The Business Review July 2012

The Business Review July - September 2012

In This Issue....

Retirement Plans for the savvy Entrepreneur Page 3

Utilize your space for income, traffic and sales Page 7

The Power of One Page 6

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F

rom the Editor

Make your business sizzle in the summer heat!

As the year is half way over I feel like time is flying by so quickly but I have to admit that during the summer months the heat can slow me down! Its been an exciting six months for 2012! We are seeing some great things happening here on the First Coast. Kerry’s Network is so proud of our new membership website! It took us several months to get it just right and I can’t tell you how pleased we are with the final outcome! Be sure to check out the site, we’d love your feedback!

We are also preparing for our upcoming September Business Expo and we are excited about the buzz around town.

We hope you can join us, if your an out-of-town guest, be sure to contact us directly so we can assist you in securing lodging close to the event.

This issue of the Business Review is filled with great advice about Sales tips, funding your retirement and so much more! If you are interested in becoming a contributing writer, please send us a sample article to review.

Thanks for taking the time to enjoy our publication and as always we are wishing you continued success!

Picturesque settings in the Spanish valleys.

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etirement Plans...

As a business owner, I receive tons of invitations to seminars, workshops, Chamber of Commerce gatherings, networking meetings, and numerous other opportunities to "grow" my business. It seems as though everywhere I look, there is some TV show, ezine, article, webpage, or group I can join devoted to helping me "grow."

But what if your business is already viable?

Maybe it hasn't necessarily grown as big as you may want (does that time ever come?) but what if the business is actually profitable... you can pay the bills and the taxman and maybe even take some home for yourself? What then?

The American small business has made more millionaires than any other source of wealth in history. How do you go from struggling startup... to successful business

By: Jon Castle

owner... to financial security?

We all hear about it... we all dream about it... but there are a LOT of people who work all of their lives in a business that they bought or created and never achieve any reasonable level of financial independence.

What is the difference?

The difference, simply put - is in their point of view. The business owners who ultimately achieve financial independence view their businesses as a leverage point which allows them to magnify their efforts into their own personal financial success. This is possible because of the benefits written into the tax laws of our country - some of which can be found in the provisions of the various employer retirement plans available to most business owners.

Most people are familiar with the IRA – the Individual Retirement Account-

that allows contributions of up to $5,000 annually for those under age 50, and $6,000 for those over age 50.

However, a number of employer sponsored retirement plans exist that provide powerful, tax-advantaged vehicles for a business owner to fund their own retirements – and enjoy significant tax savings and employee loyalty along the way.

The laws governing the use and flexibility of these plans continuously change, but the current trend is that they are becoming more attractive and user-friendly as the government seeks to ease the nation’s dependence upon Social Security and increasingly scarce pension plans.

For most small business owners, the easiest retirement plan to establish and understand is the Simplified Employee Pension Plan – also known as the SEP IRA. 3

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etirement...

The SEP is available for sole proprietors as well as partnerships and corporations. Easy to establish and inexpensive to maintain, the SEP IRA can be a powerful tool for a business owner to fund their retirement. An additional advantage of the SEP IRA is that it can be established retroactively – meaning an employer can wait until the tax filing deadline for the previous calendar year before opening an account or making any contributions. This extra time allows the business owner to evaluate their tax situation and tally business profits before making a decision on whether to contribute to a SEP for that year.

I often find business owners do not fully understand just how flexible employer retirement plans are – and as a result, many completely forego the benefits available to

them.

For example, many small business owners mistakenly believe an employer retirement plan is designed to benefit the employees at the expense of the owner.

Not so! While retirement plans can be critical elements in recruiting and retaining those employees who contribute greatly to a business’ success – most retirement plans actually benefit the business owner far more than the employees!

For example, when establishing a SEP IRA, a business owner does not have to include union employees or those who have been with the business for fewer than 3 years. Yet, by structuring her personal compensation correctly, a business owner may receive up to $50,000 tax-deductible dollars into her own retirement account!

In many cases, small business owners who have only a few employees and can make hefty contributions to their own accounts will save more than enough tax dollars to pay for any required contributions into the accounts of their employees.

"Mom and Pop" business owners with no employees other than themselves might consider an Individual 401k, which may provide a larger contribution and tax deduction for each owner than a SEP IRA. For individuals who are over age 50, the Individual 401k provides an additional $5,500 catch-up contribution allowed, bringing the maximum total contribution for a business owner to $55,500 in 2012. Keep in mind that this contribution is totally tax-deductible.

Assuming a tax bracket of $33% and enough income to make maximum 4

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contributions (your CPA can help you figure out the optimal amounts), Uncle Sam is paying $18,315 toward each business owner's retirement - not a bad head start on retirement.

For business owners with employees and who wish to encourage their employees to save for their own retirements, and plan on keeping employees longer than 3 years, a Safe Harbor 401(k) plan might be the answer.

While a 401(k) plan does require additional administration and costs more to install and maintain than a SEP, the additional benefits can be well worth the hassle.

While the contribution limits remain the same as for an Individual 401(k), with the Safe Harbor 401(k), the business owner doesn’t have to contribute one penny to an employee’s retirement plan until the employee chooses to make contributions for themselves.

While contributing up to $55,500 per year certainly sounds exciting, it is a paltry sum compared to the ultimate benefit a business owner can enjoy by establishing and fully funding a retirement plan for their business. Since retirement plan contributions are not taxed when the dollars are earned, and earnings on

In many cases, small business owners who have only a few employees and can make hefty contributions to their own accounts will save more than enough tax dollars to pay for any required contributions into the accounts of their employees. the account are not taxable until they are withdrawn, an employer retirement plan is one of the most powerful retirement funding vehicles currently available for a small business owner. Assuming an average rate of return of only 8%*, maximum annual contributions to a SEP or a 401(k) account could potentially grow to over $700,000 within 10 years – certainly a powerful step toward a well-deserved retirement for a bedraggled

business owner who retires and gets that long-awaited good night’s sleep, knowing their job is finally done. * For illustrative purposes only, not indicative of any specific investment product.

Investors should be aware that there are risks inherent in all investments, such as fluctuations in investment principal. With any investment vehicle, past performance is not a guarantee of future results.

Jon Castle, CFP®,

ChFC® WealthGuards.com.

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he Power of One

What gives someone the ability to impact our world in a powerful way? Are there characteristics inherent in these individuals? And what price do they pay for this power?

I will attempt to share with you, the reader, some of what I consider the essential elements of power!

We have all either known someone who

By: Roy Assad

always strives to make a difference, or perhaps it is you who has chosen this path — to make a difference in our homes, schools, companies, and better yet, our world.

Steve Jobs of Apple Computer said, "Let’s make a dent in the universe," and through his technological advances, Mr. Jobs has surely made a substantive dent!

In my many years of working with people and organizations, I have discovered several common -- some might say uncommon -- characteristics present in those people who effect change, first in themselves, then their environment, and ultimately the universe. I like to call it the Power of One! Continued on Page 8

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tilize your space!

Income, traffic and sales!

If you have a brick and mortar business or a storefront don’t underestimate the power of a little storefront space.

Sometimes a little extra income, foot traffic or additional sales can keep your business from being in the red during a slow month.

If you have a storefront, analyze your space. Do you have room for a table top display or counter space for business cards? What about your walls, are they covered with store bought pictures? If you have this additional space, that’s great!

This is a way to get a little extra traffic and money each month.

If you have room for a table top, set one up with a table cloth and put a sign on it that says “ask how to rent my space”.

You can ask another business to have their products and information in the store for a month and charge them rent.

You could also get a multiple business card holder (usually holds ten to fifteen cards), place it on top of your counter and put up the same sign, put your business cards out for the month, charge them for placing their cards in the holder. This can help defray rent or marketing costs for you.

Another idea to utilize your space, your walls!

Rent your wall space to a local artist or photographer to hang their artwork, you can receive a percentage Excellent sea view if anything is sold.

This from the Costa Del Renta. works great for most restaurants and bars and there is no reason it can’t work for your business as well.

I would recommend having the artist host an open house for their artwork the week they hang it in your store. This way, the artists’ clientele will attend the open house, generating foot traffic into your store.

By: Kerry Heaps

e thos e v a ’t le Don s bare! wall

To make it more beneficial, have a giveaway of your own during the event. This helps generate interest in your business.

To keep it fresh, you can change artists every six months or once a year. This is important to you because each artist will have a small following that can bring new faces to your business.

Kerry Heaps Kerrysnetwork.com

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Continued from page 6.

The power of being present.

By this, I describe those people who are so "in the moment" that you can tell they are present in the mind, body and spirit. You are the focus of their total attention and they are not distracted by anything around them.

The power of being present is extremely effective and always something we remember. It fulfills the adage, "Where ever you are, be all there!"

The power of sacrifice. It is said that, "Great achievement is born from great sacrifice." And we all know nothing in life is free! Even freedom has its price, so when we begin to understand the great privileges we have and the cost to others in order for us to enjoy them, then we begin to understand the meaning and value of sacrifice – think of the personal toll on thousands of people necessary to set the Eastern Block nations free.

The power of creativity. Another wise person said, "We are all born original; however, many of us die a copy!"

That is a sad commentary.

We all need to be as creative and different as possible in order to create a better world, better schools or even a better family.

Don’t follow a path -- leave a trail.

The power of enthusiasm. Enthusiasm is contagious. Whether it is a conscious choice or subconscious avoidance, we tend to steer clear of those who are always down on life. We respond and are drawn to people who live an excited life, and we need to always be "ON," excited about future opportunities, excited about our responsibility to mankind and to our community.

or when someone pledges to support you in your efforts, you feel gratitude, for these people are rare commodities. We are challenged to be as committed, for commitment can be felt.

Someone once told me a story of a kamikaze pilot who was flying his 59th mission – now there’s someone who obviously lacked commitment!

The power of humility.

It is said, "Go the extra mile -- it is not crowdThe power of commit- ed there." Humblement. When a friend ness and humility are promises to love you great traits to possess.. forever, 8

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When people become successful, they sometimes lose their humility – and that is a real shame. No one likes to feel as if they don’t matter anymore. Perhaps you’ve heard this one before: "It is nice to be important; however, it is more important to be nice!"

The power of your word. During his inaugural address, President John F. Kennedy challenged the American people: "Ask not what your country can do for you—ask what you can do for your country." That question still rings true today, for powerful words are an amazing force! Effective, committed communication is a required trait of he truly powerful. Clarity in conversation is a must. In fact, a coach friend of mine wrote a speech titled "No Guessing."

Do your words leave people guessing?

The power of the people.

Every successful family, church, company and city that has had the right people, doing the right things, at the right time, for the right reasons. Otherwise, nothing is accomplished. Call it people power!

It is said "there is nothing more powerful than the human soul on fire!"

And that is when a human being can make a difference; when one man or woman can change the way things are done, and create a new way of solving a problem.

we do choose how we shall live; courageously or in cowardice, honorably or dishonorably, with purpose or adrift. We decide what is important and what is trivial in life.

I am not suggesting that we all go out with the aim of changing the world; however, I am suggesting that it is within us to have the power to make a difference in our own areas of life, impacting the

"We decide that what makes us significant is either what we do or what we refuse to do. But no matter how indifferent the universe may be to our choices and decisions, these choices and decisions are

people around us. ours to make. We deAnd that, my friend, is cide. We choose.

And as we decide the "Power of One." and choose, so are Joseph Epstein wrote our lives formed. In a piece titled "The Sethe end, forming our cret Passion," and it own destiny is what summarizes what I ambition is all about." have said beautifully: "We do not choose to No truer words were be born. We do not spoken. You possess choose our parents. the "power of one."

We do not choose You have only to our historical epoch make the choice to or the country of our use it. birth or the immediate circumstances of Roy Assad our upbringing.

"We do not, most of Human Capital Group us, choose to die; nor do we choose the time or conditions of our death. But within all this realm of choicelessness, 9

W

elcome New Members!

Welcome to Kerry’s Network, Inc.!

Bill Bew Tec-on-Call Maya Velazquez InMortal Productions Neil Newman Neil Newman Accounting Mary Remson Danton & Dees Health Insurance Butch Tanner Yau Law Firm Jennifer Keller Advocare Excellent sea view from the Costa Del Renta.

Learn more about Membership Benefits!

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V

iva las illas

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Do you want more customers but feel uncomfortable marketing your business on the phone?

If you answered YES to any of the above, then let us Knockout your Marketing and Promote your Business!

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