7 Things You Need When Starting a Business From Scratch

Being a business owner is a major accomplishment that takes a lot of work and planning. From organizing documents to hiring the right contractors, you have many things to get in order to ensure your business is successful. Read further for insights about how to start your business from scratch.

1. The Right Tax Forms and Documentation

Be aware of what type of business you have. Are you a sole proprietor or an S Corp? Is your business a partnership? The type of business you have affects the type of tax forms you use. The IRS can audit any business tax return within three years of filing and can collect back taxes owed for up to 10 years. With that said, keep all your financial documentation up to date and save those receipts. One great tool you can use is QuickBooks, but of course, it’s always great to hire a financial professional as well.

2. A Lawyer for Business Operations

Lawyers are useful even outside of court. A business attorney can guide and advise you where needed. There are 1,315,561 lawyers in the United States, so you have many experienced professionals to consider.

3. A Business Financial Plan

When you create your business, you should have a very well-thought-out plan documented. It should include the purpose of your business and financial overhead. According to StudyFinds, seven out of 10 Americans live paycheck to paycheck. It’s possible to have a similar struggle when you own a business. You may not see much of a profit immediately, but you’ll have a greater chance of being in the black versus the red with a good plan.

4. A Filing System

Any business will have a lot of documentation. Therefore, you should have an accurate and organized filing system. According to The World Counts, nearly 50% of commercial paper goes in the trash. Thanks to technology, you can do a lot of documentation online. You can use QuickBooks to manage your finances and a contract workflow system to keep contracts up-to-date with stakeholders.

5. A Professional Web Designer

With so many websites available, people no longer have time to put up with slow and outdated pages. Up to 94% of people will click off a website with poor graphic design. Make sure you have a professional quality web presence as soon as possible, and hire a good professional to handle it. Your initial website can be simple, but you can scale it out as your business grows.

6. An Experienced Graphic Designer

Nearly 80% of people recognize a brand based on its logo. While it may be tempting to create your logo using one of the free sites online, it simply won’t have the same magic a professional designer can produce. An experienced graphic designer knows how to use iconography, color theory, and other design elements to create an eye-catching logo that’s only associated with your business.

7. A Training Program

Your company can never have too much training, especially if more than one person is involved. When people join a company with ongoing training, it tells them the organization cares about their development, and they’re more likely to stay. QSR Magazine reports that the right training program can reduce job turnover by up to 35%.

It’s never easy starting a business from the ground up. However, the fruits of your labor will pay off when you take the right steps and put in the work. From training to legal help to documentation organization, the right moves will have you seeing success before you know it. Contact our team for more information about starting a company.

How to Plan a Money-Making Outdoor Event at Your Winery This Summer

Summer is a great time to host events at your winery, and pleasant weather makes people more inclined to spend time outside and enjoy the scenery around them. As a winery owner, the warm months are an opportunity to capitalize on the beauty of your land by inviting customers to outdoor events, which will drive more visitors to your venue and help you make more money. Planning events like this can be challenging, and here’s some advice to help you guarantee that yours is a success.

Determine the Type of Event You Want to Host

You can host whatever event you want, but you should make it specific enough that people know what they’re attending. For example, a vineyard tour, wine tasting, themed party, or concert will attract more visitors than a general outdoor event. Consider your winery’s unique features, like specialty wines or picturesque views, and incorporate them into the experience. If you have sprawling vineyards, offer people a guided tour where you walk them through the winemaking process. Boost interest in your specialty wines by providing tastings and offering a package deal to attendees, such as a reduced rate, a discounted bottle of wine, or coupons to the winery.

Plan Your Event in Advance

Tempting as it may be to schedule something for next week, especially if you’re worried about money, it’s not advisable. You need time to plan logistics, and you risk losing out on visitors who might already have plans. Summer is a busy season for many business owners, so check out local events, as you don’t want to plan something the same day as a popular parade or street party. Remember, this is the opportunity to set yourself apart from other wineries in the area, and you want to drive as much traffic as possible.

Partner With Local Vendors

Maximize your revenue potential by contacting local stores and vendors. Food trucks are trendy and will attract loyal customers to your event. Additionally, see if stores want to set up product stalls. That way, you’re increasing your income while establishing solid business relationships with people in your community.

Consider Live Music

Live music enhances the ambiance at any event, especially if they perform popular songs and have a solid stage presence. The live music industry is very lucrative, reaching $31 billion in 2022, and you don’t need to hire a high-profile band or performer, as there are likely many talented musicians in your community that would love to spend an afternoon playing.

Educate Visitors on What Sets You Apart

Talk to visitors about your different types of wine and how they compare to other suppliers. Some people might have discounted your winery, as they have been told that foreign wine is better, and are probably unaware that California is the fourth-largest producer of wine in the world, after France, Spain, and Italy. Meaning, high-quality and tasty wine can be purchased throughout the country.

Set Yourself Apart

It’s no secret that there’s stiff competition when it comes to owning a business. You are competing with other wineries, restaurants, breweries, and coffee shops. All these places are likely to offer events, tours, tastings, and more, so it’s important to set yourself apart from the competition. Your outdoor event can help you do that!

Add Restroom Facilities

Sacramento is known for its beer, food, and coffee, but wine is always a top seller, too! With this in mind, be sure your outdoor winery event offers porta potties for your customers. This way, they can purchase food and sip on their wine throughout the day without worrying about finding a facility.

Like any business owner, your goal is to make money. Sometimes you have to think outside the box to drive traffic to your winery, and a unique outdoor event that sets you apart from the competition is an excellent way to do that. Use it to drive traffic to your location and create lasting customer relationships!

Engage New Customers With Google Advertising Solutions

Are you looking for a powerful and effective way to boost your business? Look no further than Google Advertising Solutions. With the potential to substantially increase your revenue, Google Ads can help you reach engaged audiences who are ready to spend on your products or services. Learn more about how you can leverage Google Advertising Solutions to engage new customers, maximize your advertising efforts, and take your business to new heights.

Unlock the Power of Engaged Audiences

It’s no secret that an engaged audience is more likely to make a purchase. In fact, the most engaged audiences spend 76 times more on products and services that they’ve seen advertised online! This staggering statistic highlights the importance of effectively targeting potential customers who are truly interested in what you have to offer.

Google Advertising Solutions provides a wide range of tools and features to help you tailor your advertising campaigns to reach the right people. By understanding your target audience and using Google’s powerful platform, you can significantly improve your conversion rates and create loyal customers who will keep coming back for more.

Join the Success Stories

If you’re still unsure whether Google Advertising Solutions is the right choice for your business, consider the fact that more than 1.3 million businesses, website publishers, and nonprofits across the nation have already benefited from using these tools. It means you’ll be in good company when you choose to invest in Google Ads.

These 1.3 million success stories showcase the proven track record of Google Advertising Solutions. These businesses and organizations have experienced the transformative power of Google Ads, and now it’s your turn to capitalize on this opportunity and grow your business by effectively targeting an engaged audience!

Stay Ahead With Constant Algorithm Updates

In the ever-evolving world of digital marketing, staying up-to-date with the latest trends and technologies is crucial. Google is committed to keeping its advertising platform at the cutting edge, updating its algorithm an estimated 500 to 600 times a year. If you stick with Google Ads, your advertising campaigns will continually be optimized to stay in line with the most recent changes.

Google’s dedication to staying ahead of the curve is great news for your business. Using Google Advertising Solutions, you can be confident that your campaigns will always be ready to stay ahead of the latest trends, ensuring that you remain competitive and reach the right people at the right time.

Advanced Targeting Features

One of the most important aspects of successful advertising is reaching the right audience. Google Advertising Solutions offers a wealth of advanced targeting features that can help you make the most of your advertising budget, ensuring that your ads are seen by the people who are most likely to be interested in your products or services. It takes out a lot of the guesswork and legwork, saving you a lot of time, stress, and money.

Expand Your Reach With Multiple Ad Formats

In addition to the advanced targeting features offered by Google Advertising Solutions, the platform also provides a variety of ad formats to help you engage new customers in different ways. By utilizing multiple ad formats, you can ensure that your advertising campaigns appeal to a wider audience and increase the likelihood of capturing their attention. The more people you reach, the greater the chance for profitability.

The potential to drive substantial sales growth through Google Advertising Solutions is hard to ignore. By leveraging the power of engaged audiences and learning from the success of over one million businesses, website publishers, and nonprofits that have already benefited from Google Ads, you can secure the growth and success of your own business, increasing the amount of money coming in and benefiting your profit margin. It’s definitely worth checking out!

Persian Rugs as Investments: A Guide to Choosing, Buying, and Profiting from Exquisite Carpets

Persian Rugs as Investments

For more than two millennia, people have enjoyed Persian rugs for their beauty and longevity. Because of their superior quality, they retain value after many years as long as they are not damaged or worn out. Therefore, some people consider Persian rugs as worthwhile investments. But before you spend thousands of dollars for one of these unique masterpieces, here’s what you need to know about choosing, buying, and profiting from these exquisite works of art.

7 Considerations When Buying Persian Rugs

1. Origin

Those who want to purchase Persian rugs as investments must first learn an important distinction. While Oriental rugs come from all across the Asian continent, Persian rugs only come from the area of modern-day Iran. Although borders or empires have changed, rug-making is a 2,500-year-old tradition that has remained the same over time.

2. Workmanship

When you buy a Persian rug, you have a rare and beautiful piece of the country’s artistic history in your home. Each one is handmade and unique. Although they may have similar patterns, you will always find subtle differences that make them one-of-a-kind.

The skill and workmanship that go into producing Persian rugs are what make them valuable. Each one is knotted by hand and requires multiple artisan months, sometimes years, to complete. More knots equate to more work, but a high knot count also indicates its quality. You won’t find the same level of workmanship in machine-made rugs. Not only are they identical, but they are usually much lower quality than the real thing.

3. Materials

Another characteristic to watch for is the quality of the material. Persian rugs are woven from all-natural wool, silk, or cotton, not synthetic substitutes.  They also contain natural dyes from plants, insects, and other animals. In addition to lasting longer,  they won’t adversely affect the yarn. Since they are made from high-quality materials, these rugs can last for centuries.

However, you get what you pay for. And, the cost of labor and materials is on the rise. Although Persian rugs have always been considered valuable, these factors only increase their worth.

4. Condition

The condition is one of the most important factors affecting the value of a Persian rug. Some examples that have sold for millions at auction were hundreds of years old. However, they retained their value because they were in excellent condition with no repairs.

So before you buy, ask yourself a few questions. Has the rug been well cared for? Is it soft and pliable? Or is it brittle and stiff?

If you decide to invest, then you will also need to ensure that you continue proper care and maintenance so it won’t depreciate. This includes vacuuming, sweeping off debris, or shaking them out as part of household chores. You should also rotate it regularly, avoid direct sunlight, protect it from heavy furniture, and clean stains immediately. But if it’s silk, you will need to get it professionally cleaned.

5. Rarity

Any collector will tell you that rarity is another thing you must consider. Older Persian rugs with few surviving examples of the style will be the most sought-after. However, rugs that originate from famous workshops, tribes, or cities that no longer exist will also be extremely valuable.

Sadly, Persian rug-making is becoming a dying art. Many village and tribal weavers have already passed on or are moving to larger cities to find better-paying jobs. Therefore, there are fewer skilled weavers today and fewer Persian rugs produced every year. And, there will likely be even less in the years to come. Since they are already in short supply, prices will only increase as supply chains dwindle.

6. Appeal

Many people view Persian rugs as classic decor with timeless appeal. Although they were originally used by tribes to protect against the harsh climate, they became popular among 15th-century European royalty. In addition to elevating their status, it also brought them to new markets.

While it is subjective, a rug’s appeal will also affect its value. They come in a variety of designs, unique patterns, and vibrant color combinations. Though some look similar, each one is distinctive to a specific region, tribe, and family. Establishing this history gives the piece more appeal which could make it infinitely more valuable.

7. Generational Wealth

Those who are considering Persian rugs as investments may also factor in their potential for passing on generational wealth. Like other forms of art, they will appreciate in time if they are well-maintained. And when you compare it to other forms of art, Persian rugs come with a relatively low price tag.

Finding Reputable Dealers

The experts and serious investors know that if you want a quality piece, then you will need to work with reputable dealers. Not only will they ensure authenticity upon careful inspection, but they will also provide certification if you ever decide to sell it.

But unfortunately, there are not as many dealers as there once were. And Persian rugs are the type of thing you just buy online. Like art, you want to examine it for yourself and ask questions before purchasing it.

Finding reputable dealers will protect your investment and ensure that you don’t pay more than you should. But if you have any doubts about who you are working with, check out their reputation online. Find out how long they have been in business and look for customer reviews. This information can help you identify legitimate dealers from potential scammers.

Profiting from Persian Rugs as Investments

Many people get ideas when they hear stories of thrift store finds that sold for a fortune at auction. Although the most expensive Persian rug sold for $33.7 million at Sotheby’s New York in 2013, it wasn’t hiding in the back corner of a second-hand store. It’s not very realistic to expect that you will find a hidden treasure that will bring this type of profit.

However, it’s still possible to get a return from Persian rugs as investments. It won’t pay out overnight, but it can earn decent returns in time. But like all investments, alternative assets come with risks. Trends and preferences change, and some rugs never sell at auction. So, you must consider more than projected returns. You have to do your research, find reputable sellers, and take the time to understand the market. But more importantly, you have to invest in quality if you want to earn a profit. It won’t come cheap, but it may pay off in time.

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6 Tips for Taking Your Small Business to the Next Level

Owning a small business comes with many exciting challenges. While the process of opening and handling the daily operations of a company is already a huge challenge, many business owners want to take their company to the next level. After all, the growth doesn’t stop when the phase of opening the business ends. Let’s take a look at some tips you can use to elevate your small business.

1. Assess Your Current Situation

Before you make any plans or decisions, assess your current status and what you want to do with your business moving forward. Are you looking to attract more customers? Do you want to expand on the products or services you offer? Then you can set realistic and attainable goals. Even with the most needed product or best-executed marketing strategy, your profits are unlikely to quadruple overnight. But, with careful planning, anything is attainable.

2. Diagnose and Fix Potential Weaknesses Before Moving Forward

It’s tempting to focus solely on growth and not worry about the current status of your business, which goes further than just operations. If you operate out of any physical space, such as a store, restaurant, or an office, make sure that everything is in good condition. You don’t want to put all this work into growing your company while neglecting the basics.

3. Protect Yourself Legally

Money concerns are at the back of every entrepreneur’s mind. A quick and potentially devastating blow to your financial well-being is any sort of lawsuit. You might think that your store is safe for your workers and employees, without realizing that there is a piece of the roof that is leaking or an uneven carpet that is creating tripping hazards. It just takes one accident for you to receive a lawsuit, and often the defendant has a long time to consider their legal options.

Don’t count on the fact there is a statute of limitations on filing a lawsuit. Montana, like other states, has a three-year limit for filing a civil case or settling a claim against a property owner. You don’t want to wait that amount of time to determine your financial fate, so eliminate any possible risks of legal issues in the future by making sure your business and property are in pristine condition.

4. Assess Your Technical Infrastructure

Your infrastructure isn’t just physical. Cyberattacks are a real threat, and 60% of small businesses that fall victim to them go out of business within six months. Taking your business to the next level isn’t just about increased traffic and making more money, it’s about maximized protection. Install software to protect against threats and speak with a consultant about diagnosing any weaknesses in your current system.

5. Work on Brand Alignment

While it’s true that there are real threats out there, don’t fear technology as it is one of the most diverse and far-reaching tools at your disposal. Evaluate your online presence and be detail-oriented. Your website, app, and social media presence don’t require a lot of money upfront but have the power to dramatically increase your income.

Does your online presence match your business? When you log onto your website, look at the design. If you own a floral business but your homepage has no pictures of flowers, you aren’t properly representing your company. Whenever someone clicks on your page, they should know exactly who you are, what you do, and how to contact you.

6. Go Digital

If you are looking for ways to save money, consider cutting expenses like paper. According to Forbes, going digital, such as using a cloud repository, can support a 100% paperless process. Let’s be honest, most things in our world are digital now, and you can repurpose the money you spend on paper and put it towards your plans for growth.

Taking your small business to the next level is a multi-faceted and complex process. By assessing your current areas of concern, putting together a solid plan, and utilizing tools available to you, growing your business will be attainable.

5 Tips for Saving Money When Investing in Your Startup

As a small business owner, it’s crucial to always have your best interest in mind. Nearly 30-50% of all small businesses are involved with some form of litigation at some point or another each year. From legal matters to marketing, launching and running a small business successfully requires more than simply selling a product that is currently in demand. If you are thinking of launching your very own startup, there are a few tips to keep in mind to help you save money once you dive in.

1. Get to Know Your Audience

Defining and getting to know your target audience and the demographics you intend to reach can go a long way for any startup, regardless of the industry and market you are in. Getting to know who your audience is will help you to determine which platforms, tools, and methods are likely to work best to appeal to prospective customers and/or clients. The more familiar you are with the audience you intend to reach, the less likely you are to overspend when it comes to advertising and launching marketing campaigns on platforms that are not ideal.

2. Access Free Tools and Resources

One of the greatest aspects of the internet is the ability to access and use free tools with the click of a button. With plenty of resources to help with launching a startup, you can begin building your online presence in no time. Even if you have little to no experience when it comes to handling code, building websites, or generating graphics, there are plenty of free and paid resources that can be accessed for a variety of commercial purposes.

3. Consider Your Location

Location, location, location! Location matters with any business. However, when it comes to saving money, launching a startup at home or in a small local office building is just as possible. Finding a professional organization to assist with the moving of your business will ultimately result in more benefits and additional connections over moving your business on your own.

Opting to work out of your home as you build your startup is highly recommended. The less you are required to pay to operate your business out-of-pocket, the less likely you are to put your endeavor at risk financially.

4. Calculate Your Potential ROI

Whenever you’re pondering the thought of going into business, it’s important to calculate your potential ROI, or your Return on Investment. When selling any business, including a startup, knowing how much income or revenue you will generate annually can help you to determine the overall value of your brand. For example, a company that generates approximately $100,000 in income each year can sell for anywhere between $200,000 and $300,000, depending on the brand’s niche and market. Determining your potential ROI ahead of time can also help you to assess the funds you require to get your project off the ground.

5. Use Advertising to Generate Revenue

Depending on the type of business or brand you are running, it’s also possible to generate a passive income through advertising online. Using various marketing strategies, integrate ads directly onto your official website as well as throughout your social media posts. It’s also possible to reach out to potential sponsors and/or influencers to help spread the word about your business, depending on the industry you are in and whether the industry is already overly saturated. Using ads to generate revenue on your website can also provide you with more reach and ultimately, engagement on your website.

Saving money when investing in your startup is not always easy, but it is possible with an understanding of your audience and the market you have entered. The more familiar and comfortable you become with the ins and outs of your startup industry, the less likely you will be to overpay for any type of good or service you need.

5 Reasons to Invest in NFTs in 2023

If you’re wondering about how you can get more money by investing, you need to do thorough research. This can help you find the best investments to make that will help you grow your wealth over time. While looking for investments to make, you may come across NFTs, which are Non-fungible tokens. They’ve been making a buzz over the last year, and if you’re wondering if there are any reasons for you to invest in them, have a look below to see five reasons why it might be a good idea to put your money on NFTs in 2023.

1. They’re Unique

The first reason why you may want to invest in NFTs is because they’re unique cryptographic tokens. They’re impossible to forge, which adds to their value. As an investor, you’ll appreciate the fact that each NFT artist typically has just a few pieces to sell, making them rare collectibles with a great chance of maintaining their value. This is something that could appeal to many people, especially those who enjoy collecting things as a hobby. This is based on a recent survey which found that one out of three adults in America collects some physical item or another. This is done either as a hobby or an investment, and among those who identify as collectors, one out of four of them engages with NFTs as well. A whopping 42% of millennials collect NFTs as well, making them popular.

2. They Have a Decentralized Market Place

Another reason why NFTs are an amazing investment is the fact that they have a decentralized marketplace. This means that creators can directly make money from their work, eliminating the need for an intermediary. As a result, NFTs exist in one of the few marketplaces that have a decentralized approach.

3. They’re Secure

NFTs are extremely secure. That’s because of the way in which the market of blockchains works. Your data cannot get lost and so your investment will be safe and extremely valuable. Their ownership is easy to verify and so they have an additional layer of authenticity to them. Veteran traders know that this is an important aspect of an investment item.

4. They Can Be Resold

Most people who have bought NFTs have been able to resell them and make good money doing so. The more rare one of these collectibles is, the bigger the profit that can be made from reselling them. If you invest in the right NFT, you can make good money over time, and you may also become better at learning how exactly to get the most out of your efforts.

5. You Empower Creators and Artists

Last but not least, when you trade with NFTs, you can be content in the fact that you’re empowering artists and creators. That’s because, as mentioned, trading with NFTs takes away the need for a middleman in the process. This means that the creator of each specific NFT has full rights to it and all the money you spend on a piece goes directly to the artist. Note that the size of the American online art industry peaked at about $5.65 billion in 2021. NFTs stand to increase this amount even more and contribute significantly to the art market.

These five reasons should motivate you to look into the next best NFT to trade with. This might help set you up for a successful future of trading. Over time, you may make a good amount of money as you’ll be able to figure out the details that can make trading with NFTs more satisfactory for you in all ways.

How To Set Up a DRIP Investment

How to Setup a DRIP Investment

Dividends are an important way investors create cash flow from their investments without having to sell off their shares. However, what do you do with your quarterly payout? Do you use it? Reinvest in other assets? Or, put it back into the company to help you earn even more? Many people choose this last option and set up a DRIP investment. If you’re considering option number three, here’s what you need to know.

What Is a DRIP Investment?

A DRIP investment, or dividend reinvestment plan, is a popular strategy where you use your dividends to purchase more of a company’s stock. As the name suggests, it drips your earnings into additional shares, slowly adding to your returns.

Each quarter when companies pay dividends to their shareholders, those with a DRIP investment buy more shares with their earnings. When you opt into the plan, it automatically reinvests your dividends every quarter as part of the dollar-cost averaging approach. By making consistent investments at regular intervals, it lowers the average cost of the company’s shares over time.

Investors also have a better purchasing position since they can buy fractional shares as well. Since you can roll over the full amount of dividends into new stock, it compounds your gains and puts all your money to work for you.

If you want to set up a DRIP investment, you can buy them directly from the company or through a brokerage. As an added incentive, reinvestment plans sometimes offer additional shares for a significant discount.

What Are the Pros and Cons?

Every investment strategy comes with pros and cons. Here’s what you should keep in mind when you are considering a reinvestment plan.

The Pros

1. It gives you compounding gains.

When a stock consistently brings good returns, its value will continue to increase over time. As your dividends increase, you have more to reinvest back into the company, which will pay out even higher dividends.

With a DRIP investment, the cycle of profit continues and you earn higher returns every quarter by owning more shares. Thanks to compounding gains, your initial investment has the potential for unlimited growth.


Another advantage you get with a DRIP investment is discounted share prices. Instead of paying the open market price, the company will usually offer a reduced price when you reinvest your dividends. The discount can be anywhere from 1-10% which helps you get more for your money.

3. A DRIP investment reduces your risk through dollar-cost averaging.

Banking on the technique of dollar-cost averaging, a DRIP investment reduces your risk and exposure to price fluctuations. When you buy shares at regular intervals, you are not buying them at their peak or lowest price. And since you get the shares at a discount, this lowers the average price to save you money.

4. Investors increase their position with no additional fees.

Since investors can purchase shares for up to a 10% discount, a DRIP can increase your purchasing position. When you buy shares below the market value, can buy more shares in the company and set yourself up for even greater dividends.

Plus, they usually come with zero commission and brokerage fees. Unlike other investment options, you can avoid trading fees to free up even more money for reinvestment.


Most investments require careful monitoring and adjustments based on market fluctuations. But, this is one of the few investments where you can set it and forget it. It continues making regular investments until you decide to stop. Not only does this prevent you from rash decision-making during downturns, but it also keeps you focused on your long-term goals.


It’s really very simple to set up a DRIP investment. Once you enroll in the plan, your work is done. It automatically reinvests your dividends so you don’t even have to think about it. The plan remains in place indefinitely and requires little oversight since it purchases the shares with no consideration of the market price.

The Cons

1. Plans vary between companies.

Although the structure of a DRIP investment is universal, the plans may vary between companies. For example, they may charge a one-time setup fee or offer different discounted rates when you buy additional shares. To find the details of a particular company’s stock, you should contact their Investor Relations department to learn more.

2. It limits your investing options.

When you sign up, DRIPs will automatically reinvest your dividends for you. However, they will only use it for their stock. If you have other ideas for investing your dividends, then this isn’t the right product for you.

3. A DRIP may have minimums.

As mentioned above, every plan is different. Before you sign up, find out if they require you to purchase a minimum number of shares to participate.

4. It comes with a restrictive reinvestment schedule.

With most brokerage accounts, you have the option to buy stock whenever the mood strikes. However, a DRIP only reinvests dividends when they are paid out. And since this is done automatically, there is no consideration for market conditions. If shares are high, it could end up costing you more to reinvest with the same company.

5. It could create an unbalanced portfolio.

If some of your stocks are paying dividends while others aren’t, a DRIP could lead to an imbalance in your holdings. While this reinvestment strategy has many benefits, an unbalanced portfolio reduces diversification and makes you more reliant on the stocks you own more shares of. This overexposure could leave you vulnerable when market conditions change.

6. You still have to pay taxes on your dividends.

While you can reinvest the entire amount, you still have the tax burden of dividends. Even when you reinvest them, dividends are considered taxable income. If you don’t account for this, you may end up paying out of pocket later on.

How Do You Set Up a DRIP Investment?

Although some brokers prefer not to let a calendar dictate their investment strategy, establishing regular investing habits is good for your long-term financial plans. If you and your financial advisor believe this would be a good addition to your portfolio, it’s simple to set up a DRIP investment.

  • Research which companies offer DRIPs. You can easily find this information online. However, some brokerages may set up their own DRIPs, even if the company doesn’t offer them publicly.
  • Decide which stock to buy. Look into their dividends history to ensure they have a proven track record of profitable performance. It’s also a good idea to choose a stock that will help you maintain a balanced portfolio.
  • Become a shareholder. Once you know what stock you want to buy, you have to become a shareholder. You have several purchase options. This can be done directly through the company, a brokerage, or your online brokerage account.
  • Enroll in the DRIP. The easiest way is to facilitate it through a brokerage. If you use your online brokerage account, the site will usually include tutorials. However, if you choose to go directly through the company, you will have to enroll through their Investor Relations department or with a transfer agent.
  • Watch your dividends grow. Once you’ve enrolled, the DRIP will automatically reinvest your dividends following each payout. It will continue to do so until you opt out of the program.

If you are a new investor, DRIP investments are a great way to grow your portfolio. However, if you plan to live off the dividends, it make not make sense for your investment strategy. As with all investments, you should always weigh the benefits and discuss them with your financial advisor to see if it’s the right choice for you.

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10 Investing Principles Everyone Should Understand

10 Investing Principles Everyone Should Understand

If you buy into all the latest investing apps, they make it look simple. But don’t be fooled; investing gets complicated. And it can become even more so if you are trying to stay ahead of new trends, strategies, financial products, and fluctuating markets. However, using common sense and sticking to a few key financial principles can help you navigate your finances. Unfortunately, many people forget these and make foolish mistakes that cost them money. Even if you are just starting out, here are 10 investing principles everyone should understand.

10 Investing Principles Everyone Should Understand

1. Saving and investing are two different things.

One of the most common misconceptions that I hear is when people assume that their saving and investing strategies are one and the same. However, understanding the difference is one of the most important investing principles.

Investing is an important part of long-term retirement planning. But, it requires you to put money in riskier assets to get higher returns. On the other hand, saving goals require more stable products and should be accessible when you need funds. Since you are allocating the funds towards different goals, they should operate independently of one another.

2. You aren’t Warren Buffett.

If you enjoy discussing investment strategies, you will encounter many eager, young investors who have high hopes of becoming the next Oracle of Omaha. However, you have to be realistic. You are probably not the next Warren Buffett. But, that doesn’t mean that you can’t develop a sound investment strategy.

The average investor will experience moderate success with sound decision-making and long-term gains. While it’s great to have role models and high aspirations, you must make decisions based on your financial situation.

3. You can’t time the market.

Investors have always tried to predict the future and time the markets to maximize their ROI. But, no one has a crystal ball and investing isn’t an exact science.

Truth be told, it’s impossible to know exactly how the markets will react. Therefore, you shouldn’t try to time the markets. There will always be ebbs and flows, so it’s better to take a measured approach to ride out the highs and lows of these fluctuations.

4. Day trading is harder than it looks.

When day trading apps hit the scene, it was big news. In the past, investors relied on brokers to handle their trading. But now, the average investor can access the same markets without a middleman.

Although these apps have made investing more convenient, day trading is much harder than it looks. If you were to ask someone who makes several trades a day, they will probably tell you that they don’t make much money. In fact, many people experience losses from these trades. That’s not to say that you can’t make money day trading. But, it’s naive to ignore how much skill and luck it takes to be successful at it.

5. You probably won’t get rich on meme stocks.

Investing has become a popular topic of conversation on social media. With a quick search, you can find hundreds of sites and videos that discuss new products and available stocks. Some of these groups and forums attract novice investors and create frenzies when the nets start buzzing about the latest meme stocks.

Unfortunately, it’s probably too late to jump on the gravy train by the time it becomes newsworthy. Unless you owned these stocks become they became popular, there is very little chance you will make money from meme stocks. Any financial advisor worth their salt will tell you to avoid popular trends and stick to the fundamental investing principles and strategies.

6. Diversify!

When it comes to your assets, you never want to be all your proverbial eggs in the same basket. Therefore, diversification is an important way to mitigate risk and protect your portfolio during market declines.

When you are building your portfolio, you want a healthy, well-rounded amount of offerings with different types of assets, including some that are inversely correlated or independent of the stock market. For those who take a more hands-off approach, index funds are a wise investment since they have built-in diversification that will bring you steady returns.

7. Short-term losses and market fluctuations are normal.

If you have been tracking your portfolio day to day during the last year, it has been gut-wrenching. But when I get that feeling in the pit of my stomach, my financial planner always reminds me that market fluctuations are the nature of the game.

You have to accept that there will be periods of significant gains and serious losses. Remember, these fluctuations are normal and market corrections will happen. The worst thing you can do is panic sell. Instead, take a longer view and allow time for the markets to rebound.

8. Expect taxes and fees.

When you are investing and earning dividends, you should expect to pay management fees and taxes on your trades. When it comes to your investments, there are going to be tax implications when you sell stock or take withdrawals. So, you should have a clear understanding of these before you act.

9. Investing shouldn’t be one-size-fits-all.

Everyone has different risk tolerance and long-term goals. That’s why the initial assessment is so important to your strategy. If you haven’t done it already, it will help you determine where you are at in life and what products and assets will get you to your goals. Every situation is unique. Therefore, a one-size-fits-all approach won’t work when it comes to investing.

10. You have to monitor and adjust your strategy regularly.

There are several helpful investing principles. But if you take nothing else from this list, let it be this: change is constant. So, you have to monitor and sometimes adjust your strategy.

Markets and economic conditions never remain stagnant. Since they are always changing, you can’t just set your strategy and walk away. It’s a good habit to check them on a regular basis. Or if you prefer, pay someone to do it for you. As markets and circumstances fluctuate, may need to rebalance, reallocate funds to more profitable investments, or adjust your risk tolerance level. If you aren’t willing to adapt, it could cost you more than you realize.

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Editors note: If you’re reading this because you’re looking for fresh investing ideas you could always go and read about dividend stocks at Ten Factorial Rocks.  It’s a nice little site with some good thoughts on investing.