Son of Five Rivers Blog

For the advancement of Entrepreneurship, Sustainability & the Ecology of Everyday Life

This Site has Moved to SonOfFiveRivers.com

Click Here to Vist NEW Site: www.SonOfFiveRivers.com

I’ve been blogging for several months now and I’m glad to have recieved the feedback I have.  I’ve enjoyed the experince and for that reason I’ve decided to take blogging to another level.  I’ll be self hosting my blog and that means you’ll see a lot more creativity in the design, functionality and layout of the new blog.

Check it out: www.SONofFIVErivers.com

Cheers

January 22, 2010 Posted by | 1, A Thought, Ads, Agriculture, Art, Blogging, Books, Brochure, Business, Business Cards, Business Development, Business Model, Carbon Credits, Clean Energy, Co-op, Community Economic Development (CED), Computer Networking, Construction, Creativity, Data Recovery, Definitions, Earth, Economics, Education, Electric Cars, Email, Entrepreneurship, Family, Finance, Geothermal, Government, Grants, Great Ideas, Green Roofs, Human Resources, Information Technology (I.T.), Inspiration, Investment, LEED, Life, Marketing, Micro Credit, Not for Profit, Open Source, Packaging, PDA's, Philanthropy, Photography, Politics, Power Piont, Products, Project Management, Quotes, Sales, Search Engine Optimization (SEO), Services, Social Enterprise, Social Media, Solar, Sustainability, Sustainable Community Development, Taxes, Venture Capital, Videos, War, Waste, Water, Website | Leave a comment

Text Messaging while Driving

So recently I watched a Public Service Announcement (PSA) on Text Messaging while driving.

I think naturally any organization that has a company vehicle should put this into a written policy that clearly states employees should never text or email while driving.

It seems like common sense but I heard the statistic that 45’000 people die from this a year?  This just seems completely absurd to me.

In the United States they have already banned texting while driving in many states.  Canada on the other hand is very far behind and we don’t have a single Province or Territory passing any sort of legislation on this matter.

August 26, 2009 Posted by | Business, Education, Electric Cars, Human Resources, Life, PDA's, Videos | , , , | 1 Comment

Tesla Motors, Model S 2011 Electric Car

I’m a big fans of Tesla Motors and its plan to build long-range plug-in electric cars with performance that matches or exceeds that of most sports cars. So we’re naturally very excited about Tesla’s anticipated Model S sedan, due for release as a 2011 model.

The Model S will extend Tesla’s thinking into a vehicle that can accommodate four adults at a much lower price point than that of Tesla’s currently available Roadster. You can get a better sense of the Model S through the video below, which features Chief Designer Franz von Holzhausen and Tesla Chairman, Product Architect, and CEO Elon Musk.
MSRP $49’000.00 for this electric Car.

http://www.oncars.com/video/494/2011-Tesla-Model-S-Part-1-of-3-Design

June 19, 2009 Posted by | Electric Cars | , , , , , | Leave a comment

Should a Small Business Buy or Lease a Company Car?

This is a good question and one that is asked regularly by many business owners and the answer is not straight forward (when is a finance answer ever straight forward).

People frequently ask, “Is it more advantageous to lease or to buy a vehicle?”. Revenue Canada has considered each option and has established rules to ensure that one has little if any benefit over the other. The decision is therefore based on your situation, needs and cash flow circumstances. Whatever decision you make, make sure you thoroughly comparison shop and sleep on it before you make any final decision, sign documents and take the car away. You want to make a decision based on sound logic–not based on emotion or the dealer’s sales pitch. Compare the cost of each approach over the term you expect to own the vehicle.

There are many different types of leasing arrangements, and dealers offer a wide variety of choices and options on both new and used vehicles. All leases involve making periodic payments for the term of the lease, and there may or may not be an option to purchase the vehicle at the end of the lease.

On some leasing contracts, the vehicle is returned to the dealer at the end of the lease period and you have no further obligation except possibly paying for extra mileage or damage. On other leasing contracts, you will be asked to “guarantee” the dealer a residual value for the vehicle at the end of the lease period. Residual value is the amount the vehicle is expected to be worth at the end of the lease period, and is specified in the contract. Sometimes you may be able to buy the car for the residual value. If it is returned to the dealer and sold for less than the residual value, you must pay the dealer the difference.

Lease contract
This contract sets out the contractual nature of the deal. You cannot count on any representations that the sales rep makes to you that are not contained in the lease contract. So make sure that any statements made to you to induce you to lease the vehicle are written into the contract.

Important questions to ask
Before you sign any contract, make sure you have answers to these important questions and calculate what they will mean to you.

* What would be the total cost to buy the same vehicle and finance its purchase through a lender?

* What is the best retail price of the vehicle, and what price is the company using as the basis for the lease? The difference between the market value of the vehicle at the beginning and end of the lease is one of the main factors in calculating monthly payments.

* What is the interest rate being applied to the lease and how does it compare with current loan rates for purchasing a vehicle?

* Is there an option to buy the vehicle at the end of the lease?

* Can you buy the vehicle during the term of the lease, and if so, and are there penalties or additional charges?

* Are you required to guarantee the residual value of the car to the dealer?

* Can you terminate the lease before the date specified in the contract, and if so, is there a penalty or additional charge?

* How is normal wear and tear on the vehicle defined, and what is excessive wear and tear that makes you liable for an extra expense at the end of the lease?

* How is extra mileage defined and how much might you have to pay at the end of the lease?

* What is the total cost of the lease, and could you have bought a similar car for that amount?

* What are the associated fees you might have to pay for items such as insurance and administration? What are the late payment penalties?

* What is the total financial obligation of the lease, including the cost of all lease payments, plus all taxes, levies, fees, trade-in allowance, security deposit, advance payments and any down payments?

* Is the leasing contract easy to understand and is the information large enough to read without difficulty?

* What are the restrictions on the use of the vehicle–can you use it outside your city or province, or in another country?

* What is your responsibility for maintaining and servicing the vehicle?

* What are the warranties and guarantees, and is there any insurance provided for or required by you?

* What is the retail price of the vehicle, the price on which the lease payments are based, and the interest rate applied to the lease contract?

* What are the details of periodic payments, including the total number of payments, amount of each payment, payment dates, taxes on payments, and the total amount of all payments?

* Do you have “gap” protection? If you do, and you are in an accident and the vehicle is damaged beyond repair, this program will cover the difference after you pay the deductible, between what you owe on the remainder of your lease and the amount of your insurance settlement.

ADVANTAGES AND DISADVANTAGES OF BUYING

Advantages:

* you own the vehicle and therefore do not have any restrictions on use.

* you are building up potential equity in the vehicle (the value of the vehicle less the debt you have paid off).

* you can use the vehicle as security to borrow money.

* you can sell the vehicle and keep the money, after any loans are paid off

If you are using the car as a business vehicle, there are additional benefits:

# depreciation is deductible. For cars, it is 30 per cent a year on a declining balance. However, only a maximum of $25,000 (plus taxes) is accepted as the capital cost of the vehicle, no matter how much more you pay.
# interest on money that you borrow for the car purchase is deductible. However, there is a maximum of $300 a month, no matter how much more than that you pay.

Disadvantages:

If you are using the car as a business vehicle:

* you cannot deduct the full cost immediately

* only the first $25,000 plus taxes may be capitalized and depreciated for tax purposes. The car you want or need may cost more than that.

* only a maximum of $300 per month for interest is accepted by Revenue Canada.

* you pay your own repairs and maintenance expenses.

* time and effort is required to sell the vehicle.

ADVANTAGES AND DISADVANTAGES OF LEASING

Advantages:

* you can change to a new vehicle relatively easily.

* you have more consistent and predictable cash flow requirements.

If you are using the car as a business vehicle:

* since monthly payments are generally less than loan payments when you purchase a car, you have better cash flow.

* lease payments are deductible, subject to limits set out by the Income Tax Act. At present, it is $650 per month.

Disadvantages:

you don’t own the vehicle.
you are not building up equity in the vehicle.
you are basically renting the vehicle for a stated time period.
there could be restrictions on where you can use the vehicle.
leasing costs are slightly higher than purchase costs.
leasing expenses can be subject to increases.
costs could include financing, administration and other fees.
you are responsible for maintaining the vehicle, according to the maintenance schedule set out by the leasing company. This could cost you more money than if you had the freedom to do what you wanted, where and when you wanted, as in a purchase situation.
there are many restrictions and limitations set out in the lease that potentially affect your use and enjoyment of the vehicle
you could be paying more money for greater mileage use, wear and tear and guarantee of residual value at the end of the lease, or penalties if you want to terminate the lease early.

If you are using the car for business purposes:

* depreciation is not deductible on operating leases.

In summary, if you want a more expensive car, you’re not emotionally attached to the idea of ownership and you change cars every two or three years, you might consider the lease option. However, what makes leasing appear less expensive than buying is that you are not paying any money to build up equity in the vehicle. When you buy a vehicle and pay for a loan, part of the loan payments are reducing the debt, and therefore building up equity.

For further information, you can pick up a free consumer booklet on vehicle leasing, Turning the Lights on Leasing, published by the Canadian Automobile Dealers Association. You can also purchase a Canadian “buy vs. lease” software program that customizes the pros and cons in specific situations. One such program is The Car Calculator, published by Orangesoft. You can obtain further information on it at 1-800-647-8693 or http://www.carcalculator.com. Also, check with your provincial consumer services department for brochures and any legislative lease protections for consumers that might be available.

Based on an original article by the Editors of CarPoint.

June 15, 2009 Posted by | Business, Business Development, Electric Cars, Entrepreneurship | , , | Leave a comment