Professional Documents
Culture Documents
April 2003, Volume 8 – Issue 4 “Great fortunes are made through Fellowship, Knowledge and an Abundance of Opportunities”
2
generated will (and any other will or trust for that that has been left inactive by the owner for at least
matter), you’ll require two witnesses, as already three years. Usually, unclaimed property is com-
mentioned. For a few hundred dollars, however, a prised of tax refunds, old bank deposits, refunds,
lawyer can draw up a legal will for you. If you want to securities, money orders, yet-to-be benefit checks
be absolutely sure that a judge will validate your will, and dividends, certificates of deposit, paid-up life
then you need an attorney to draw it up, plain and insurance policies, safe deposit box contents, trust
simple. If you ever want to implement changes, you fund distributions, money orders, credit balances,
can make a “codicil,” which is basically an amend- and other sources. Lost money representatives can
ment to your will. Drawing up an amendment will check records to see if any monies or other property
cost you between a few hundred and a thousand dol- are being held for you, and, with any luck, you’ll not
lars. Only people who are mentally competent are only get a check, but you’ll also get the interest that
permitted to make amendments. Remember that a has accrued. Plus, there is no time limit for a right-
will can only take effect after you die, so, in the event ful owner or heir to claim the assets. The state acts
that you become incapacitated, a judge can name a as a custodian (not all states pay interest, but some
guardian to look after your matters. do). A quick letter or phone call may be all that it
takes to put some found money in your pocket (see
2. Make a List of Important Documents – Bank ac- numbers and addresses below).
counts, insurance policies, brokerage accounts, safe
deposit boxes, etc., should be kept track of on paper. Your Treasure Could be a Mouse Click Away
Your spouse should know where this information is, The law demands that all holders of unclaimed
and so should your kids and a relative or friend you property try to contact the owners prior to report-
trust. You don’t want people having to search for ing the assets to the state. Although some states have
your money in their time of grief. made concerted efforts to reunite owners with their
unclaimed property, these state employees have not
3. Check Your Credit Report – The only one of always been successful. As a last resort, the State
the three credit bureaus that lets you make a re- Controller will publish a notice in the newspaper
quest and receive your report on-line is Equifax, directed at unclaimed property owners, but these
www.equifax.com. Or, call 1 -800-465-7166 or fax notices sometimes escape detection.
them at 1 -800-355-8502. It’s free. This is the best To improve their success rate and reunite property
way to make absolutely sure that no one has issued with its rightful owners, two excellent web sites have
credit cards in your name or ruined your credit in been established in recent years. Both will help you
any other way. to determine if you are indeed lucky enough to own
unclaimed property. If you have access to the World
Wide Web, log on to www.unclaimed.org, which is the
Finding Lost Money Can Pay web site belonging to the National Association of
Unclaimed Property Administrators (NAUPA), with
Off Big-time headquarters in Boston, Massachusetts. NAUPA lists
all phone numbers and addresses of U.S. Unclaimed
When is the last time you stuck your hand in the Property offices.
pocket of an old pair of jeans and discovered a You can search for your treasure according to
quarter…or better yet, a five-dollar bill? Nothing home state, and then phone your state’s Treasurer’s
compares to the good feeling of finding money you Office and speak to a representative working in the
didn’t know you had. Unfortunately, finding money “unclaimed property” department. NAUPA also
in your pockets is not a common daily occurrence. sponsors an on-line searchable database contain-
However, now, we can turn that around and actually ing unclaimed property records from participating
look for money that belongs to us. In fact, if money states. You can conduct an immediate nation-wide
could talk (and many say that it can), some “lost” search by logging on to www.missingmoney.com .
money would be on the phone to many people right Some states have wonderful web sites for people
now, crying that it wants to come home! interested in learning more about unclaimed prop-
Lost money, commonly known as “unclaimed erty. These sites address many concerns, and some
property,” is any financial asset (not real estate) even provide answers to the most frequently asked
3
questions. One such site, one of the most detailed traditional money sources that you will likely be fa-
by far, originates in California. The web site address miliar with, as well as other more creative sources to
is www.sco.ca.gov. put cash in your business’s pockets:
Find Your Money Free of Charge 1. If Appropriate, Open Shop Outside the Home
Most states employ representatives who will run – Many businesses, because of their nature, can only
an unclaimed property search free of charge, on operate inside an industrial facility. With that in
your behalf. Some states, however, such as South mind, is there a manufacturer from which you will
Carolina, may charge a nominal fee to sell you their be buying? Does it run a large operation? If so, don’t
lists of unclaimed property. Fortunately, in most hesitate to approach it regarding leasing an office or
states, the search won’t cost you anything. Whatever some floor space on the property.
you do, don’t pay a single cent for an unclaimed You will be charged rent, but it won’t be nearly
property search to a shifty “company” that just may as pricey as the rent you would pay if you rented
contact you with heartwarming news that you have separate office space. Ask for a three- or four-month
unclaimed funds. These companies ask for payment grace period before you have to pay rent. This is not
in advance, and that payment, albeit small (usually as unusual as it might seem. After all, the manufac-
just $10 or $15) will be better in your pocket than in turer knows that they will win in the long run if they
theirs, so send nothing! Anyone who does remit pay- have exclusive manufacturing rights, and they will
ment only receives the address and phone number be pleased to oblige you so you can have a positive
of where to call. That information is available for free cash flow in your early days.
on the National Association of Unclaimed Property Arrange to have permission to use a phone line,
Administrators web site at www.unclaimed.org (men- a fax machine, a photocopier, and a computer. That
tioned above). Also, in certain states, it is actually will be part of the deal. Explain to the owner that,
against the law for anyone without a valid contract with every order you receive, it means another order
to help recover unclaimed funds. Any valid contract for the manufacturer. Approach him/her with the
will contain pertinent information on that case. idea of signing a mutual-referral deal. It will be a
Finders with a contract are entitled to a finder’s mutually beneficial arrangement, so when you ap-
fee (usually about 10% of the value of the claim), proach the subject, it is likely that you’ll be able to
but, again, you can get a state employee to do pique his/her interest. By having something down
the searching for you. The only thing you’ll need on paper, you’ll look more professional, and you
to spend is a few minutes either on the Web, the can show the manufacturer the amount of profit
phone, or writing a quick letter to the Unclaimed you plan to make for both companies.
Property Unit in your state. So, be wary of finders Let’s say you came up with a great invention for
who ask you to pay them for information that you a bicycle rack, for example, and you approach a big
now know can be obtained for free. steel manufacturer. That manufacturer lets you set
up shop in a small corner of his factory. If you get a
big order that you couldn’t possibly handle, you can
15 Ways to Get Money for Your give it directly to them, charging a 25% referral fee.
Here’s another example: A small clothing business
Business owner could open in the corner of a garment firm,
and, when a big order comes in, the small business-
Approximately 60% of all businesses in the United person could give the order to the larger firm for
States are started with $5,000 or less, and 25% are a referral fee. Likewise, when a small order comes
started with no money at all. Believe it or not, it is in to the large company, it could refer the smaller
possible to obtain start-up capital with no credit, no business owner. This agreement also would give
cash, and no help from “friendly” bankers. the larger firm the chance to sell some supplies.
Many people who dream about running their own Eventually, the small businessperson might even
business never actually go through with launching it, grow too big for 900 square feet of space and move
because they believe that they need money that can into a facility where a lease-to-own agreement could
only be obtained through conventional means, such be drawn up.
as the SBA, banks, or angel investors. Here are some Once you have your office in place, you can collect
4
on your sales invoices before having to pay any rent. you are borrowing from yourself against the cash
That will give you a positive cash flow. When you set value of your property.
up your operation in a successful, busy, established
shop, you’ll be working in an environment condu- 6.Credit Cards – Credit cards provide one of the eas-
cive to your needs. You’ll feel more motivated, and iest, yet most expensive sources of funds. Even the
you’ll meet new contacts and absorb fresh ideas. famed director Spike Lee is said to have financed his
early movies using a fistful of credit cards. The trick
2. Straight Bank or Trust Loan – This is the most is to apply for several credit cards at the same time.
widely used method of obtaining start-up funds, When each institution checks for other cards with a
whereby the bank sets the interest rate according to credit bureau, none of the newly applied-for cards
the type of investment and the borrower’s credit his- will show up. Any use of a credit card other than the
tory and collateral offered. Most people are familiar interest-free grace period is not advisable. The inter-
with consumer loans, but also available are demand est rates, even on the cheapest cards, are simply way
loans. Whereas the standard installment loan has too high, and, of course, the interest kicks in imme-
fixed interest and payments, the demand loan’s diately for cash advances. You are better off rolling
rate fluctuates, usually according to the prime rate. over any balance to a PLC.
In this case, the rate, at least at the outset, is going
to be significantly lower, but the danger is that, as a 7. Borrow Against Securities – When you margin
demand loan, the bank can call it in at any time. The securities, the broker holds the stock as collateral
likelihood of this happening depends largely on the – the shares themselves are security enough. But,
collateral offered as security. you can also use stock you own outright as collateral
for other loans in two ways: First, you can pledge
3. Personal Line of Credit – Make sure that you the shares as security for a bank loan. The bank will
obtain a line of credit from the bank before going likely want to hold the actual certificates. Second,
into business. You only pay interest on the amount you can transfer wholly owned shares into a margin
that you borrow, and you should only borrow if you account, and borrow up to the margin limit for that
need to pay your expenses prior to receiving pay- security. Loan limits for debt securities like bonds
ment yourself. A line of credit is like a pre-approved and T-bills are much higher than for stocks.
loan that you can access when you like. PLC’s can
be either secured or unsecured, and, naturally, the 8. Borrow from Friends and Family – This is usually
rate will be higher if no collateral is offered other the easiest and cheapest way to obtain money for
than your general creditworthiness. The repayment your business. The secret to doing it and not ruining
schedule is also flexible, working in a manner simi- your relationships is to have your loan agreement
lar to a credit card, with a minimum payment due in writing and signed and witnessed by all parties.
monthly, but otherwise the ability to carry the loan Prepare a promissory note, which essentially is a
indefinitely. The only real downside comes if inter- letter stating that you promise to pay back the loan
est rates skyrocket. PLC rates are tied to the prime plus a certain percentage of interest each month.
rate. If rates rise quickly, you should be prepared to The note will state what rights your lender has if
convert any balance into a fixed installment loan. you can’t pay back the loan. Usually, they have the
rights to your equipment or supplies. For a sample
4. Second Mortgage on a Home – You can use the of a promissory note, log on to http://www.nolo.com/
equity built up in your home to secure funds to encyclopedia/articles/sb/borrowing.html.
invest elsewhere. Such high-quality collateral will When you borrow from family, make sure that you
attract some of the lowest borrowing costs available, regard the loan just as you would if you were borrow-
and the interest will be deductible. ing from a bank or other lender. This way, you will
program yourself to repay the loan without going
5. Borrowing Against Life Insurance. An under-uti- into default. Money is an emotional issue, and, all
lized source of funds, borrowing against life insur- too often, the process of borrowing money from
ance can often be done at unbelievably low rates. If relatives can spawn the wrong kind of emotions. It’s
you have a cash value life insurance policy, you can a risk you shouldn’t take unless you don’t mind the
borrow against the policy’s cash value. In essence, extra challenge of dealing with family. Make sure
5
that you set out a formal loan agreement with a set of potential investors. Foreign investors trust these
interest rate and payment schedule. One alternative advisors. Also, advertise in foreign newspapers. It’s
is to ask the family member to co-sign a loan from quite possible to find long-term financing abroad,
another source or to pledge collateral. You could al- if you take the time to cement your credibility
ways offer to pay a fee or small percentage of future amongst lenders. Borrowing money from a foreign
profits to your relative. lender is no different than borrowing from a domes-
tic lender, except that you are obligated to withhold
9. Loan Against Certificate of Deposit – If you don’t 30% (or a lower treaty rate, if applicable) on interest
want to pay the penalty for cashing in these locked- payments made to the lender. This is to protect do-
in instruments, then use them as security. They are mestic interests. When American companies borrow
very high quality collateral because the bank already from foreign banks, the American government still
has the money in hand. wants to retain some control over the repayment
schedule. If the country from where the money was
10. Finance Companies/Loan Brokers – These spe- borrowed becomes a known terrorist state, for ex-
cialists generally charge very high fees and interest ample, the American government would be able to
rates. If you feel the need to go to a loan broker, be stop the flow of the money to that country. This trea-
very careful before paying any fees in advance. Look ty that requires 30% to be withheld encourages de-
for any up-front fees. velopment of domestic industries. If this treaty were
not in place, a lot of American businesses would go
11. Venture Capital Companies – These firms usu- elsewhere to borrow the money. The U.S. banking
ally have pools of capital specifically targeting start- industry would then fade, wiping out employment
up, higher-risk ventures. They can lend funds, but for hundreds of thousands of people.
they often want either outright equity participation,
or an option to convert a loan to equity at some 14. Use the Services of an Incubator – An incubator
future date. They are extremely flexible as far as is a company or facility that fosters entrepreneur-
terms are concerned. For $35, you can buy a bro- ship and helps start-up companies expand through
chure called “Venture Capital and Where to Find It” shared resources, management expertise, and intel-
through The National Association of Small Business lectual capital. Incubators are especially good for
Investment Companies, 666 11th Street NW, Suite high-tech companies. For a list of incubators, send
750, Washington, DC, 20001, (202) 628-5055. Check a self-addressed stamped envelope to the NBIA
out the web site at www.nasbic.org. (National Business Incubation Assocation), 20 E.
Circle Drive, #190 Athens, OH 45701-3571, or go to
12. Advertising for Loans/Private Sources – Look in www.nbia.org and look up the firms in your state. You
almost any large newspaper, and you’ll see “Funds can send an e-mail for information to info@nbia.org,
Available” and “Funds Wanted” classified sections. or you can phone 740-593-4331 or fax 740-593-
This is actually an effective method of cutting out 1996.
the expense of using a broker as middleman. Some
people advertise themselves as “loan finders.” These 15. Place Private Ad Placements – If you have a bril-
are private brokers who try to match up money (co- liant idea and a good plan, you can persuade private
signers) with borrowers, for a fee. There are some investors to put money into your business…with the
newsletters devoted almost entirely to matching expectation that they’ll get a return out of it if your
lenders and borrowers. business succeeds. This can work particularly well
right now, when people are looking for investments
13. Foreign Sources/Immigrants – Go beyond other than stocks.
our borders in search of funding. America has a One story in Inc. Magazine, for example, told the
fairly conservative lending atmosphere, but there story of Joe Kunkel. He attracted 12 private investors
other are sources with enormous amounts of capi- who put $570,000 into Wholesome Kidfoods Inc.,
tal. Potential immigrants looking to qualify in the the Oak Park, Illinois maker of “Fruit Wownies,” a
investment category are a good source. Contact healthy snack. “We sent letters to at least 140 people
immigration lawyers, U.S.-based private bankers, we knew who could invest $25,000,” says Kunek. “We
accountants, and stockbrokers, all who have lists wanted investors who knew what they were doing.”
6
Now, make a list of all the people you know that structured, a banker, creditor, or investor won’t
have some money they could potentially invest give you the time of day. If you don’t have the
in your business. Be sure to inform the investors time to maintain your financial statements, hire
that you too are sinking your own savings into the someone to do this for you.
project. For information on how other people have • Take delivery before paying.
structured deals like this, log on to www.inc.com/ • Offer customers a discount if they pay early or pay
articles/start_biz/20934.html. cash on delivery.
Always remember that the key to creative financ- • Synchronize your bill payments with your own revenue
ing is to maximize tax-deductibility of interest and intake. You can’t pay your bills before you get
that loan size and your net worth aren’t as important paid, so how can you get paid faster?
as cash flow. • Maintain a strong relationship with your banker.
One of the best things you can do to avoid a cash
flow problem is to develop a good rapport with
Cash Flow Management - It’s your banker. Give your banker as much informa-
tion as you can about your business, and provide
Do or Die it regularly. Maybe he or she will help you arrange
late payment privileges if you ever run into a cash
It’s imperative that a new small business maintains flow problem or approve a loan.
proper cash flow. Many businesses have been forced
to close their doors, even though they were profit- It takes motivation, discipline, and persistence to
able, because of getting into a cash crunch. manage your cash flow paperwork, but it’s well
worth the time and effort, and it can help you avoid
What Does Cash Flow Mean to You a cash crunch. Poor cash flow is the main reason
Let’s look at two definitions: that businesses fail, but, with some work, you can
1. Cash flow: Usually, this means net income plus learn to maintain a positive cash flow and, there-
depreciation as well as other non-cash expenses; fore, a successful operation.
a measure of a firm’s ability over time to satisfy
its debt obligations and fixed asset replacement
needs.
2. Operating cash flow: The changes in balance
The Best Place to Find Low-
sheet accounts that end in a change in the cash Cost Vacations
account. When there is less in the account, it is a
negative. When there is a surplus, it’s a positive. When it comes to finding low-budget travel ideas,
When we talk about cash flow, it’s usually appli- check out www.lowestfare.com. As stated on the web
cable for the short term only. site, “Priceline.com owns the Lowestfare.com web
site. Through Lowestfare.com, travelers have com-
In plain language, cash flow represents the amount plete access to all of Priceline.com’s ‘Name Your
of money you have in the bank to pay your expenses. Own Price’ services for airline tickets, hotel rooms,
Although maintaining proper cash flow sounds rental cars, and vacation packages, as well as multi-
easy, it isn’t. Follow these tips to protect your busi- ple discount travel options from other travel service
ness from the devastating cash crunch: providers. They can also purchase worldwide cruises
• Give attention to detail daily. By paying close atten- on a specially discounted, fixed-price basis.” Don’t
tion to detail, you’ll be able to detect a problem go anywhere without investigating this site first.
before it arises. Obviously, it’s important to pay Apple Vacations also has some of the best all-inclu-
attention to and document your gross margins, sive packages around. After all, they’ve been in the
daily or weekly sales, receivables, or cash position, business of making vacationers happy for 33 years.
but your balance sheet, in particular, needs to be You won’t find prices on the web site, but look at the
accurate. Understanding and presenting your photos of the various resorts (and judge the quality
numbers properly will be helpful when talking based on their “apple-guide.” Write down a few of
with your creditors and investors. If the figures the ones that pique your interest, and then call a
don’t make sense or if the sheet isn’t properly local agent listed on the site. You can also call the
7
Dominican Republic Tourism Board in New York and the people from all over the globe you will meet
at 1-888-374-6361 or log on to www.roanoke.infi.net/ will make getting a job on a cruise ship the very best
~domrep/. job you will ever have. Just remember to buy yourself
a good camera and take lots of film with you. The
Cruising Right Along film on the boat won’t be cheap…and the food will
Would you enjoy visiting an abundance of coun- be plentiful and delicious. So, ship ahoy!
tries? One of the best ways to do that is to brush up
on your culinary skills and apply for a job as a meal Write Your Own Trip
server (or chef, photographer, front desk reception, Maybe you have taken a cruise, a rail trip, or any
etc.) on a cruise ship. Cruise ships employ hundreds other kind of vacation to a faraway land. Perhaps
of people from nations all over the world, and, the you went on a jungle safari or were one of the few
more languages you speak, the better your chances people who actually went behind the Great Wall of
of being hired. Cruise lines all over the world are China. Are you a fairly decent writer? If so, make
looking for retirees, semi-retirees, and students to sure you take along a pencil, notebook, and camera
work aboard their boats as lecturers, trainers, doc- (a digital camera is best, but not mandatory) on
tors, nurses, and even “gentlemen hosts.” If you your next trip. All kinds of people who take all kinds
have a specialty in something that would interest of trips can make money selling their vacation sto-
travelers, use one of the following resources to ries. Get hold of any travel publication you can, and
land a free, paid vacation: www.cruiselinejob.com or inquire as to whether or not they accept freelance
www.cruisechooser.com. Cruise lines employ maids, submissions. Very often, you will be paid for your
dishwashers, pastry chefs, deckhands, and many accompanying photos, as well as your article. Your
others. They have also been known to hire profes- inquiry should take the form of a letter to the editor.
sional flirts of all ages. Cruise ships can have as If you are a published writer, make sure you men-
many as a dozen or more bars on board, and single tion that fact in your letter. It can only help you. In
men and women travelers looking for companions your letter, write that you are going to be traveling to
often meet up with attractive people who were hired a certain vacation spot and that you’d be interested
specifically to meet the unattached. If you honestly in knowing if they would like an article, stressing
believe you are a “ladies’ man,” (and we are talk- when you return. Once you get the go-ahead (and
ing about charming men of all ages), it won’t hurt make sure it is in writing), call your tourism bureau
to apply to cruise ship personnel as a professional and explain your assignment. Show them the letter
companion. Cruise ship workers are not allowed to and watch how quickly you will be packing your bags
visit the cabins of guests, so forget about rocking the – for a free trip! Naturally, you’ll want to do the best
ship while at work! job possible when it comes to writing your article.
Six Months On, Six Weeks Off Persistence Will Pay Off
Most cruise line employees work for six months, and No trip planned, but the idea of becoming a travel
then they get six weeks off. Therefore, they don’t writer intrigues you? Now that you have phoned
have to maintain an apartment in their hometown. a tourist bureau, phone the ones you haven’t yet
They can arrange a short-term rental, or move in called. After that, don’t hang up. Continue your
with a friend or relative for their six off-weeks. Or, task by phoning up vacation resorts and airlines to
they can rent a two-bedroom apartment and find a explain that you are interested in raising interest
roommate who doesn’t mind staying alone most of about vacation destinations that need promoting.
the time. That way, they’ll always have somewhere Sometimes, you may be transferred to someone in
to live for their six-week “vacation.” When you think the Public Relations Department. You never know
about it, that’s 12 weeks of vacation every year. when an empty seat on a plane will be handed to
That’s three months! Where else can you get a great you in exchange for an uplifting and well-sculpted
job that gives you 12 weeks of vacation each year? In story about a resort, city, etc. This tactic works espe-
all fairness, however, you will be required to share cially well in a poor economy when airplanes and
your cabin with three other employees, and cabin hotels are half-vacant. You don’t always have to be
quarters on a cruise ship are anything but large. an award-winning magazine writer to get these little-
That said, the fun, the pay, the sights you will see, heard-of vacation “benefits.” v