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The smooth flow of finances makes for an indispensable part of running a business. It ensures that your business activities run in accordance to the plan while also providing capital for business expansion. There are several ways such as crowdfunding, angel investors and personal savings that can be used to generate funds for business. However, a business loan is a common way of funding and can let you access a large sum of money. These type of loans are offered by leading financial institutions.

Banks immensely review an application before approving a business loan. These help in gagging the repayment capacity of the business. Before applying for a business loan, you must be well-aware of the factors that are assessed by the bank.

Credit history – Banks consider the credit history to be an extremely important indicator of a borrower’s repayment capacity. It is essential that you and your business have a good score or it could dampen your chances of getting the loan approved. A personal credit score that ranges from 700-750 is considered to be a good score. Financial companies regard a lower score holder to be a potential risk.

Also Read: How to Keep Investing during Panic

Collateral – While banks offer unsecured business loans, there are some secured loans that require you to generate a collateral. The secured lending will involve a collateral that can include anything from a real estate property to a high-value business machinery.

Business cash flow – Banks evaluate the cash flow of the business and use this as a driving factor for approving a business loan. A business with a low cash flow is regarded to carry a risk. For this purpose, the banking institution will ask you to provide a bank statement for the business, as well as for the personal account. The statements provide a clear understanding of the cash flow.

Documentation – Every business has a set of documents that continue to grow with its expansion.  Before approving of a business loan, the bank will need you to present different documents that include identity proof, address proof, business license, financial documents, business ownership proof and more. These documents prove that your business is legal and the lender only offers a business loan after viewing the same.

Also Read: First-Timers: Avoid the Gamble in Market Panic

Lacking in any of the above stated areas can cause a hindrance in the approval of your business loan. Hence, ensure that you sort the same before applying for one.

It was March 2020, we were all set to end our financial year just as every year. Life was sailing pretty normal, but something wasn’t going right in the world as a whole. China was hit by a viral outbreak later termed as CORONAVIRUS (COVID-19) by WHO in January 2020. And, March 2020 it has entered India as well and infected many. The pandemic had taken a deadly shape and the entire country is facing a lockdown situation to avoid any contact with people who could be potential carriers of the virus.

I’m feeling like I’ve time-travelled in my life and telling these stories to my grand-kids. Really? Would I want to share the story this way? I don’t think so! Rather, I’ll share with them the opportunities I could grab during the economic breakdown ad how they made us successful as a family.

The time when we are house arrested as per the Government notice, it’s time to not just Netflix and eat the delicious food at home but to plan for a better life ahead. This Coronavirus pandemic situation has got the economy slashing more than a recession alone would do. Here is what I’m doing to take due advantage of the market scenario and plan for a better future:

Thinking Long-Term

I have never in my investment journey thought of short term investing when I chose a company to pour my money into. I always want to associate myself with the companies that I have belief in fundamentally, and when such happens I don’t detach myself from the same in short run.

I started investing with very little money in few thousands, investing was the only way that I could think of for achieving financial freedom. The journey started in the summer of 2012 and somewhere along the way, it turned into a passion and love for the share-market.

I would like to highlight one of my investments in the company Deepak Nitrite Ltd. Five years ago, I began buying its shares and the very first lot that I bought was priced at INR.60/- per share. During this period of last five years I kept on buying its shares repeatedly and it was a joy watching the share reach the price value INR.540/- per share.

Sir Warren Buffett’s Influence

When I used to read Sir Warren Buffett say, “There will be a Multi-Bagger share in your portfolio which will outperform every other share and will make you believe in the power of compounding” I used to wonder! But personally got to experience in my portfolio with Deepak Nitrite Ltd. I have been holding this share for more than 5 years now, and it has more than doubled my wealth in this period.

Also Read: 10 Secrets That’ll Boost your Money Saving

Initially your investment could be in thousands, then lakhs and then definitely in crores one day. But patience to continue keeping a long term view is really important when it comes to investment. You cannot think of becoming a billionaire unless you start investing with that thousand bucks in your bank account which you could spend sitting in a café in just 2 minutes time.

Nothing is Permanent in this World

We, very often begin taking things for granted. For the first time in my life, I am experiencing such pandemic situation spread in the world which has put everybody’s life in danger. Such situations make one think that nothing is permanent in this world!

While I’m pen downing this piece, I’m reading in the news that we have 550+ positive coronavirus cases in India and 19000+ people are dead due to this deadly virus worldwide. All these people would never ever have thought such an outbreak could lead to loss of their lives.

So, don’t wait for the world to be favorable in all aspects for you. Begin your investment whenever you think you’re ready and are convinced with the company’s philosophy. Just keep a good track of the invested businesses, the market gives an opportunity to buy them back at more reasonable valuations during such crisis situations.

I have a detailed self-made checklist to judge a business before investing in its shares. The checklist has many factors like quantitative, qualitative, management philosophy, valuation, promoter and the full picture for past mistakes. I have made it a discipline to not buy any stock before going through my checklist thoroughly. Also, I keep updating my checklist with new learning regularly.

Also Read: Value Investing: The Butterfly Effect

I urge that one should invest with a long term (at least five years and plus) horizon. But keep checking how the business is performing every quarter. Long-term investment does not mean you invest and then forget about it, instead keep a brilliant track of the same.

Happy Investing Guys!

This is not the investment advice, please do your own research.

Hospitality and Real Estate are two such sectors which have large number of players in them but are still highly unorganised up to a large extent. Quality living spaces are something on which still people have to compromise these days. This is a socio-economic problem, which has been taken up by OYO for proper fixing with the help of technology.

With a promising mission of creating great quality living spaces, OYO has completed the target of becoming a 100% leased & franchised hotel chain in the year 2018. In which they tie up with an existing and not-so-well-performing hotel building for their renovation. The entire renovation is done as per OYO’s branding and quality standards & promises to deliver core services are fulfilled.

Currently, OYO is offering an array of services under their bucket, namely:

  • SilverKey (Corporate Apartments)
  • OYO Living (millennial housing)
  • Pallete (Resorts)
  • OYO Homes (Vacation rentals)

It’s been observed in the year 2018 that number of room nights stayed has increased from 6m in December 2016 to 13m in December 2017 to 75m in December 2018 globally. This shows the growth to be at 5.7x on y-o-y basis.

Here in this visual, I have tried creating a glimpse of the recent journey of OYO taken. OYO aspires to become the largest Hotel Company in the world and this seems pretty evident from the visuals herewith.

Analysis of OYO Business Model

Someday while cleaning your wardrobe if you find some notes lying (not the old thousand rupee notes obviously but the pink ones). How happy does it make you feel? What feelings strike to your head immediately? You can keep this money for your next vacation planning or you may keep it safe as an emergency fund etc. We want you to save money not just accidentally but purposefully.

“The habit of saving is itself an education; it fosters every virtue, teaches self-denial, cultivates the sense of order, trains to forethought, and so broadens the mind.” —T.T. Munger”

There are no trees bearing free cash or there are no rains of rupee happening from the open sky into our wallets. This reminds that we have to live in our budgets and save money for the future. For this very reason, we are listing a few ways of making you start saving money today itself. Some of them might just take a minute to implement. While others may require serious efforts from your side. But we’ll say try these tactics at least once and mark the difference in your monetary lives.

Newsletter

10 Ways to Save Money

1. Turn your TV OFF

TV according to us is an evil necessity of today’s society. We never ever had a TV in our home, not even in the living room. It saves us our money and our time which we utilize in doing something productive. Maybe if we had a TV set at home, we would not have worked on our blogging projects such as DhandhoInvestor & SoftParenting.

We remember our parents’ habits on TV. The moment they used to enter home from the office, they used to switch on this box until they fell asleep. Was merely sitting on the couch and changing channels helping anyways at all? In fact, was only contributing to our household monthly bills (cable plus electricity both).

Let us share some data with you all. The renowned rating agency CRISIL, in a report in February 2019 said, that the new TRAI regulatory framework is estimated to surge the monthly TV bills of the majority of subscribers by around 25%

Let’s do an exercise for you. Please check how many total TV channels are there on your TV. You’ll be surprised to find it close to hundreds. And, you’ll not be able to count even ten that are of interest to you. You may decide to cut off the cable expense and put the TV in the store room. Or sell it to someone who needs it and earn money instead.

2. For shopping, Always make list and stick to it

We know this could be tough, especially for a gentlelady. But trust us, once you begin to apply this rule of shopping you’ll start seeing the changes yourself.

Also Read: The Reality of Being Self-Employed

Make a list of items to be bought before going shopping and please for God sake STICK TO IT! You’ll observe yourself being away from any impulsive buying and looking only for the articles mentioned in your list. This saves your money and wandering around time too.

3. Invite Friends home instead of Chilling out

Friends are everybody’s lifelines. In our good or bad times, they are the ones always ready to be there.

Call the friends to your home for occasional get together instead of meeting outside in a café of a mall. This way you can spend more quality time with your friends without any external disturbance. Your expenses are also cut down to a large extent when you plan your gatherings at home.

4. Drink Plenty of Water

Drinking water in huge quantity has a lot of benefits to our health, skin, and metabolism. Did you know it can also make you spend less money?

Let us share our own story. There was a time when Vikas used to feel hungry and empty stomach at lesser intervals of time. He wanted to munch on something at those times. When he was in office, he could not grab something from the kitchen and satiate himself as at home. Being outside he used to end up buying some packaged food or ordering from an eating joint. Firstly he used to stuff himself with junk food and secondly he spent unnecessary money on the same.

To counteract the same, he began drinking lots of water and he would not feel empty all the time. He is able to avoid the little hunger pangs easily. And of course, avoids the thoughtless ordering of food as well.

5. Maximize the End of Season Sales

Plan your shopping such that you visit your favorite brand store when they offer End of Season Sale. Here also you may follow the shopping list rule. Prepare a list of items needed and stick to them only. Just try to go to store well early during the season’s end sale, or you might face little problem finding the best sizes.

6. Avoid Mall for Grocery Shopping

Grocery is something that we require bi-weekly/monthly (as the buyer prefers). When we go to the fancy super-marts in big malls and we see all the racks stacked beautifully with some random items. We tend to buy more than what we had gone to buy exactly. Sometimes completely irrelevant shopping is made at super markets which are not our need at all.

Also Read: Importance of Books for Investors and Entrepreneurs

It’s advisable to do online shopping for grocery. It saves time, gives a big discount on the retail price, door step delivery and most importantly helps you avoid impulsive buying.

We also used to love doing our grocery shopping at Spencer’s. But when we realized that we have stacked out kitchen and store room shelves just as to make it look like mini spencer’s. We quit!

We now buy your grocery from amazon pantry from 1st-7th of every month.

7. Apply 10 Seconds Rule for Impulse Buying

When we go to a market, it happens with all of us that we want to buy something.

Before making the final purchase, just think for ten seconds for what’s the need and use of the item immediately. Straightaway, you’ll have your answer in mind. And we can bet, 85% of the times you’ll walk away after exercising this on every such impulse.

8. Take your lunch along at Work

How many of you take your lunch along or it is provided in the pantry at work? If you do take your lunch along at work, you’re saving $65-70 every month.

When we buy the lunch outside, it always costs hefty as compared to a home-made meal. While eating outside, we’re not considerate of the amount of junk you consume. Later on, the health problems that junk food brings in costs another bill at the hospital. So, packing lunch for work has double benefits in terms of health and money.

9. Start Gardening

We both love gardening. We have a small garden but we have so many vegetables growing in it. We have tomato, spinach, fenugreek leaves, coriander leaves, chilies, lemon, curry leaves, Chinese oranges, etc. growing in our garden. We don’t buy them from outside at all.

Also Read: Don’t Try to Saw Sawdust

We are eating organically home-grown vegetables that too for free.

 10. Use Public Transportation or CarpooL

We know this is a bit of a hassle initially, but trust us this method of commuting is the best. You save a lot of money spent on your car’s insurance and continuous maintenance.

By using public transport, you are lessening the pollution and contributing one less car to the traffic on roads. The cherry on the cake is: you save a lot of money at the end of the month.

Okay so, these are few simplest ways via which we save money and invest for a greater good. Let us know your saving tips and tricks in the comments section below.

We’ll love to hear your tricks too.

Keep Saving, Keep Growing!

 

Vikas & Khushboo

Newsletter

“All progress takes place outside the comfort zone.” – Michael John Bobak

That sounds more like a trade-off. The essence of working for self provides me every opportunity that I may not have been exposed to when I was underemployment. However, getting to self-employ requires a lot of work hours and responsibilities than what I would spend on a traditional job.

The life a self-employed person creates for themselves is a serious blessing. It’s something that a person works hard for many years and dreams about every day & night. A self-employed person sets themselves up in a way that they can take care of themselves, do what they love, make a living doing what they love, and still have time to experience their life.

We’ll mostly be speaking about the “WE” part of ourselves. Let us introduce to the “SHE” part, as she’s into self-employment now.

Every good opportunity comes with some sacrifices along, and self-employment doesn’t remain untouched from this fact. Before launching herself into self-employment and becoming her own boss or abandoning the life of employee-hood, there were some seriously considerable realities of self-employment. These were non-negotiable and were totally out of her comfort zone.

You Reap What You Sow:

As an employee, sometimes I used to wonder sitting in my office cubical as to when the clock will tick 5:00 PM and I’ll leave the doors & sometimes it has happened that I have carried lots of work to home and skipped dinner and submitted the assignment late night or early in the morning. One thing is noteworthy here that in either of the two scenarios, never have I been ever asked for why I’m just counting the hours clicked on the clock or was applauded for my extra hours put in to deliver an assignment perfectly.

On the other hand, I never get paid just for showing up and marking my presence marked at my business/freelancing. Every single minute worked upon my business or anything that I do as freelancers count something. If I run out of clock any day and don’t do my best I hurt just one person and that’s ME. Starting employment for myself made me realize that I’m the maker of my destiny, and if I want extraordinary results in my life it would not happen by putting ordinary efforts into it. And, that’s exactly what I’m learning and trying to practice now.

No Job is Perfect:

It is true in almost every sense, either it is a job as an employee or you work for yourself. But self-employment lets me bet on myself every day. When I win that’s the happiest day, and when I do not that teaches me something. I’m loving every day’s challenges and how every time I have to come up with unique and comforting solutions. I still remember my first day at my venture, where I wasn’t confident enough to be making eye contact properly with one of my clients.

Since I have turned self employed, the cherry on the cake has been the happiness of making more money by working hard my way rather anyone else deciding how much should I take home every paycheck. Though my income varies (and that’s how it plays in business). But I’m happy living my life at ease, with freedom, and with much better work-life balance. I know self-employment too isn’t perfect, but still, I would never want to go back to my employment life.

Also Read: Multiple Streams of Income: What it is?

Long Working Hours:

When I was working as an employee, I used to see Friday 5:00 PM with a feeling of relief and freedom. But this happiness of freedom lasted only until the clock used to tick 9:00 PM on Sunday night. Mostly the working hours are 40-45 hours per week at the job.

Self employment generally asks for 50 or sometimes more than 50 hours a week. The self-employed people don’t get a weekend off, they work full time on weekends as well. You must be wondering, if self employment comes with so many disadvantages why would I chose this. Simply because of the one single perk that probably is beyond everything for me, and that’s personal freedom.

Wear All Hats Yourself:

When I take the responsibility of being self-employed, I wear multiple hats at a time. I am in charge of accounting, financials, operations, marketing, client engagement etc. I’m the boss and I’m the employee as well. And I have to do all of these jobs at once, and do them well, to make self-employment actually work.

It may happen that someday almost half of my employees have sat back home and haven’t shown up for the job. Well, that’s the hell of a task then and I have to manage each one of theirs’s job. Some by doing myself and some by delegating to others but covering up for the day’s task.

No Real Vacation:

During my employment, I used to shut down the laptop at my work station at 5:00 PM. I was free (completely) from the jobs that were to be delivered for that day. Every day, I used to walk out of those doors carrying no stress of office work further.

I have kissed my paid vacations Goodbye and left aside the hope of “real vacation”. Of course, being self-employed enables me to plan my vacations whenever I want. But the real problem that arises is, the customers don’t like waiting upon something or I not readily being available over calls as per their requirements. Gradually my relaxing vacation turns into a working vacation.

Still, I love it when I can plan according to my schedule as to when I’m free. Instead of asking for anyone else’s approval for the same for the sake of “planned holidays”. The control over my life is mine, not someone else’s.

Also Read: 5 of Our Favourite Money Hacks

Get Ready for Bank’s Turn Down:

Bank distributes Loans to almost anyone having a decent monthly income as an employee. But it doesn’t consider the application of a Self-Employed person until they have completed 3 years into that business and an ITR has been filed for the same. I have been turned down by 3 banks when I was looking to raise some money at the initial stage of my business. Although I had enough capability for getting the payment settled clearly. All the three banks wanted me to have (as assurance) is a steadily flowing paycheck every month.

You’re all by yourself:

Bidding the last goodbye at my job made me realize that there are few pieces of this job puzzle that I am actually going to miss. Such as: being able to look forward to guidance & suggestions from your boss, sharing warmth/frustration/companionship with your colleagues, being able to learn a new technique from a colleague who just got a course certification done/sharing of knowledge on the big meeting table etc.

Along with these, I was also losing the company’s other benefits like health insurance, the MacBook, the cell phone, the gym membership etc. I had to manage everything on my own now during my self-employment. A weird thought constantly nudged inside my head,  what if I’ll be ill-equipped to provide all of this for me? I might be in trouble!

But fortunately, things have turned out nice. The passion for conducting business on my own has synced deep inside me during the last two years.

Taxes can be bit Overwhelming:

The best part which I’d found during my employment that whatever amount was to be paid by me as tax, was deducted while the disbursement of my subsequent monthly paycheck towards the tax submission. I did not have to worry about the tax submission and arrange a surplus for the same when the financial year was closing.

However, now when I’m self-employed I do tend to worry at the financial year end as to what amount will my chartered account ask for tax payment. Also the CA’s charges for working on my balance sheet and tax accounting. I still haven’t got the habit of doing it every three months. This habit is obviously going to make a lot easier for me and my CA as well. Assessing financials quarterly is a better option than doing it annually, I’ll try to get this implemented soon enough 🙂

Well, taking into account the advantages and the disadvantages of self-employment, people like me any day prefer becoming their own boss. You may read about those people who are into self-employment for sometimes now. You’ll get to know of their experiences on successes and failures to be unique and addictive. Once a person starts to create their own success stories, it is difficult to go back in the course.

While I was in my job, it was a thought in the back of my mind that I’ll get a handsome annual raise from the employer. And once this raise was not as expected, I used to feel detached from the company. Whereas as a self-employed person getting a raise is directly proportionate with my business’s performance.

I want a raise – I have to bring more clients, sell more products/services, better my services, hike my rates and take whatever raise I want. I think for almost every entrepreneur the opportunity of making unlimited money is something that they keep working hard every single day. Once you succeed in self-employment, you’ll have the life you have always dreamt of professionally and personally as well. And, you keep thriving for more and more every time you touch new heights of achievement.

We hope to have touched the chord of your heart with our drafting.

Much Love!!

Khushboo & Vikas

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