GIFTS THAT KEEP ON COMING
Acknowledgement- copied from "Fundsource" Website
year it seems to get harder and harder to find the right
gifts. A lot of us don’t like to simply give cash, but a
lot of the time a “financial” gift can be just the
answer, especially for someone who struggles in this area.
And the benefits of helping someone out in this way last a
lot longer than you may realise. Here are five ideas, some
bigger than others, and the benefits they offer beyond what
1. Paying off a Credit Card or other
This is a gift that can be large or small, but the ultimate
benefits are much bigger than what it costs you. For
example, if you paid $50 of someone’s credit card debt,
not only are you helping them pay off the debt, but you are
also reducing their interest charges, even if only by a
little bit. Because credit card interest compounds, over one
year you will save them another $10 in interest charges if
they are paying the typical 19.95% and over two years this
will grow to $24 in interest savings.
2. Units in a Managed Fund
This gift will probably be a pretty generous one, as the
minimum investment in a fund is usually $1,000 although you
can get funds where the minimum is $500. That said, another
way to approach it could be to offer them a deal – for
instance, you’ll contribute a certain amount if they come
up with the rest of the minimum investment. Once again, this
is a gift that has the potential to be a lot bigger than
what you spend on it. If the fund you invest in earns 7%
p.a. (after taxes and fees) for the next ten years, the gift
of $500 would grow to $983.
3. Education and Tools
There is an enormous array of books on financial matters,
and they are all suited to people in different situations.
You can find books on paying off your mortgage, making and
sticking to a budget, investing, teaching kids about money
– just about anything you can think of. Books aren’t the
only option either – for grown-ups there is software than
can help you manage your finances, and for kids toys and
games can help them to learn about money. Helping someone
get in control of their financial destiny is a gift
they’ll benefit from for years to come.
If you know what someone really needs is cash, but you are
worried cash might just get frittered away, then why not use
vouchers to ensure it goes on something you feel is useful?
You can get vouchers for all manner of necessities, such as
petrol, groceries and pharmacies. Even better, with many
credit cards you can redeem your points for vouchers, and if
this is the case for you, the voucher costs you nothing!
For the person who has everything, why not make a donation
to a charity in their name? Many charities have a lot on
their plate around Christmas, and a donation could put a
smile on the face of someone who needs it. Of course, a cash
donation in the name of the person concerned could get them
a tax deduction too! But you could also contribute items to
food banks, buy animal food for the SPCA or buy toys or
books for children who otherwise wouldn’t receive
As you can see, there are lots of options for gifts that
keep on giving. While they might not be exciting or
glamorous, they are gifts that show how much you care about
the wellbeing of the people around you.
YOUR BUSINESS TO THE NEXT LEVEL IN 2006
You have probably heard the saying, “Do
what you have always done, and get what you have always gotten.” This
statement is true in all areas of life, including business. If you have hit
the five to seven year mark in your business, you will be facing new
challenges before you enjoy the fruits of your labour. To date, you have
become aware of the selling cycle in your industry, you have interacted with
different kinds of people, you have done 95 percent of the work yourself, and
you have overcome some major challenges of staying focused and breaking
through serious roadblocks when those close to you have questioned your goals.
If you've been
accustomed to running your business solo and are looking to move to the next
level, you need to re-structure your thinking. Some tips and suggestions
1. Update your
Make sure you know where you are going so you don't get lost or side-tracked.
Are you looking to hire full-time employees? If so, how many? How much will
they get paid? What will their jobs look like? What do you expect your company
to make in six, 12 and 18 months from now? How will you measure the results to
assess whether you are on the right track? Visualise where you want to be at a
particular point in time. Record everything in print.
2. Change your
One of the hardest things to do is to change what you're used to doing. Why?
Because this is human nature. As an entrepreneur, you've been accustomed to
doing everything yourself. Letting go of certain responsibilities and
delegating tasks is one thing. Knowing who will perform effectively is
another. This is one of the challenges of moving to the next level, but it can
be done. Others have done it. So can you. One of the pluses is to get others
to do what you've always disliked. Your business will become more effective as
Motivating your Staff
If you have become so used to relying on yourself to get to a
certain level of success, teach your staff the value of self-motivation. You
should also praise them for their hard work, dedication, creativity and
enthusiasm. This will serve everyone well over time. Learn to trust yourself
and the decisions you make when hiring certain individuals. At first, your
judgment might be poor. As time passes, you will learn from your mistakes and
assess people more effectively. Always get your staff to open up and tell you
their concerns and challenges. Never assume all is well when it might not be.
You were once the doer. Become the observer.
4. Maintaining your
Whenever you hit unfamiliar territory things can appear quite scary. There is
no way out of this. In order to move ahead you must apply what you have
learned to date. As an entrepreneur you have maintained your focus to
accomplish a certain level of success. As a business owner you can do the same
thing by developing others. Take time to train your individual staff members
and monitor their progress regularly. Your focus has changed, but you are
still, if not more responsible to maintain it.
5. Defining and
re-defining your Values
Ask yourself: why are you in business for yourself? Continue to keep asking
yourself that same question over time. If you want to build a team of strong
leaders who share the same mission and vision as you, you need to know exactly
what that is. As you grow, your values might change. Make sure your team is
in-tune with them.
The best way to grow is at a slow, steady
If you are to sustain anything, you must
first learn to make room for it. Expand your mind and prepare for change
before it happens. You won't know exactly what it will look like but at least
you'll be able to handle it when it comes.
"ORDINARY WEEKLY PAY" AND "AVERAGE WEEKLY EARNINGS" IN
RELATION TO HOLIDAY PAY
The Holidays Act 2003 came into effect on 1 April 2004, which affected the
method of calculating holiday pay.
Both “ordinary weekly pay” and “average weekly earnings” need to be
calculated and the greater figure used for the employee's annual holiday pay.
Ordinary Weekly Pay
“Ordinary weekly pay” represents everything an employee is normally
paid weekly, including:
|regular allowances, such as a shift allowance
|regular productivity or incentive-based payments (including commission
or piece rates)
|the cash value of board or lodgings, and
Intermittent or one-off discretionary payments are not included in ordinary
For many people, ordinary weekly pay is quite clear because they are paid
the same amount each week.
Where ordinary weekly pay is unclear for any reason, the Act provides an
averaging formula for working it out. Ordinary weekly pay is established by:
|Going to the end of the last pay period
|From that date go back
|4 weeks, or
|if the pay period is longer than 4 weeks, the length of the pay period
|Take the gross earnings for that period
|Deduct from the gross earnings any payments that are irregular or that
|Divide the answer by four|
Sometimes an employment agreement will include a specified ordinary weekly
pay. If this is the case, the figure in the employment agreement should be
compared with the actual ordinary weekly pay (as calculated under 1 or 2
above), and the greater of the two should be used as “ordinary weekly
Average Weekly Earnings
“Average weekly earnings” are determined by calculating gross earnings
over the 12 months prior to the end of last payroll period before the annual
holiday is taken, and dividing that figure by 52. The following payments make
up gross earnings and should be included in the calculation:
|salary and wages
|allowances ( not reimbursing allowances)
|all overtime payments
|piece work payments
|at risk, productivity or performance payments
|payment for annual holidays and public holidays
|payment for sick and bereavement leave
|the cash value of board and lodgings supplied
|amounts compulsorily paid by the employer under ACC (i.e. the first week
|any other payments that are required to be made under the terms of the
Unless the employment agreement says otherwise, reimbursement payments and
discretionary or ex-gratia payments (for example, genuinely discretionary
bonuses) are not included in these calculations; nor are payments made by ACC
or when an employee is on voluntary military service.
EMPLOYEE ALLOWANCES ARE TAX FREE
There are three types of allowances commonly paid:
travelling, benefit and reimbursing.
These are cash allowances paid to employees for travel
between home and work, and may be tax-free. The
allowance will be tax-free if the amount reimburses an
employee's additional transport costs and any of the
following special circumstances exist:
|the employee is working outside the normal hours of
work (e.g. overtime, shift or weekend work)|
|the employee needs to transport work-related tools
and equipment (e.g. the employee normally takes the bus
to work and has to use some other type of transport to
carry work-related equipment).|
|there is a temporary change in workplace (e.g. your
employee normally works in Wellington but for the next
fortnight you require them to work in Palmerston North)|
|the employeee is travelling to fulfill an
obligation for the employer|
|there is some other condition of the employee's job
(e.g. your emplyee is on call and uses their car for
|there is no adequate public transport system
serving the workplace.|
For all these special circumstances, except lack of
adequate public transport, the tax-free amount is the actual
cost of travelling between home and work, less the
employee's usual transport costs. If you pay a
travelling allowance because there is a lack of adequate
public transport the first $5 of the daily travelling
allowance is taxable and any additional amount is tax-free.
If you are registered for GST you can claim a GST
credit for the reimbursement for your employee's actual
expenses, provided normal GST requirements are met.
These are payments made in addition to salaryand wages
which benefit your employee. A benefit allowance is
taxed with your employee's wages.
These payments are made to employees to compensate
them for expenses they have had while doing their job- such
as meal allowances, mileage allowances or tool money.
A employer may make a reasonable estimate of the
expenditure incurred by an employeee and treat this as if it
was the amount incurred by the employee.
Reimbursing allowances are not taxable.
However, if the payment is more tha the employment-related
expenses or more than a reasonable estimate, the excess is
If your empoyee's allowance is taxable add the taxable
value of the benefit to the empoyee's pay for each pay
period, and deduct PAYE from the total.
OBLIGATIONS WITH UNCLAIMED MONEY
Unclaimed money is funds left untouched for six or more consecutive years
in financial institutions and businesses.
Most of the forgotten and abandoned money comes from deposits left in
financial institutions such as insurance proceeds, and also includes unclaimed
funds such as cheques or wages.
Initially it is the responsibility of the institution holding the funds to
make every effort to locate the proper owner of the money. If they cannot
locate the company or individual, under the Unclaimed Monies Act 1971 the
funds are required to be paid to Inland Revenue.
The Act applies to all companies, banks, building societies, insurance
offices, money-lenders, auctioneers, real estate agents, accountants,
sharebrokers and motor vehicle dealers that hold defined classes of unclaimed
Companies need to consider if they have amounts that are unclaimed money
and to ensure that systems are in place to pay the money to Inland Revenue at
the appropriate time.