How to Go About Budgeting for a New Vehicle and Financing It Too

Buying a new vehicle is a big  commitment and not a decision which should be entered into lightly. If, like most of us, you are unable to buy a new vehicle cash, you’re going to have to consider car finance in order to complete your purchase. Financing a vehicle is often associated with unnecessary problems and a fair amount of stress, too.

But financing your vehicle needn’t be fraught with uncertainty, confusion, or indecision. By acquainting yourself with the appropriate information you’ll find that the process of purchasing a new or used vehicle can be an exciting process. whether you enjoy the process or not hinges on whether or not you’re comfortable with your knowledge of the process.

So, what should you know before you finance a car?

The first and most important question you need to ask yourself is: Can I afford to purchase a vehicle? As important as it is to have your own set of wheels, overcommitting yourself to repayments you cannot afford will only end in disaster. At best, you’ll be able to scrape by and you’ll manage to purchase the vehicle. At worst you stand a chance of having the vehicle being repossessed and destroying your credit rating.

To figure out how much you can afford on a monthly basis use the following simple formula:

Income – Expenses = Surplus

Once you’ve determined what your monthly surplus is you’ll have a pretty good idea of how much you can afford on a monthly basis, but don’t get too excited just yet. Your surplus cash is not the final amount you can spend on a vehicle. You also need to factor in how much insurance you’re going to have to pay on a monthly basis (all financed vehicles need insurance) and you’re also going to have to factor in the monthly running costs of the vehicle, ie. How much petrol will I need? Does the vehicle require any additional maintenance to keep it on the road? Don’t forget that you still need to save on a monthly basis – life happens to all of us so it’s best to stay prepared.

How to go about financing your vehicle:

There are a number of options available to someone looking to obtain finance. You can either:

  • Apply for finance online
  • Use one of the bank’s pre-approved finance facilities
  • Apply for finance at a dealer
  • Each of the options outlined above offer their own benefits, however, using an online application will make the process as simple as possible.

Stay tuned for our next article which will cover everything you will need when financing a car.

Budget Preparation Guide

Budget preparation is a common affair in most established companies. Most of the time, the preparation procedures and formats are inherited from the predecessors. Giving short time and tight deadline are very common.  Most people who are involved in the budget, were always too engrossed to rush and meet the deadline.

How many people involved really understand the full budget preparation process? I have been preparing budgeting for the last 10 years of my working career. I realised that many of the people who are involved in budgeting, that I met, don’t really have a proper training or knowledge of the full budget preparation process.

Therefore, I prepared this guide with an objective to give a better understanding of the budgeting process.  This guide is based on real practice and may differs from organization to organization.

Budget Preparation Guide:

Budget templates and schedules may differs from organization to organization. However, most master budgets have two major common components such as the operating budget and the budget. From my experience, it is pertinent to have first two years prepared in monthly format and the next three or whatever years in yearly format.

1. Operating budget consists of the following components:

a. Sales/revenues budget provides the various sources of revenue lines and how they would be achieved.

b. Cost of sales/direct cost budget provides the associated cost directly linked to the various revenue lines.  The difference between the sales/revenues budget and cost of sales/direct cost is the Gross Profit Margin.

c. Operating expenses budget provides the details of the indirect operating cost such staff salary, office rental, printing and stationery, telephone expense and etc. Such expenses normally will be incurred regardless whether there are sales/revenues.

d. Advertising & promotion budget provides the various plans of how the organization is going to promote its business. Example would be the advertisement cost, product promotion cost and etc.

The overall operating budget basically provides a full picture of the business operation and its bottom line.

2. Financial budget consists of the following components:

a.  Capital budget provides the details of the capital expenditures such as office renovation, hardware investment cost and etc.

b.  Income from operations budget is the end result (bottom line or profitability) of the above operating budget. It can be a cash deficit or contribution from the operating activities.

c.  Cashflow budget provides the requirements of the business operations. It consist of the following components.

Basics Of Meaningful Budgeting

Nearly every organization, whether it be public, non – profit, or related to a for – profit group or scenario, has some sort of budget process. Unfortunately, far too often, the attitude towards the significance and relevance of the budget process is often a diminishment of the need for this process. Meaningful budgeting must always begin with an attitude of understanding and appreciating the reasons and needs for the process. When done correctly, it enhances one’s ability to do a thorough and relevant analysis of needs and priorities, as well as direct a process in the right direction. This should assist in the prioritization process, and make this a step towards functionality, rather than merely an exercise. Once this is understood, many believe that only by using a zero – based budget process, does the document serve the maximum purpose.

1. The vast majority of individuals tend to feel that creating a budget is merely a guide, rather than a directive. Because of this, once they get the budget approved, they often ignore the document, and merely resort to shorter term or crisis management form of leadership. On the other hand, when budgets are used properly, they set the tone, create priorities and direction, and do so in a responsible and effective manner.

2. Effective budgets begin with a commitment to thorough analysis. This permits groups to set goals, create meaningful prioritizes (based both on needs as well as goals and visions), and to effectively plan for the upcoming period. When use properly, budgets are an essential first step in realistic strategic planning.

3. Does your group have needs and priorities, and do they plan to address these in a manner that includes budgeting for them, or do they simply take haphazard steps in a less than meaningful manner?

4. Budgets must be used as a guide to which actions to take, and how to get the maximum bang for the buck. When this is done, organizations have the ability to prioritize providing value to their constituents and other stakeholders.

5. For more than three decades, I have prepared and assisted in preparing numerous budgets, and have become an advocate for the need for using zero – based process. Zero – based means avoiding the tendency of merely extending meaningless budgets year after year. When groups merely look at what they are doing, and just either maintain a line item expenditure or increase things by a specific percentage, groups lose an opportunity to improve and become more efficient and effective. Zero – based means one must justify each non contractural item on a needs, priorities, best ways, and relevant manner. Only when this is done can most organizations plan effectively in a non – crisis manner, and evolve before they must.

Don’t consider budgeting to be merely a process or exercise! When that is the approach and attitude, opportunities are squandered, monies and time wasted, and true leadership dinminished. Commit to use your budget as your ally.

5 Keys to Successful Budgeting

What is a budget? A budget is a way to track the in flow and out flow of your . This being said, how to you create a successful budget? There are many articles that will give you tips and trick of how to create a better budget but these are just a few that have helped me and countless of other people out the most. You will be surprised that by just having a successful budget in place can help you pay off your debts much faster by using the debt snowball.

Step 1- Have a written budget. If you don’t have your budget written somewhere then it will never happen. This doesn’t mean that it actually has to be down on paper but you should at least have a spreadsheet on the computer. Most of us have heard the saying. “a goal not written is merely a wish” and it goes the same with budgeting. A budget not written is actually a nightmare.

Step2- Track every penny. One of the purposes of a budget is to track all of your spending. You cannot do this if you do not have a written budget. In order to get your finances under control you need to know where every dollar and penny is being spent. Be very strict about how you do this. Don’t let anything fly by. You would be surprised how much  you spent that you don’t even keep track of.

Step3- Use cash. After you have your budget completely set up, set aside the amount of cash that you need for your budget and spend only cash as much as possible. For some things it is easier to use a debit card, like gas. In all ways possible you should only use cash. It is much easier to control your spending when you only have cash to spend. Some people like to use what is called the envelope system. The envelope system works by setting aside envelopes of cash for each area of your budget. When your envelope is out of cash you stop spending.

Step 4- Cut out unnecessary expenses. One of the key points of budgeting is to cut out any unnecessary expenses. The first month of the budget is the hardest. After you have faithfully tracked all of your expenses, you will see areas where you have spent more  than you thought. Now it is time to cut out any unnecessary expesnes. The money that you save can be put towards you debt using the debt snowball. If you don’t have any debt than start saving.

Capital Budgeting

Capital budgeting is a process of planning expenditures incurred on assets whose cash flow is expected to range beyond one year. In other words, it is defined as a process that requires planning for setting up budgets on projects expected to have long-term implications. It can be used for processes such as the purchase of new equipment or launching of a new product in the market. Businesses prefer to intricately study a project before taking it on, as it has a great impact on the company’s performance.

Some of the projects that use capital budgeting are investments in property, plants, and equipment, large advertising campaigns, and research and development projects.

The success of a business depends on the capital budgeting decisions taken by the management. The management of a company should analyze various factors before taking on a large project. Firstly, management should always keep in mind that capital expenditures require large outlays of . Secondly, firms should find modes to ascertain the best way to raise and repay the funds. The management should also keep in mind that capital budgeting requires a long-term commitment.

The requirement for relevant information and analysis of capital budgeting has paved the way for a series of models to assist firms in amassing the best of the allocated resources. One of the oldest methods used is the payback model; the process determines the length of time required for a business to recover its cash outlay. Another model, known as return on , evaluates the project based on standard historical cost accounting estimates.

Popular methods of capital budgeting include net present value (NPV), discounted cash flow (DCF), internal rate of return (IRR), and payback period.

While working with capital budgeting, a firm is involved in valuation of its business. By valuation, cash flow is identified and discounted at the present market value. In capital budgeting, valuation techniques are undertaken to analyze the impact of assets instead of assets.

The importance of capital budgeting is not the mechanics used, such as NPV and IRR, but is the varying key involved in forecasting cash flow. The importance of capital budgeting is not only its mechanics, but also the parameters of forecasting the incurrence of cash in the business.

Finance Article: Capital Budgeting

For the growing firms, Capital investments decisions are very important to stay in the business and to remain competitive in the  The planning for capital investments is very complex and involves many persons inside and outside of the company, as these decisions cannot be reversed at a low cost and mistakes can be very costly. The nature and complexity of capital decision can vary depending on the size of the project. Lower-level managers may have a discretion to make decisions that involves less than a given amount of money or that do not exceed a given capital budget. Larger and more complex decisions are reserved for discretion of top management and some are so significant that a company’s board of directors ultimately has the decision-making authority.

Capital budgeting is a cost-benefit analysis. At the margin, the benefits from improved decision making should exceed the costs of the capital budgeting efforts in order to create wealth for shareholders.

The Capital budgeting decisions are based on cash flows rather than accounting net income which deduct the non cash charges and more importantly based on timing of cash flows where capital decision maker put extraordinary efforts in order to determine with precision when cash flows will occur. The Relevant cash flows in capital budgeting decisions depend on future cash flows and future benefits including non-cash expenses and income. To determine the relevant cash flows, high level of professional skills is mandatory for judging the relevant or irrelevant cash or noncash expenses. Relevant cash flows are of two types of outputs that are, cash and cash inflows. Cash outflows are relatively easy to determine, including initial capital costs plus the cost of installation of plant and machinery. You can also include the reversal of initial working capital repayment after project completion. Cash inflows are more technical in nature and are determined by adding depreciation to profits after tax for each year. Moreover, residual value of an asset and recovery of working capital is also added at the end of the project.

For cost-benefit analysis, we implied time value of  technique using the discount rate. The discount rate we used in capital budgeting could be different from the firm discount rate as it depends on riskiness of the project like replacement projects have probably the same risk as the firm but expansion projects are more riskier project where a new discount rate or required rate should be determined. The discount rate is a rate which is required on a project by a diversified investor.

The discount rate should thus be a risk adjusted discount rate. In order to calculate the discount rate for a particular project, there two equilibrium models, for estimating this risk premium, are the capital asset pricing model (CAPM) and arbitrage pricing theory (APT).

In the CAPM, total risk can be broken into two components: systematic risk and unsystematic risk. Systematic risk is the portion of risk that is related to the  and that cannot be diversified away. Unsystematic risk is non-market risk that can be diversified away. Diversified investors can demand a risk premium for taking systematic risk but not unsystematic risk. When corporation is diversified or investors who are financing the project are diversified investor, it would be inappropriate to incorporate unsystematic risk factor in determining the required return for the project.

The last important consideration in capital budgeting is forecasting the inflation to incorporate its effect in cash flows and discount rate. Accuracy of estimation in forecasting inflation is essential because if the inflation is higher than expected, the profitability of investments is correspondingly lower than expected. Inflation essentially shifts wealth from the taxpayer to the government. Higher than expected inflation, higher will be the corporation’s real taxes because it reduces the value of the depreciation tax shelter.

How To Budget Money

Budgeting money is something of a neglected necessity in the modern world, with so many people lured into spending regardless of their situation. It has become almost the norm to spend each month more than is earned, often without even knowing it. This has led to severe debt problems for millions of people in the US and UK in particular, and an encouragement and acceptance of ignorance in personal money management.

Despite all the bad debt write offs, the banks and other lenders are happy with the situation. They build the risk factor of bad debts into their interest rates to ensure overall profitability, so borrowers are paying for the collective lack of ability to budget properly. Yet, budgeting is easy, so it is baffling in some ways that many people are unsure how to budget .

Being able to budget your own  is a bit more than listing your incomings and outgoings each month, quarter, year, or whatever period you need to budget for. Yes, you must go through the listing process, and then keep an eye on both sides of the equation constantly. But there are other factors in home budgeting, and that is what this article is about.

The Greatest Incentive

To encourage yourself to budget money is important, as without the motivation, you will probably not budget that well. What incentive can there be to having a home budget and sticking to it? The answer is actually quite simple. Nobody becomes rich by spending more, or even the same, each month than they receive. Wealth grows from surplus; that is, the surplus left over at the end of the month after you have completed your spending.

Recognizing this can provide you with a kick start in wanting to learn how to budget money, and then put that learning into practice. Once you start to see those surpluses build, your confidence in wealth building, and incentive in budgeting, will grow.

Keeping Detached

It is important when budgeting to maintain a detached view of the figures. Think of yourself as a finance professional helping a consumer set and manage a home budget, and set yourself aside from any emotions that may seep out during a review of your budget. Some parts of the budget can arouse emotions, and thus distort sensible decisions. Things like cutting out a family holiday or weekend trips, that new bike for your son or designer outfit for your daughter, can be emotional sparks. It is important not to allow those sparks to set light to your well drafted budget.

Be Open

If you have a family, the household budget affects those closest to you. The budget is a family affair, and it does help to talk openly about it with your spouse and children who are old enough to understand. Children may not like sacrifices, but they will understand eventually. It can be an important part of their education if you involve them. If you can give them some incentive, too, such as building their own savings scheme into the budget, then they may even start to enjoy it and truly see the benefits.

Have a Blast in Houston, Day or Night

So you’re stuck in the second largest state in the Union with nothing to do on a weekend? Houston has everything that you’re looking for to entertain and enlighten yourself. It all depends on what you want to do and where you want to be.

If you love the great outdoors, you’ll find plenty of ways to enjoy the fresh air of Houston. One of the mainstays of outdoor entertainment in Houston is Hermann Park. Offering an excellent zoo housing over forty-five hundred animals, Hermann Park is perfect for wildlife lovers. The “Natural Encounters” feature brings visitors literally face-to-face with animals from every corner of the globe.

For those who want to explore scientific horizons but prefer the great indoors, Hermann Park also contains the
ballroom dance houston Museum of Natural Science; which has a planetarium, a 3-D IMAX theater, and a world-renowned butterfly exhibit. Be sure to enjoy a relaxing paddle boat ride on the calm waters of McGovern Lake.

When you are out and about in H-town, be sure to visit the famed Battleship Texas, a survivor of both world wars. Wander its decks and interior and imagine what it was like to live and fight aboard this magnificent ship, which has recently been renovated.

Or, if that’s not your style, check out one of the city’s many golf courses. See a baseball game at the legendary Astrodome. Hike on one of the trails in Braeswood Bayou.

Now that you’ve got some great ideas for things to do in Houston during the day, it’s time to plan for your night. What does Houston have to offer for nightlife? Start the night off right with one of Magnolia City’s restaurants. Check out the Goode Company Barbeque for a nice dining experience.

After dinner, catch a show at the famous Anderson Fair in Montrose. It features internationally acclaimed musicians. Anderson Fair is famous for its black box stage, which emphasizes the musicianship of its artists. Most of its talent is acoustic in nature, so metal heads be warned.

But if your not in the mood for some acoustic jams, try getting your groove on at South Beach, Houston’s premiere nightclub. Top international DJs will have you grooving with the beautiful people until dawn. The club features suspended jets that spray water on the dance floor to cool off the action when it gets too hot.

Numbers Houston might be more your fare if you’re in the market for indie rock. Hole and Ben Folds Five is just a couple of acts that have played Numbers Houston, and upcoming shows feature all kinds of new talent. On nights that they don’t have live entertainment, DJs spin everything from new wave and Goth to metal.

Or, if you’re looking for an authentic Texan time, try your line dancing skills out with a trip on down to Eddie’s Country Ballroom in nearby Manvel. It’s about 20 minutes from the Astrodome, but if your boots crave a scoot, it’ll be worth the drive.

The Truth About Getting a Fast Online College Degree

There are affluence of acceptable affidavit for you to go aback to academy and acquire a bachelor’s degree. But you resent accepting to do it for years. There are a lot of acquirements institutions these canicule accouterment online education. While some accessory legit, others complete too acceptable to be true. Accepting a fast online academy amount abiding sounds appetizing because it will save you affluence of time. However, there are a few credibility you ability wish to accede first.

Literally affairs the degree

This ability complete as a abruptness to you, but a fast online academy amount is something which you can access even after accessory classes or axis in homework.

Such is accessible from amount mills on the Internet, area you audibly buy the degree. Additional options may cover archetype of annal or graduation certificate.

How amount mills work

Degree mills are sometimes based on activity adventures alone, or on a akin of bookish plan far beneath what added institutions crave from their enrollees. You can acquire such degrees from added accepted online acquirements institutions as well, by accessory basic classes and downloading your assignment modules. But accepting a fast online academy amount will crave you no assignments.

The downside of accepting a fast academy degree

For a lot of people, actually affairs a amount online is artlessly wrong. A lot of administration will not alternate to about-face down applicants whose accreditation were garnered from amount mills on the Internet. A authority becoming from amount mills is not acceptable to affect abeyant administration and may just be a complete decay of money. In some locations of the United States alone, it is advised actionable to administer for a job application an unearned academy degree.

Some of the things you can do to ensure a fast online academy amount affairs are genuine:

1. Assess the apprenticeship programs offered by the academy and the minimum requirements they seek from the enrollees. Usually these online college degree apprenticeship programs will crave activity adventures based on above-mentioned acquirements obtained, usually account added than two years.

2. Perform a accomplishments analysis of the acquirements institution. Utilize the Internet to acquisition out aggregate you can acquisition out about the academy — about their enrollees and their graduates. Read advice about the academy based on a third affair assessment, and not abandoned from the institution’s website alone.

3. Acquisition out about the adroitness members; you wish to apprentice alone from apt instructors. See how abounding there are and if they are aboveboard abundant to teach.

4. Analysis out if the academy has accreditation from several academy commissions. And while you’re at it, you ability wish to accomplish abiding that they are accustomed by abeyant employers, to anticipate difficulties applying for a job.

The key actuality is evaluating anxiously the academy of your choice. You can access a fast online academy amount that is 18-carat and accustomed by several abeyant employers. Accomplish abiding that your time and money is account what you are getting. With accurate planning, you will acquisition an online apprenticeship affairs that’s best for you.