Monthly Archives: May 2017

How to find safe dividend growth stocks

When you’re evaluating a dividend-paying stock, your primary focus has to be the viability and sustainability of the dividend itself. Not rain nor sleet nor dark of night should stand a chance of keeping that courier from delivering a payment to your account every year.

The clearest danger to a dividend is a lack of cash flow. When a company has weak cash flow, the dividend is among the first costs to be cut — because this at least allows the company to appear to be bolstering that key metric. But a dividend stock that stops paying its dividend is of little value to anyone’s portfolio.

For example, in the energy sector, companies such as Chesapeake Energy  (CHK) and Linn Energy (LINE) were forced to eliminate their dividends recently, while industry bellwethers, Chevron (CVX) and ExxonMobil  (XOM) have maintained, if not increased, payouts.

How do you find a “safe” dividend? Seek out companies whose operating earnings and cash flow can cover their annual payments at least two times over. It is possible, in the near term, to raise capital through debt or equity offerings to prop up dividends, but most companies would not sustain this practice for more than a quarter or two.
It also helps to take a look at a company’s dividend history. It’s impossible to predict the future from the past, but some companies have exhibited a strong tendency to raise their payouts annually. For example, Dover (DOV) and Procter & Gamble (PG) have each updated their quarterly dividends for 59 consecutive years. 

Starting a new business and investing your time

When you’re starting a new business and investing your time, energy, and often your own hard earned cash into it, the promise of “free” money often sounds enticing. Chances are that you’ve stumbled across at least a few advertisements promoting business grants to help you fund your venture. So what’s the deal with business grants? Are grants available? Are you or your business eligible?

The answer to these questions depends on many variables, so we’ll get to that in a moment. First, let’s start off by defining, in loose terms, what a government business grant is (or in some cases, is not). Federal business grants are funded by tax dollars. Because of that, grant eligibility and approval is a very tightly run ship.

Furthermore, government business grants are appropriated through, well, the government (specifically Congress and the White House). As such, many of these grants are closely aligned to the agendas of a specific government agency like the U.S. Department of Education or the U.S. Department of Agriculture.

If it seems like receiving a business grant, specifically a government-funded one, is tricky. And it can be. Here are some general guidelines and requirements that the federal government uses to determine business grant eligibility:

 

Alternatives to Federal Small Business Grants

If your business doesn’t necessarily fit into the requirements listed above (many do not), there is still hope. State and local programs do exist, as do grant opportunities through other groups and organizations. For example, many large corporations offer grants through an affiliated foundation (i.e. Walmart Foundation Grants), as well as a number of networks that specialize in grants for women.

Additionally, businesses that can attribute to positive gains in local tourism, child care, and energy conservation, and healthy nutrition may also find grants to support their initiatives.

 

Where to Find Additional Information on Grant Opportunities

If you think your business qualifies for financial assistance through a grant, or if you’re simply not sure if you’re eligible, you can look for additional information by:

  • Visiting Grants.gov. Here, you’ll be able to search over 2,000 grants. You’ll also be able to enter keywords like “small business grants” to help you find specific results, as well as a list of requirements, tips, and other pertinent information to help you.
  • Check out SBA.gov. Specially developed to help small business owners, this site can help you find essential information about grants, loans and other financial assistance available. You’ll also have access to a community of small business owners who’ve probably had experience with the small business grant application hunt.
  • Visit your local and state government websites. As mentioned above, specific grants may be available through local and state governments. Check their sites to see what may be available for your business financing needs.
  • Search corporate or nonprofit organizations within your specific industry or location. Often times, you can search grant networks to help you on your search.

If you’ve exhausted all your options and you’re still not able to find a grant to help fund your venture, don’t give up hope! The truth is, many current or potential business owners find themselves in the same boat. Sometimes grants simply aren’t the answer. Luckily, there are other perfectly viable means to obtain the funds necessary to finance your business plans.

How to Get a Business Credit Card on Easy Step

More and more small businesses are turning to business credit cards as a way of having back up financing and improving their business credit scores at the same time. Many business credit cards offer perks just for using them, including frequent flyer miles and cash rewards. Business credit cards are great for business owners who need back up credit for emergency situations or to offset irregular cash flow. Additionally, making on time or early payments on a business credit card will help your business build its credit so that your business can secure better terms with vendors and suppliers, government and high profile private contracts, and the right business financing at the right price.

But how does one go about getting a business credit card? While the process is relatively painless there are many choices to take into consideration. Let’s take a look at some of the steps you’ll need to take in order to obtain a business credit card.

1 Close your eyes, take a deep breath, and look up your credit scores.

The people to whom you’re applying for a business credit card will want to know how responsibility you behaved with your credit. A low credit score will not automatically keep you out of the running for all cards, but if you find yourself getting denied, you can check out this list of business credit cards with lower credit standards.

2 Choose the right business credit card.

Spend some time thinking about how you plan to use your card so you can pick one that meets your needs. Do you want rewards? If so, cash back or miles (or something else)? Do you pay in full or plan to carry balances from time to time? If the latter, a low interest rate will be important. You’ll also want to understand whether the cards you are interested in are available based on your credit scores.

Time Saving Tip: Check out Nav’s business credit card marketplace if you need help choosing a business credit card or signup for a free Nav account and get matched to credit card and financing offers based on your credit.

3 Apply for your new business credit card!

These applications usually ask for basic business and personal information such as your name and date of birth, the name of your business, its address, and your EIN (or SSN if you don’t have an EIN). If you’re the company owner, you will likely be required to give your personal social security number as well. You’ll also need to provide information regarding the type of business you’ve started—the options being sole proprietorship, partnership, and corporation—along with the number of years you’ve been in business and a little bit about your industry.

If you’re a startup wondering how to get a business credit card, know that business credit card applications are going to require your personal household income information. Usually when you’re filling out your application, you’re asked to enter your business income for the previous year. Since you didn’t have a business income last year, your creditor will have to look to your personal household income when making their decision.

Small business owners facing expenses

Nowhere is the saying “you need money to make money” more true than in the crowded, competitive, fast-moving world of small business. As you seek to establish and grow your enterprise, access to capital (or the lack thereof) will be one of your biggest hurdles.

For small business owners facing expenses that just can’t wait, traditional approaches—SBA loans from banks, for example—can be burdensome, inconvenient, and ultimately disappointing. On the other hand, while the APR for a bank loan is usually around 6 or 7%, the APR for an online loan can climb above 30%!

It’s a simple fact that the faster you need a loan, the more you’re going to pay for it. That doesn’t necessarily mean you’re going to regret it, though—if it grows your business, keeps you afloat at a crucial stage of development, and ultimately carries you forward, the cost will have been more than worth it. Let’s take a closer look at a few lenders and see what they have to offer by way of fast business loans.

Kabbage isn’t a “business loan” product, rather they are offer a business line of credit. They are worth mentioning here because business owners can receive funds from Kabbage the same day they apply.

Minimum requirements: At least 1 year in business, with a minimum of $50,000 in annual business revenue

Time for approval and funding: Kabbage’s online application process usually takes around 7 minutes to complete, and you can get funds the same day.

Required paperwork: Along with basic information—business address, tax ID, credit scores, and SSN—Kabbage looks at the online systems used by your business. It takes data about your business from online systems like Amazon, PayPal, QuickBooks, Etsy, etc., in order to evaluate your creditworthiness.

How much can you borrow: $2K to $100K. Kabbage will give you a maximum credit limit that you can borrow against, always keeping in mind that you only need to draw on the credit line as needed, without ever having to use the full amount. You only pay interest on the funds you use.

How long can you borrow it: either 6 or 12 months, with payments automatically deducted from your bank account on a monthly basis.

APRS and fees: The APR for Kabbage loans ranges from 30% to 100%. Most of these fees are charged in the first two months, although you can save money by paying the loan off early.

Personal guarantee and collateral: While Kabbage doesn’t require a personal guarantee, it does place a lien on your general business assets for loans over $20K. Your business assets can be seized if you don’t repay the loan, but your personal assets can’t.