banking - Building Wealth

Many people I know talk about how they want to make more money, how they have all of these ideas for doing so, and how they want to make sure they can retire early, but I never see them doing anything about it. They do have some good ideas for building wealth, but they don't have any money. This is because there is a huge difference between wanting to make a lot of money and actually doing it. As I get older I realize that money is out there to be made, but you have to really want to do it. If you have the drive, there should be nothing stopping you from getting what you want. The first step in building wealth is indeed knowing if you really want it. You may think you do, but if you are not willing to put the time and effort into it, you aren't going to get very far. There is no fast building wealth method that will make you rich overnight. You can give someone your money that says they can do it for you, but you might as well forget about seeing a return. They are making money from your lack of drive and your wish to get rich quick. Building wealth means finding out what you can do, and what you can do to make money with the skills that you have. You may be good with numbers, or you may have a talent. It doesn't matter what it is as long as you can think of a way to make it profitable. Building wealth does mean that you have to have somewhere to start, but everyone has a chance. You may even get more than one chance, but if you let them pass you by, they aren't going to do any good. Another important aspect of building wealth is to know what to do when the money does start to come in. You can buy some things, but if you spend it as fast as you make it you aren't going to have anything to show for all of your hard work. Building wealth means saving as much as you can, and it also means living like you don't have much money. Many millionaires live in houses that are adequate but not flashy, and you would never know they had that much money. That's why they have it! For more information on how to find the Best Business Online try visiting Small Business Start located at http://Small-Business-Start.com where you will find valuable information on internet marketing, making money and other information. Article Source:http://EzineArticles.com/?expert=Dominic_Ferrara banking - Employee Motivation Strategies:Effective Solutions That Could Yield Maximum Profits When people think of honoring employees for jobs well done, they may typically think of monetary rewards. However, these may be neither necessary nor the best type of reward. Once offered, cash bonuses can come to be expected and quickly forgotten, especially if they are the only recognition employees receive. By contrast, frequent, positive feedback provided within an enjoyable, team-oriented environment makes a tremendous difference in employees' sense of being valued and, as a result, their commitment to your company. With or without financial rewards, these cultural aspects of the workplace could be the smartest investment in the staff and business. Recognize and Reward High-Quality Work Employees are bound to be much more productive when they work in a positive, supportive environment. For example, Tejas Securities Group, Inc., a full-service broker/dealer and investment banking firm, strives to maintain an enjoyable, family-oriented atmosphere in which all employees focus on achieving team goals. This company goes an extra step by bringing in catered lunches every day for all the employees to enjoy together. "In this environment, everybody wins. We enjoy the dynamics of striving toward our goals together as a team," said Kurt Rechner, President and Chief Operating Officer of Tejas Securities Group. Praising employees for achieving their goals is important in maintaining an enjoyable work environment. Management can show their appreciation with positive feedback, however, if they go a bit beyond verbal praise, they can enhance employees' motivation without spending a lot of money. For example, celebrate successes with bagels or pizza. Invite employees to share their experiences in, and coworkers' contributions toward, accomplishing the goals. Peer recognition will further reinforce employees' sense of teamwork and commitment. Conclude the celebration by presenting mugs, T-shirts or other tangible items that will serve as reminders of their success and inspiration for ongoing achievement. With these good intentions, there are still potential drawbacks. For example, improvements in performance may be temporary, rather than long term. In addition, employees could lose their intrinsic motivation: they can become motivated solely for gaining a tangible prize, especially if it's a substantial monetary reward, rather than for experiencing the satisfaction of accomplishment. These challenges can be avoided by maintaining a positive, motivating atmosphere. Inspire Employees' Creativity and Empower Them to Use It Recognizing success is critical, and equally important is inspiring employees to work toward achievements. Your staff will be inspired by knowing their contributions are valued and that management is confident in their capabilities. At Tejas Securities Group for example, "The Chairman's Cup", a silver chalice inscribed with its name, is awarded each month to an employee who is recognized for their individual contribution to the overall team's success. The winner is then announced in a company wide meeting and is awarded the cup to display at their work station. Rechner noted "This announcement and award has become a fun and highly anticipated event, recognizing the ongoing importance of individual contribution to the company's success." Inspire creativity by providing freedom, time and other resources to employees. Ask them what they need to maximize their innovative thinking and productivity, and provide it with enthusiasm and encouragement. To further stimulate employees' creativity and confidence, support continual education through classes, seminars, subscriptions and memberships. Make information easily accessible through a work library. Ask employees to offer new ideas, request proposals for new projects, and share employees' suggestions through publications, meetings and recognition events. Most importantly, take action on those ideas that have potential benefit for the company, and recognize employees who made any resulting achievements possible. While encouraging creativity and rewarding success may come somewhat easily, it may be more difficult to stay optimistic when mistakes are made. However, this is where positive reinforcement is even more critical. Employees will be much less likely to offer ideas if they are intimidated by management's reactions to possible mistakes. Keep in mind and express to employees that mistakes are learning opportunities, which could lead to innovative ideas that have a major, profitable impact on your company. If an idea doesn't work out, recognize the initiative and effort. Employees will feel further inspired and satisfied, knowing that management truly listens to their ideas and supports their efforts. According to Rechner at Tejas Securities Group, "management's openness to staff members' input, feedback, ideas and suggestions is the cornerstone of good communications and strong employee relationships. Everybody wins when they are all part of a supportive team." All of these steps contribute to a sense of entrepreneurship and empowerment, which are essential to reinforcing teamwork and dedication. Empowerment should be initiated on three levels: encouraging employees to be more active in their work; involving staff members to improve processes and procedures; and enabling them to make more and bigger decisions. In addition to motivation and job satisfaction, employees benefit with strengthened confidence to accept and pursue new responsibilities. Once a few employees succeed, their enthusiasm and motivation would become contagious throughout their teams or departments. As a result, those groups would become more enthusiastic, proactive and therefore, successful, which further stimulates their team spirit. Ultimately, your company has much to gain by empowering staff members. By maximizing employees' talents and motivation, managers could invest more time in strategic planning and further motivating employees. Be Wary of Financial Incentives and Rewards Certainly, monetary incentives and rewards could be part of your employee-recognition program. However, it is critical that these incentives not be the only or primary strategy for motivating and retaining employees. On the surface, financial incentives may seem to be the most meaningful forms of motivation for employees. However, the short-term benefits may be far outweighed by long-term disadvantages, which could turn your costly financial incentives into serious deterrents to employees' productivity. As a result, your company's profitability could suffer, and you may be faced with further costs of replacing employees who leave for more satisfying work environments. Typical of human nature, people tend to think about what their employers have (or haven't!) done for them recently, especially if they do not feel appreciated. Furthermore, a brief word of gratitude only when a financial reward is presented will not be perceived as a sincere expression of appreciation. The easiest and most cost-effective way to avoid this pattern is to maintain open communication with positive feedback and encouragement at all times, with occasional celebrations - where presentation of cash rewards or announcement of new financial incentives, if any, should be just a small part of these events. Similarly, if cash bonuses are presented on a schedule, such as around the holidays, they probably come to be expected. This reaction could be avoided if bonuses are given randomly, when you have extra money to share with employees. However, before deciding to present cash bonuses, determine if that money could be better used to expand your business. Express to employees how their contributions resulted in the extra cash flow, and rally them up for investing that money into exciting new possibilities for themselves and the organization. In addition to cash bonuses, other types of monetary rewards are profit-sharing plans and Employee Stock Option Programs (ESOPs). Profit-sharing plans are simple types of retirement plans in which employers contribute an amount of money equal to a certain percentage of eligible employees' salaries. With ESOPs, the company contributes to a trust, and these funds are allocated to individual employee accounts. Also, employees can reserve part of their paychecks to purchase shares of the company's stock. Profit-sharing plans offer a strong incentive for employees to be more involved with the company. The staff is more likely to work as a team and accept greater responsibility for increasing the company's profitability. Another advantage is that financial benefits are measurable and objective. As a result, management would not risk showing favoritism, which would cause this motivational strategy to backfire. On the contrary, profit-sharing plans can also have potential drawbacks. They do not guarantee that employees will be focused on customer service, productivity or other essential elements for the company's success. If profit levels are ever too low to be shared, employees will feel disappointed or even resentful. Even if this does not occur, employees may object to the lack of acknowledgment for their individual achievements. Of course, this particular disadvantage can be overcome with strategies discussed previously. In any case, a negative situation would lead to lower employee morale, which inevitably diminishes employees' motivation and performance. On the positive side for ESOPs, employees directly gain a sense of ownership, usually at levels proportionate to how much stock each employee has. The potential disadvantage, similar to profit-sharing programs, is if stock options do not work out. Furthermore, emotional stress often associated with fluctuations in stocks could interfere with employees' productivity. Certainly, financial incentives and rewards can be true motivators, but only when balanced against the potential drawbacks and packaged with ongoing verbal recognition, encouragement and support. At Tejas Securities Group, for example, "We supplement our employee-recognition program with an ESOP. The employees' sense of ownership and the stock investments' potential are icing on the cake - on top of the essential substance of open communication, teamwork and positive reinforcement," Rechner said. Launch a Positive, Ongoing Cycle with the Best Choices for Your Staff When handled in a consistently positive manner within a team-oriented atmosphere, all of these strategies contribute to an ongoing positive cycle: motivated employees are encouraged to be creative, which leads to accomplishments that gain recognition, which strengthens their sense of job satisfaction and boosts their motivation. With all of these factors in place, staff members will produce more for the company. The entire process should be continual and even begin with the hiring selection. "It's essential to start with quality people as the foundation, and then motivate them to succeed," said Rechner at Tejas Securities Group. It takes hard work, some money and a bit of luck to recruit employees who have the technical skills and personal qualities you need to strengthen your business. Maximize your investment in these individuals by establishing and maintaining a positive relationship with them. This article is copyrighted by Tejas Securities Groups, Inc. It may not be reproduced in whole or in part and may not be posted on other websites, without the express written permission of the author who may be contacted via email at tejas@digitalbrandexpressions.com.

banking - Employee Motivation Strategies:Effective Solutions That Could Yield Maximum Profits

When people think of honoring employees for jobs well done, they may typically think of monetary rewards. However, these may be neither necessary nor the best type of reward. Once offered, cash bonuses can come to be expected and quickly forgotten, especially if they are the only recognition employees receive. By contrast, frequent, positive feedback provided within an enjoyable, team-oriented environment makes a tremendous difference in employees' sense of being valued and, as a result, their commitment to your company. With or without financial rewards, these cultural aspects of the workplace could be the smartest investment in the staff and business. Recognize and Reward High-Quality Work Employees are bound to be much more productive when they work in a positive, supportive environment. For example, Tejas Securities Group, Inc., a full-service broker/dealer and investment banking firm, strives to maintain an enjoyable, family-oriented atmosphere in which all employees focus on achieving team goals. This company goes an extra step by bringing in catered lunches every day for all the employees to enjoy together. "In this environment, everybody wins. We enjoy the dynamics of striving toward our goals together as a team," said Kurt Rechner, President and Chief Operating Officer of Tejas Securities Group. Praising employees for achieving their goals is important in maintaining an enjoyable work environment. Management can show their appreciation with positive feedback, however, if they go a bit beyond verbal praise, they can enhance employees' motivation without spending a lot of money. For example, celebrate successes with bagels or pizza. Invite employees to share their experiences in, and coworkers' contributions toward, accomplishing the goals. Peer recognition will further reinforce employees' sense of teamwork and commitment. Conclude the celebration by presenting mugs, T-shirts or other tangible items that will serve as reminders of their success and inspiration for ongoing achievement. With these good intentions, there are still potential drawbacks. For example, improvements in performance may be temporary, rather than long term. In addition, employees could lose their intrinsic motivation: they can become motivated solely for gaining a tangible prize, especially if it's a substantial monetary reward, rather than for experiencing the satisfaction of accomplishment. These challenges can be avoided by maintaining a positive, motivating atmosphere. Inspire Employees' Creativity and Empower Them to Use It Recognizing success is critical, and equally important is inspiring employees to work toward achievements. Your staff will be inspired by knowing their contributions are valued and that management is confident in their capabilities. At Tejas Securities Group for example, "The Chairman's Cup", a silver chalice inscribed with its name, is awarded each month to an employee who is recognized for their individual contribution to the overall team's success. The winner is then announced in a company wide meeting and is awarded the cup to display at their work station. Rechner noted "This announcement and award has become a fun and highly anticipated event, recognizing the ongoing importance of individual contribution to the company's success." Inspire creativity by providing freedom, time and other resources to employees. Ask them what they need to maximize their innovative thinking and productivity, and provide it with enthusiasm and encouragement. To further stimulate employees' creativity and confidence, support continual education through classes, seminars, subscriptions and memberships. Make information easily accessible through a work library. Ask employees to offer new ideas, request proposals for new projects, and share employees' suggestions through publications, meetings and recognition events. Most importantly, take action on those ideas that have potential benefit for the company, and recognize employees who made any resulting achievements possible. While encouraging creativity and rewarding success may come somewhat easily, it may be more difficult to stay optimistic when mistakes are made. However, this is where positive reinforcement is even more critical. Employees will be much less likely to offer ideas if they are intimidated by management's reactions to possible mistakes. Keep in mind and express to employees that mistakes are learning opportunities, which could lead to innovative ideas that have a major, profitable impact on your company. If an idea doesn't work out, recognize the initiative and effort. Employees will feel further inspired and satisfied, knowing that management truly listens to their ideas and supports their efforts. According to Rechner at Tejas Securities Group, "management's openness to staff members' input, feedback, ideas and suggestions is the cornerstone of good communications and strong employee relationships. Everybody wins when they are all part of a supportive team." All of these steps contribute to a sense of entrepreneurship and empowerment, which are essential to reinforcing teamwork and dedication. Empowerment should be initiated on three levels: encouraging employees to be more active in their work; involving staff members to improve processes and procedures; and enabling them to make more and bigger decisions. In addition to motivation and job satisfaction, employees benefit with strengthened confidence to accept and pursue new responsibilities. Once a few employees succeed, their enthusiasm and motivation would become contagious throughout their teams or departments. As a result, those groups would become more enthusiastic, proactive and therefore, successful, which further stimulates their team spirit. Ultimately, your company has much to gain by empowering staff members. By maximizing employees' talents and motivation, managers could invest more time in strategic planning and further motivating employees. Be Wary of Financial Incentives and Rewards Certainly, monetary incentives and rewards could be part of your employee-recognition program. However, it is critical that these incentives not be the only or primary strategy for motivating and retaining employees. On the surface, financial incentives may seem to be the most meaningful forms of motivation for employees. However, the short-term benefits may be far outweighed by long-term disadvantages, which could turn your costly financial incentives into serious deterrents to employees' productivity. As a result, your company's profitability could suffer, and you may be faced with further costs of replacing employees who leave for more satisfying work environments. Typical of human nature, people tend to think about what their employers have (or haven't!) done for them recently, especially if they do not feel appreciated. Furthermore, a brief word of gratitude only when a financial reward is presented will not be perceived as a sincere expression of appreciation. The easiest and most cost-effective way to avoid this pattern is to maintain open communication with positive feedback and encouragement at all times, with occasional celebrations - where presentation of cash rewards or announcement of new financial incentives, if any, should be just a small part of these events. Similarly, if cash bonuses are presented on a schedule, such as around the holidays, they probably come to be expected. This reaction could be avoided if bonuses are given randomly, when you have extra money to share with employees. However, before deciding to present cash bonuses, determine if that money could be better used to expand your business. Express to employees how their contributions resulted in the extra cash flow, and rally them up for investing that money into exciting new possibilities for themselves and the organization. In addition to cash bonuses, other types of monetary rewards are profit-sharing plans and Employee Stock Option Programs (ESOPs). Profit-sharing plans are simple types of retirement plans in which employers contribute an amount of money equal to a certain percentage of eligible employees' salaries. With ESOPs, the company contributes to a trust, and these funds are allocated to individual employee accounts. Also, employees can reserve part of their paychecks to purchase shares of the company's stock. Profit-sharing plans offer a strong incentive for employees to be more involved with the company. The staff is more likely to work as a team and accept greater responsibility for increasing the company's profitability. Another advantage is that financial benefits are measurable and objective. As a result, management would not risk showing favoritism, which would cause this motivational strategy to backfire. On the contrary, profit-sharing plans can also have potential drawbacks. They do not guarantee that employees will be focused on customer service, productivity or other essential elements for the company's success. If profit levels are ever too low to be shared, employees will feel disappointed or even resentful. Even if this does not occur, employees may object to the lack of acknowledgment for their individual achievements. Of course, this particular disadvantage can be overcome with strategies discussed previously. In any case, a negative situation would lead to lower employee morale, which inevitably diminishes employees' motivation and performance. On the positive side for ESOPs, employees directly gain a sense of ownership, usually at levels proportionate to how much stock each employee has. The potential disadvantage, similar to profit-sharing programs, is if stock options do not work out. Furthermore, emotional stress often associated with fluctuations in stocks could interfere with employees' productivity. Certainly, financial incentives and rewards can be true motivators, but only when balanced against the potential drawbacks and packaged with ongoing verbal recognition, encouragement and support. At Tejas Securities Group, for example, "We supplement our employee-recognition program with an ESOP. The employees' sense of ownership and the stock investments' potential are icing on the cake - on top of the essential substance of open communication, teamwork and positive reinforcement," Rechner said. Launch a Positive, Ongoing Cycle with the Best Choices for Your Staff When handled in a consistently positive manner within a team-oriented atmosphere, all of these strategies contribute to an ongoing positive cycle: motivated employees are encouraged to be creative, which leads to accomplishments that gain recognition, which strengthens their sense of job satisfaction and boosts their motivation. With all of these factors in place, staff members will produce more for the company. The entire process should be continual and even begin with the hiring selection. "It's essential to start with quality people as the foundation, and then motivate them to succeed," said Rechner at Tejas Securities Group. It takes hard work, some money and a bit of luck to recruit employees who have the technical skills and personal qualities you need to strengthen your business. Maximize your investment in these individuals by establishing and maintaining a positive relationship with them. This article is copyrighted by Tejas Securities Groups, Inc. It may not be reproduced in whole or in part and may not be posted on other websites, without the express written permission of the author who may be contacted via email at tejas@digitalbrandexpressions.com. R.L. Fielding has been a freelance writer for 10 years, offering her expertise and skills to a variety of major organizations in the education, pharmaceuticals and healthcare, financial services, and manufacturing industries. She lives in New Jersey with her dog and two cats and enjoys rock climbing and ornamental gardening. Article Source:http://EzineArticles.com/?expert=RL_Fielding banking - When Quicken Doesn't Balance After you've been using Quicken for while and have been balancing your account regularly, you will only irregularly have trouble reconciling it. However, if you are just getting started, you may have trouble getting your Quicken account to balance. For that reason, let me offer some suggestions for balancing a Quicken account that's causing you trouble. Check for missing transactions Account balance trouble stems from only three causes: Reason 1: You cleared a transaction the bank hasn't recorded Reason 2: You forgot to record a transaction, or perhaps several transactions Reason 3: Either you or your bank incorrectly recorded a transaction Therefore, when you find yourself with reconciliation troubles, first make sure that you are not missing some transaction. Go through the bank statement line for line, comparing each of the transactions listed there with the contents of your account register. If you find the bank statement lists a transaction that your Money account register does not, then you need to record it in Money. Confirm you haven't incorrectly cleared transactions Once you confirm that the Quicken account register includes all transactions, verify that you have not incorrectly cleared transactions that are still outstanding. To do this, thoroughly review the Quicken account register and make sure that each transaction marked with a "C" does, in fact, appear on the bank statement. Compare amounts If the two reviews described in the preceding paragraphs don't explain the difference between your records and the bank's, you need to check the actual transaction amounts that you have recorded against those shown in the bank register. In other words, if the bank register shows a check to your mortgage company for $500, you need to make sure that your account register also records the check as $500. Unfortunately, it is easy to incorrectly record transaction amounts in the Quicken account register. All it takes is pressing the wrong key. And, in fact, two data entry errors are particularly difficult to see: transposition errors and sign errors. Watch for transpositions Transposition errors occur when you transpose, or flip-flop, the numbers in an amount. If you write a check for $123, but record the check as $132, for example, you've transposed the 2 and the 3. And this error is hard to spot later. You look at the bank statement, for example, and see the digits 123. Then when you look at the account register, you see the digits 132. Unless you are looking not just at the digits used but also at their order, you may miss this error. Watch for sign errors Sign errors occur when you enter a deposit as a withdrawal, or a withdrawal as a deposit. All this really means is that you have entered some transaction amount in the wrong column. Again, this error is sometimes tough to spot because the transaction appears both on the bank statement and in your register'just in the wrong column in the Quicken register. If you come up with some difference with your records and the bank's that is irreconcilable, try dividing the error by 2. Then look for a transaction equal to this result. For example, if you have a $200 error, divide $200 by 2 to get the result $100. Then look for a $100 transaction that is entered in the wrong column. Know the errors reconciliation won't catch There are several common errors that account reconciliation won't catch. Reconciliation won't catch when you forget to record a transaction and the transaction hasn't yet cleared the bank. If you forget to record a check and the check is still outstanding at the end of the statement month, for example, the check doesn't appear in your register and it doesn't get listed on your bank statement. Another kind of error that a bank reconciliation won't catch stems from entering a fictitious transaction in the account register. For example, if you enter a check in the Money account register that you never wrote or a deposit you never made, the check or deposit will never clear the bank. Unfortunately, there is not much you can do to find these sorts of errors. Mostly, you need to apply simple common sense to prevent them. In the case of forgotten uncleared transactions, your only recourse is to be careful in your record keeping. Try to establish a system whereby you regularly record the checks you write and the deposits you make.

banking - When Quicken Doesn't Balance

After you've been using Quicken for while and have been balancing your account regularly, you will only irregularly have trouble reconciling it. However, if you are just getting started, you may have trouble getting your Quicken account to balance. For that reason, let me offer some suggestions for balancing a Quicken account that's causing you trouble. Check for missing transactions Account balance trouble stems from only three causes: Reason 1: You cleared a transaction the bank hasn't recorded Reason 2: You forgot to record a transaction, or perhaps several transactions Reason 3: Either you or your bank incorrectly recorded a transaction Therefore, when you find yourself with reconciliation troubles, first make sure that you are not missing some transaction. Go through the bank statement line for line, comparing each of the transactions listed there with the contents of your account register. If you find the bank statement lists a transaction that your Money account register does not, then you need to record it in Money. Confirm you haven't incorrectly cleared transactions Once you confirm that the Quicken account register includes all transactions, verify that you have not incorrectly cleared transactions that are still outstanding. To do this, thoroughly review the Quicken account register and make sure that each transaction marked with a "C" does, in fact, appear on the bank statement. Compare amounts If the two reviews described in the preceding paragraphs don't explain the difference between your records and the bank's, you need to check the actual transaction amounts that you have recorded against those shown in the bank register. In other words, if the bank register shows a check to your mortgage company for $500, you need to make sure that your account register also records the check as $500. Unfortunately, it is easy to incorrectly record transaction amounts in the Quicken account register. All it takes is pressing the wrong key. And, in fact, two data entry errors are particularly difficult to see: transposition errors and sign errors. Watch for transpositions Transposition errors occur when you transpose, or flip-flop, the numbers in an amount. If you write a check for $123, but record the check as $132, for example, you've transposed the 2 and the 3. And this error is hard to spot later. You look at the bank statement, for example, and see the digits 123. Then when you look at the account register, you see the digits 132. Unless you are looking not just at the digits used but also at their order, you may miss this error. Watch for sign errors Sign errors occur when you enter a deposit as a withdrawal, or a withdrawal as a deposit. All this really means is that you have entered some transaction amount in the wrong column. Again, this error is sometimes tough to spot because the transaction appears both on the bank statement and in your register'just in the wrong column in the Quicken register. If you come up with some difference with your records and the bank's that is irreconcilable, try dividing the error by 2. Then look for a transaction equal to this result. For example, if you have a $200 error, divide $200 by 2 to get the result $100. Then look for a $100 transaction that is entered in the wrong column. Know the errors reconciliation won't catch There are several common errors that account reconciliation won't catch. Reconciliation won't catch when you forget to record a transaction and the transaction hasn't yet cleared the bank. If you forget to record a check and the check is still outstanding at the end of the statement month, for example, the check doesn't appear in your register and it doesn't get listed on your bank statement. Another kind of error that a bank reconciliation won't catch stems from entering a fictitious transaction in the account register. For example, if you enter a check in the Money account register that you never wrote or a deposit you never made, the check or deposit will never clear the bank. Unfortunately, there is not much you can do to find these sorts of errors. Mostly, you need to apply simple common sense to prevent them. In the case of forgotten uncleared transactions, your only recourse is to be careful in your record keeping. Try to establish a system whereby you regularly record the checks you write and the deposits you make. Having trouble with Quicken? Specifically, does the data look funny? Seattle CPA and Quicken for Dummies author Stephen L. Nelson explains how to get your accounts to balance. Seattle certified public accountant & author Stephen L. Nelson wrote Quicken for Dummies and more than 100 other books as well. Nelson holds an MBA in Finance and an MS in taxation. He also edits the limited liability company web site. Article Source:http://EzineArticles.com/?expert=Stephen_Nelson banking - E-banking (Online Banking) and Its role in Today's Society The world is changing at a staggering rate and technology is considered to be the key driver for these changes around us (Papers4you.com, 2006). An analysis of technology and its uses show that it has permeated in almost every aspect of our life. According to Tero et al (2004) many activities are handled electronically due the acceptance of information technology at home as well as at workplace. Internet can be seen as a truly global phenomenon that has made time and distance irrelevant to many transactions. According to Heikki et al. (2002), the transformation from the traditional banking towards e-banking has been a 'leap' change. The evolution of electronic banking started from the use of automatic teller machines (ATM) and has passed through telephone banking, direct bill payment, electronic fund transfer and the revolutionary online banking (Alter, 2002). The future of electronic banking according to some is the acceptance of WAP enabled banking and interactive-TV banking (Petrus & Nelson, 2006). But it has been forecasted that among all the categories, online banking is the future of electronic financial transactions. The rise in the e-commerce and the use of internet in its facilitation along with the enhanced online security of transactions and sensitive information has been the core reasons for the penetration of online banking in everyday life (Papers4you.com, 2006). According to the latest official figures from the Office of National Statistics (ONS, 2006) indicate that subscriptions to the internet has grown more than 50% from 15 million in 2000 to 35 million in 2005 in the UK. It has also been estimated that 60% of the population in the UK use internet in their daily lives. The fundamental shift towards the involvement of the customer in the financial service provision with the help of technology especially internet has helped in reduce costs of financial institutions as well as helped client to use the service at anytime and from virtually anywhere with access to an internet connection. According to theorists (Walfried et al., 2005) customer evaluation of the electronic services is influenced by attributions of success and failure in inter personal service situations. The use of electronic banking has removed the banking personnel that facilitate the transactions and has placed additional responsibilities on the customers to transact with the service. Although the use of E-banking is provided for the benefit of the customers but these changes require increased work or involvement on the part of customers. These and other factors might be seen as lesser service provided in terms of customer service. But these assumptions would be wrong if the customer knows the value of using the electronic service. Thus it can be concluded that a fit between task i.e. the banking; technology i.e. the user interface and its reliability; and individuals i.e. the customers and their knowledge about using the service, is the key to successful E-banking services (Zigurs & Buckland, 1998). References: Alter, S. (2002), "Information Systems" 4th Edition, Prentice Hall Heikki Karjaluoto, Minna Mattila, Tapio Pento (2002), "Factors underlying attitude formation towards online banking in Finland", International Journal of Bank Marketing; Volume: 20 Issue: 6; 2002 Research paper ONS (2005), "Office of National Statistics", www.statistics.gov.uk Papers For You (2006) "C/B/93. Dissertation. Will online business replace the traditional business in the banking industry in UK?", Available from http://www.coursework4you.co.uk/sprtfina35.htm Papers For You (2006) "P/F/174. Dissertation. Adoption of Online Banking", Available from http://www.coursework4you.co.uk/sprtfina35.htm Petrus Guriting, Nelson Oly Ndubisi (2006), "Borneo online banking: evaluating customer perceptions and behavioural intention", Management Research News; Volume: 29 Issue: 1/2; 2006 Conceptual Paper Tero Pikkarainen, Kari Pikkarainen, Heikki Karjaluoto, Seppo Pahnila (2004), "Consumer acceptance of online banking: an extension of the technology acceptance model", Internet Research; Volume: 14 Issue: 3; 2004 Research paper Walfried M. Lassar, Chris Manolis, Sharon S. Lassar (2005), "The relationship between consumer innovativeness, personal characteristics, and online banking adoption", International Journal of Bank Marketing; Volume: 23 Issue: 2; 2005 Research paper Zigurs, I. & Buckland, B. (1998), "A Theory of Task/Technology Fit and Group Support Systems Effectiveness", MIS Quarterly, Sep98, Vol. 22 Issue 3, p313-334, 22p

banking - E-banking (Online Banking) and Its role in Today's Society

The world is changing at a staggering rate and technology is considered to be the key driver for these changes around us (Papers4you.com, 2006). An analysis of technology and its uses show that it has permeated in almost every aspect of our life. According to Tero et al (2004) many activities are handled electronically due the acceptance of information technology at home as well as at workplace. Internet can be seen as a truly global phenomenon that has made time and distance irrelevant to many transactions. According to Heikki et al. (2002), the transformation from the traditional banking towards e-banking has been a 'leap' change. The evolution of electronic banking started from the use of automatic teller machines (ATM) and has passed through telephone banking, direct bill payment, electronic fund transfer and the revolutionary online banking (Alter, 2002). The future of electronic banking according to some is the acceptance of WAP enabled banking and interactive-TV banking (Petrus & Nelson, 2006). But it has been forecasted that among all the categories, online banking is the future of electronic financial transactions. The rise in the e-commerce and the use of internet in its facilitation along with the enhanced online security of transactions and sensitive information has been the core reasons for the penetration of online banking in everyday life (Papers4you.com, 2006). According to the latest official figures from the Office of National Statistics (ONS, 2006) indicate that subscriptions to the internet has grown more than 50% from 15 million in 2000 to 35 million in 2005 in the UK. It has also been estimated that 60% of the population in the UK use internet in their daily lives. The fundamental shift towards the involvement of the customer in the financial service provision with the help of technology especially internet has helped in reduce costs of financial institutions as well as helped client to use the service at anytime and from virtually anywhere with access to an internet connection. According to theorists (Walfried et al., 2005) customer evaluation of the electronic services is influenced by attributions of success and failure in inter personal service situations. The use of electronic banking has removed the banking personnel that facilitate the transactions and has placed additional responsibilities on the customers to transact with the service. Although the use of E-banking is provided for the benefit of the customers but these changes require increased work or involvement on the part of customers. These and other factors might be seen as lesser service provided in terms of customer service. But these assumptions would be wrong if the customer knows the value of using the electronic service. Thus it can be concluded that a fit between task i.e. the banking; technology i.e. the user interface and its reliability; and individuals i.e. the customers and their knowledge about using the service, is the key to successful E-banking services (Zigurs & Buckland, 1998). References: Alter, S. (2002), "Information Systems" 4th Edition, Prentice Hall Heikki Karjaluoto, Minna Mattila, Tapio Pento (2002), "Factors underlying attitude formation towards online banking in Finland", International Journal of Bank Marketing; Volume: 20 Issue: 6; 2002 Research paper ONS (2005), "Office of National Statistics", www.statistics.gov.uk Papers For You (2006) "C/B/93. Dissertation. Will online business replace the traditional business in the banking industry in UK?", Available from http://www.coursework4you.co.uk/sprtfina35.htm Papers For You (2006) "P/F/174. Dissertation. Adoption of Online Banking", Available from http://www.coursework4you.co.uk/sprtfina35.htm Petrus Guriting, Nelson Oly Ndubisi (2006), "Borneo online banking: evaluating customer perceptions and behavioural intention", Management Research News; Volume: 29 Issue: 1/2; 2006 Conceptual Paper Tero Pikkarainen, Kari Pikkarainen, Heikki Karjaluoto, Seppo Pahnila (2004), "Consumer acceptance of online banking: an extension of the technology acceptance model", Internet Research; Volume: 14 Issue: 3; 2004 Research paper Walfried M. Lassar, Chris Manolis, Sharon S. Lassar (2005), "The relationship between consumer innovativeness, personal characteristics, and online banking adoption", International Journal of Bank Marketing; Volume: 23 Issue: 2; 2005 Research paper Zigurs, I. & Buckland, B. (1998), "A Theory of Task/Technology Fit and Group Support Systems Effectiveness", MIS Quarterly, Sep98, Vol. 22 Issue 3, p313-334, 22p Copyright 2006 Verena Veneeva. Professional Writer working for http://www.coursework4you.co.uk Article Source:http://EzineArticles.com/?expert=Verena_Veneeva banking - Home Equity Line Of Credit - Tips On How To Make The Most Of It Without a doubt, your home is your biggest asset, and a home equity line of credit can help you take full advantage of it. When you stop to consider how much equity your home builds up over the years, it only makes sense to use it when you need it. A home equity loan or line of credit will help you during times when you need financial assistance. Sure, you can go to your bank and try to get a personal loan, but at what rate of interest? Same with a credit card. You can easily be looking at a 12%-18% APR on these transactions, compared to an equity loan of 6% or & 7%. The key is in how you will be using the funds with this type of loan or credit line. They are best utilized in these types of situations: 1. Medical emergency - A home equity credit line works well during times of unexpected medical emergencies, or even a funeral. It gives you a way to get the money you need, quickly and without damaging your credit. 2. Paying off debt - If you are trying to manage and pay off debts from credit cards, loans, etc. then a home equity loan makes sense. Pay off the high interest credit cards and loans, and pay it back with a low interest loan. 3. College expense - If you have kids in school then you know how expensive college can be. Even a community college will run in the thousands every semester. Using some of the equity in your home to pay these expenses can be invaluable. 4. Home remodeling projects - This is one of the best ways to utilize the funds from a home equity loan or credit line. Use the funds to build a new addition, or update a bathroom, etc., and further increase the value of your home. Not only do you get to enjoy the updates, but the benefits of adding more value as well. These are some of the biggest reasons for getting a home equity line of credit. All Rights Reserved Worldwide. Reprint Rights: You may reprint this article as long as you leave all of the links active and do not edit the article in any way.

banking - Home Equity Line Of Credit - Tips On How To Make The Most Of It

Without a doubt, your home is your biggest asset, and a home equity line of credit can help you take full advantage of it. When you stop to consider how much equity your home builds up over the years, it only makes sense to use it when you need it. A home equity loan or line of credit will help you during times when you need financial assistance. Sure, you can go to your bank and try to get a personal loan, but at what rate of interest? Same with a credit card. You can easily be looking at a 12%-18% APR on these transactions, compared to an equity loan of 6% or & 7%. The key is in how you will be using the funds with this type of loan or credit line. They are best utilized in these types of situations: 1. Medical emergency - A home equity credit line works well during times of unexpected medical emergencies, or even a funeral. It gives you a way to get the money you need, quickly and without damaging your credit. 2. Paying off debt - If you are trying to manage and pay off debts from credit cards, loans, etc. then a home equity loan makes sense. Pay off the high interest credit cards and loans, and pay it back with a low interest loan. 3. College expense - If you have kids in school then you know how expensive college can be. Even a community college will run in the thousands every semester. Using some of the equity in your home to pay these expenses can be invaluable. 4. Home remodeling projects - This is one of the best ways to utilize the funds from a home equity loan or credit line. Use the funds to build a new addition, or update a bathroom, etc., and further increase the value of your home. Not only do you get to enjoy the updates, but the benefits of adding more value as well. These are some of the biggest reasons for getting a home equity line of credit. All Rights Reserved Worldwide. Reprint Rights: You may reprint this article as long as you leave all of the links active and do not edit the article in any way. By the way, you can learn more about a Home Equity Line Of Credit as well as more information on everything to do with home equity loans by visiting us at http://www.HomeEquityLoansA-z.com Article Source:http://EzineArticles.com/?expert=Terry_Edwards banking - An Analysis of Wells Fargo & Company (WFC) Wells Fargo & Company (WFC) is a huge Western and Midwestern bank that provides a diverse array of financial services to its more than 23 million customers. The company employs more than 150,000 people at its over 6,000 locations nationwide. Wells Fargo has about $500 billion in assets. While the company continues to derive more than half its revenues from interest income (about $26 billion), its activities are not limited to collecting deposits and lending money. Wells Fargo engages in other businesses such as brokerage services, asset management, and investment banking. The company also makes venture capital investments. Over the last ten years, Wells Fargo has averaged a 1.57% return on assets and an 18.19% return on equity. Location Wells Fargo is closely associated with California in the minds of most investors. The company now operates in 23 different states. However, the concentration in California remains. Mortgage lending in California accounts for approximately 14% of Wells Fargo's total loan portfolio. Commercial real estate loans in California account for another 5% of the company's total loans. No other single state accounts for a similarly sized portion of total loans. In fact, neither mortgage lending nor commercial real estate lending in any other state accounts for more than 2% of Wells Fargo's total loans. Cross-Selling Wells Fargo's focus on cross-selling is well known. The company has a stated goal of doubling the number of products the average consumer and business customer has with Wells Fargo to eight products per customer (from the current four products per customer). Cross-selling increases customer stickiness. It also helps increase profitability by decreasing expenses relative to revenues. The need for a large physical footprint is reduced - as is the need for a large number of bankers. Instead, the existing infrastructure is able to provide additional revenue from the same customers. Wells Fargo's Chairman & CEO, Richard Kovacevich, explains the importance of the company's cross-selling in the "Vision & Values" section of the corporate website: Cross-selling ' or what we call "needs-based" selling ' is our most important strategy. Why? Because it is an "increasing returns" business model. It's like the "network effect" of e-commerce. It multiplies opportunities geometrically. The more you sell customers the more you know about them. The more you know about them the easier it is to sell them more products. The more products customers have with you the better value they receive and the more loyal they are. The longer they stay with you the more opportunities you have to meet even more of their financial needs. The more you sell them the higher the profit because the added cost of selling another product to an existing customer is often only about ten percent of the cost of selling that same product to a new customer. This gives us'as an aggregator ' a significant cost advantage over one product or one channel companies. Cross-selling re-invents how financial services are aggregated and sold to customers ' just like other aggregators such as Wal-Mart (general merchandise), Home Depot (home improvement products) and Staples (office supplies). Mr. Kovacevich's enthusiasm for the cross-selling model is well justified. It is difficult to quantify the importance of meeting all the varied needs of your customers, because you can not measure the opportunities you missed. However, it is obvious that reducing each customer's interest in considering a competitor's services will greatly increase long-term profitability for any company engaged in any line of business - not just for a bank. Later, in the same website section, Mr. Kovacevich addresses the importance of customer stickiness: (Cross-selling) is our most important customer-related sales metric. We want to earn 100 percent of our customers' business. The more products customers have with Wells Fargo the better deal they get, the more loyal they are, and the longer they stay with the company, improving retention. Eighty percent of our revenue growth comes from selling more products to existing customers. This focus on retention is an important part of a long-term plan to maintain Wells Fargo's above-average returns on assets and equity. Extraordinary profitability comes from differentiating your product or service from those of your competitors. Increasing customer stickiness and reducing "comparison shopping" is a key part of maintaining extraordinary profitability. Some businesses are blessed with enviable economics because of their product's natural prominence in the minds of their customers. Most businesses are obsessed with market share. But, how many really think about "mind share"? Obviously, a product like Coke (KO), Hershey (HSY), or Snickers is going to have a positive association in the minds of consumers. For many people, these products will also have a prominent place in each customer's mind (relative to other products and services on which money can be spent). A few other businesses have a healthy mind share without the positive association; GEICO is the most obvious example. The company's brand conjures up nothing but the words "auto insurance". Of course, that's all the GEICO brand has to do. So, what does all this have to do with Wells Fargo? Mind share isn't just the result of exposure to advertising. In fact, in most cases, exposure to advertising can not duplicate the kind of results that a direct, differentiated experience creates. Entertainment properties are by far the leaders in mind share. People who saw and loved Star Wars remember the film. In fact, they don't just remember the film, they actually file it away (or, more precisely, cross reference it) in countless ways within their mind. The evidence for this particular example is abundant. There are countless references to Star Wars in other media. The name, the music, the opening text and countless other elements are immediately recognizable. Even the films Star Wars fans hated made more money than almost any other movies in the history of cinema - and this was decades after the original came out. So, obviously Star Wars has the kind of lasting mind share any business should aspire to if it hopes to continuously earn extraordinary profits. Unfortunately, most businesses, however well run, can not attain this kind of mind share. The products and services they provide can never be as differentiated and memorable as a motion picture. Just as importantly, the positive associations will not be present, simply because the product or service is not inherently exciting, entertaining, or pleasant. This is clearly the case in financial services. So, what can a financial services company do to improve its mind share? The most obvious tactic is simply to "wow" its customers. In fact, Wells Fargo's CEO discusses this particular option in the "Vision and Values" section of the company's website: We have to "wow!" them. We know what that feels like because we're all customers. We go to the cleaners, the grocery store, a restaurant or whatever, and we find a situation where we're "wowed!" We walk out and we say, those people really listened to me and helped me get what I need. All of us hear stories about customers, say, who pick a certain line at the supermarket because they know the person who bags the groceries connects with customers ' smiles, greets regular customers by name, asks how their families are doing. When a personal banker helps a customer in one of our stores, or when a customer gets help from one of our phone bankers or does transactions on wellsfargo.com we want them to say, "That was great. I can't wait to tell someone." Another option worth pursuing is widening the associations present in the customer's mind. Financial services is a business where associations tend to be more conscious, categorized, and hierarchical than the associations formed in more heavily branded businesses. Put simply, the (potential) customer usually thinks of a "set" before thinking of an "element" within that set. Like many mental associations, the information can be returned in either direction. For example, the customer may normally think "banks" and then think "Wells Fargo", but will also be able to return the word "bank" if prompted by the name "Wells Fargo". This categorization is important, because it provides (limited) permission for Wells Fargo to expand its mind share horizontally (across service categories). In other words, providing a diverse range of financial services doesn't just make sense from the provider's perspective, it also makes sense from the user's perspective, because the user of financial services has already grouped deposits, borrowing, credit cards, insurance, brokerage services, asset management, etc. together in a very loose way within his mind. As a result of this mental network, one positive experience with Wells Fargo will greatly affect a customer's desire to pay for an additional service, even if the two services are not really all that similar. The three key elements here are: a broader definition of what Wells Fargo is (a place that does "money things", not just a bank), a positive experience, and some sense of trust that the quality of service will be consistent. The last requirement is the easiest to meet, because it's natural for a customer to assume that the positive experience was not a fluke, much the way a diner assumes the good meal he had at a particular restaurant was not caused by his picking the best offering from the menu. The diner usually assumes the overall quality of the restaurant's various entrees is superior. Likewise, a good experience with one of Wells Fargo's products or services will likely rub off on its other offerings. Valuation Shares of Wells Fargo currently yield just over 3%. The stock trades at a price-to-book ratio of just under 2.75 and a price-to-earnings ratio of less than 15. Conclusion Over the last 5, 10, 15, and 20 years shareholders of Wells Fargo & Company have fared better than the S&P 500. As of the end of last year, WFC's total return over the last ten years was 17% vs. 9% for the S&P. Over the last 20 years, WFC outpaced the S&P 500 by an even wider margin: 21% vs. 12%. Wells Fargo has a stellar reputation with investors. The company is the only U.S. bank to earn Moody's highest credit rating. Wells Fargo also boasts a well-known major shareholder. The largest owner of the company's common stock is Berkshire Hathaway. Warren Buffett's holding company has a roughly 5.5% stake in Wells Fargo. Berkshire's last reported purchase occurred during the first quarter of this year. Wells Fargo has a stated goal of achieving double-digit growth in earnings and revenue while managing a return on assets over 1.75% and a return on equity over 20%. Those are both very ambitious goals. The company has achieved some of the highest returns on assets and equity of any major U.S. bank. However, Wells Fargo will probably need to increase the percentage of revenue it derives from fee businesses if it is to achieve these goals. In the years ahead, the company may well become more of a diversified financial services business. In fact, that's what I expect will happen. The company's commitment to cross-selling is not some fad. Eventually, this commitment will change the way investors think about Wells Fargo. Soon, it may be considered much more than a bank. Wells Fargo's CEO makes the case that his company's P/E is simply too low. Wells Fargo has a solid history of strong growth and profitability. So, why should it be valued similarly to most other banks? Shouldn't it be awarded a multiple more in line with a growth company? There's actually some merit to this argument. Wells Fargo is unusually well positioned for a bank. Often, those banks that seem certain to earn very high returns on assets and equity for many years to come are poorly positioned for future growth. These banks are often smaller than their competitors and focused on a specific geographic niche. Any acquisitions would dilute the exceptional profitability of the bank's niche. Of course, there are also many consolidators in the banking industry. Unfortunately, many of these banks do not have a history of earning the kind of returns on assets and equity that Wells Fargo has achieved. Even more importantly, there is little differentiation between these titans of the banking industry and their national competitors. Therefore, their moats are highly suspect. Wells Fargo is a different kind of bank. It has a history of extraordinary growth and profitability. There are two obvious opportunities for future growth: geographic expansion and cross-selling. Of these two opportunities, it's clear I'm more enamored with the latter. An eastward push is not necessary, and certainly not via an ill-advised acquisition. There is a lot of value in the Wells Fargo franchise and there is plenty of room within that franchise for future growth. That's one of the great advantages of the financial services industry. With the right model, limits to growth are almost non-existent. In other highly-profitable industries, there is often nowhere to reinvest new capital at a similar rate of return. If Wells Fargo is a growth stock, it is a peculiar sort of growth stock. Maybe that is what attracted Buffett to the company in the first place. Here is a business with a strong franchise that can grow for many years to come. Perhaps most importantly, it is a growth business that frequently trades in the market at value like multiples, simply because it's a bank. At the current market price, Wells Fargo is the sort of investment you make once and forget. The valuation is not so cheap as to promise a good return if the business falters. But, the business is not so suspect as to require the margin of safety be provided by a low P/E ratio. Sometimes, near certain growth is the margin of safety. On a separate topic, I'd like to encourage anyone with an interest in competitive advantages to read the entire "Vision and Values" section of the Wells Fargo site. Superficially, it looks like any other online presentation to investors. In truth, it is nothing like those hollow, sugary slide shows. It's actually an engaging exploration of competitive advantages within an industry that seems totally unlike the sort of branded, consumer-oriented businesses one normally associates with strong franchises. Even if you aren't interested in the banking industry in particular, I recommend reading this section for its insights into customer psychology and behavior.

banking - An Analysis of Wells Fargo & Company (WFC)

Wells Fargo & Company (WFC) is a huge Western and Midwestern bank that provides a diverse array of financial services to its more than 23 million customers. The company employs more than 150,000 people at its over 6,000 locations nationwide. Wells Fargo has about $500 billion in assets. While the company continues to derive more than half its revenues from interest income (about $26 billion), its activities are not limited to collecting deposits and lending money. Wells Fargo engages in other businesses such as brokerage services, asset management, and investment banking. The company also makes venture capital investments. Over the last ten years, Wells Fargo has averaged a 1.57% return on assets and an 18.19% return on equity. Location Wells Fargo is closely associated with California in the minds of most investors. The company now operates in 23 different states. However, the concentration in California remains. Mortgage lending in California accounts for approximately 14% of Wells Fargo's total loan portfolio. Commercial real estate loans in California account for another 5% of the company's total loans. No other single state accounts for a similarly sized portion of total loans. In fact, neither mortgage lending nor commercial real estate lending in any other state accounts for more than 2% of Wells Fargo's total loans. Cross-Selling Wells Fargo's focus on cross-selling is well known. The company has a stated goal of doubling the number of products the average consumer and business customer has with Wells Fargo to eight products per customer (from the current four products per customer). Cross-selling increases customer stickiness. It also helps increase profitability by decreasing expenses relative to revenues. The need for a large physical footprint is reduced - as is the need for a large number of bankers. Instead, the existing infrastructure is able to provide additional revenue from the same customers. Wells Fargo's Chairman & CEO, Richard Kovacevich, explains the importance of the company's cross-selling in the "Vision & Values" section of the corporate website: Cross-selling ' or what we call "needs-based" selling ' is our most important strategy. Why? Because it is an "increasing returns" business model. It's like the "network effect" of e-commerce. It multiplies opportunities geometrically. The more you sell customers the more you know about them. The more you know about them the easier it is to sell them more products. The more products customers have with you the better value they receive and the more loyal they are. The longer they stay with you the more opportunities you have to meet even more of their financial needs. The more you sell them the higher the profit because the added cost of selling another product to an existing customer is often only about ten percent of the cost of selling that same product to a new customer. This gives us'as an aggregator ' a significant cost advantage over one product or one channel companies. Cross-selling re-invents how financial services are aggregated and sold to customers ' just like other aggregators such as Wal-Mart (general merchandise), Home Depot (home improvement products) and Staples (office supplies). Mr. Kovacevich's enthusiasm for the cross-selling model is well justified. It is difficult to quantify the importance of meeting all the varied needs of your customers, because you can not measure the opportunities you missed. However, it is obvious that reducing each customer's interest in considering a competitor's services will greatly increase long-term profitability for any company engaged in any line of business - not just for a bank. Later, in the same website section, Mr. Kovacevich addresses the importance of customer stickiness: (Cross-selling) is our most important customer-related sales metric. We want to earn 100 percent of our customers' business. The more products customers have with Wells Fargo the better deal they get, the more loyal they are, and the longer they stay with the company, improving retention. Eighty percent of our revenue growth comes from selling more products to existing customers. This focus on retention is an important part of a long-term plan to maintain Wells Fargo's above-average returns on assets and equity. Extraordinary profitability comes from differentiating your product or service from those of your competitors. Increasing customer stickiness and reducing "comparison shopping" is a key part of maintaining extraordinary profitability. Some businesses are blessed with enviable economics because of their product's natural prominence in the minds of their customers. Most businesses are obsessed with market share. But, how many really think about "mind share"? Obviously, a product like Coke (KO), Hershey (HSY), or Snickers is going to have a positive association in the minds of consumers. For many people, these products will also have a prominent place in each customer's mind (relative to other products and services on which money can be spent). A few other businesses have a healthy mind share without the positive association; GEICO is the most obvious example. The company's brand conjures up nothing but the words "auto insurance". Of course, that's all the GEICO brand has to do. So, what does all this have to do with Wells Fargo? Mind share isn't just the result of exposure to advertising. In fact, in most cases, exposure to advertising can not duplicate the kind of results that a direct, differentiated experience creates. Entertainment properties are by far the leaders in mind share. People who saw and loved Star Wars remember the film. In fact, they don't just remember the film, they actually file it away (or, more precisely, cross reference it) in countless ways within their mind. The evidence for this particular example is abundant. There are countless references to Star Wars in other media. The name, the music, the opening text and countless other elements are immediately recognizable. Even the films Star Wars fans hated made more money than almost any other movies in the history of cinema - and this was decades after the original came out. So, obviously Star Wars has the kind of lasting mind share any business should aspire to if it hopes to continuously earn extraordinary profits. Unfortunately, most businesses, however well run, can not attain this kind of mind share. The products and services they provide can never be as differentiated and memorable as a motion picture. Just as importantly, the positive associations will not be present, simply because the product or service is not inherently exciting, entertaining, or pleasant. This is clearly the case in financial services. So, what can a financial services company do to improve its mind share? The most obvious tactic is simply to "wow" its customers. In fact, Wells Fargo's CEO discusses this particular option in the "Vision and Values" section of the company's website: We have to "wow!" them. We know what that feels like because we're all customers. We go to the cleaners, the grocery store, a restaurant or whatever, and we find a situation where we're "wowed!" We walk out and we say, those people really listened to me and helped me get what I need. All of us hear stories about customers, say, who pick a certain line at the supermarket because they know the person who bags the groceries connects with customers ' smiles, greets regular customers by name, asks how their families are doing. When a personal banker helps a customer in one of our stores, or when a customer gets help from one of our phone bankers or does transactions on wellsfargo.com we want them to say, "That was great. I can't wait to tell someone." Another option worth pursuing is widening the associations present in the customer's mind. Financial services is a business where associations tend to be more conscious, categorized, and hierarchical than the associations formed in more heavily branded businesses. Put simply, the (potential) customer usually thinks of a "set" before thinking of an "element" within that set. Like many mental associations, the information can be returned in either direction. For example, the customer may normally think "banks" and then think "Wells Fargo", but will also be able to return the word "bank" if prompted by the name "Wells Fargo". This categorization is important, because it provides (limited) permission for Wells Fargo to expand its mind share horizontally (across service categories). In other words, providing a diverse range of financial services doesn't just make sense from the provider's perspective, it also makes sense from the user's perspective, because the user of financial services has already grouped deposits, borrowing, credit cards, insurance, brokerage services, asset management, etc. together in a very loose way within his mind. As a result of this mental network, one positive experience with Wells Fargo will greatly affect a customer's desire to pay for an additional service, even if the two services are not really all that similar. The three key elements here are: a broader definition of what Wells Fargo is (a place that does "money things", not just a bank), a positive experience, and some sense of trust that the quality of service will be consistent. The last requirement is the easiest to meet, because it's natural for a customer to assume that the positive experience was not a fluke, much the way a diner assumes the good meal he had at a particular restaurant was not caused by his picking the best offering from the menu. The diner usually assumes the overall quality of the restaurant's various entrees is superior. Likewise, a good experience with one of Wells Fargo's products or services will likely rub off on its other offerings. Valuation Shares of Wells Fargo currently yield just over 3%. The stock trades at a price-to-book ratio of just under 2.75 and a price-to-earnings ratio of less than 15. Conclusion Over the last 5, 10, 15, and 20 years shareholders of Wells Fargo & Company have fared better than the S&P 500. As of the end of last year, WFC's total return over the last ten years was 17% vs. 9% for the S&P. Over the last 20 years, WFC outpaced the S&P 500 by an even wider margin: 21% vs. 12%. Wells Fargo has a stellar reputation with investors. The company is the only U.S. bank to earn Moody's highest credit rating. Wells Fargo also boasts a well-known major shareholder. The largest owner of the company's common stock is Berkshire Hathaway. Warren Buffett's holding company has a roughly 5.5% stake in Wells Fargo. Berkshire's last reported purchase occurred during the first quarter of this year. Wells Fargo has a stated goal of achieving double-digit growth in earnings and revenue while managing a return on assets over 1.75% and a return on equity over 20%. Those are both very ambitious goals. The company has achieved some of the highest returns on assets and equity of any major U.S. bank. However, Wells Fargo will probably need to increase the percentage of revenue it derives from fee businesses if it is to achieve these goals. In the years ahead, the company may well become more of a diversified financial services business. In fact, that's what I expect will happen. The company's commitment to cross-selling is not some fad. Eventually, this commitment will change the way investors think about Wells Fargo. Soon, it may be considered much more than a bank. Wells Fargo's CEO makes the case that his company's P/E is simply too low. Wells Fargo has a solid history of strong growth and profitability. So, why should it be valued similarly to most other banks? Shouldn't it be awarded a multiple more in line with a growth company? There's actually some merit to this argument. Wells Fargo is unusually well positioned for a bank. Often, those banks that seem certain to earn very high returns on assets and equity for many years to come are poorly positioned for future growth. These banks are often smaller than their competitors and focused on a specific geographic niche. Any acquisitions would dilute the exceptional profitability of the bank's niche. Of course, there are also many consolidators in the banking industry. Unfortunately, many of these banks do not have a history of earning the kind of returns on assets and equity that Wells Fargo has achieved. Even more importantly, there is little differentiation between these titans of the banking industry and their national competitors. Therefore, their moats are highly suspect. Wells Fargo is a different kind of bank. It has a history of extraordinary growth and profitability. There are two obvious opportunities for future growth: geographic expansion and cross-selling. Of these two opportunities, it's clear I'm more enamored with the latter. An eastward push is not necessary, and certainly not via an ill-advised acquisition. There is a lot of value in the Wells Fargo franchise and there is plenty of room within that franchise for future growth. That's one of the great advantages of the financial services industry. With the right model, limits to growth are almost non-existent. In other highly-profitable industries, there is often nowhere to reinvest new capital at a similar rate of return. If Wells Fargo is a growth stock, it is a peculiar sort of growth stock. Maybe that is what attracted Buffett to the company in the first place. Here is a business with a strong franchise that can grow for many years to come. Perhaps most importantly, it is a growth business that frequently trades in the market at value like multiples, simply because it's a bank. At the current market price, Wells Fargo is the sort of investment you make once and forget. The valuation is not so cheap as to promise a good return if the business falters. But, the business is not so suspect as to require the margin of safety be provided by a low P/E ratio. Sometimes, near certain growth is the margin of safety. On a separate topic, I'd like to encourage anyone with an interest in competitive advantages to read the entire "Vision and Values" section of the Wells Fargo site. Superficially, it looks like any other online presentation to investors. In truth, it is nothing like those hollow, sugary slide shows. It's actually an engaging exploration of competitive advantages within an industry that seems totally unlike the sort of branded, consumer-oriented businesses one normally associates with strong franchises. Even if you aren't interested in the banking industry in particular, I recommend reading this section for its insights into customer psychology and behavior. Geoff Gannon writes a daily value investing blog and produces a twice weekly (half hour) value investing podcast at: http://www.gannononinvesting.com Article Source:http://EzineArticles.com/?expert=Geoffrey_Gannon banking - What If There Was A Huge Tax On Currency Trading? What if currency traders when making money were also helping the wealth of a nation? What if currency traders were taxed on each trade and that money was used to kick start third world nations and emerging markets? What if we used this money to build water reservoirs and water filtration plants or what if we used it to build sewer treatment plants and hydroelectric power plants? What if we used the money to slow down or defeat AIDS, Malaria, Yellow Fever or stop disease? What if we used the money to help promote children's health and education? What if along with this money we taught people to farm, grow food and sell what they did not need to regional trading partners or neighboring countries? What if we could help finance small businesses through micro loans, which would help grow local economies? What if every time currency was traded out of a smaller nation there was just a 2.5-5% tax and when currency traded out of a powerful nation there was a 1% fee on top of the current banking fees? What if when currency traders made millions before breakfast, that children in Africa could eat breakfast? What if everyone won, when investors and traders in currency won or lost? What kind of good deeds could we do with that unit of trade if it were strategically placed to do the most good? Think on this.

banking - What If There Was A Huge Tax On Currency Trading?

What if currency traders when making money were also helping the wealth of a nation? What if currency traders were taxed on each trade and that money was used to kick start third world nations and emerging markets? What if we used this money to build water reservoirs and water filtration plants or what if we used it to build sewer treatment plants and hydroelectric power plants? What if we used the money to slow down or defeat AIDS, Malaria, Yellow Fever or stop disease? What if we used the money to help promote children's health and education? What if along with this money we taught people to farm, grow food and sell what they did not need to regional trading partners or neighboring countries? What if we could help finance small businesses through micro loans, which would help grow local economies? What if every time currency was traded out of a smaller nation there was just a 2.5-5% tax and when currency traded out of a powerful nation there was a 1% fee on top of the current banking fees? What if when currency traders made millions before breakfast, that children in Africa could eat breakfast? What if everyone won, when investors and traders in currency won or lost? What kind of good deeds could we do with that unit of trade if it were strategically placed to do the most good? Think on this. "Lance Winslow" - Online Think Tank forum board. If you have innovative thoughts and unique perspectives, come think with Lance; www.WorldThinkTank.net/. Lance is a guest writer for Our Spokane Magazine in Spokane, Washington Article Source:http://EzineArticles.com/?expert=Lance_Winslow banking - Money Transfers In Argentina - Banking, Law And Real Estate Investment Transferring money to Argentina (a second-world country) isn't as simple as it is in the U.S. or Europe. The people of Argentina don't believe in the banks after the peso devaluation in December of 2001. Western Union has a low limit, so they're not an option. And I definitely wouldn't advocate that you bring $100,000 in your carry-on luggage. I recommend that you demonstrate "proof of origin" for the funds that you're transferring into Argentina (W-2 forms, 1040, etc) because the government is beginning to regulate the influx of money. The AFIP (equivalent to the U.S.'s IRS) has the authority to audit you, and you need to be careful so that you don't have problems when you sell the property in the future. Transfer fees are usually between 1-3%, depending upon how you transfer your money. You can use "money exchanges," which are technically illegal, but used regularly by the locals and foreigners. Or, you can use the Central Bank, which is the safest way, and the most costly. There is new legislation scheduled for March 2007 to mandate that all real estate purchases are conducted by: check, bank wire or some other method, except CASH. The reason for this is that many locals buy/sell properties and change the recorded purchase price by 30-50%. This limits the amount of income taxes that people pay on the sales price and the amount of property taxes the new owner pays the government. The government is losing millions of dollars every year in lost revenue. Tax evasion is a common practice in Argentina. I do not advocate this practice due to the risks its poses for my clients. Fines can be exorbitant, and when investing in a foreign country, risk mitigation is important. Currently, the government is worried about money laundering, as well as looking for more ways to increase tax revenues. So, consult a lawyer and a banker when you're serious about investing in Argentina. Opening a Bank Account in Argentina The majority of the foreign banks left Argentina in December of 2001. The crisis prompted the people to march in the street, and the banks ran home with their tails between their legs. Now, if you go to a local bank in Buenos Aires, it's not uncommon to see a half-dozen security guards and/or policeman. Argentina is serious about the safety of their financial institutions and is trying to rectify its international image. A bank account in Argentina will help you manage your property from overseas. Opening a bank account in Argentina is more difficult than most foreigners expect. By law, the requirement to open a savings account is a CID (tax ID number), an address certificate and a Passport. But many banks have stricter requirements. If you have an account with HSBC, CitiBank, BankBoston or BBV in the U.S. or Europe, they will generally open an account for you in Argentina. Or, if you're referred to them by a current customer, they will speak with you. Banco Naci'n, http://www.nacion.com.ar, opens accounts to foreign non-residents requiring only the CDI (tax ID), address certificate and Passport. The minimal deposit is $50 pesos and they charge a maintenance fee of $3 pesos. Important things to inquire about: online banking, maintenance fees, wire transfers, minimum deposits, debit/credit cards

banking - Money Transfers In Argentina - Banking, Law And Real Estate Investment

Transferring money to Argentina (a second-world country) isn't as simple as it is in the U.S. or Europe. The people of Argentina don't believe in the banks after the peso devaluation in December of 2001. Western Union has a low limit, so they're not an option. And I definitely wouldn't advocate that you bring $100,000 in your carry-on luggage. I recommend that you demonstrate "proof of origin" for the funds that you're transferring into Argentina (W-2 forms, 1040, etc) because the government is beginning to regulate the influx of money. The AFIP (equivalent to the U.S.'s IRS) has the authority to audit you, and you need to be careful so that you don't have problems when you sell the property in the future. Transfer fees are usually between 1-3%, depending upon how you transfer your money. You can use "money exchanges," which are technically illegal, but used regularly by the locals and foreigners. Or, you can use the Central Bank, which is the safest way, and the most costly. There is new legislation scheduled for March 2007 to mandate that all real estate purchases are conducted by: check, bank wire or some other method, except CASH. The reason for this is that many locals buy/sell properties and change the recorded purchase price by 30-50%. This limits the amount of income taxes that people pay on the sales price and the amount of property taxes the new owner pays the government. The government is losing millions of dollars every year in lost revenue. Tax evasion is a common practice in Argentina. I do not advocate this practice due to the risks its poses for my clients. Fines can be exorbitant, and when investing in a foreign country, risk mitigation is important. Currently, the government is worried about money laundering, as well as looking for more ways to increase tax revenues. So, consult a lawyer and a banker when you're serious about investing in Argentina. Opening a Bank Account in Argentina The majority of the foreign banks left Argentina in December of 2001. The crisis prompted the people to march in the street, and the banks ran home with their tails between their legs. Now, if you go to a local bank in Buenos Aires, it's not uncommon to see a half-dozen security guards and/or policeman. Argentina is serious about the safety of their financial institutions and is trying to rectify its international image. A bank account in Argentina will help you manage your property from overseas. Opening a bank account in Argentina is more difficult than most foreigners expect. By law, the requirement to open a savings account is a CID (tax ID number), an address certificate and a Passport. But many banks have stricter requirements. If you have an account with HSBC, CitiBank, BankBoston or BBV in the U.S. or Europe, they will generally open an account for you in Argentina. Or, if you're referred to them by a current customer, they will speak with you. Banco Naci'n, http://www.nacion.com.ar, opens accounts to foreign non-residents requiring only the CDI (tax ID), address certificate and Passport. The minimal deposit is $50 pesos and they charge a maintenance fee of $3 pesos. Important things to inquire about: online banking, maintenance fees, wire transfers, minimum deposits, debit/credit cards Nancy Landi and Christian DeBlis formed Nancy Landi International with a focus on the Buenos Aires real estate market. We provide rental properties, property management services and real estate investment expertise. Nancy Landi International has developed partnerships, locally and globally, to serve the needs of our unique client'le. We have relationships with real estate developers, lawyers, accountants, translators, wineries and many other individuals and organizations to make your stay exquisite. Nancy Landi International represents select properties for rent and investment at this time. The NLI team can help you locate distinguished properties for investment and guide you through the process. Our vision is to exceed your expectations. Nancy Landi International: http://www.NancyLandi.com Buenos Aires Investment Blog: http://buenosairesinvestment.blogspot.com/ LinkedIn Professional Profile: http://www.LinkedIn.com/in/ChristianDeBlis Article Source:http://EzineArticles.com/?expert=Christian_DeBlis banking - Inflation Or Deflation - Which One Is Worse? Which One Lies Ahead? Surely inflation is our greater enemy, isn't it? Rising prices are bad for the economy. Falling prices are a good thing, aren't they? Inflation and deflation are due more to mindset than anything else. Let me explain. Whether you realize it or not, you are infected with inflation mentality, which goes back to at least the 1970s. I can illustrate that for you: Let's say your favorite loaf of bread at your local store costs $3 today. If you go back to that same store in ten years time and are able to buy a loaf of bread identical to today's, how much will you pay? Will it still cost $3 or will you pay more or less than $3? Did you answer more? Why? Because you are conditioned to assuming that prices will keep rising. You would not have answered that way in 1937 and you probably would not answer that way today in Japan, where prices have been falling for many years. What's wrong with that? It's true that inflation erodes the purchasing power of money, but as long as your income keeps up, rising prices are not the end of the world, are they? There is a consequence of inflation that is far more sinister than the erosion of purchasing power and you are not even aware of it. Inflation sucks you into debt. Let me illustrate that for you as well: Your car is three years old and you want to replace it, but you would rather wait another year. The new model costs $25,000, but you expect it could be $30,000 in a year's time. Will you wait another year and save up a further $5,000 cash, or will you go into debt and buy it now? You will almost certainly borrow and buy the new auto now, won't you? Why? Because you expect the price to rise. You go into more debt because of inflation. And you are infected with inflation mentality, which is the cause of the crazy, unsustainable debt bubble today. When you borrow that money from the bank, it is injected into the economy, increasing the money supply and fuelling yet more growth in consumer spending and thus the economy (and probably prices). Now let's reverse that situation. Let's say you believe the price of that new auto you want will be lower next year. Say $20,000. Now will you be in such a hurry to buy it? No. You will almost certainly wait. And let's say in 12 months time you expect the price to fall even further in the following 12 months, say to $15,000? Chances are you will make the old jalopy last yet another year. But you will not be the only person thinking this way. Everybody will be putting off buying a new car. To such an extent that auto makers, who have failed to increase sales, even by slashing prices, have to scale back production and lay off employees. And if auto workers lose their jobs, will they be able to spend as much on shoes and clothes and restaurants and gadgets? No. But stores need cash flow to pay their rent and wages, so "50% off" sales appear everywhere. But even they do not work, and retail stores also have to shed staff. And the more prices fall the more the consumer expects them to fall, so the more they put off buying everything that is not absolutely urgent. And so the economy begins to contract and unemployment rises, all because of deflation mentality. The lifeblood of an economy is consumer borrowing and spending, which is fuelled by the ready availability of money. When the mindset changes from inflation mentality to deflation mentality, people not only stop spending. They stop borrowing. In fact, reckless abandon changes to conservatism, and they even try and speed up the repayment of loans they already have. This disappears money from the economy back to the banks from whence it came, and so reduces money supply. And thus the economy spirals down into a deflationary recession or even worse. Every depression in history has been accompanied by deflation, not inflation. In the 1930s, was there any shortage of goods? Not at all. Stores were fully stocked. Was there any shortage of manpower? Hardly. Unemployment reached 25%. So what caused the depression? What was in short supply? Only one thing. Money. And the only way money comes into existence is by way of a loan from a bank. When people are reducing their indebtedness rather than increasing it, money supply shrinks and the economy contracts. Interest rates can be reduced to zero (as in Japan in recent years), but if people lose the courage and the capacity to take on more debt, they will not borrow. This is called "pushing money on a string." In my book "How to Profit from the Coming Great Depression" one entire chapter is devoted to this subject of deflation. You will learn why the coming downturn is inevitable and what you can do to escape the most serious consequences.