Tag Archives: franchise

The Best Way to Secure Your Stock Market Gains: Why You’ll See Most Stock Market Investors Pull Out in the Next 6 Months

We’ve all been on this ride before. The stock market is at an all-time high!
This past week, the Dow Jones eclipsed the 26000 mark for the first time in history and everybody is excited. The current bull market began nearly 9 years ago and is the longest running bull market ever. Even individual investors who got burned in the crash of 2008-09 have jumped back into the market and have long forgotten the period of time spent praying for their 401K’s to recover from that calamity. Right now, things are going good with our investments and our 401K’s look so promising that we can flirt with the idea of retiring and enjoying life in the sunshine.

However, in recent weeks some investment professionals have begun warning that the nearly nine-year-old bull market may be entering its “euphoria phase” — which typically marks the final stage of a long, upward climb for stocks. This stretch of a bull market is characterized by higher share prices, rising investor optimism and fresh cash being funneled into the stock market by investors who fear missing out on gains despite the market’s lofty levels. This “irrational exuberance” can lead to some very undesirable outcomes. So, now may be the time to secure those gains and quit while you’re ahead.

Martin Feldstein, one of the most influential Republican economists of the last 40 years, is warning that the stock market is poised to plunge. In a Wall Street Journal column with the headline “Stocks Are Headed for a Fall,” Feldstein argued “When interest rates rise back to normal levels, share prices are also likely to revert to previous norms,” he wrote. “…The implied fall in the market would reduce the value of household equities held directly and through mutual funds by $10 trillion.” This prediction comes as stocks continue one of their strongest runs ever, regularly setting record highs, and going for the longest period on record without even a modest 3% pullback. Feldstein was the chairman of The Council of Economic Advisers under President Reagan and an adviser to President George W. Bush credited with being one of the fathers of his administration’s tax cut plan.

In an effort to preserve savings and watch from the sidelines when the market inevitably collapses, many people are now pulling their money out of the stock market and reinvesting in two big areas, Real Estate and/or Franchise Businesses. The major benefit of this strategy is it can reduce portfolio risk at the same level of investment return. These returns have relatively low correlations with other asset classes such as stocks and bonds so regardless how the market is performing, your rate of return is unaffected. Additionally, with Real Estate or a Franchise, you have and maintain the ability to influence that assets performance. To speak with an expert and learn more, visit JPaytonconsulting.com.


9 Steps to Financial Prosperity


1. Make up in your mind that you want to control your own destiny:        Complaining and placing blame regarding your current situation doesn’t change anything. Any sort of physical discomfort causes a physical reaction. The same is true with mental discomfort. When you’re not happy and don’t feel good about where your life is going, realize you can change it. Just make up your mind.
2. Peacefully reflect on what types of things really interest you:
Quiet, peaceful thought allows you to hear yourself without the interference of the outside world. Find that quiet place, relax and allow yourself to hear what makes you happy, what you really like and are interested in. Make a list of these items. There is opportunity to profit in everything that gives you pleasure but you must first find out what that is.
3. Identify what your true and natural skill set is:
We all have gifts. Some of those gifts we were born with, others we have developed over time. What are they? You may be creative, analytical, mechanical or even charismatic. Whatever your talents are, identify them and list them.

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What Millionaires Know and Everyone Else Should

High Net Worth Investors understand that real wealth is generated in the private markets rather than the public or common markets. The ultra-wealthy may gain a lot of their initial wealth from private businesses, often through direct business ownership or as an angel investor in private equity.images

If you’re disappointed with your portfolio’s returns and are looking for other options, there are alternative investments. Alternative investments are generally defined as anything that falls outside traditional stock and bond investments and whose role is to potentially maintain a positive position when the broader markets decline. The goal is to mitigate portfolio volatility, hedge against downslides and boost portfolio returns in a way that is not tied directly to the stock market’s performance.

The stock market, as measured by the Standard & Poor’s 500 Index, gained a meager 1.2 percent in 2015 (including reinvested dividends). So far in 2016, the S&P is in positive territory by less than 1 percent. The bond market’s returns, meanwhile, have languished in the range of 1 percent to 2 percent for at least five years. When you think of investing the stock market or other somewhat passive investments, returns of 10 to 20 percent per year on invested capital are normally considered very good.

The mistake in applying this type of logic to Franchising, as an alternative investment, is that normally the investment is not passive. You make two types of investments in a franchise opportunity. In addition to your capital, you are also investing a fair amount of your time and management talent as well. You should be able to achieve a good rate of return on both investments.

The capital you invest is static, and the returns you will earn on your invested capital are normally reasonable by passive investment standards. The real opportunity for leverage in franchising relates to the investment you’re making in your time and talent. This is where a great franchise system can utilize this asset to increase your returns dramatically.

The franchisor develops a system or method of operation that employs the franchisee’s time in a manner that drives the income from the business to levels that are not available from an investment of capital alone. These are the systems where a good operator can create annual incomes greater than 100 percent of the total initial franchise investment within a short period of time.

Warren Buffett’s winning strategy is remarkably simple: Focus on companies that generate robust annual cash flow, and make sure those companies are not at risk of technological obsolescence.

Millionaires understand that some of the best ideas don’t come out of costly research but out of a passion for making the world a better place. Always listen to that little voice that says to “pursue your passion and success will follow”.  Click Here to learn more.

Top 10 Things to Consider When Shopping for a Franchise

If you’re an investor looking to put some cash to work outside the stock market, investing in a franchise business is a very popular option that is worth looking into. As tempting as it may be to just type the word, “Franchise” in your favorite search engine to “See what’s out there,” you’re going to need to understand several things first. JPayton Consulting assist entrepreneurs and investors nationwide put their ideas into action. Click Here to learn more.tree-of-wisdom

  1. How Franchises Work

It’s been called the greatest business model ever invented, and has enabled hundreds of thousands of people that never owned a business before to do just that; become owners of their own business.

The premise is simple; someone comes up with an idea for a product or service, implements it, and starts a business. The business turns out to be easily replicated there for the opportunity for expansion is simplified. This person doesn’t really want to just use all of their own money to grow the business, so the decision to seek out investors is a smart choice.

It’s just that the investors in this case are not only going to buy into the business; they’re going to run it too. As franchisees. That’s right; the person who came up with the business idea is now going to be the franchisor, and will be using other people’s money, i.e., franchisees, to grow the business.

  1. My Personal Risk Tolerance

Investing in a business (franchise or non-franchise) is risky. There’s no way to completely mitigate your risk, but there are ways to lower it. Are you prepared to risk your own money in a business venture?

One thing you can do to make sure that you’re really ready to write a check to a franchise company is this: Look back at some of the major decisions involving money that you’ve made over the years. How were you able to handle the “risk” part of those decisions? Did you analyze things for weeks, maybe even months on end? Or, did you do some research, and make your decision relatively quickly?

Bottom line, calculate your risk and be comfortable with it.

  1. The Franchisor’s Rules

Franchising is not free from accountability to the franchisor,  it can’t be. Can you imagine going into your local McDonald’s for a Big Mac only to find out that the franchisee decided to discontinue it?

Before you commit to becoming the owner of a franchise business, make sure that you understand the rules. All franchises have them, and need them. Rules maintain the consistency of the products, the services, and the brand.

  1. Your Personality Type

Before you become a franchise owner, do a self-check. Telling yourself that you’ll follow the rules in a franchise business, then actually following them once you become a franchisee are totally different things.

Some self-reflection is definitely warranted here. For example, in a corporate setting, there are always rules to follow. How did the rule-following work out for you? Were you generally comfortable with them, or did you have a problem following them? Did you feel that the rules that were in place didn’t apply to you? Dig deep here; either you’re a rule-follower, or you’re not.

If you don’t generally follow the rules, don’t buy a franchise. It probably won’t work.

  1. Your Finances

If you don’t know where you stand financially, you’ll waste an awful lot of time learning about and getting excited about franchise opportunities that may not even fit your budget.

Do a simple net worth statement before you start your franchise search. Add up your assets. Then add up your liabilities. The difference between the two is your net worth. You’ll need this information for the franchisors. (Most franchises have a minimum net worth requirement)

  1. Who Am I

Searching endlessly online for that perfect franchise may sound like the right way to find one, but it’s not. Trying to figure out what’s what without customizing your search can be a massive waste of time.

Instead, grab a legal pad and write down your top professional skills. In addition, write down some of the traits that tend to define you. Are you outgoing, or are you introverted? Are you highly competitive? Are you good with details, or are you a big-picture person?

  1. How to Find Possible Matches

Now that you’re armed with your top skills and some of your more dominant personal traits, it’s time to start your search for a franchise. Go to your favorite online search engine and type in “franchise opportunities,” or “franchises for sale,” and start digging in. You’ll see specific franchises come up, as well as a number of franchise directory type websites.

Here’s the trick; only request information from those that seem to be a fit for what you wrote down on your legal pad. See No. 6. And don’t forget to make sure that your net worth meets the minimum requirements.

  1. How to do proper research

Once you’ve found some franchises that could turn out to be a match, it’s time for you to do your research. You’ll find that some of your questions can be easily answered by your franchise development representative, while others can’t.

For instance, unless franchisee sales and earnings figures are clearly disclosed on the Franchise Disclosure Document, (which you’ll receive from the franchisor) your franchise representative cannot answer any earnings-related questions. But don’t worry; all you have to do is ask the current franchisees. In most cases, that’s where most of your answers about the business will be coming from anyway.

  1. You’ll need a business plan

Don’t even think of going into your local bank to apply for a small business loan without a formal business plan in your hands. The lender will want to see your projections and hear your story. JPayton Consulting can help you create one.

  1. The Process

The entire franchise discovery and research process will probably take two to three months to complete. Eventually, you’ll have to make a yes or no decision.

You’ll probably be a little nervous. After all, it’s not like your starting a new job. If you buy a franchise, you’re going to have real skin in the game, and it’s a game that you’re expecting to win.

You can win, if you focus on choosing an opportunity that’s really right for you, that you’ve done terrific research on, and that easily fits into your budget. Click Here to begin your search.

Your 401K and the Next Stock Market Crash, Plan Now!

It’s not a matter of if, but when the next significant market decline will occur. Utilizing a retirement vehicle such as a self-directed IRA can help you avoid serious loss. A self-directed IRA is an individual retirement account that gives you complete control over your investment choices. Stock market crash2Unlike other IRAs, you’re not limited to stocks, bonds, or mutual funds. This means you can take advantage of investing in alternative assets – such as a franchise, real estate, limited partnerships, and gold with your self-directed retirement account.

Opening a self-directed retirement account gives you the freedom to invest in almost any type of asset – meaning you have more flexibility in the amount of risk you take on and more potential for a higher rate of return.

The ability to diversify your portfolio by investing in alternative assets such as a franchise, real estate and precious metals can act as a hedge against market fluctuations and volatility.

Put your knowledge and expertise of a particular industry or niche to good use. Make investment decisions based on what you know and understand to grow your retirement savings.

Investing over time in a self-directed IRA that allows for tax-deferred or tax-free growth can significantly affect future wealth positively.

“Private Placements” is a term that refers to investing in privately held entities, such as companies or small businesses.  Banks have recently tightened their purse strings when it comes to lending to these entities, creating a higher demand for development capital from investors.

For those seeking funds, obtaining capital from a self-directed IRA owner can be simpler and faster than the loan process with institutional lenders. For self-directed IRA owners, this type of lending has the potential to bring higher returns than the stock market or CDs.

Providing private loans to businesses is an allowable way to diversify your retirement portfolio. Your self-directed IRA can invest in:

  • LLCs
  • C corporations
  • Private stock
  • Partnerships
  • Private placement memorandums
  • Businesses
  • Land trusts
  • Secured and unsecured notes
  • And more

To learn more about the different ways your IRA can invest in private placements, or to make a private placement investment, please Contact Us today.