finances. It takes time to learn how to manage your finances in the right way in order to avoid being stressed about money. Many people have a problem with managing finances and this is the reason why many people are always stressed about money. It is not about the amount of money you earn, it is how you manage it that counts.
Most of the people who are not able to finance correctly will always end up stressed and probably always broke. In such a case, it is important to ensure that you have a money coach, someone that can guide you through the process so that you learn.
3 Must-Know Accounting Tips To Help You Finance Correctly
There are firms like Marsh Tincknell Accountants that in addition to giving you accounting advice, can also help you in planning your finances. Here are the top 3 tips by Marsh Tincknell Accountants to help you manage your finances.
1. Write down your goals:
This is the first and most important tip when you want to plan your finances. Write down all your long-term and short-term goals that require you to spend money. Once you have your list of major goals, number them according to their priority and how soon you need to achieve them. Arrange them in order from the one you wish to achieve soonest to the one you want to achieve at a later date. For example, saving for retirement may be at the bottom of your list. This way, as you work on your short-term goals like reducing your spending, you are also able to work on your long-term goals slowly.
2. Create a financial plan:
This is one of the other important things to do to help you finance correctly. Your financial plan should have the steps to follow in order to achieve your short-term and long-term goals. For example, your plan may include steps like controlling your budget then coming up with a savings plan in order to get out of debt. This way, you are able to monitor how fast you achieve these steps towards reaching your long-term and short-term goals. When you see that you are taking too much time to conquer one step, you can then come up with strategies to ensure that you move faster toward your goal.
3. Create a budget and stick to it:
Having a budget is one of the most important tools to help you spend your finances wisely. This is because a budget acts as a boundary or restriction on the amount of money you are supposed to spend at a particular period of time. A budget also helps you to keep track of your spending. This helps you to evaluate and see where you are spending most of your money carelessly and cut down on that.
Conclusion:
Many people today have a problem with finances and how to manage them correctly. Three of the main problems that may lead to financial chaos is not having a list of the goals to be achieved, not having a financial plan and not having a budget. People who have these three things in place rarely experience stress due to the management of finances.
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Have you been practicing law for a while? Today, many lawyers are stepping into the entrepreneurship world to open their law firms. Indeed, practicing under experienced lawyers gives a lot of exposure but having autonomy at work is equally vital. You can choose clients and legal cases of your choice and practice in a particular area. Likewise, you can enjoy flexibility and freedom, make decisions, and set your priorities.
However, most lawyers don’t understand that starting a law firm is more than practicing law. Apart from legal responsibilities, you have to recruit people, market the law firm, and most importantly, manage finances. You have to document a long-term financial strategy to stay on top of your daily budget and earn profits. At the same time, you have to manage taxes, acquire funding, handle invoices, and much more.
To help you get started, here is a comprehensive guide to law firm finance in 2021.
1. Create a Long-Term Financial Strategy:
As a law firm owner, you have to establish a vision for the firm’s future. Do you picture a multi-lawyer firm handing corporate clients? Or you want to step into litigation or criminal law? Having a clear idea of long-term goals will help in creating a well-defined financial strategy. You can start putting funds aside for expansion from the beginning.
Likewise, you have to keep up with numbers, forecasts, and budgets to manage the day-to-day cash flow. You have to ensure the business has enough funds to secure new clients and take cases to trial. After all, not every case settles. However, if you don’t have a knack for numbers, consider learning the ropes.
You can look for virtual programs such as MSF online to avoid the hassle of traveling to college. After all, online education gives students a lot of flexibility, motivating them to keep learning. As for your law firm, it will help in managing finances efficiently while practicing law.
2. Get Access to Funding:
Although you are stepping into a service business, you will need a hefty amount of capital and cash to start a law firm. From office rentals, conference rooms, stationary costs to staffing – you will come across a long list of expenses. Therefore, look for ways to obtain capital for your law firm. Here are some of the options you can explore.
Savings:
Whenever starting a business, make sure a small chunk of the capital comes from personal savings. That way, you will keep working in the game because you won’t be liable to another person when things get tough.
Bank Loan:
You can start with a few thousand dollars, but more capital gives lawyers enough runway to make the business profitable. Hence, if your savings don’t seem sufficient, opt for a bank loan or open a credit line to raise capital.
Startup Incubators:
Today, many incubators connect new business owners with funding to get going. Often, they use their contacts with angel investors to fund new businesses or seek help from venture capitalists.
3. Manage Taxes:
Most attorneys operating law firms aren’t aware of legal obligations. As a result, taxes hit them in surprising ways. You might get a call from Internal Revenue System (IRS) or a hefty fine for missing the deadline.
Similarly, many lawyers have difficulty categorizing deductibles. You might think everything is deductible, whereas your tax liability is higher than you predicted. These pitfalls not only halt business operations but are super pricey too.
Hence, consider bringing an experienced tax specialist on board. However, if you don’t have a budget for additional hiring, learn about the taxation policies yourself. It doesn’t mean you have to go back to school; instead, look for online programs. You can opt for an online LLM tax program and learn from the comfort of your home and office. It will help you plan for tax liability, closing doors for IRS audit, and incorrect tax deductions.
4. Streamline Invoicing & Payment System:
Usually, lawyers have different payment policies. When dealing with corporate clients, they charge a monthly fee and have separate legal charges for cases. On the other hand, they don’t charge when fighting for accident victims until the negligent party’s proven guilty. Despite having different payment policies, you must have an appropriate invoicing and payment system at the firm. You can leverage savvy software to automate the firm’s finances.
Moreover, record your income correctly. If you charge a retainer fee, treat it as an advance payment and track its spending on every case. Similarly, avoid recording any income in your financials until you have won the case. It will give you a realistic view of the firm’s financial position, making sure you are on the right track. Besides this, don’t forget to set flexible billing terms with the clients and discuss everything upfront to avoid issues later.
5. Prepare Budgets, Reports, & KPIs:
Having a budget is imperative for your law firm’s financial success. You have to estimate your expenses and the revenue you expect to earn. It will give you a solid idea of how much you should work to make the business profitable. Likewise, you have to prepare financials to catch a glimpse of profitability.
Well, to begin effective financial reporting, you have to start with the bookkeeping basics. You have to record all financial transactions and maintain a separate account for every client.
After this, you can prepare an income statement and balance sheet to determine the law firm’s equity. Also, create a cash flow statement to understand how much cash goes out and comes into the business. All these financials will be a brilliant source of insights about your law firm. You can spot trends, overcome weaknesses, and capitalize on your strengths to make the business more profitable.
Final Thoughts:
Every successful law firm considers numbers and data first. You have to create an excellent financial plan with a growth vision to make your law firm successful. Similarly, you have to manage cash flow, follow a detailed billing process, and raise sufficient capital. As you progress forward, a strong financial position will unfold new growth opportunities. You can tap into new practice areas, offer more services, and expand your team.
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1. Daily Updates :
Who doesn’t like to get all the updates about financial markets at one place in a short and crisp manner? Stock Edge provides this feature in the “Daily updates” section. You just have to dedicate 5-10 minutes of your day to this section and you are ready with all the updates for the day.
It also helps those people who do not have much time to spare and still want to keep a track of the day-to-day activities of the markets.
2. Scans :
Scans make it very easy for the user to filter out stocks that he wants on the different basis. For example, if the user wants to filter out stocks on the basis of profitability, he/she can use the fundamental scans, and if he/she wants to filter out stocks on the basis of technical scans like simple moving average scans, Relative Strength Index scans (RSI) etc., and he/she can do so by using the technical scans.
Likewise, there are many other scans available in the StockEdge application like price scans, volume and delivery scans, futures scans and options scans etc. The user can select the scan that he/she finds suitable and make scans accordingly.
For more detailed knowledge about each of the section of the StockEdge application, click here
3. Learn Section :
There is even a “Learn Section” on the StockEdge homepage. In this section, many useful materials for your reference are available as shown in the image below.
These materials are free to use by anyone who is using the StockEdge application. This section is a combination of different content that has been developed to know the concepts of financial markets.
What does it include?
It includes basic and advanced levels of capital market and financial market. It includes both written material and videos by an expert.
4. Tracking FII/DII activity :
Who are FIIs/DIIs?
Foreign institutional investors (FIIs) refers to people from other countries who are investing in Indian companies and Direct Institutional Investors (DIIs) are Indian Institutional Investors who invest in Indian Companies like banks, financial institutions, insurance companies, mutual funds etc.
What do they signify?
These traders trade in huge quantities so they have the capability to influence the movement of the market. This data helps in tracking the inflow and outflow of the money in the Indian market.
With the help of this data, one can track in which segment of the market, these investors are investing their money in whether cash market, futures market, stock options or stock futures.
5. Tracking what big investors are doing :
This section gives you a list of all the investors that purchase shares of a company for long-term because they believe that the company has strong growth prospects in the future. Tracking these big investors helps in getting an idea of where should one invest their money in only after proper study and “doing your homework”.
Suppose, you want to track the big bull of India, i.e. Rakesh Jhunjhunwala, all you need to do is type his name in the search box and you will get a list of people or institutions that are in any way related to Rakesh Jhunjhunwala. You can add all of them in your “investor group” and keep a track of them just by clicking on the group.
6. Search by Sector :
One can even search a stock by sector wise. For example, if you want to study how the automobile sector is performing, he/she can just click on the “sector” section and go to the automobile part. All the stocks are classified on the basis of the different sector which makes it easy for anyone to study a particular sector.
Bottom Line :
Stock Edge is best for anyone who does not have much time to invest in the stock market and still wants to earn returns higher than the bank deposit. StockEdge helps you to be your own analyst by providing with all the data that you need to analyze a company.
How to download the StockEdge application?
For Android (Google Play Store) users, you can click here to download the app.
For iOS users, you can click here to download the app.
You can also check out the video below for a better understanding of the application.
Link:-https://www.youtube.com/watch?v=h8ooI9Fo7Dg
Stock Edge provides you with all the analysis you required for self-research. However, if you still feel that you need a more customized learning environment, we present StockEdge club for you.
This is India's first virtual club for stock market enthusiasts. This club will have the following features -
Access to 12 paid webinars that we conduct on a monthly basis.
Invitation to become part of one workshop in your city or in the nearby city.
Become a part of a What's App group where there will be continuous learning, continuous doubt clearing, and continuous question and answer so that you become a more knowledgeable and learned participant of the financial market in India.
To know more about this, you can click here.
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Term insurance plan is a type of insurance policy that offers pure life protection to the family of the insured in case of an uncertain demise of the insured person. This is the most basic kind of insurance policy that you can opt for. The premium amount on the term plan is also the lowest as compared to other life insurance policies.
What Is A Term Insurance Policy?
The term insurance policy offers life coverage for a specific period of time to the family of the policyholder in case of any eventuality. In case the policyholder expires within the tenure of the policy then the nominees get the sum assured amount. If the policyholder, however, survives all through the term plan and the policy expires then no maturity benefit is offered to the policyholder. The term plan is designed in such a way that it protects the family financially in case of the policy holder’s death. The online term plan is also for a set period of time. There is no wealth creation or investment benefit when you invest in a term plan.
Term Insurance Plan Offers an Affordable Premium Rate:
The offline/ online term insurance plans offer the lowest premium as compared to the other kinds of insurance policies. This is because the plan has no investment component attached to it and it is pure life protection. So in case, the policyholder expires during the policy term then the nominees will get the benefit. However, the term plan has no survival maturity benefit. This makes the term plan different from the other insurance policies that offer a maturity benefit to the policyholder in case the policyholder survives the entire tenure of the policy.
How Is The Premium Of The Online Term Plan Calculated?
Term insurance is basically a contract that the policyholder and the insurance company get into. The insurance company agrees to financially protect you and your loved ones in case of any eventuality within the policy term. In return for this security, you pay a premium amount to the insurance company.
Having an online term plan is a great idea and should be apart of your financial plan. Life is unpredictable and your family could get into a big financial crunch if you leave them without any financial backup. Thus if you are not financially secure then your family could be in big trouble.
If you leave without insurance then you may leave your family in big debt and thus you need to make it a priority to protect your family in every possible way. The term insurance plan is simple and the most economical way in which you can insure your life. The insurance plan lets you to financially secure your loved ones even when you are not around.
Terminsuranceplansattract a premium amount and thus you need to know first what decides the premium amount that you pay towards the term insurance policy.
The Term Plan Premium:
The premium of an online term insurance policy is calculated based on some simple aspects. This is the premium rate which is multiplied with the coverage amount that you have chosen. Mathematics and statistics are used to decide the premium rates. The risk is calculated to determine what the term premium is. The risk is basically how likely you are to place a claim. The lower is the risk attached to you the lower is the term insurance policy premium rate.
Factors That Affect the Term Insurance Premium Rate:
The insurer determines the premium amount based on the various factors when you apply to buy a term insurance plan.
Your age
Age is one of the most important factors that determine the premium amount of the online term plan. The older you are the more is the premium amount that you will have to pay. This is because as you age you are a higher risk to the insurance company and the chances that you will be claiming the insurance amount is high. This is why it is advised that you get the term insurance plan when you are young.
Gender
It is studied that women have a higher life expectancy than men. The insurance companies feel that women are less likely to die and thus they are charged a lesser online term plan premium than men of the same age. This is why the premium that is charged for men is higher than that for women.
Job profile
What your occupation also determines the online term plan premium amount that you will pay. There are some job profiles that are high risk as per the insurer and thus you will have to shell out a huge premium if you are working in any of those profiles. Those that are in some dangerous professions like an army, pilot, etc. have a higher premium rate than those who work in safe working conditions.
Geography
Where you stay also plays a very vital role in deciding the premium amount. Those places that are less prone to disaster charge you less premium than those places where natural calamities could charge anytime. This includes places that are prone to earthquakes or hurricanes.
BMI
Your body mass index is calculated by the insurance company. If you are overweight then you are likely to suffer from medical conditions like heart diseases and thus you will be paying a higher premium towards the life insurance policy.
Smoking
Smokers have a lower life expectancy and thus if you smoke then get ready to shell out extra towards the term insurance policy. This is because smokers have a high probability of having cancer and lung disorders.
The cost of premiums can vary more wildly for smokers than non-smokers, so it is even more important to compare quotes. You could use a comparison website or a regulated broker such as Reassured.
Alcohol
If you drink a lot then you could be prone to health problems related to alcohol. This is something that is considered when calculating your insurance premium.
Medical history
Your past medical state is also considered to calculate the premium amount. If you have ever suffered from illness in the past then this could cause the life insurance premium to increase. Also if your family member had some life-threatening disease at an early age then this could cause you to pay a higher premium towards the term insurance plan. This is because you are likely to get affected by the same disease at a later stage in your life.
Adventure Sports
If you are into adventure sports then you are likely to die having met with an accident. If you are too much involved in adventure sports then the premium charged to you will be higher.
Other factors
There are many other factors that could affect the premium that you pay towards term insurance policies. This includes your travel history, marital status and whether you have chosen for an additional rider. Every factor of your life determines how much premium you will be paying towards an insurance policy.
It is important that you declare them all when buying a term insurance policy. There is no point keeping the insurer in the dark because in case they get to know about it after then they would reject the claim. Thus your whole purpose of having a term insurance plan in the first place gets nullified.
How Much Premium Do You Need To Pay Towards Your Term Insurance Plan?
If you are wondering how much premium you would have to pay towards your term insurance plan then here you go. You could use a term insurance premium calculator that will be available for you to use for free on the website. All that you will have to do is to key in some details required and this will calculate the premium amount for you.
How much insurance coverage you will need is dependent on your age mostly. You need to add your present income and multiply it roughly with 15 and then add any of the outstanding debts or loans to it. This will give you an approximate amount of the coverage that you need.
This just gives you an approximate amount. You will also have to figure out the premium based on your retirement age, present age, inflation, liabilities that are existing and other needs. It is important that you consider the information and put in as much information as required and accurately you can come up with the most approximate figure.
Some of the details that will be required when you use the online calculator are your name and age, purchase year, tax liability, date of birth, gender, total coverage amount, etc.
You can use the term insurance premium calculator to get a rough amount of premium that will be charged towards your term insurance plan.
Choosing the Best Term Insurance Plan- Term Insurance Comparison
It could be a little tricky to decide on the best term insurance plan. You need to keep the following things in mind to make an informed choice.
The reputation of the insurance company
Coverage required
The claim settlement ratio of the company
Factors that could affect the coverage
Terms and conditions associated with different companies
Online or offline term insurance plan purchase.
All these will let you decide on the term insurance premium calculator on the best term insurance plan for your needs. The premium of the term insurance plan is comparatively lower than any other insurance plan that offers life coverage. It is however advised that you buy a term plan because it offers higher life coverage for a very low premium amount.
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