Legal Advice Demystified: Shareholders’ Agreement

by Sean Bryant on February 4, 2016

Legal Advice Demystified: Shareholders' Agreements

When setting up a business with a family member or close friend, it can be difficult to envision any problems in the future that may cause you to fall out, or result in the business breaking down. Nevertheless, these things do happen and it could be to your detriment. Without drawing up a shareholders’ agreement, you could find that you don’t get anything from the business you worked so hard to build up, while facing an expensive legal dispute. This is why establishing a shareholders’ agreement is imperative when setting up a business.

What is a shareholders’ agreement?

A shareholders’ agreement is exactly that; an agreement between the shareholders of a company. It helps to determine how a company is run, ensuring it’s done fairly while protecting each shareholder’s investment. However, it may only exist between certain shareholders, rather than all of them.

Although certain documents are required by law when setting up a business, a shareholders’ agreement is not. Creating an agreement is sometimes put off when a business is set up to save time, but it shouldn’t be overlooked altogether.

Why is it important?

There are various scenarios that could threaten your business if a shareholders’ agreement isn’t put in place. For example, if other shareholders wanted to leave the company, they could sell their shares to whoever they wished and you wouldn’t have a say. A shareholders’ agreement can also anticipate changes that may happen in the future, and allow business owners to adequately prepare for them. It can also stop others from doing anything to your share. Ultimately, a shareholders’ agreement provides protection.

When should I set one up?

A shareholders’ agreement should be set up as soon as a company is formed, when the relationships between the shareholders are the best they could be, and before there’s any opportunity for something to go wrong. That way, the shareholders are protected right from the start, should anything happen.

What do I need to do?

When setting up a limited liability company there are several things you need to do. This includes making an operating agreement, which is declaring the number of shares and their value; outlining prescribed particulars, which are the rights each shareholder has according to each class of share; and getting the articles of association (written rules), which are required by law. Once these are in place, a shareholders’ agreement can be established.

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Self-Trading at Home: Common Pitfalls and Mistakes

by Sean Bryant on February 3, 2016

Self-Trading at Home: Common Pitfalls and Mistakes

Let us imagine for a moment that you had recently decided to take the leap into the Forex marketplace. While you may have had all of the confidence in the world and a theoretical knowledge of the industry, your funds have quickly depleted and you now find yourself with little liquidity for future trades. What went wrong? This is a very common situation and in order to dive into the reasons for such a disappointment, it is important to take a look at some of the most common (and costly) mistakes which first-time traders make.

Not Enough Preparation

Much like any new venture, it is important to appreciate the intricacies of the Forex markets. Many newcomers are overly eager to begin and as a result, they are completely unprepared for what may be in store. Without a strong foundation, even the loftiest of castles is bound to tumble to the ground. This principle is just as true with investing. Study Fibonacci lines, charts, market fundamentals and technical analyses. Begin to understand the impact that other sectors have upon currency pairs. These are only a handful of topics that need to be addressed. It is far better to spend months studying Forex strategies as opposed to taking foolish risks.

A Failure to Listen to Others

The most successful traders are always open to the suggestions of others. Even those who have become millionaires will heed the advice of experts. Take some time and examine the strategies of the best in the business. Pride has a certain amount of influence here. Many could feel that they are impervious to failure after the execution of a few well-placed (and perhaps lucky) trades. This is certainly not the case. Humility goes a long way within the financial industry. Home trading should never be an isolated experience. Make powerful contacts and ask their opinions on a certain topic whenever it is relevant.

The Wrong Trading Platform

Home-based trading is massively impacted by the trading platform that is chosen. Some may choose generic architecture such as MetaTrader 4 while others prefer the unique sense of intuitive flexibility that is provided by cutting-edge firms such as CMC Markets. Should the incorrect platform be chosen, it is likely that lucrative positions will fall by the wayside and losses can quickly incur. Study each system with an eye for detail and keep in mind features such as usability, flexibility, customization, customer support and the amount of underlying assets to be traded.

Overexposure

Due to the sheer liquidity of the Forex markets, it is a good idea to limit one’s exposure to a specific position (such as a currency pair). Instead, home-based traders should strive to diversify their portfolio. This can be thought of as the ballast of a ship. Should all of the ballast be found in one location, it is likely that the vessel will tip when the seas become rough. Diversification is key to success.

Emotion

Home-based traders will often fall victim to their emotions; particularly because there are no other colleagues to provide them with a more objective perspective. This can be the death of any otherwise lucrative position. Greed and fear should be kept in check at all times; regardless of the perceived state of the markets. Execute trades with objectivity and pragmatism. If this seems difficult, it is wise to consult with established contacts (as mentioned above).

Home-based trading is an excellent way to become self-sufficient in this day and age. Avoiding these common pitfalls will help to make sure that any trader is prepared for what is in store.

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The Digital Wallet Revolution

by Sean Bryant on January 19, 2016

The Digital Wallet Revolution

You may have noticed the uptick of digital wallet commercials, which (not so coincidentally) happens to coincide with the holiday shopping season. These television commercials all point to one thing: digital wallets are about to be the next big thing, especially since Apple Pay is now a major player.

Lack of Consumer Confidence

Although digital wallets have been around for at least a decade, they haven’t really gained traction. According to a recently published Gallup survey, only 13 percent of American smartphone users currently utilize a digital wallet. Moreover, only two percent of all Americans use a digital wallet. Another study, which was conducted by Phoenix Marketing International and was delivered at the Money 20/20 conference, found that 64 percent of smartphone users would consider using a digital wallet that was provided by their financial institutions, while only 32 percent would consider using a digital wallet such as Apple Pay. Smartphone users, the survey found, trust their banks, PayPal, and their card issuers over other digital wallet sources, mainly because of security issues.

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Understanding Your Car Insurance Bill

by Sean Bryant on January 12, 2016

Understanding Your Car Insurance Bill

Anyone who has ever had to pay a car insurance bill before (which should be every single driver out there) can fully understand just how much car insurance can cost. However, if you’ve always been less than pleased with what you’re paying for car insurance, have you ever stopped to actually inspect the bill? All too often we accept the prices we pay for things, even if we’re not satisfied with their costs.

Below we’re going to look at some basic but essential details to understanding your car insurance bill.

Premium Fees and Deductibles

At the core, car insurance involves paying a premium to your insurance company, and, in the event of a loss, they will protect you financially per the contract. This is not only the most basic cost, but it is the only true cost of having insurance. Whether you choose the highest limits with bells and whistles or you decide to minimize your coverage, it’s all correlated to what your premium payment will be.

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How to Build a Savings Plan into Your Budget

by Sean Bryant on January 5, 2016

How to Build a Savings Plan into Your Budget

Most Americans aren’t saving enough for retirement, the latest data shows. Financial journalist Brian Stoffel has compared Transamerica data on what Americans of different ages actually save with Fidelity guidelines for what they should be saving, and he found that Americans start to fall behind in their 30s as living expenses mount up.

At 35, you should have saved up $54,000, but most people have only saved $45,000. By 45, you need $162,000, but most only have $63,000. By 65, when you should have built up a nest egg of $432,000, most people only have $172,000. Combined with Social Security, this only leaves retirees $22,500 a year for living expenses. To avoid spending your retirement in poverty, the best strategy is to start developing a savings plan now.

Setting Savings Goals

A first step toward developing a savings plan is setting some financial goals. Knowing what you’re saving toward lets you know how much to set aside. The American Institute of Certified Public Accountants recommends thinking about your needs for each stage of life when setting financial goals. For instance, if you just graduated from college, paying off your student debt and starting your retirement plan might be major goals. If you’re planning to get married and have kids, you and your spouse should discuss your mutual financial goals, including both your retirement plans as well as issues such as separate vs. joint savings accounts, insurance and educational funds for children. If you are looking to buy your first home, saving up to afford a mortgage becomes an important goal.

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Estate Planning for Millennial Clients is as critical as Planning for Other Generations

December 22, 2015
Estate Planning for Millennial Clients

Various estate planning surveys have showed that there is a significant disconnect when it comes to most people’s understanding of estate planning for millennials. Out of the people that have been interviewed so far many believe that it is important to have estate plans while only a few have them. Millennials are missing out on […]

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Tips for Outdoor Gear Shopping During the Holidays

December 18, 2015
Tips for Outdoor Gear Shopping During the Holidays

If you’re a camper, hiker, or general outdoors enthusiast, you’re probably waiting patiently for winter to pass so your favorite trails and parks are accessible once more. The colder months are generally downtime for campers, but the perfect opportunity to stock up on gear is in the offseason — and the holidays make this time […]

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