A restaurant, nightclub or tavern is largely a cash business, and for many business-owners in this industry, cash in hand is what counts. It’s tangible, it’s immediate, and it’s cheaper than paying the transaction fees associated with keeping a card machine.
So why should you put your hard-earned cash towards insurance plans and investments – especially when it feels like you’re not really getting anything in return?
A smart business owner plans not just for the short-term (like monthly payments to suppliers), but also for their financial future. In other words, now that you are making money, you need to start thinking about how to grow your money with the right types of risk cover or insurance plans.
Now that you are making money, you need to start thinking about how to grow your money and protect your money. Here’s where to start…
In this issue of Spotong, we’ll focus on investing first.
What this means is that there is no such thing as a quick buck when it comes to investing your money. If someone promises you unbelievable returns – for example, 30% of your original investment back within 12 months – chances are that this is too good to be true.
Here are three simple ways you can start investing immediately:
First, don’t try to time the market and wait for share prices to be at their highest before selling or at their lowest before buying. Second, don’t put too much emphasis into buying certain stocks. The keys are consistent investment and diversification. – Dr Vladimir Nedeljkovic, Absa
What if you are in an accident that leaves you unable to work, and your family needs to unlock your disability benefit? Or worse, they need the policy number for your funeral plan? Create a folder called ‘Important Documents’, and put copies of the following in it:
If you are in a business partnership, create a second folder that contains your partnership agreement, official company documents, latest tax clearance and BEE certificates, business insurance policies and your SARS-issued business tax, VAT, UIF and PAYE numbers.
“Sadly, we only realise the importance of having insurance and financial planning after a life-changing event,” says Kgomotso Masongoa, financial advisor of Discovery.
Look out for the next issue of Spotong, where we focus on what types of basic insurance you need in your personal capacity and as a business owner, and how to calculate how much you should be paying.