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In this episode, Mena and Stuart dive into the various ways rising interest rates can impact businesses. They explain how higher interest rates directly affect business valuation by reducing multiples, as higher required returns lower company values. The discussion also covers the increasing costs of holding inventory and tighter payment terms from creditors due to higher interest rates.

They address the rising cost of capital for businesses seeking funding through credit cards, overdrafts, and bank bills, noting borrowing costs can now reach 7.5% to 8.5% per annum. Additionally, both consumer and business demand take a hit, with less discretionary spending available, which can slow business growth and alter purchasing behaviours.

Mena and Stuart highlight the challenges higher interest rates pose to personal cash flow needs from business, and they offer insights on navigating these conditions by focusing on sectors less sensitive to rate changes, securing contract revenue, and continuously adding value to customers regardless of the economic environment.

If this episode resonated with you, please leave a rating on your favourite podcast platform. It helps us reach more incredible listeners like you. Thank you for being a part of the journey!

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SPECIAL OFFER: Buy a one of Stuart's books for ONLY $20 including delivery. Use the discount code blog here.

Work with Mena & Stuart's team: At ProSolution Private Clients we encourage clients to adopt a holistic and evidence-based approach when making financial decisions. Visit our website.

Follow us: Stuart: Twitter/X and LinkedIn. Mena: LinkedIn

IMPORTANT: This podcast provides general information about finance, taxes, and credit. This means that the content does not consider your specific objectives, financial situation, or needs. It is crucial for you to assess whether the information is suitable for your circumstances before taking any actions based on it. If you find yourself uncertain about the relevance or your specific needs, it is advisable to seek advice from a licensed and trustworthy professional.

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In this podcast, Mena and Stuart emphasise the importance of staying focused on your own business strategy and pace. They caution against common mistakes like investing in unsuitable assets, withdrawing funds without considering tax implications, and being lured by quick-fix strategies due to FOMO.

They stress the need to define personal success without comparing oneself to others, advocating for steady progress over time. Managing cash flow, prioritising investments, and diversifying beyond business interests are key strategies they highlight.

Ultimately, they encourage listeners to trust their own path, resist distractions, and prioritise sustainable growth aligned with their own goals and values.

If this episode resonated with you, please leave a rating on your favourite podcast platform. It helps us reach more incredible listeners like you. Thank you for being a part of the journey!

Click here to subscribe to our weekly email.

SPECIAL OFFER: Buy a one of Stuart's books for ONLY $20 including delivery. Use the discount code blog here.

Work with Mena & Stuart's team: At ProSolution Private Clients we encourage clients to adopt a holistic and evidence-based approach when making financial decisions. Visit our website.

Follow us: Stuart: Twitter/X and LinkedIn. Mena: LinkedIn

IMPORTANT: This podcast provides general information about finance, taxes, and credit. This means that the content does not consider your specific objectives, financial situation, or needs. It is crucial for you to assess whether the information is suitable for your circumstances before taking any actions based on it. If you find yourself uncertain about the relevance or your specific needs, it is advisable to seek advice from a licensed and trustworthy professional.

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In this episode, Stuart and Mena explore why self-employed individuals often gravitate toward property investment and the key considerations they should keep in mind. They discuss the appeal of property as an easily understood and tangible asset, particularly for those with strong incomes but limited cash reserves. Property investment can offer control, tax advantages through gearing, and the potential for self-employed individuals to purchase their business premises, further integrating their business and personal wealth strategies.

However, they also highlight the common mistakes self-employed investors make, such as focusing on quantity over quality, delaying the maximisation of borrowing capacity due to accounting structures, and choosing the wrong ownership structure without considering all tax implications. Stuart and Mena emphasise the importance of understanding these pitfalls and maintaining adequate cash flow buffers to manage volatility.

The episode concludes with a discussion on why self-employed people shouldn't overlook shares as part of their investment strategy, noting the benefits of income, liquidity, and the ease of investing in diversified ETFs. If you're self-employed and considering property investment, this episode provides valuable insights to help you make informed decisions.

Related podcasts

1/3/23 - What costs are deductible when you buy an investment property

9/11/22 - How do I maximise negative gearing tax benefits from investing in property?

10/5/23 - Should you own your business premises?

If this episode resonated with you, please leave a rating on your favourite podcast platform. It helps us reach more incredible listeners like you. Thank you for being a part of the journey!

Click here to subscribe to our weekly email.

SPECIAL OFFER: Buy a one of Stuart's books for ONLY $20 including delivery. Use the discount code blog here.

Work with Mena & Stuart's team: At ProSolution Private Clients we encourage clients to adopt a holistic and evidence-based approach when making financial decisions. Visit our website.

Follow us: Stuart: Twitter/X and LinkedIn. Mena: LinkedIn

IMPORTANT: This podcast provides general information about finance, taxes, and credit. This means that the content does not consider your specific objectives, financial situation, or needs. It is crucial for you to assess whether the information is suitable for your circumstances before taking any actions based on it. If you find yourself uncertain about the relevance or your specific needs, it is advisable to seek advice from a licensed and trustworthy professional.

Send us a text

In this episode, Mena and Stuart discuss practical strategies for businesses to navigate an economic slowdown or recession in Australia, reflecting on the lessons learned from the 1990-1992 recession, where unemployment soared to 10.8% and interest rates approached 20%.

Key points include:

1. Assessing Business Sensitivity.
2. Scenario Planning.
3. Strengthening Financial Resilience.
4. Cost Management.
5. Strategic Divestment.
6. Personal Financial Impact.
7. Developing a Contingency Plan.

This episode offers valuable insights for business owners looking to safeguard their operations and personal finances against the challenges of an economic downturn.

If this episode resonated with you, please leave a rating on your favourite podcast platform. It helps us reach more incredible listeners like you. Thank you for being a part of the journey!

Click here to subscribe to our weekly email.

SPECIAL OFFER: Buy a one of Stuart's books for ONLY $20 including delivery. Use the discount code blog here.

Work with Mena & Stuart's team: At ProSolution Private Clients we encourage clients to adopt a holistic and evidence-based approach when making financial decisions. Visit our website.

Follow us: Stuart: Twitter/X and LinkedIn. Mena: LinkedIn

IMPORTANT: This podcast provides general information about finance, taxes, and credit. This means that the content does not consider your specific objectives, financial situation, or needs. It is crucial for you to assess whether the information is suitable for your circumstances before taking any actions based on it. If you find yourself uncertain about the relevance or your specific needs, it is advisable to seek advice from a licensed and trustworthy professional.

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In this episode, Stuart and Mena explore strategies to maximise borrowing capacity from your business profits. They stress the importance of having a knowledgeable broker who can effectively advocate for you with bank credit managers. The duo highlights the significance of financial "add-backs," such as interest and depreciation, which banks often consider when determining serviceability. Properly reporting these expenses can substantially enhance your borrowing position.

They also discuss the distinction between regulated and unregulated credit, the benefits of using corporate tax rates for serviceability analyses, and when a corporate beneficiary might be advantageous. Liabilities can be a hindrance to borrowing, but they suggest paying down corporate liabilities if they impact your borrowing power.

Finally, they touch on how director payments can affect your loan application, particularly in partnerships. Stuart and Mena explain how dividends and salary/wage structures can be optimised to ensure the bank considers your income fully. For business owners looking to leverage profits for borrowing, this episode provides key insights and actionable tips.

If this episode resonated with you, please leave a rating on your favourite podcast platform. It helps us reach more incredible listeners like you. Thank you for being a part of the journey!

Click here to subscribe to our weekly email.

SPECIAL OFFER: Buy a one of Stuart's books for ONLY $20 including delivery. Use the discount code blog here.

Work with Mena & Stuart's team: At ProSolution Private Clients we encourage clients to adopt a holistic and evidence-based approach when making financial decisions. Visit our website.

Follow us: Stuart: Twitter/X and LinkedIn. Mena: LinkedIn

IMPORTANT: This podcast provides general information about finance, taxes, and credit. This means that the content does not consider your specific objectives, financial situation, or needs. It is crucial for you to assess whether the information is suitable for your circumstances before taking any actions based on it. If you find yourself uncertain about the relevance or your specific needs, it is advisable to seek advice from a licensed and trustworthy professional.

Send us a text

In this episode, Stuart and Mena delve into the complexities of property development, offering valuable insights on how to structure your projects effectively. They tackle common misconceptions about development feasibility, emphasising the importance of consulting with a holistic accountant before making any significant investment decisions.

The discussion highlights the necessity of setting up a robust operating structure before beginning the planning process. Stuart and Mena stress the importance of clearly defining your intentions for the development, as tax treatments vary depending on whether you plan to build and sell or build and retain.

They explore key considerations like GST, the margin scheme, and capital account management, as well as strategies to minimise land tax and capital gains tax (CGT). The episode also covers partition agreements to avoid stamp duty, the benefits of joint ventures, and the critical importance of choosing a reputable builder with solid home warranty insurance policies.

Whether you're new to property development or looking to refine your approach, this episode provides essential guidance to help you navigate the process successfully.

If this episode resonated with you, please leave a rating on your favourite podcast platform. It helps us reach more incredible listeners like you. Thank you for being a part of the journey!

Click here to subscribe to our weekly email.

SPECIAL OFFER: Buy a one of Stuart's books for ONLY $20 including delivery. Use the discount code blog here.

Work with Mena & Stuart's team: At ProSolution Private Clients we encourage clients to adopt a holistic and evidence-based approach when making financial decisions. Visit our website.

Follow us: Stuart: Twitter/X and LinkedIn. Mena: LinkedIn

IMPORTANT: This podcast provides general information about finance, taxes, and credit. This means that the content does not consider your specific objectives, financial situation, or needs. It is crucial for you to assess whether the information is suitable for your circumstances before taking any actions based on it. If you find yourself uncertain about the relevance or your specific needs, it is advisable to seek advice from a licensed and trustworthy professional.

Send us a text

In this episode, Stuart and Mena delve into the crucial topic of protecting your interests in the event of a relationship breakdown, especially when owning a business or investment entity. They discuss proactive steps to take when entering a new serious relationship, including setting up a Binding Financial Agreement (BFA) with the help of a reputable family lawyer, structuring business affairs thoughtfully, and ensuring both partners have independent financial, legal, and accounting advice to avoid conflicts of interest.

For those already in business, Stuart and Mena outline what to expect during a relationship breakdown. They emphasize the importance of a business valuation, particularly if it involves personal goodwill or exertion, and highlight the need to account for taxes in financial splits. They also discuss tax rollovers to guide asset division effectively.

The conversation touches on the emotional toll of a relationship breakdown and the necessity of planning who can manage business affairs during such times. Additionally, they recommend considering buy/sell agreements to stipulate business operations post-breakdown if both partners are involved.

Tune in to gain valuable insights and practical advice on safeguarding your business and financial interests in the event of a relationship breakdown, ensuring you're prepared for any eventuality.

If this episode resonated with you, please leave a rating on your favourite podcast platform. It helps us reach more incredible listeners like you. Thank you for being a part of the journey!

Click here to subscribe to our weekly email.

SPECIAL OFFER: Buy a one of Stuart's books for ONLY $20 including delivery. Use the discount code blog here.

Work with Mena & Stuart's team: At ProSolution Private Clients we encourage clients to adopt a holistic and evidence-based approach when making financial decisions. Visit our website.

Follow us: Stuart: Twitter/X and LinkedIn. Mena: LinkedIn

IMPORTANT: This podcast provides general information about finance, taxes, and credit. This means that the content does not consider your specific objectives, financial situation, or needs. It is crucial for you to assess whether the information is suitable for your circumstances before taking any actions based on it. If you find yourself uncertain about the relevance or your specific needs, it is advisable to seek advice from a licensed and trustworthy professional.

Send us a text

In this episode, Stuart and Mena tackle the crucial topic of protecting your business from cybersecurity threats. With 59% of losses reported to the ACCC's Scamwatch in 2022 affecting small and micro businesses, they delve into common cybersecurity threats like ransomware, malicious software, phishing, and business email compromise. They highlight essential cybersecurity practices, such as regularly updating software, using strong passwords with multi-factor authentication, and backing up critical data.

Stuart and Mena offer practical steps for implementation, including setting up automatic updates, using password managers, maintaining a regular backup schedule, and developing basic cybersecurity training for employees. They also discuss additional protection measures, such as getting an IT professional to review your risks and considering cyber liability insurance.

The episode emphasises the importance of creating a cybersecurity policy and an incident response plan, outlining key elements and the necessity of being prepared for cyber incidents. They recommend resources and support, such as the Australian Cyber Security Hotline, the Digital Solutions - Australian Small Business Advisory Services program, and signing up for ACSC alerts and the Partnership Program.

Tune in to learn how to safeguard your business against ever-evolving cyber threats and ensure your cybersecurity measures are robust and up-to-date.

If this episode resonated with you, please leave a rating on your favourite podcast platform. It helps us reach more incredible listeners like you. Thank you for being a part of the journey!

Click here to subscribe to our weekly email.

SPECIAL OFFER: Buy a one of Stuart's books for ONLY $20 including delivery. Use the discount code blog here.

Work with Mena & Stuart's team: At ProSolution Private Clients we encourage clients to adopt a holistic and evidence-based approach when making financial decisions. Visit our website.

Follow us: Stuart: Twitter/X and LinkedIn. Mena: LinkedIn

IMPORTANT: This podcast provides general information about finance, taxes, and credit. This means that the content does not consider your specific objectives, financial situation, or needs. It is crucial for you to assess whether the information is suitable for your circumstances before taking any actions based on it. If you find yourself uncertain about the relevance or your specific needs, it is advisable to seek advice from a licensed and trustworthy professional.