Tax Return Funny Quotes

Collateral Capacity or Net Worth? If young Bill Gates had knocked on your door asking you to invest $10,000 in his new company, Microsoft, could you get your hands on the money? Collateral capacity is access to capital. Your net worth is irrelevant if you can’t access any of the money. Collateral capacity is my favorite wealth concept. It’s almost like having a Golden Goose! Collateral can help a borrower secure loans. It gives the lender the assurance that if the borrower defaults on the loan, the lender can repossess the collateral. For example, car loans are secured by cars, and mortgages are secured by homes. Your collateral capacity helps you to avoid or minimize unnecessary wealth transfers where possible, and accumulate an increasing pool of capital providing accessibility, control and uninterrupted compounding. It is the amount of money that you can access through collateralizing a loan against your money, allowing your money to continue earning interest and working for you. It’s very important to understand that accessibility, control and uninterrupted compounding are the key components of collateral capacity. It’s one thing to look good on paper, but when times get tough, assets that you can’t touch or can’t convert easily to cash, will do you little good. Three things affect your collateral capacity: ① The first is contributions into savings and investment accounts that you can access. It would be wise to keep feeding your Golden Goose. Often the lure of higher return potential also brings with it lack of liquidity. Make sure you maintain a good balance between long-term accounts and accounts that provide immediate liquidity and access. ② Second is the growth on the money from interest earned on the money you have in your account. Some assets earn compound interest and grow every year. Others either appreciate or depreciate. Some accounts could be worth a great deal but you have to sell or close them to access the money. That would be like killing your Golden Goose. Having access to money to make it through downtimes is an important factor in sustaining long-term growth. ③ Third is the reduction of any liens you may have against these accounts. As you pay off liens against your collateral positions, your collateral capacity will increase allowing you to access more capital in the future. The goose never quit laying golden eggs – uninterrupted compounding. Years ago, shortly after starting my first business, I laughed at a banker that told me I needed at least $25,000 in my business account in order to borrow $10,000. My business owner friends thought that was ridiculously funny too. We didn’t understand collateral capacity and quite a few other things about money.

Good heavens, those men really did hit your head hard, didn’t they?” Millie pressed the wet cloth into Reverend Gilmore’s hand before heading Everett’s way. Reaching out, she plucked the meat off his face and peered into his eyes. “Your pupils seem to be working all right, but . . . perhaps we should summon the physician to make certain you haven’t been grievously injured.” “My wits aren’t addled.” “I imagine that’ll change once Caroline hears about your latest foray—which means venture—into brawling.” Everett simply stared at Millie for a long moment before he laughed. “There’s nothing funny about this, Everett. Caroline is determined to pull off the ball of the summer season tonight, and she’ll be hard-pressed to do that if everyone at the ball spends their time discussing your recent activities.” “She probably won’t even notice the new bruises I incurred today.” “Do you think she’s not going to notice that your father is sporting bruises as well, and Reverend Gilmore’s lip is twice its normal size?” “I wasn’t planning on attending the ball, dear,” Reverend Gilmore said. “And I was only punched because one young gentleman got a little too enthusiastic when the mayhem began.” Fletcher smiled but then winced as if smiling caused him pain. “That certainly did put an end to everything rather quickly, once everyone realized an elderly gentleman—and a man of the cloth, at that—had been pulled into the fray.” Reverend Gilmore suddenly looked a little smug. “I’m sure the local churches will see an increase in their attendance, especially since I just couldn’t seem to resist suggesting all those gentlemen repent and make reparations for speaking such vile things about my lovely Lucetta.” Everett grinned. “That was the best part of the whole brawl.” Reverend Gilmore returned the grin. “I do still have my uses, son, but . . .” He rose slowly to his feet and sighed. “I think I’ll go have a nice lie down. As Fletcher so kindly pointed out, I am an elderly gentleman, and brawls can be rather taxing on us, even though, truth be told, I’ve never been in the midst of one before today.” Everyone