What are the differences between debt financing and bank financing?

There are many methods of financial management. There is a big difference between the two methods of debt financial management and bank financial management. The following is the difference between debt financing and banks compiled by the editor. Share it with everyone!

The difference between debt financing and banks 1. Regarding the linkage to real projects

The debt financing model requires a capital demand side Providing real loan purposes and project information, investors can independently screen and select loan projects, truly knowing and understanding the situation clearly. Many financial managers who work in banks do not know what the projects they sell are about. They do not even know the purpose of the funds, how the income is linked to, the risks of the products, etc., and customers are also confused when buying them.

2. About current income

The debt financing model has various forms of principal and income recovery. For example: one-time repayment of principal and income, income first and then principal (pay income monthly, repay principal at maturity), equal amount of principal income/equal amount of principal, etc., which reduce financial management risks to a certain extent and also meet the needs of meet daily liquidity needs. Let’s compare it with bank financial management. Bank financial management generally settles the principal and interest together after the product matures. It cannot bring stable cash flow benefits to investors during the purchase period, which can easily lead to insufficient liquidity or tension among investors.

3. About the yield

The high yield of debt financing is obvious. I believe that the first factor that attracts most investors is its high yield. Compared with banks, the annualized rate of return is generally between 7% and 13%, and the income is clearly priced. Why do you say that? Because banks will share a large amount of income from financial investors through handling fees, custody fees, management fees, etc.

4. Regarding mortgage guarantees

Debt financing generally has the borrower's full-value assets or high-quality claims as collateral (pledge), and the mortgage registration procedures are completed, and a third party is introduced at the same time The guarantee company's performance of overdue compensation obligations has certain guarantees. At this point, debt also has an incomparable advantage compared to banks. Bank financial management is actually a kind of credit loan lent by investors to banks. Apart from bank credit, there are no risk compensation measures or means.

How to manage money by rich people’s money 1. It is better for money to make money than for people to make money

There is a saying: “A man has two legs and money has four legs”, which means that money has 4 legs. With only one foot, money chases money much faster than people chase money. Hexin Enterprise Group is one of the top five large groups in Taiwan, led by Ku Zhenfu, Chairman of Hexin Enterprise Group, and Ku Liansong, Chairman of Taiwan Trust. The outside world always wants to know who is richer between the two uncles and nephews. In fact, whether they are rich or not has a lot to do with personality. Gu Zhenfu belongs to the slow type, while Gu Liansong belongs to the convulsive type. Gu Zhenfu’s eldest son, Taiwan Life General Manager Gu Qiyun, knew them very well. He said: If the money is put in Gu Zhenfu’s pocket, it will not come out, but if it is put in Gu Liansong’s pocket, it will disappear. ?

Because all the money Gu Zhenfu earned was deposited in the bank, while all the money Gu Liansong earned was invested. The result is: Although there is a 17-year age difference between the two, nephew Gu Liansong's assets are far ahead of his uncle Gu Zhenfu. Therefore, how much money you can accumulate in your lifetime does not depend on how much money you earn, but on how you manage money. The key to getting rich is how to manage money, not to increase revenue and reduce expenditure.

2. Don’t underestimate the power of savings

Most modern people do not think that saving is a good way to increase wealth, but is this really the case? Look at such an example. Suppose there is a A young man can save 14,000 yuan every year from now on regularly for 40 years; but if he invests the money he should save every year in stocks or real estate and obtains an average annual return on investment of 20%, So how much wealth can he accumulate in 40 years? The amount most people guess is between 2 million and 8 million yuan, and the most guessed is 10 million yuan. However, the correct answer is: 102.81 million, a number that surprises everyone. Of course, this is calculated through compound interest. 14,000 is multiplied by 1.2 raised to the 40th power to get the value of 102.81 million. Of course, the savings here are not depositing money in the bank, but a fixed investment.

3. Don’t put your eggs in one basket

Don’t put your eggs in one basket is a very simple investment philosophy. From an economic point of view, this is It is a concept of risk diversification, but from an investment perspective, more financial management methods can ensure the steady growth of wealth and the value will not fluctuate greatly. The principle that diversified investments can maintain and increase value is that under normal circumstances, there will not be instances where all financial products will fall in value. Therefore, when managing your finances, don’t just choose one way of managing your finances, but choose a portfolio of investments.

Many financial experts recommend dividing your property into three equal parts: one part in the bank, one part in real estate, and one part in more speculative instruments. We might as well suggest that your investment portfolio is "two large and one small", that is, most of the assets are invested in stocks and real estate, and a small part of the money is deposited in financial institutions for daily needs. Of course, this is just general advice. When choosing specific investment and financial products, it also needs to be based on the specific economic situation. After all, investment involves risks, and you need to be cautious in financial management. You need to make scientific and reasonable analysis and formulate appropriate investment strategies.

4. To become rich, you need to be good at calculation

Being good at calculation is usually a derogatory term, which means that people care too much about their own interests and care about everything. But here, being good at calculation refers to being sensitive to wealth figures. Through surveys, it is found that the vast majority of rich people are very good at calculation. Let’s not talk about the wealthy people who have received higher education. To get into prestigious schools, they certainly need to have first-class abilities, which of course includes computing skills. For ordinary rich people, their path to wealth is also very elite calculation. No matter what industry they are involved in, no matter what their lifestyle is, this is their uniqueness. If they are rich people who rely on their own abilities to obtain wealth, absolutely no one can get rich by being confused. !

The rich man Buffett is one of the typical representatives who is good at calculation. Buffett's professional specialty is actuarial science, and his flagship company controls many insurance companies. How does a 20-year-old or a 70-year-old collect their life insurance premiums? It is an actuarial calculation of life and death, and investing in stocks is also an actuarial calculation of life and death. Being able to accurately calculate the future will naturally lead to smooth sailing on the road to wealth.

General investors may not be able to reach such a high level of calculation, but they also need to make accurate calculations and improve their calculation capabilities. With good calculation ability, you will have a first-mover advantage in controlling costs, controlling risks, and judging returns, so being good at calculation is also a good habit for getting rich.

5. Don’t be discouraged in defeat and don’t be arrogant in victory

Investment is definitely not something that can be achieved overnight. Many people have experienced ups and downs. Duan Yongping, known as "China's Buffett", experienced investment failures, but the subsequent acquisition of NetEase stock allowed him to gain huge profits. If your initial investment fails, there is no need to worry too much. There will be many opportunities to try again in the future, but the lessons this failure brings to you are precious wealth that cannot be bought. After a failure experience, you will be more cautious in future investment and financial management activities, and the chance of making mistakes will be greatly reduced. If you maintain this habit for a long time, you will definitely achieve great success. Isn't this the wealth brought by failure? What?

At the same time, after achieving great success in financial management, don’t let the victory get to your head. The "China National Aviation Oil Foreign Exchange Investment Case" of that year is still vivid in my mind. Chen Jiulin, the general manager of China National Aviation Oil Singapore Company, made huge profits through a series of operations in the capital market. However, these victories made him forget about it and finally invested in oil futures. He returned home in defeat, which led to a huge loss of state-owned assets and also led to his final imprisonment.

When investing, you must maintain rational thinking skills. No matter when you fail or succeed, you should calmly analyze and make the decision that is most beneficial to you.

The accumulation of wealth is not an accidental event in most cases. It must be the result of accumulation over time, and this accumulation over time requires people's good habits in more cases. Only by having good self-discipline and cultivating good financial management habits can you go further on the road to wealth and realize your wealth dream.

Basic elements of bonds Although there are many types of bonds, they all contain some basic elements in content. These elements refer to the basic content that must be stated on the issued bonds. This is the main agreement that clarifies the rights and obligations of creditors and debtors, including:

1. Par value

Bonds The face value of the bond refers to the face value of the bond, which is the amount of principal that the issuer should repay to the bond holder after the bond matures. It is also the basis for calculating the periodic interest payments by the company to the bond holder. The face value of a bond is not necessarily consistent with the actual issuance price of the bond. If the issuance price is greater than the face value, it is called a premium issue, and if it is less than the face value, it is called a discount issue.

2. Repayment period

The bond repayment period refers to the period for repaying the bond principal specified on the corporate bond, that is, the time interval between the bond issuance date and the maturity date. The company should determine the repayment period of corporate bonds based on its own capital turnover status and various influencing factors in the external capital market.

3. Interest payment period

The interest payment period of a bond refers to the time for interest payment after the company issues the bond. It can be paid once upon maturity, or once every year, half a year or three months. Taking into account the time value of money and inflation, the interest payment period has a great impact on the actual return of bond investors. The interest on a bond that pays interest once upon maturity is usually calculated on the basis of simple interest; on the other hand, the interest on a bond that pays interest in installments during the year is calculated on the basis of compound interest.

4. Coupon rate

The coupon rate of a bond refers to the ratio of bond interest to the face value of the bond. It is the calculation standard for the issuer's promise to pay bondholders a certain period of time in the future. The determination of the bond's coupon rate is mainly affected by factors such as bank interest rates, the issuer's credit status, repayment period and interest calculation method, as well as the supply and demand of funds in the capital market at that time.

5. Issuer name

The issuer name specifies the debtor of the bond and provides a basis for the creditor to recover the principal and interest when due.

The above elements are the basic elements of the bond face, but not all of them are necessarily printed on the face of the bond when it is issued. For example, in many cases, the bond issuer announces the bond to the public in the form of announcements or regulations. term and interest rate.