Ever dreamed of starting your own business?

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Ever been tempted to tell the boss you’re leaving to start your own business? You’re not alone. In fact, more than nine million Aussies dream about becoming their own boss.

However, the biggest hurdle for 60% of those people (5.4 million) is ‘access to money’, according to research commissioned by the Australian Banking Association (ABA).

The percentage is even higher for women and young people. Indeed, two-thirds of women and people aged 18 to 34 believe access to finance is stopping them from fulfilling their entrepreneurial dreams.

What’s holding most people back?

It’s fair to say there’s no shortage of entrepreneurial self-promoters plugging their brands on Instagram and LinkedIn these days, which could give you the impression that plenty of people are reaching out for business finance.

But small business loan applications have actually declined by 33% since 2014, according to the ABA report.

That is despite 94% of small business loans being approved by lenders, not to mention record low interest rates.

“There could be many reasons for the downturn, including people believing that they won’t get a loan, thinking it takes too long, deeming the application process is too complex, or they’re simply borrowing money from other sources,” acknowledges ABA CEO Anna Bligh.

Why seek finance?

Well, besides obtaining access to the initial capital that’ll allow you to become your own boss, business finance can also allow you to grow your business more quickly.

That’s important, because the bigger your business, the better its chance of survival.

For example, while almost two-thirds of businesses in Australia are sole traders, only 60% of sole traders who were operating in June 2014 were still in business by June 2018.

That number increased to 70% for businesses with 1-4 employees, 78% for 5-19 employees, and 82% for 20+ employees.

Meanwhile, the main reasons businesses seek finance are to maintain short-term cash flow or liquidity (40%), to ensure the survival of business (32%) and to replace equipment or machinery (24%).

Want to get started?

To help prospective small business owners the ABA has created an educational website, which includes a suite of resources demystifying business financing.

Once you think you’re ready to apply for finance, get in touch. As the ABA points out, one of the key benefits of using a finance broker like us is that we handle the paperwork and assist you every step of the way.

And because we have developed professional relationships with lenders, we may also be able to reduce the processing time for your application.

Last but not least, we can review your current financial position, as well as your business case, to help match your funding needs to finance available in the market.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Making the most of the instant asset write-off

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Cash flow is like your daily hit of caffeine. You don’t really notice how important it is for your business until you’ve got to try and operate without it. Today we’ll look at how the recently expanded instant asset write-off initiative can help out in that area.

Budget week is always hectic.

You’re bombarded with dozens of different promises and initiatives – so much so that it’s near impossible to keep track of them all, especially ahead of an impending federal election.

So today we’re going to home in on an initiative that was put into place by the government within 24 hours of the budget being released – the instant asset write-off increase.

What is the instant asset write-off?

Haven’t heard of instant asset write-off yet? You’re not alone. Research shows just half of businesses know about it.

The instant asset write-off allows small and medium businesses to claim immediate deductions of up to $30,000 for new or second-hand depreciable asset purchases.

This can include things like vehicles, tools and office equipment.

Now, the initiative has been around since 2015, but the threshold was recently increased from $25,000 to $30,000 for purchases made from April 3, thanks to the federal budget.

That means your business is eligible to claim an immediate deduction for the business portion of each asset that costs less than $30,000 if:

– you had a turnover less than $50 million (increased from $10 million after budget night), and

– the asset was first used (or installed ready for use) in the income year you are claiming it in.

Assets that cost $30,000 or more can’t be immediately deducted.

How can it help with cash flow?

Before you go out and buy a $29,990 company car, there are a few things you’ll need to consider.

The first of which is what impact this purchase may have on your cash flow.

Now, the good news is we can help you obtain a business loan that will take into account your business’ current cash flow situation.

The even better news is that by using the instant asset write-off initiative, you can get the entire depreciation deduction back next tax year, which is just around the corner in July.

That’s much better for your business’ cash flow than the old fashioned way where you’d only be able to claim a small proportion each year.

These funds can then be used to further expand other parts of your business – so it’s definitely worth thinking about before the financial year ticks over on June 30.

Other key considerations

It’s important to keep in mind that “write-off” doesn’t mean “free asset”.

Basically, this initiative allows you to immediately claim all the tax deductions you would have claimed over the life of the asset.

As we touched upon earlier, getting this cash back sooner means you can re-inject it straight back into other parts of your business.

Also, say the asset will be used 80% of the time for business purposes and 20% for personal usage (examples might include a laptop or a car) then you can only claim deductions for 80% of the asset.

It’s also worth noting that if for example, you buy a $40,000 ute, half of which will be for used work and the other half for play, the asset won’t be eligible for you to immediately write-off the $20,000 business proportion.

Finally, you can take advantage of the instant asset write-off multiple times – the cap is $30,000 per purchase, not overall.

This means you can buy multiple assets that are worth under $30,000 each.

Final word

As we touched upon earlier, for many businesses it can make more sense to take advantage of these changes towards the back end of the financial year.

So if you’d like help obtaining finance that’s friendly on your business’ cash flow then please get in touch. We’d love to help out.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

12 reasons you should see a broker for car finance

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We’ve all heard the horror stories about a mechanically-challenged friend buying a car and it turning out to be an absolute lemon.

Well, the truth is that sourcing finance for the car isn’t all too dissimilar. But here are 12 reasons why you won’t end up with a lemon of a loan with us!

1. Using a finance broker doesn’t cost you a penny

Using a car finance broker is free. We won’t charge you for any of the work we do on your behalf. Also, all enquiries are free and there’s absolutely no obligation to go ahead with any of the options we present to you.

While it’s true we work on a commission basis from the lender, we work for you. Not the car dealership. Not the bank. You.

If we don’t find you a loan product that you’re completely happy with, then you’ll go elsewhere and we don’t get paid. And fair enough!

2. Access to possible discounts

We don’t want to brag, but negotiating with lenders is our thing. We deal with lenders on a daily basis and know just how hard to push when sourcing you a loan. This can result in discounted interest rates for you.

3. Time is money

Using a finance broker saves you time. And as we all know time = money.

By having us go out and negotiate on your behalf it can save you countless hours researching interest rates and repayments, and then getting in touch and negotiating with various banks and lenders.

4. We’ve got your best interests at heart

It’s our number one priority to make you happy by helping you source a loan that suits your needs.

It’s really important for our business and reputation that we nail our job. The big banks don’t have this same incentive to ensure you’re completely satisfied with the quality of their service. Neither do the car dealerships!

5. Pay less for the vehicle

There’s this little trick car dealerships like to use – the old ‘Drive away, 0% finance to pay’.

But all too often the dealerships sell these vehicles at inflated prices.

For example, a car that has a price tag of $24,990 with a 0% finance deal might sound great, but the automaker would most likely be willing to sell it to you upfront for $19,990. Therefore, you can actually end up paying $1000-$2000 less if you take out a competitive loan through us.

6. Avoid hidden nasties

Did you know that 80% of people don’t read Product Disclosure Statements?

You can’t exactly blame them. If you read every PDS, T&Cs and Privacy Policy you came across it would literally take you weeks to complete each year.

Instead, by using us we can give you the low down on the important points in the PDS to help you avoid getting stung by hidden nasties.

7. Access to dozens of lenders

We’ve got access to dozens of lenders on the market to help you score a competitive rate. Not only that, we’ve got our fingers on the pulse when it comes to the deals that lenders are offering.

You won’t have access to this many lenders if you deal directly with a bank or car dealership.

8. Get a loan suited to your needs

After finding out a little more about your situation, we’ll be able to get in touch with our panel of lenders to find a loan that’s suited to your personal needs.

This can even include finding a vehicle that’s suited to your family’s needs, if you need us to do so!

9. Got less than perfect credit rating?

If you’ve run into a bit of credit trouble in the past, we can still help you source a line of credit for your vehicle. We’ve got good experience in this department and know which lenders to approach to help you get a loan.

10. Convenience is king

We take all of the legwork out of sourcing car finance. We’ll liaise with lenders on your behalf, compare what they can offer, and come back to you with the options that we believe will suit you.

That will take a big weight off your shoulders as well as a lot of potential stress!

11. Minimise the impact on your credit file

If you apply for finance with more than one lender it can have a detrimental impact on your credit file. However working with a finance broker can allow you to apply with a number of lenders through just the one application.

12. The personal touch

While online (and big bank) options exist, we pride ourselves on our personal touch. If you’ve ever got any queries or concerns about your loan you can pick up the phone and we’ll sort it out for you.

That’s much better than calling up a call centre and being bumped around from anonymous customer service person to anonymous customer service person.

Get the ball rolling now

All too often the process of sourcing car finance is put in the too-hard-basket. But by simply picking up the phone and calling us now we can help you get the ball rolling.

It’s quick and easy, too. We’ll get some initials details from you and get cracking asap.

That way you can get stuck into the other tasks on your to-do-list, or simply kick back and watch Netflix!

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.