Here’s What to Look for in a Secured Credit Card

Committing to a credit card is a big deal. If you feel some trepidation when you consider it, starting with a secured card may be a better option. These cards have features that make them somewhat safer for first-time card owners. They’re also an excellent option for those looking to build credit.

It’s a well-known vicious cycle that you need good credit to get a credit card. However, having a credit card is one of the chief ways to build credit. Secured credit cards can help you escape that cycle and begin your financial journey. In this article, you’ll learn what to look for in a secured card and which ones may work best for you.

Safe Credit Building
When choosing a secured credit card, you want something that will let you safely build credit. Safety is essential if your credit has been damaged in the past. A card that offers some level of protection to you is a huge asset. This protection can be provided in a number of ways, depending on the card.

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A card like the Chime Credit Builder will allow you to set up automatic bill payments. This means you don’t need to worry about remembering to pay on time. Timely payments and total balance payments will do wonders for your credit. Choosing a card that lets you do that automatically can remove some of the stress of card ownership.

Default Protection
Automatic payments are a bonus feature. A crucial part of secured credit cards is their default protection. When setting up your card, the deposit you make ensures that you don’t default on your account. A late payment on your account will still negatively affect your credit. However, you won’t be in debt due to a missed payment on your card.

When deciding which secured card is right for you, make sure you’re only looking at cards that require a deposit. A card that doesn’t need one isn’t a secured credit card. The deposit, a hallmark feature of these cards, reduces the risk to the card issuer and lays it on the user instead. Don’t stress about the risk, though. As long as you maintain regular payments, you’ll get that money back.

Upgrade Options
How do you get your deposit back? By closing your secured card account or upgrading to a non-secured credit card. When you close your account, barring any problems, your initial payment should be returned to you. Better yet, choose a card that will let you upgrade your account once you’ve built up your credit.

Selecting a card that allows that process to happen automatically can help you reach your financial goals more easily. The Discover it® Secured Credit Card is one that provides this service. After you sign up for the card, your account is periodically checked to assess your upgrade eligibility. Once you qualify, the company will change your account status.

Reports to Credit Bureaus
Your ability to upgrade depends on your credit score. Essentially, your credit score determines your creditworthiness. That determination affects your capacity to apply for better credit cards and take out a mortgage or auto loan. Your score is assessed by credit bureaus or credit reporting agencies.

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While there are many of these agencies, only three of them are significant to consumers. These groups determine your overall credit score. It’s imperative that any card you choose reports to these bureaus so that your credit-building efforts will be recorded. All major secured cards file these reports, but it’s worth double-checking to be certain.

Low or No Annual Fees
Another thing to consider is the fees assessed on your card. Frequently, secured cards have a higher annual fee than unsecured ones. These fees make the card more expensive to maintain from year to year, impacting your ability to keep it. Fortunately, there are some low- or no-fee secured card options available.

Do some research, and you’ll be able to find a card that fits your yearly budget. A card such as Capital One’s Secured Mastercard® could be a good fit. It charges no annual fee and also offers flexibility in terms of deposit and credit limit amounts. A minimum deposit as low as $49 makes it easy for a first-time card owner to get started building credit.

Credit Education Tools
As a first-time card owner, you may not know a lot about how credit works. This lack of knowledge is understandable and shouldn’t be a barrier to getting a card. It can, however, make you feel uncomfortable about using your card. This sense of unease is why some companies are now offering credit education tools with their secured credit cards.

For example, the OpenSky® Secured Visa® Credit Card gives you access to educational materials through a website. It also provides credit tips for those just getting started on establishing credit. A downside is that the card doesn’t offer cash back or points of any kind. Other cards that offer education may also provide those perks, so be sure to comparison shop.

Rewards Options
Though rewards aren’t common with secured credit cards, some do offer them. Secured cards associated with more prominent issuers may offer rewards comparable to those from traditional cards. Anytime you’re looking at a card with benefits of some kind, be sure to balance those with other costs. Often, robust rewards can mean a higher APR or other fees.

Reward options are helpful if you’re trying to save for a specific goal, like air miles. If it’s your first card, seek out cards that offer rewards on everyday spending, like gas and groceries. Those are small purchases that will keep your monthly bill manageable. Using them to earn points would be a great way to get the most value out of your card.

Starting — or rewriting — your credit history is a daunting task. Luckily, secured credit cards make it possible with many features that can protect you. After you make the initial deposit, they work just like a traditional card. Make credit building easier for yourself by choosing a card that eases you into the journey. Your nerves, and your credit score, will thank you.

The Best Time to Invest in Cryptocurrencies Is Now

Because of the internet, transacting with digital currency is now possible. Do we all remember how it felt to interact through social media a decade ago? Cryptocurrency is in this stage now and is taking its position in the global economy. Actually, experts are optimistic that it will shape the future economy.

The evolution of crypto since it was born compels people to believe that this is a lucrative investment. When you look at the curve, there has been consistent growth and stability. Any investor has numerous reasons to give it a shot now. Accordingly, let us focus on the reasons why the best time to invest in crypto is now.

Evolution and Growth
What more do you want to hear? Cryptocurrencies have recorded tremendous growth over time. Bitcoin, for instance, did not record as much growth in the first two years, but once it kicked off, it has continuously grown in value. As people get more information and gain trust in digital currency, they become willing to start buying and selling Bitcoin.
Other cryptos such as Ethereum and Bitcoin Cash have also grown very well. Actually, relatively few major cryptocurrencies have failed once they took off. It is a great time for you to invest in cryptocurrency.

Crypto’s Bright Future
Past data can tell us a lot about the future of something. From our analysis, the past has been relatively smooth for cryptocurrencies even considering a few challenges along the way. Experts in the industry have developed solutions to make the blockchains faster, more secure, and more accurate. Bitcoin and Ethereum are the leaders in making blockchain technologies that give hope for an even brighter future in the industry.

If you invest in crypto today, you are in a better position to enjoy all the future advancements. Surprisingly, more innovators are now understanding blockchain technology and bringing their inputs to the table to further improve it. Its success has even compelled other sectors like banking, insurance, and many others to adopt it. This is a major sign that they have seen a bright future in the cryptocurrency sector.

Easier Transactions
Cryptocurrency transactions and trading are now easier than ever. Third-party service providers are on the rise. Reliable ones such as Nakitcoins provide a secure and easy-to-use environment to buy and sell Bitcoin, Ethereum, XRP, and many other cryptos. First, these service providers allow investors to create secure wallets and deposit the crypto that they want to sell. The third-party service providers do offer trading advisories to beginners and seasoned investors as well.

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If you would rather use your existing wallet, it is not only easy to buy and sell Bitcoin and other cryptos through these sites but also very secure and discreet. All you need to do is to visit one of these websites and conduct a transaction using your current crypto wallet.

Numerous Options
Gone are the days when Bitcoin was the only crypto on the market. If its current value and performance do not look enticing to you, try others. It is almost impossible not to find one crypto that is suitable for you from this list.

Bitcoin – It is one of the oldest and most popular. It was introduced in 2009, and the current value of one Bitcoin against USD is $9,614 and getting stronger.
Bitcoin Cash – This was coined from the original Bitcoin in 2017 to address some flaws in the original crypto. It is now independent and gaining popularity at a fast rate.
Litecoin – Since 2011, this crypto has provided an excellent opportunity for an open-source global payment framework that is now getting adopted by some other cryptocurrencies.
Ethereum – After Bitcoin, this is the second in popularity. It was launched in 2015. Today, investors have the option to choose either standard Ethereum or Ethereum Classic. Just like the other growing cryptos, Ethereum has shown continuous growth in an amazing way.
XRP – This crypto came into the market in 2012, making it one of the oldest. Although you will not hear a lot about it like Bitcoin or Ethereum, it has numerous benefits such as peer-to-peer transactions and open payment platforms.
Dash – The last cryptocurrency to discuss here is Dash. It is very fast with reliable and almost instant transactions.
Precautions to Take When Investing in Cryptocurrency
We have focused on the reasons why you should consider investing in one or a couple of the many cryptocurrencies today. But there is always a catch in everything that is very lucrative. The crypto world is very volatile, which increases the chances of losing money. If there are significant economic changes, the value could go down. We have seen a couple of dips in the major cryptocurrencies in the past. Again, there is the danger of being hacked and losing your wallet especially if you do not use a secure platform.

With this in mind, always consider taking the safer route by diversifying your investments. These are just precautions but not a discouragement to invest. Actually, all the insights that we have shared above give more reasons to invest in cryptocurrency today.

Smythe Adapts to Working from Home

As the world around us continues to adapt to a new sense of normal in light of COVID-19, we at Smythe LLP (Smythe), recently sat down (virtually) with Kendall Hanson from CHEK News to discuss how we’re adapting to working from home and what is means for us as a firm, as well as the communities we live and work in.

Although we may be smack dab in the middle of our busiest time of year, things at Smythe are still business as usual – with a few notable exceptions.

The first, and probably most obvious, is that nearly all our staff have now transitioned to working from home.

“The first week of office closures and having everyone work from home was definitely a week of transition, but I think everyone’s really quickly adapted to it and gotten used to it and a lot of people are really enjoying it,” said Partner, Trevor Topping.

During a time where our offices would normally be a buzz with client visits and meetings, our offices are now closed to the public and a skeleton crew has been put in place to ensure clients are able to safely drop off necessary files and mail is being received and sent out.

To read the full article and to hear what Trevor had to say about Smythe’s new normal, click here.

For more information on our response to COVID-19, or to learn what support is available to you, please visit our COVID-19 Resource Centre, or reach out to your Smythe Partner directly.

Cash Flow Management

Given the current economic uncertainty, effective cash flow management will be critical for the success of many businesses. This will likely involve a combination of:

Managing working capital levels
Managing discretionary expenses
Obtaining additional financing

Working capital management can take the form of:

Implementing Credit Policies
By implementing credit policies with your customers you can speed up the collection process. This could include requiring upfront deposits, reducing the credit terms or offering incentives for early payment. Always ensure you follow-up on overdue accounts.
Utilizing a Just-in-Time Inventory System
Unless it will hurt your ability to sell, don’t carry extra inventory.
Using Credit Terms to your Advantage
Unless they are offering worthwhile incentives, don’t pay your suppliers until it is necessary.

A tool that should be utilized to help with managements’ decision making, is a cash flow forecast. This will help you assess the impact of working capital and expense management decisions, as well as determine whether additional financing will be required.

If you decide that you need to obtain financing (see below), it is likely that the lender will require a forecast as part of the application process.
Obtaining Additional Financing

As part of the economic stimulus package, the Government of Canada is working to ensure businesses have access to traditional financing, from both the government and private lenders.

Among the products being targeted to COVID-19 relief are:

Working Capital Loans
Funds to provide working capital for the operations, and cover general operating expenses, as opposed to capital purchases or expansions. There are currently programs in place where loans can be approved within 48 hours or maybe available without any payments for the first six months. BDC loans of up to $100,000 can be applied for online.
Loan Guarantee for Small and Medium-Sized Enterprises
As part of the Business Credit Availability Program, EDC is partnering with financial institutions to guarantee 80% of new loans or credit requests up to $6.25 million for small and medium-sized enterprises. Financing is meant to be used for operating costs and is available to exporting and non-exporting companies. The idea behind the program is to encourage additional funding from banks as the EDC provides a re-payment guarantee of 80%. This program is now available through your bank or credit union.
Bridge Financing Program
Offered through BDC Capital, this special program may match (with a convertible note) a current financing round being raised through qualified existing and/or new investors made into eligible Canadian start-ups. This program is best suited for high-potential companies that have venture capital investors willing to support them. BDC will then invest alongside these groups. There are separate criteria for both companies and investors who wish to take advantage of this program – for full details, click here.
Term Loan and Lease Payment Relief
Ability to delay payment of principal for up to six months on existing loans.
Increases to Existing Line of Credit
Financial institutions are providing increases to the borrowing limits on existing lines of credit.
Purchase Order Financing
Flexible terms are being offered to ensure existing and future orders can be fulfilled.
Buyer Financing
Export Development Canada is providing buyer financing and direct financing for international sales to ensure Canadian businesses are able to participate in international trade opportunities.

If your business requires cash flow management or additional financing, please contact your Smythe Partner directly as additional reporting may be required. Our team can match your business with the appropriate product and guide you through the process and provide financial information to the lending institutions.

Canada Emergency Business Account (CEBA) Interest-Free Loans

the Government of Canada announced the Canada Emergency Business Account interest-free loans that provide up to $40,000 for small businesses and not-for-profits that have been financially impacted by COVID-19. On December 4, 2020, the program was expanded to offer an additional $20,000 to businesses that continue to be seriously impacted by the pandemic. The loans are available through eligible financial institutions, and businesses must apply through a financial institution where they had an existing relationship. The loans are interest-free, and 25% of the original $40,000 of the balance and 50% of the additional $20,000 of the balance is forgivable if the business repays the loan by the end of 2022. Businesses are required to have had an annual payroll of $20,000 to $1,500,000 or non-deferrable expenses of at least $40,000 in 2019 to qualify.

Businesses have until March 31, 2021, to apply for a loan or the $20,000 expansion. In the case where applicants are waiting for their financial institution to finalize the submission of additional information, they will have until May 7, 2021, to complete the submission.

Roles and Responsibilities of a Finance Department

The activities expected from a finance department cover a wide range from basic bookkeeping to providing information to assisting managers in making strategic decisions. What to expect from your finance department will depend largely on factors such as how much involvement the owner/manager has in the organization.

At the base level, your bookkeeper will be responsible for all the day-to-day transactional accounting for the business. This will include the tracking of all transactions and the management of any government reporting. In very small owner-managed businesses, this role is often filled by a family member with accounting experience. An outside accounting firm is usually used for annual financial statements and returns. In larger organizations this role will extend right through to preparing the financial statements with an external auditor engaged for assurance purposes.

To talk to one of our trusted advisors today contact us here, or continue reading below.

The finance department is also responsible for management of the organization’s cashflow and ensuring there are enough funds available to meet the day-to-day payments. This area also encompasses the credit and collections policies for the company’s customers, to ensure the organization is paid on time, and that there is a payment policy for the company’s suppliers. In most organizations there will be some form of forecast prepared on a regular basis to systematically calculate the ongoing cash needs.

Where there are cash needs beyond the day to day working capital, the finance department is responsible for advising and sourcing longer term financing. Financing may be obtained though bank or private lender debt or, in applicable firms, share issues to private investors. If the organization is ready to target angel investors or venture capitalists the finance department will be key in preparing the documents required for these presentations and may work with outside consultants on a company valuation. In larger firms considering public share offerings the finance department will assist with the preparation of the offering documents but will likely also use outside consultants to advise on this complicated process.

With the must-do’s taken care of, the finance department can now start to contribute to the management and improvement of the operations by measuring and reporting regularly on key numbers crucial to the success of the organization. Management accounting information is information that managers can use to monitor the operations and decide where further attention may be required. It will likely include some non-financial information and should be communicated to managers in a way that is easy to understand. In smaller owner-managed businesses this resource, though extremely important, is often overlooked or ignored.

Looking forward, the finance department will work with managers to prepare the organization’s budgets and forecasts, and to report back on the progress against these throughout the year. This information can be used to plan staffing levels, asset purchases and expansions and cash needs, before they become necessary. Some organizations often ‘plan’ by the seat of their pants, while organizations know it is important to have some idea of where you want to go before you start going there.

Finally, the finance department should be called upon to provide information to assist managers in making key strategic decisions, such as which markets or projects to pursue or the payback periods for large capital purchases. The finance department can often contribute an objective perspective based on special financial assessment techniques.

In summary, some organizations know the finance department should be considered a resource to assist managers in the running of the business. With the growing popularity of outsourced finance departments, it is possible for even small businesses to have access to all of the benefits of a full finance department, through part time professionals, at a fraction of the cost of employing a full time finance department.