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  # 939219 22-Nov-2013 18:55
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I wish you luck for the future.

I also advise you to be careful with the new company. If the old one is liquidated and the receivers decide you have played a shell game by simply moving assets/customers/contracts over to a new company before the liquidation, things can get very nasty. Make sure you have good legal advice. (Disclaimer - I'm not a lawyer!).

Financial education doesn't have to be complicated. Just a few key rules really:
1. If you borrow money, you will have to pay it back.
2. Make sure you can afford to pay anything you borrow back and, if you can't, don't borrow it. No matter how much you want the shiny object.
3. Don't stretch yourself to the limit - things can and do go wrong, accumulate something for a rainy day as soon as you can.
4. For shiny non-essential consumer goods, if you can't pay cash for something then you can't afford it.
5. Don't sign anything if you don't understand it, and also understand the possible consequences of signing.

Follow those, and for most people (barring unforeseen calamity) you won't get into trouble. Not rocket science.



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  # 939339 22-Nov-2013 23:38
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Wow, interesting answer from a former mayor.

Some people do actually start their businesses that way.
I guess you would have allowed for funding in the financial part of your plan.
You could next have approached people with money in the same industry either individually or in a seminar and presented your ideas and offered shares in your business.

Thats why I like the idea of operating a business like an investment. Show people it will benefit them and others. Use words that show people that you understand business. Words like - Return on Investment, shareholder dividends etc. You don't need to be that smart to get a loan or credit.

Even if you are not successful in securing funds from other sources you would learn a lot more. There is minimal skill in obtaining money via credit cards and banks, and unless you have a specific strategy because it will also be the most expensive. Over the years I have learnt that one person will not have all the answers. You gather the information they give you then move on to the next person. You then use that knowledge then share that knowledge with others by your actions because you care about the wellbeing of our society.

If we all learnt to do that we could have a great city. I believe that is possible.
Unfair debt collection practices would then be no longer acceptable in our society.
And we would have other solutions available to us than to just writeoff money.
My accountant just told me today that now I'm at the point where my debt will be made public.
I refuse to give in and accept "death".

Ford


 
 
 
 




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  # 1015277 30-Mar-2014 07:51
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Update on this topic

The Banking Ombudsman found in my favour.
They found that ANZ had not been responsible with its lending.
The only consequence for ANZ was to offer interest reduction and small compensation of inconvenience, of which I have to sign an acceptance form for. I have not signed anything thus far.

The banking code then is not worth the paper its written on and if anyone else was rung up by ANZ and offered money after the earthquakes you could be entitled to an interest refund, if found that ANZ did not access your application for lending correctly.

I also found out that debt collectors are not regulated in this country and you don't even need any sort of licence or be registered. Baycorp had to write off 3.5million in debts last year when the Commerce Commission found they were in breach of the Credit Repossession Act.

Ford




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  # 1015302 30-Mar-2014 08:55
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Ford: Update on this topic

Correction - Fair Trading Act

Ford


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  # 1015465 30-Mar-2014 17:09
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One of the things that have shocked me here in NZ is the "Payday loans" with 350% and up as the annual interest. Those kind of services can only be targeted to people in serious financial problems and without much insight into what loans should cost.

Short term credit is one of the first things you should get rid of if you want to have a more healthy personal economy.

Financing a business on short term credit is a sure way to get in financial trouble from the start.

I think a lot of startups fail to understand that it takes a while to start a business, and that you can't expect to be profitable the first year - so adding to your financial burdens with bad financing is not a good way to go.




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  # 1015741 30-Mar-2014 23:30
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They have very strict rules in the UK about this - a few I can recall are

Bailiffs cannot attend in the hours of darkness
Bailiffs cannot break and enter
The tools of your trade cannot be sold to pay debt
They cannot leave you without a bed or clothes, medical equipment, infant equipment etc
They cannot claim to be acting on court orders unless they are

I forget the rest - we studied them as part of my law training. I do know that most bailiffs (those who collect debts, distrain goods and so on) are known to widely ignore the rules and it is an area of great concern about which there is often debate on making rules even stricter.

They send the bailiffs in the UK at the drop of a hat -  for parking fines, late council rates - even overdue library fines!

I don't know what the rules are here - or even if there are any.





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  # 1015742 30-Mar-2014 23:34
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Ford: Update on this topic

The Banking Ombudsman found in my favour.
They found that ANZ had not been responsible with its lending.
The only consequence for ANZ was to offer interest reduction and small compensation of inconvenience, of which I have to sign an acceptance form for. I have not signed anything thus far.

The banking code then is not worth the paper its written on and if anyone else was rung up by ANZ and offered money after the earthquakes you could be entitled to an interest refund, if found that ANZ did not access your application for lending correctly.

I also found out that debt collectors are not regulated in this country and you don't even need any sort of licence or be registered. Baycorp had to write off 3.5million in debts last year when the Commerce Commission found they were in breach of the Credit Repossession Act.

Ford



Codes of Practice are what one judge in a case I studied many moons ago memorable called "merely so much waste paper"!

It seems to me, based on observation for the best part of 50 years, that only laws stand any chance of being observed. Voluntary codes of practice stand no chance.





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  # 1015743 30-Mar-2014 23:38
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Ford: Yes I definately agree about the school system.
There certainly wasn't any form of financial education when I was at school. To bring financial education into the school system would certainly mean challenging government education policy, but it is a good idea and I could at least in the beginning speak to a schools principal to get a handle on what if any financial education is currently taught in our schools.

I read an interesting article in a chartered accountants magazine about crowd funding which is an alternative to borrowing instead of using the banks. That at least gives people choices. The banks control the financial media such that it appears the only way to obtain money is via banks or credit card. This I believe is because the focus is on teaching people to save their money. Which means they "park" it somewhere (like a bank) who lend it out and make more money. I have read that to make money the smart way you need to keep it moving and don't just hand it over to others and hope they will take care of it. Our society also teaches us to cut costs and reduce and downsize and layoff and make bankrupt. I say, lets increase and expand so we can get educated. What I don't understand is that I am told that bankruptcy should be the last option. So why are people telling me to take that as a first option? I get some interesting grimaces from lawyers when I ask what other alternatives are there that doesn't involve having all my debts written off in some form or another.

In the meantime I've changed the name of my company - with the debt still against it. I've setup another company with the same name of the original, retaining the same customers. It will be an investment company with share/stock offerings, unencumbered with no debt and a fresh start and a new mission/campaign to bring financial education to others. If the banks don't want to accept my settlement offers then they can liquate the "debt" company. If they come after me personally and force me into bankruptcy I'll make sure I'll be ready for them.

Wish me luck!
Thanks for your insights.


If you own a house and go into business, consider starting a Trust and get the house in there.

It's not cast iron (although the longer the time between when you do it and when you have financial problems, the more it is likely to succeed) but in theory any business creditors cannot come after the house because it actually does not legally belong to you. Seek professional legal and or accounting advice first  though but it is certainly one viable strategy for many.







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