“Getting Your Business Financially Fit”

How to increase cash flow for your business using advanced financial

strategies

Sovereignty Financial Group 2013. All rights reserved.

OUR MISSION

To create better financial futures and legacies through a higher quality of financial education. We believe that a strong foundational understanding of how money works leads to much more sound financial decisions. While always putting people before profits, we will recommend strategies that will not only benefit clients today, but also families for generations to come.

AgendaHow to save safely and create a retirement using• Fixed Indexed Annuities• Equity Indexed Life Insurance• Devastating mistakes small business owners

make when financing their businesses• How to acquire capital for your business using

business credit

If you distributed the world’s

wealth equally among every person on earth… over time most of the wealth would end up back in the

hands of a few people.

Distribution of Wealth

WHY?

Everyone Falls Into One Of These Three Categories

WEALTH CHASERS

WEALTH WASTERS

WEALTH CREATORS

How We Handle Our Money

Let’s Take A Closer Look At These…

“61% of Baby Boomers fear

outliving their money

more than death…”

“Only 53% who were confident about their ability to gauge their

retirement income needs.”

Source: Financialpost.com

“Indexing”

What is it?

Floor

0%

Goal:

•To have some potential for market gain without risk of principal

Ceiling

15%

“Cap”

• Use of index like Standard and Poor’s 500 or the DOW

• Principal guaranteed against loss

The Safety of Guarantees

$100,000

Gains BecomePrincipal

That is a $11,705 difference because of the annual lock in and reset.

10%

$110,000

$99,000

-10%

$115,655

$103,950

5%

5%

11%$110,000

The Powerful Advantage of Locking in Annual Gains

The Safety of Guarantees

Comparison Between the S&P Index andan EIUL Fixed Index Account "Legacy Bank"

Assumptions      Beginning Acct Value of: $100,000 (Both Accounts)

S&P Cap: None Index Product Cap: 15%

Year Account Floor: None

Account Floor: 0%

Year Market return Account Value   Account Value1/1/2000 14.82% $114,820 14.82% $114,820 1/1/2001 -10.14% $103,177 0% $114,820 1/1/2002 -13.04% $89,723 0% $114,820 1/1/2003 -23.37% $68,755 0% $114,820 1/1/2004 26.38% $86,892 15.00% $132,043 1/1/2005 8.99% $94,704 8.99% $143,914 1/1/2006 3.00% $97,545 3.00% $148,231 1/1/2007 13.62% $110,831 13.62% $168,420 1/1/2008 3.53% $114,743 3.53% $174,365 1/1/2009 -34.12% $75,593 0% $174,365 1/1/2010 21.50% $91,845 15.00% $200,520

11 Yr. -0.77% $91,845 6.53% $200,520 Totals   Difference         7.30%  

Building Business Credit

Devastating Mistake #9 Using personal credit to finance your business

The hands-down biggest and most common mistake entrepreneurs make is using personal credit to finance their businesses.Common examples include: • Paying for business expenses with your personal credit cards • Obtaining personal loans to finance your business expenses

By using your valuable personal credit for business expenses, you run the risk of

Lowering your personal credit score. When you personally guarantee business-related financing, the lender will require a personal credit check. Every time an inquiry into your credit history is made, your personal credit score takes a hit

Reducing the amount of credit available for personal use. The more credit you have personally guaranteed for your business, the higher your debt-to-income ratio soars … and the less that lenders will be willing to give you for personal

Losing everything. When you use your personal resources or credit to finance a business, you chain your financial security to your company’s success. If the company fails, you’ll be left holding the bag … and your personal finances will sink along with your business

Devastating Mistake #8 Putting personal assets at risk

Each time you pledge your personal assets for any type of credit extended to your business, you jeopardize your personal belongings, such as savings and investment accounts, your car, and even your home. If your business can’t pay off its debt, the bank will come looking for you to make good on the loan.

A business entity established as a sole proprietorship is most susceptible to this risk. You will be completely liable for all personal and corporate debt. Your credit history will be based solely on activity associated with your social security number because you will not have a corporate tax ID number. As a sole proprietor, you also have no legal means for separating corporate and personal credit.

The best way to protect your personal assets is to incorporate your business. You’ll shield yourself from personal liability for the company’s debts and typically will also reduce your tax burden.

Devastating Mistake #7 Contaminating your credit

When people marry, they vow to share their lives. For some good-hearted but financially naïve couples, this means sharing personal credit. Unfortunately, adding your spouse to your credit isn’t a show of undying loyalty and devotion. It’s credit file contamination – an almost unforgivable sin if you’re a business owner.

To avoid credit file contamination, keep your credit history completely separate from your spouse’s history. If your spouse ruins his or her credit, then you’ll still have a good credit history to support your family, as well as your business.

Devastating Mistake #6 Not paying your bills on time … 100% of the time

Your credit file is a complete history of your credit activity. Not paying your bills on time can ruin your credit file. A single delinquency can be held against you for years and be used to constrict the extension of existing credit or deny new credit – which can make or break your ability to finance the launch, operation or growth of your company

There are two things you should do to protect yourself from this critical mistake. The first, obviously, is to ensure that you pay your bills promptly. Second, keep your personal credit separate from your corporate credit.

Devastating Mistake #5 Using your family’s money

Be forewarned: if you convince your family members to finance your business, you’re just digging a deeper hole for your family to crawl out of. If your business fails – as 95% of business do in the first five years, according to the Small Business Administration – your family could be wiped out financially

Don’t ask family members to use their personal credit to invest in your business. As we discussed in Mistake #9, using your personal credit to pay for business expenses is a strategic error. And if it doesn’t make sense for you, the business owner, it makes even less sense for family members. Keep everyone’s personal credit strictly separated from your company’s corporate credit.

Devastating Mistake #4 Not setting up a corporation and building corporate credit – the right way

Many business owners are unaware of the value of incorporation. Even fewer understand the essential steps necessary for building the kind of corporate credit that will enable them to take full advantage of their entrepreneurial status.

Some of the preliminary steps every entrepreneur needs to take to secure excellent corporate credit include incorporating your business, maintaining a physical office, obtain a local phone number and a 411 listing, and get a business license and have a business that has real revenue.

Devastating Mistake #3 Rushing the process for building corporate credit Corporate credit can be an invaluable tool as you build your wealth; because it gives you the flexibility to invest money in ways that you have determined will help you build your business. But just as it takes time and patience to build wealth, it takes time and patience to build the corporate credit that enables you to get cash from lenders without your personal guarantee. Incorporating your business is just the start of the process. The industry standard for building corporate credit to the point where you can secure cash without a personal guarantee is two to three years. We have streamlined its credit-building process so that you can get the corporate credit you need in as little as one month (as long as you meet the criteria, if you don’t qualify, don’t worry, we will help you understand what changes need to be made in order to help you qualify). And then follow the steps to position your company to qualify for no personal guarantee forms of credit.

Devastating Mistake #2 Not following up on the credit-building process

Once they begin to follow the prescribed process for building corporate credit, many entrepreneurs simply don’t do enough follow-up work. But if you don’t keep track of your progress during the process of building excellent corporate credit, you may miss key elements that could make the difference between getting the cash line of credit you need … or being denied. It is always a good idea to delegate, especially if you are busy. But you have to be careful as to which kind of work you delegate. The work that directly affects the growth of your business and your wealth deserves your personal attention.

Devastating Mistake #1 Not recognizing opportunity costs

At the first sign of profits or the first influx of credit, many business owners spend more than they have – or even more than they will make – on material goods. Lured by the luxury car or exotic vacation they’ve lusted after for years, they ignore long-term business goals in favor of temporary and immediate gratification. But if you want to achieve your long-term business goals, recognize that corporate credit and profits should only be leveraged to create greater gains for your business. Instead of figuring out how much profit you can take out of the business, seek ways to invest your earnings so that it will deliver greater returns for your business. This is not, by any means, a comprehensive list of all the mistakes entrepreneurs make when it comes to building corporate credit. But if you address these costly and dangerous errors, you will be on your way to building a safe, secure, and financially sound business—the business you always dreamed of!

Business Credit• Business Credit is credit that is obtained in a

Business Name• With business credit the Business builds its

own credit profile and credit score• With an established credit profile and score,

the business will then qualify for greater credit

Business Credit• This credit is in the business name and based

on the business’s ability to pay, not the business owners

• Since the business qualifies for the credit, in some cases there is no personal credit check required from the business owner

Business Credit Benefits • A credit profile can be built for a business that

is completely separate from the business owner’s personal credit profile

• This gives business owners DOUBLE the borrowing power as they have both Personal and Business credit profiles built

Step 1- Build Business Credibility • The perception lenders, vendors, and creditors

have of your business is critical to your ability to build strong business credit.

• Before applying for business credit a business must insure it meets or exceeds all lender credibility standards

• There are over 20 credibility points that are necessary for a business to have a strong, credible foundation

Corporate Entities • You can build business credit with almost any

corporate entity type• If you truly want to separate business credit

from personal credit your business must be a separate legal entity not a sole proprietor or partnership

• Unless you have a separate business entity (Corporation or LLC) you might be "doing business" but you are not truly "a business“

• You need to be a Corporation or an LLC in order to separate personal from business credit

EIN• Whether you have employees or not, your

business entity must have a Federal Tax ID number (EIN)

• Just like you have a Social Security Number, your business has an EIN

• Your Tax ID number is used to open your bank account and to build your business credit profile

• Take the time to verify that all agencies, banks, and trade credit vendors have your business listed with the same Tax ID number

Business Address• Business Address

– Must be a real brick-and-mortar building– Deliverable physical address– Cannot be a home address– Cannot be a PO Box– Cannot be a UPS address

• Some lenders will not approve and fund unless this criteria is met

411• You must have a dedicated business phone number

that is listed with 411 directory assistance, under the business name

• Lenders, vendors, creditors, and even insurance providers will verify that your business is listed with 411

• A toll-free number will give your business credibility, but you must have a LOCAL business number for the listing with 411 directory assistance

Fax Number• Lenders perceive a credible business as one

with a fax number• As a business you will need a fax number to

receive important documents, you will also need it to fax in some of your credit applications

• You can setup an e-fax that goes directly to your email

Website • Credit providers will research your company on the

internet• It is best if they learned everything directly from your

company website.• Not having a company website will severely hurt their

chances of obtaining business credit• There are many places online that offer affordable

business websites so you can have an internet presence that displays an overview of your company's services and contact information.

Email• It is important to get a company email address

for your business. • It's not only professional, but greatly helps

your chances of getting the thumbs up from a credit provider.

• Setting up a business email address is just too easy and inexpensive to neglect

Email• Avoid using free email services like Yahoo and

Hotmail • There is nothing worse than credit providers

seeing an email address like partychic2009@yahoo.com

• The Email address should be @yourcompany.com• A great example is an email like

support@yourcompany.com or john.smith@yourcompany.com

Bank Account• Your business banking history is vital to your future

success of being able to secure larger business loans • The date you open your business bank account is

the day that lender's consider your business to have started

• So if you incorporated your business 10 years ago, but you just opened the business bank account yesterday, then your business started yesterday

• The longer your business banking history, the better your borrowing potential will be

Licensing • One of the most common mistakes when

building credit for your company is non-matching business addresses on your business licenses

• Even worse is not having the "required" licenses for your type of business to operate legally

• You will need to contact the State, County, and City Government offices to see if there are any required licenses and permits to operate your type of business

Step 2- Business Credit Reports

• Business Credit reports are offered by Experian, Dun & Bradstreet, and Equifax

• You will first want to get a copy of your business credit reports to see what is being reported

Dun & Bradstreet DUNS Number

• Obtaining a Dun and Bradstreet number (D-U-N-S #) begins the process of building your business credit profile with them

• Your D-U-N-S # will also play an important role in enabling your business to borrow without a personal guarantor.

• http://www.dnb.com/• $299- 699 per DUNS Number

Step 3- Building Business Credit• A business credit report can be started much

the same as a consumer report commonly is, with small credit cards

• The business can be approved for small credit cards to help them build an initial credit profile

• These types of initial cards in the business world are commonly referred to as “vendor credit”

Vendor Accounts• You need to have a total of at least five (5) Net

30 day pay accounts reporting. • Some vendors require an initial prepaid order

before they can approve your business for terms.

• Your vendors do not necessarily have to serve 100% of your business needs.

We want to make sure you are successful in your pursuit of business credit and financing options. While there are many things we can control, there are some things we cannot control. For example, we cannot control how soon you will be approved for financing. That will depend on the specifics of you and your business. The good news is that we can control many other aspect of the business credit-coaching program. Here is what we can control and what we guarantee:

1. Corporate Compliance and documentation review 2. Discount on D&B file and a D&B rating 3. D&B Paydex Score 4. Business credit file with Corporate Experian with an intelliscore5. Business credit file with business Equifax with the appropriate business credit score. 6. Trade accounts and/or Vendor Accounts with and without a personal guarantee. 7. A Business Credit Asset™ that can be used to leverage financing opportunities 8. Access to a dedicated funding advisor 9. $50,000 GUARANTEE: we will continue to work with you UNTIL you have been extended up to $50,000 in business credit.

In other words, we are so confident in our system that if after the initial 6 months of following our program, you will be extended up to $50,000 in business credit or we will continue to coach you, at NO COST, until you do!

The Business Credit and Funding Suite• More funding and business credit sources than anywhere

else• Only system which integrates directly with Equifax,

Experian, and Dun & Bradstreet• Only system where clients can get a free DUNS number and

Experian Smart Business report• Only system with certified coaches for business credit and

funding• $50,000 Guarantee which guarantees clients will be

approved for at least $50,000 in business credit or funding

PRICINGOne Time Special Discount PriceDo It Yourself $1,000Standard Program $3,500Done For You Program $5,000Payment ArrangementsDo It Yourself$750 down and $175 per month x 6 months = $1,750.00Standard Program$ 1,500 down and $291 per month x 12 months = $5,000Done For You Program$2,500 down and $416 per month x 12 months = $7,500

Questions

Winston L. Green, Jr.Financial Strategist

Sovereignty Financial Group, LLCOffice: 404.419.6595Mobile: 404.749.6053

Fax: 404.419.6545www.sovfinancial.com

winston@sovfinancial.com