Think Like A Millionaire

Many years ago, people would have considered that being a millionaire would be the ultimate in luxury and wealth. Now, for some people, being a millionaire is not even considered enough to do much. Warren Buffet made his first million dollars when he was just 31 years-old. That amount of money is .002% of his current wealth. With rising billionaires like 26 year-old Mark Zuckerberg, founder of Facebook, there seems to be more money to be made than at any other time in recent history.

When you study what unique strategies millionaires use, you may get some ideas to improve your own circumstances. Whether you make $30,000 a year or $1,000,000 a year, improving your skills can help you on the road to becoming more financially secure. Maybe you’ll never be a millionaire or don’t even want to be. You still will need to make strategic financial decisions that will affect how much you enjoy your future life. If you could see your distant future life as well as you can see your life next week, you may decide to live life differently.

Let’s take a look at what millionaires say they do and how they got there.

Paul Lim, a writer for Money magazine, reported some interesting facts from a poll of millionaires. In his article, “Millionaires in the Making,” he shares with us the answers.

How did you get to be a millionaire?
95% said hard work, 83% investing wisely, 81% by being frugal and 41% by luck.

Do you feel wealthy?
42% said no.

What preparation did they have?
90% are college graduates, 5% have law degrees, 3% went to medical school.

What is the average amount annually invested?
$39,300.

What seems to be the number one thing that millionaires did to get where they are is a lot of hard work. All of us are capable of doing that. We can all become more frugal about what we spend our money on and although we are not all lucky, we can learn to invest wisely.

Did you notice that quite a few people said that even though they were millionaires, they did not feel wealthy? Feeling wealthy is probably one of the things we do have control of. Since your perspective on life can run the gamut of outright depressing thoughts to unrealistic elation, you choose where in that range you want to be. Of course, when the joys of seeing more money coming in and how nice it makes your life, it is easier to think about bigger income numbers than you have thought of before. If you can’t imagine the larger numbers in your income, will you ever improve your standard of living?

Another thing that millionaires do is to habitually save money to invest. The average amount per year that they invest is $39K. If your income level is not even that high, you can work on saving in percentages. Make it a goal to save a certain percentage of money every month. Financial experts advise you to have enough cash to pay your bills for at least six months. Whatever percentage you decide on the important thing is to follow through with your plan each month. Automate that savings if possible.

Some millionaires have also made a practice of living below their means. This falls into the category of budgeting and anyone can follow a budget. You just need to include your savings plan in your budget. It is one thing to have a million dollars sitting in your bank account, but it’s another thing to learn how to best use it.

Millionaires did not become millionaires by working for someone else. Many have started their own businesses. Anyone can start their own business for very little money and if you have a low overhead in your business plan, you can actually accomplish this while working for someone else. Did you know that only 12% of American households own their own business? Paul Lim, reported that the median income for business owners was $497,000 compared to $42,000 for non business owners. Would it be worth your time and effort to start your own business? When you can harness the power of entrepreneurial thoughts and put into action a good business plan, you are on your way to a brighter future.

Realistically speaking there are few people that reach the status of being a millionaire. Learning key money management skills and business building skills can only help you increase your productivity and increase your income. Start today to create a better outlook on life. Do what you can to take your first steps to a new life.

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Protect Your New Business

The Five Most Commonly Used Business Organizations

There are five common types of business organizations. Outlined below you will find the definitions of each type of business and why you might want to choose that type of structure.

Sole Proprietorship

The sole proprietorship is for someone who owns a company and is not planning to incorporate or become a limited liability company. This is mainly for a business that will be owned by one individual. That individual may or may not have employees. When you have this type of business structure, you report your business income on your individual tax return. Some of the risks of the sole proprietorship are that your business debts and obligations could be attached to your personal assets, even if they are not directly related to your business.

Partnerships

The second type of structure is a partnership. Usually a partnership will consists of two or more people who want to do business together. Each partner has a fiduciary duty of loyalty and trust to the other partners and put his own interests below the interests of the partnership. Partners have unlimited liability to the business. Creditors can require that liabilities be paid from personal assets. Partnerships report profits or losses on individual income tax returns. Partners are not allowed to sue each other. Usually partnerships require a written partnership agreement.

Limited Partnerships

The third type of structure is a limited partnership. This is made up of at least one or more general partners and at least one or more limited partners. General partners act as the fiduciaries of the business and assume all the monetary risk. All parties can profit from the company. Limited partners assume risk of their contributions and that is all. Limited partners often assume the role of raising capital and do not participate in the day-to-day business operations. Members file their own individual tax returns. The partnership files an information return with the Internal Revenue Service, notifying the IRS of each partner’s share of the year’s profit or loss.

Corporations

The fourth type of business structure is a corporation. This is the type of organization that is most often used with the term business. Most large businesses are corporations. People can invest in corporations without assuming liability or management responsibilities. Corporations are creations of the state. Corporations have a board of directors and can issue stock. Shareholders are owners of the corporation and have limited liability and are not involved in the day to day operations of the business. A corporation is a legal person and a legal entity separate from its shareholders and managers. A corporation pays state and federal income taxes on its income.

Limited Liability Company

The fifth business structure is a limited liability company or LLC. LLCs are created by filing Articles of Organization with the state in which you live and have one or more “persons” conducting business. One benefit of this organization structure is that no member, manager or employee is personally liable for any debt obligations of the company. The LLC has a tax status of a general partnership with limited liability protection. No annual meetings are required. Members can participate in management more than in a limited partnership. They are responsible for disclosure, record keeping and annual reporting requirements. LLCs are only taxed once and the earnings of a partnership are treated as the earnings of its partners.

Conclusion

This information is intended to be used as a very brief overview of the main types of business structures. Consulting with a CPA or attorney can help you make the final decision about your new business. Protect yourself against unnecessary risks and get your new business off to a good start.

Rare Earth Mine Mountain Pass, California owned by Molycorp Inc.

Small business plans are created in the same way large business create their plans. In fact, looking at the development of  large companies is helpful to the small business owner. Modeling the success strategies they use can help you take your business to the next level.

Molycorp Inc.

For example, the story behind the scenes of the well publicized Molycorp, Inc. gives small business owners key strategies to emulate. Making a paper profit of $2.3 billion dollars in less than three years, Molycorp Inc. made some strategic business plans.

Molycorp Minerals LLC was formed in 2008 by a group of investors. Two critical players  in this LLC are  Mark S. Kristoff,  CEO of Trayxs, (which provides financial services for the mining, metals and minerals industries) and Dr. Ross R. Bhappu, of  Resource Capital Funds  (focused on investing exclusively in the mining and minerals industry).

These two individuals have expert, inside knowledge of the mining industry. When Mr. Kristoff was just 12 years old, his father, who worked as an executive at the mine,  gave him a tour of the Mountain Pass rare earth mine in California, one of the largest rare earth mines in North America.   Dr. Bhappu’s father was also an executive at the mine which was then owned by a Union Oil company. In 2005, the company was  acquired by Chevron.

Mr. Kristoff and Dr. Bhappu developed an interest in buying the Mountain Pass mine  in 2005.  In 2008, Chevron sold the mine to their LLC because they promised to keep the existing employees and to revitalize the unproductive mine. It had been inactive since 2002. Mr. Mark Smith, former President of Mining for Chevron  was lured away from Chevron to become the new CEO of Molycorp Inc.

Investment Strategies

In the beginning, there were four principal investors in the company, Resource Capital Funds, Pegasus Capital Advisors, Traxys  and Goldman Sachs. In 2009, Goldman Sachs sold their shares of the company because the economy was in such turmoil.

Demand Exceeds Supply

Molycorp Inc. invested  $80 million into upgrading the mining equipment and facility. Currently producing 3,000 tons per year, their next goal is to produce 20,000 tons. Leaders have predicted that this will double in production by 2014. With China recently announcing that they are limiting the export of rare earth materials,  demand (predicted to be 190,1000 tons in 2014) is now exceeding the supply (170,000 tons).  Cerium oxide rose in price from $6,000 to $71,000. Ianthanum oxide rose from $8,400 to $73,000.

Production of Green Technologies

The rare earth minerals that will come from this mine are used in many green earth technologies like wind turbines and hybrid cars. They are also used in electronics, plasma and LCD televisions and the widely popular Apple Ipad.

The combination of the world events and good strategic business planning by the Molycorp, Inc. leaders have caused, “one of the fastest windfalls in private-equity history.” (Wall Street Journal).

Small Business Plans

For small business owners, the key strategies that created this success were familiarity and expertise with the product line, choosing products that are in demand, effectively using global trade news to make plans, hard work, passionate leaders and the ability to communicate their business plans to key investors. Definitely a good model for small business owners to emulate.

Owning a trademark is appealing to people because they hope that one day, their particular brand may receive universal recognition. This universal recognition can make your company become more profitable than you may have imagined.

Historically, famous trademark names like Levi Strauss Jeans, Dutch Boy, McDonald’s and Coca-Cola have made life long impressions on millions of people. There are trademarks on other things that you may not have thought of like sounds. In 1924, Metro-Goldwyn-Mayer registered the sound of a lion roaring. When you go to the movies today, you’ll hear that sound and associate it with Metro-Goldwyn-Mayer movie productions. Even the design of buildings can be trademarked. The famous McDonald’s golden arches are trademarked.

Images can be trademarked and they have powerful effects on consumers. The most reproduced image in the world is that of Walt Disney’s Mickey Mouse. There are over 7,500 items that have that image on it. The second most reproduced image is that of Jesus. Surely you’ve seen thousands of products with his image on them. You may be surprised to know that the third most reproduced image is of Elvis Presley and he “ain’t nothing but a hound dog.”

The average person knows what these symbols, sounds and words mean and generally that is good for business because of their universal appeal. So how does that affect you and your new business?

Suppose you have been dreaming of a new product or already have a great product and a very unique name for that product. You will want to make sure that you and your company are the people who benefit from your brilliance. You don’t want other people using this name to generate profits for themselves which will ultimately diffuse your profit making efforts. The best thing to do is to get a trademark for your name, idea or product.

Cost of Trademarking

This is perhaps the first question on your mind. It has a complicated answer. There are fees involved in getting a trademark and they vary. You may be able to complete the process for as low as $325.00 or if you have a lawyer handle it for you, you could be looking at several thousand dollars in fees.

How To Trademark

The government has a special procedure for you to apply for a trademark. Perhaps the easiest thing for you to do is to call them at 1-800 786-9199. If you want to be a bit more prepared to talk to them, you’ll need to find out if the idea you have is already trademarked. You can use a trademark search at the United States Patent and Trademark Office.

You can apply online for a trademark, but you must be able to provide information in a timely fashion. They have strict deadlines that must be met to process your application. You will need to provide the name of the applicant, name and address for correspondence, a clear drawing of your symbol or  the words you want trademarked, the goods or services you intend to provide and a filing fee.

Once you submit that information, a lawyer will research it and decide whether it will be approved. This procedure may take up to two months. Once it is approved, they will print a public notice in the the Official Gazette. The public is given 30 days to issue a protest against your filing if they can prove that your trademark will be damaging to their business. If you make it through that step, then within 3 months you will be issued a NOTICE OF ALLOWANCE. Then you have six months to notify them of your intended STATEMENT OF USE plan. Once that is sent in and approved, you will be issued a REGISTRATION CERTIFICATE.

Do you think it’s worth your time and effort to register a trademark? I’m sure Levi Strauss did!

First things first, you must be very clear on the type of business you are to set up.  Success begins when you have clear goals and know how to take actions to achieve these.  Before starting, you must write down your business idea clearly. This is to help you with strategic planning.  Different types of business have different types of strategic approaches and marketing strategies in order to become successful. You should also set your goals based on your skills.  Let’s be realistic here.  Being successful in business also depends on your skills and attitude.  If you think your expertise is not adequate, then you can ask for help and assistance from business professionals.  Furthermore, to have a booming business, ask for sufficient finance.  And one thing more, choose a good spot to start your business.  Upon considering all of these, things will go on smoothly.

There are other things you need to get started legally and officially.  You cannot just put up a shop and sell products without having some permits. Above all, you need a business permit/license to start.  This is a universal truth, whatever state or country you live in, a business permit must be obtained.    In the US, business licenses are issued by the state, so expect some differences in requirements and guidelines per state. You can get a business license online or go directly to the county clerk’s office.  It is suggested you go directly to the clerk’s office and Occupational License Department to get answers to your questions right away.  Sometimes, there are areas or zones where certain business establishments are not allowed.

Another thing you need to do is to register your business name with the Internal Revenue Service.  You may also need an Employee Information Number or a Federal Tax Identification Number. This can be obtained online at www.irs.gov. Also, you to have an estimate gross receipt to determine the approximate taxes and other business fees to be paid. These things may appear tedious but after getting everything done legally, you won’t be facing any more problems regarding your business.

A resale certificate or a wholesale license is also needed.  Any business establishment that sell products need a reseller’s permit.  Having this permit allows you to collect sales taxes.  For more information on how to get a reseller’s permit, you can go to http://www.businessnameusa.com.  You may also want to visit http://www.business.gov for more details on starting a business.

Here are some useful links you might want to visit to help you with your business plan and strategic planning:

http://www.themanager.org/pdf/Businessplan.PDF

http://www.sos.mo.gov/business/corporations/startBusiness.asp

http://www.state.nj.us/njbusiness/starting/

http://www.sba.gov/smallbusinessplanner/

Some things that are essential to be included in your business plan:

Your business – Your business name, the business address, phone number, email address, and website name with the URL. Don’t forget to write your name as the owner and list other owners if there are any.

Business description – State here how you came up with the idea of creating your business. Describe each section of your business. Write a summary about your business and make it interesting so as to get the attention of prospective investors. You can site reasons why you need the money for your business. Mention your competitors as well. You can list supplies you use for your business and what you do on a daily basis.

Products or services offered – Be specific in writing how your business operates. Explain how you market your products or services.

Personnel – Who are the people working for you and how many employees are there? What are their roles and responsibilities in the company. The same thing applies if you are the only person running your business. State your role and how you run your business.

Your plan – If you want the financial aid of a lender or are planning to apply for a loan from the Small Business Administration, keep in mind that a business plan is required to acquire the financing. Your business plan is crucial for the success of your business.

Financial Data – Write down how much money you want to borrow for your business and how are you going to spend the money. An explanation of the expected profit and loss should be included. Also document how much money you earn monthly and your personal financial statement. Include your expected revenue in your business. Attach some supporting documents that you think will be helpful to the success of your business plan. For the investors, this data is the most important part of the business plan.

A business plan is the map of your journey to success. Coming up with a good business plan is not easily done overnight. It is a task that needs effort and time on your part. Some business owners neglect preparing a business plan until the night before their meeting with the bank. You can guess the results of those actions.

Be creative but make a realistic business plan. If you haven’t written one yet, now is the time to start.

The audience was asked to identify thoughts that were either empowering or limiting in nature. Here are ten empowering thoughts that were selected.

1. There is an abundance of money.
2. People deserve to be compensated generously for the value they produce.
3. I can spend money freely to enjoy life.
4. I can make money very easily with very little effort.
5. Money flows to me easily.
6. I would like to compensate people for their value because I appreciate them.
7. Money is to be enjoyed.
8. You are priceless.
9. The past is not my future.
10. I can get many people to act on something.

It seems to be human nature to dwell on some very limiting beliefs, which guide our course of action. How often have you told yourself that there is scarcity in your life? Or lately, the economy is so bad, no one is making any money. Recognizing and replacing our limiting beliefs is crucial to our success in any field of business or any area of our lives.

Would you picture yourself as someone who could influence others to take action? And don’t think of the times you’ve asked your children to clean up their rooms.  Think of the times that you’ve recommended a great movie to your friends.

Could you become a person that could influence 100 people to take the action you want them to take?  A 100,000 or 100,000,000?  How would you do it?  What would you say? What could you write?

Mark Zuckerberg influenced over 100 million people to use his website application at www.facebook.com. He is now enjoying the billionaire status as noted in Forbes magazine, The 400 Richest People in America, 2008 edition.

Create your website business plan to get as many people as you can to take the action you would like them to take. There are approximately 6,732,600,000 people in this world to influence!  Keep empowering beliefs in the forefront of your mind as you create a successful website business plan that can move people to take action!