As you develop your business, the need for financial information and tracking will grow.
Where is your money coming from?
Where is your money going?
What areas are the most profitable, and what are losing the most money?

A sole proprietor or partnership needs to take this into consideration in order to make sure they are being as effective as possible. Corporations and other businesses need to be aware of their situation at all times as well.

This is where accounting comes along. The basic financial statements that you should be aware of are:

• Balance Sheet - This Statement shows the breakdown of what your business owns (The Assets) and what it owes (The Liabilities) for a specific point in time.
• Income Statement – This Statement will show how your business performed over a period of time. Your revenues and expenses for the time are displayed here.
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Do you start to get stressed out when watching your stock prices yo-yo up and down?
I do. I’m willing to bet that this has consumed your mind a number of days before. Especially when you’re losing money.

When your stocks are down, it’s common for people to stare at the tickers and look at every piece of news about the market. The technology that we have today allows us to completely entrench ourselves into the market’s world.

We’ve got CNBC running news, stock prices, and evaluations at us with Yahoo Finance streaming our quotes and bringing in tons of RSS feeds chalked full of info on the market conditions. Meanwhile you’ve got a copy of business week on your desk that you can’t even begin to think about until you completely devour your copy of The Wall Street Journal.

Now if that doesn’t cause you stress, I don’t know what will.

The most well known and successful investor lives a thousand miles away from Wall Street simply for this reason. Of course with technology one could still easily become entangled and paralyzed with the random fluxuations of the market. Warren Buffet chooses not to.

What does Omaha, Nebraska have that’s so appealing to him?

Peace and Quiet. You don’t have to make thousands of trades a year. You can do fine with only making a couple good ones.

So the next time you’re pulling out your hair because your Euro-Disney Stock is flailing, tighten your belt, turn off your computer, and go spend the day with your kids.

You never know when a good idea might hit you.

If someone were to invite you to go skiing this weekend, though you’ve never skied in your life, what would you say?

Probably: “Oh, I can’t ski.”

What if you were invited to shoot some pool?

:Oh, I can’t play pool.”

When else have people been inviting you, even daring you, to try something new, only to find you turning them down? You don’t know how to shoot pool. You’d rather stay home and watch TV than try to ski.

I think that saying you can’t do something means that you don’t want to try to do it. In fact, I would bet that if you played pool every day, not only would you be able to play the game, but you might also become the best player there is.

Now what about all of those ideas that pop into your head that you shoot down before you even consider your new thoughts? How many million dollar ideas might be passing through your head, simply to be met with, “Oh, I can’t”?

Before other people can believe in you, you have to believe in yourself. Some day, no one is going to ask you to ski. No one is going to invite you to shoot some pool. And you’ll be looking back. Maybe you really could have done it.

What would you do if somebody slipped and fell at your business? I’m hoping that you would simply be able to send a letter to your insurance agent and they would take care of it. That’s what liability insurance does, pays damages to people without regard to fault.

The problem is that law is vague, and justice is expensive. The solution right now is liability insurance. It’s pretty crazy to run a business without a CGL policy. (Commercial General Liability)

It will provide you with three lines of defense in case of an accident.

1. Medical Payments Coverage – Pays injured customer’s medical bills without regard to fault
2. Supplementary Payment – If you go to court, the insurance company chooses and pays the defense team.
3. Damages Payment – The insurance agent will pay damages to the injured party. This includes both judgments and cases that are settled out of court.

One good thing about your insurance company is that they are going to find and hire a really good legal team, because they are also responsible for the damages. Being as they are the ones who are paying the bills on it, it’s also there decision if they want to settle out of court.