Monthly Archives: October 2016

Right Funding Can be Daunting

Vendedy is the first social network designed to connect global travelers to street markets. Founded by Forbes30Under30 Entrepreneur Christine Souffrant Ntim, the small business’s goal is to digitize the $10 trillion dollar street market economy and make it accessible to anyone and everyone.
But when Ntim started out, she had an incredibly difficult time getting the funding she needed.

When you’re an entrepreneur attempting to start a small business, getting funding can be tough. That’s especially true if you’re like Ntim and trying to launch something bold and new. So its important to explore all both traditional and newer funding options and pick the one that best fits you and your business best.
For example, you might be able to get a traditional small business loan, just beware of prepayment and other penalties that are part of the agreement. Newer types of options to consider include crowdfunding, online lenders and non-profit lenders. You might also consider applying for a loan from the U.S. Small Business Association.

Invest in Startups Using a Gold IRA

Did you know you could use a gold IRA to fund a startup venture? It requires taking some legal steps and placing the funds into a corporate account but is one way to provide a financial seedbed as the business grows and matures. And if you follow the rules, you can invest without incurring any tax liability. Here’s how to go about it.

Start with a Self-directed IRA
Before you can use gold as an asset to fund the business, you must first set up what’s known as a self-directed IRA.
Not every type of IRA qualifies as a business funding option. Traditional IRAs limit investment to stocks, bonds, mutual funds and similar instruments. But a self-directed IRA provides greater control in deciding where to invest assets, including your own startup or someone else’s. (Those assets can include, among other things, real estate, mortgage notes, foreign currency and gold and precious metals.)
That control comes with several advantages, too, not the least of which is tax savings. IRAs are tax-deferred and carry the potential for huge tax deductions. Also, federal bankruptcy laws protect self-directed IRAs, which means your assets are secure.

You will need a custodian such as a bank, credit union or trust company to hold and keep records of these assets. Typically, organizations filling this role do not give investment advice but merely provide administrative oversight.

Bear in mind that the IRS keeps a tight rein on self-directed IRAs. Thus, any error you make with the setup or management of the account could result in taxes, levies and penalties. A financial planner or reputable investment firm can help you avoid any such mistakes.

Fund a Startup with a Gold IRA
One smart way to exert control over a self-directed IRA business-related investment is by purchasing gold, silver and other precious metals, usually in the form of coins.
Why? For some very good reasons:
Gold Outperforms the Stock Market
According to the investment firm Lear Capital, gold has outperformed the Dow by more than 300 percent over the past decade.

Kiplinger credits gold’s skyrocketing value to rising debt levels resulting from banks attempting to spend their way out of slowing economic growth, demand for gold in China and other emerging markets and negative interest rates. These are just a few of the reasons gold is escalating in value and will continue to do so for the foreseeable future.

Gold Is Less Vulnerable to Market Fluctuations
Gold historically moves counter to the direction of stocks, bonds and mutual funds, says Lear, which means your holdings are less vulnerable to market fluctuations — something of particular concern given the uncertainties associated with the shift toward a global economy.
“Gold’s perception as a safe haven in times of economic turmoil makes it a top choice for fearful investors,” says Kiplinger.

Gold Provides a Hedge Against Inflation
Gold prices tend to rise as the cost of living increases, which makes it a hedge against inflation. Unlike paper money, the Fed can’t “print” more of it. As a result, gold gives you more purchasing power than you can get with the temperamental dollar.

Gold Is an Ideal Choice for Portfolio Diversification
Gold is an ideal choice for those wishing to diversify their investment portfolio to protect assets from the risk associated with market volatility. It is a stable asset that has intrinsic value — a property and reputation it has maintained for centuries.
How to Move an Existing IRA to Gold and Precious Metals
You can move any portion of an existing IRA into gold, silver or other precious metals using one of two mechanisms: transfer or rollover.

Transferring an IRA
Investors can transfer an existing IRA into a precious metals IRA at any time as long as the assets go “from custodian to custodian.”
“In a direct transfer, the money flows directly from one IRA custodian to another,” says Lear Capital. “This means the distribution check from the old IRA custodian must be made out in the name of the trustee or custodian of the new IRA account that receives the funds.”

Rolling Over an IRA
A rollover lets you receive the funds from your existing IRA account, which you then deposit into another IRA custodial account. You would need to redeposit the funds within 60 days to avoid taxes or penalties, however.

If funding a startup venture using assets from a self-directed IRA is in your future, consider investing in gold, silver and other precious metals. It’s a sure way to secure your assets and protect them from market volatility, save on your taxes and provide financial stability as the business grows.

Maximizing Your Social Security Benefits

It seems like a simple equation. You pay money into Social Security during your working years. You get it back when you retire. And if you hold off past full retirement age, you get more. Unfortunately, it’s not that simple.
The reality is there are 2,728 core rules to the Social Security program.* Given that jaw-dropping number, it’s not surprising that many retirees are leaving substantial amounts of money on the table.

The problem is that we’re not armed with basic information about our options, according to Rob Kron, Head of Investment and Retirement Education for BlackRock. “None of us are given a user guide when we start paying into the system,” he says. “The Social Security statement can be confusing and there are areas that are not covered, so a lot of people don’t know they can apply for certain benefits.”

The result? Valuable benefits, such as those for spouses and survivors, can be underutilized.
Here are Three of the Most Helpful Tips for Collecting What You’re Owed

1. Be patient. There may be instances where you need to dip into Social Security early — if you lose your job or your health takes a turn for the worse. But in the long run, most people are better off waiting until full retirement age to start receiving benefits.
social security benefit
For example, if you start collecting your Social Security benefits at age 70 rather than at age 62, your benefits would be 76% higher. Spousal benefits would be 43% higher at full retirement age of 66 than at age 62. And survivor benefits would be 40% higher at full retirement age than if you start collecting at age 60.
View more information on benefit reduction amounts based on retirement age on the Social Security website.
2. Get all of what’s yours. Take all the benefits available to you based on the work history of your current spouse, your ex-spouse(s), your deceased spouse(s) and/or your deceased ex-spouse(s).
3. Get the timing right. You may be eligible for a spouse or survivor benefit as well as your own retirement benefit. But Social Security won’t give you both at once. So you need to time them. There can be either:
a. retirement and spousal benefits, including divorce spousal benefits, or
b. retirement and survivor benefits, including survivor benefits for those who are divorced
Retirement benefits are based on your own earnings record. Spousal and survivor benefits are based on your spouse’s earnings, whether the spouse is deceased or divorced from you.

Work with an Advisor to Help you Get the Benefits You Deserve
Your financial advisor can walk you through your distribution options, point out benefits you might be missing out on and help you incorporate Social Security into your overall financial picture. “With the right guidance, it really doesn’t have to be an overwhelming process — and everyone deserves to get all they’re entitled to receive,” Kron says.