How fast is too fast

How Fast Is Too Fast?

Growing too fast can be dangerous to your company’s health. By using the affordable-growth-rate formula, you can measure your company’s financial ability to continue growing at its present level.

What tops the list of worries of the typical chief executive officer of an INC. 500 company? Business financing, according to an INC. survey («What, Me Worry?» June, page 56).This year’s INC. 500 class would probably agree, because chances are good that more than a few of them are growing faster than they can afford to.

Your company may be growing faster than it can afford to if you must continually scramble to increase your debt-to-equity ratio, sell stock, liquidate assets, or take more drastic measures to finance your growth. But business life doesn’t have to be like that. It is possible to grow at an affordable rate.

The AGR is a growth strategy based on two assumptions. The first is that your sales can grow only as fast as your assets. If yours is like most firms, for example, you can’t increase your sales by 30% unless you increase your receivables, your inventories, and your fixed assets by about 30% as well. The second assumption is that your firm has a target debt-to-equity ratio and that your lenders are willing to continue to extend credit at that ratio. This assumption implies that as your equity grows, debt can grow at the same rate, allowing you to maintain a constant debt-to-equity ratio.

The AGR can be determined easily by considering the effect of these assumptions on an INC. 500 company that plans to double its sales yearly. If sales are to double, assets must double (assumption 1). And since the balance sheet must balance, total debt and equity must double as well. Lenders will allow debt to double if equity doubles (assumption 2). The growth rate of your firm’s sales, then, depends on the growth rate of its equity.

The AGR is equal to the annual percentage increase in the stockholders’ equity section of a firm’s balance sheet. The box on the following page shows how the AGR can be expressed as a formula:

AGR = Earnings After Dividends / Beginning Stockholders’ Equity

= Earnings After Dividends / Earnings X Earnings / Beginning Stockholders’ Equity

= Earnings Retention Ratio X Return on Equity

Let’s take an example. Suppose your company pays out 20% of its earnings in dividends.The retention ratio (b) is therefore 80% (1.00 minus 20%); that is, your firm keeps 80% of its earnings. If your company maintains a return on beginning equity (R) of 30%, your affordable growth rate is equal to 80% times 30%, or 24%.

Notice in the formula that the stockholders’ equity figure at the beginning of the period is used to calculate R. When you use balance-sheet data in any AGR formula, always use data from the beginning of the period. This is the same, of course, as using data from the year-end balance sheet of the previous period. The reason is that the AGR formula compares what you started with (the balance sheet) with what you did with it (the income statement).

What does an AGR of 24% mean? It means that if you maintain a growth rate of about 24%, your financial growth will stay in balance. A faster growth rate would force you to increase your debt ratio or sell more stock. A slower growth rate would allow you to reduce your debt ratio or buy your stock.

The AGR shows your firm’s financial ability to grow through performance. It’s important that you keep this calculation in perspective, however. As Packard told his audience, «In spending most of my time talking about the financial aspects of growth, I do not mean to imply that these are in any sense determining. The other things you do determine how fast you grow, provided you have the financial resources.»

Although the formula does calculate your affordable growth rate, it offers little insight if you wish to improve on that performance. An expanded version of the formula (shown in the box, above right) begins to offer that insight.

This formula shows that your affordable growth rate is the product of your earnings retention ratio (I), a leverage ratio (II), your profit margin on sales (III), and the turnover of your assets (IV). These four ratios represent two types of components. Earnings retention and leverage, I and II, are decisions. Net profit margin and asset turnover, III and IV, are results.

[SEE ORIGINAL MAGAZINE]

The decision components are statements of policy. They reflect the attitude that you, your investors, and your lenders take toward your company’s risks and opportunities.

Often, I’ll combine the two decision components and the two result components in an AGR formula. Since both decision components tend to be relatively stable over time, I use a constant in the calculation, based on their actual values. I call this the decision multiplier. The profit margin multiplied by the turnover is an overall measure of operating performance, called the return on assets (ROA).

To illustrate, HP maintained a retention ratio of about 90% and a debt-to-equity ratio of about 45% from 1975 to ’85. Its decision multiplier is therefore 1.31 (90% times 1.45). HP could express its affordable growth rate as:

I like this version of the AGR formula because it emphasizes the importance of operating performance to your firm’s financial ability to grow. Growth depends on operating performance, and the ROA reflects that performance.

How should you use these AGR formulas? Most frequently, I suspect, you will find them useful in your mental tool kit. When the AGR in mind, for example, you will know that your friend’s company, which has an ROA of 35%, must be generating a lot of cash if it is growing by only 20% a year.

You will also find the AGR to be useful during your planning and budgeting cycle. Calculating an AGR allows you to step back from the nitty-gritty details and determine the overall financial performance necessary to finance the expected growth rate of your sales.

But when you begin to apply these formulas to your own financial statements, you’ll probably encounter some difficulties. First of all, of course, if you’re losing money, you can’t very well grow through performance. You’ll neet to get your business into the black before you can start thinking about an affordable growth rate.

Another problem you may experience is that your financial ratios may jump around from month to month. What effect will these fluctuating ratios have on your AGR? «Now, obviously,» Packard said, «you cannot control all of these factors on a day-to-day basis or even a year-to-year basis to match this formula precisely. But it does tell you how fast you can grow without changing the ownership pattern, the debt structure, or any of the other basic characteristics of your business.

«Actually, you can deviate quite widely from this on a year-to-year basis,» Packard then continued. «For example, in our case, our profit has varied from 6% to 15%. The turnover has gone as high as seven times per year in years of very rapid growth, and on occasion it has gone below four times.»

Ratios like these are tough to achieve year after year. But such ratios are what even the slowest-growing company of the INC. 500 must exceed if it expects to sustain its present growth rate.

Whether your firm is growing quickly or slowly, however, it must pay its own way over the long run. The AGR formula provides a convenient measure of your financial ability to support the growth rates of which we all dream.

CORRECTION-DATE: February, 1987

In his article «Finance: How Fast Is Too Fast?» (December), Charles W. Kyd makes the question of financing growth much more complicated than necessary for small business.

We should recognize that the structure of a balance sheet remains relatively constant. For example, the ratio of inventory, receivables, and equipment to sales runs about the same year after year. With that in mind, here is a formula you can use: if the percentage increase in net worth is the same as the percentage increase in sales, then you will continue at the same relative comfort/discomfort level with your financial structure. If you want to increase the comfort level there are three things you can do: first, improve your profit percentage while maintaining your growth rate; second, lower your growth rate below the rate of increase in equity; or third, bring in new capital.

How Fast Is Too Fast? The 45-Minute Power Rotation

The new Top 40 battle between Cumulus’ KRBE Houston and CBS’ newly launched “Hot Hits” KHJZ (Hot 95.7) will be a referendum on several fronts: rhythmic-leaning vs. determinedly mainstream, mostly current vs. a broader library, and, in particular, ultra- fast power rotations vs. the slowest power rotation in the top 50 markets.
KRBE, according to Mediabase, played its six powers no more than 65 times last week. On the day before KHJZ launched, the station’s most spun song, Buckcherry’s “Sorry” was coming around every 2:45 or so. By contrast, KHJZ could be heard playing songs as close together as 45 minutes on its first full day. After six days on the air, six songs have more than 100 spins. Rihanna’s “Don’t Stop the Music” shows a jaw dropping 169 spins, but that apparently includes stunting before the launch.
Among mainstream Top 40 stations, the mega-powers put Hot 95.7 in rarefied company. Beasley’s WXKB (B103.9) Fort Myers, Fla., played Flo Rida’s “Low” 138 times last week. During the midday/afternoon stretch I looked at yesterday, its spins came as close as 45 minutes together (but also as far apart as 1:15). Clear Channel’s WIOQ (Q102) Philadelphia was at 120 spins on its most-played record, Sara Bareilles’ “Love Song,” which was playing anywhere from 45-minutes to 1:10 apart yesterday.
Mega-spins used to be mostly for a launch or relaunch. But Philly has been a battleground for monster spins since 2003 when Rhythmic WRDW (Wired 96.5) came to town under consultant Jerry Clifton and launched with powers as close as 45-minutes to each other. (Wired was at 108 spins on its most-played song last week.) Last fall, Q102’s rotations made national news when The New York Times, reporting on the national spin record set by Timbaland/One Republic’s “Apologize,” said that Q102 was “letting as little as 50 minutes tick by between repeat spins.”
The headline of the Times article – “Radio’s Newest Strategy: Play a Hit Again and Again” – wasn’t entirely on point. Many of Q102’s Clear Channel brethren had hit the 100 spin mark on powers in the early part of this decade. Monster spins were neither quite as audacious as they were when a handful of PDs first cracked the 100 mark in the mid-’90s or, it seemed, quite as common as they were a few years ago. Since then, for example, WHTZ (Z100) New York has backed down to what now feels like a positively leisurely 94 spins a week. But that article was before B103.9 and Hot 95.7. So it’s easy to see mega-spins capturing programmers’ attentions again.
Ultra-high spins usually went hand-in-hand with stations that were distinctive in other ways. Mike Joseph’s all-current version of “Hot Hits” on WCAU-FM Philadelphia spun its powers every hour and 10 minutes. In the morning countdowns that ran on his WHYT Detroit, the biggest songs played literally an hour apart. More than a decade ago, Roy Jaynes used mega-spins on the early WKXJ Chattanooga, Tenn..–a tight-playlisted station that was mostly rhythmic, but was also one of the few Top 40s to play LeAnn Rimes’ “Blue,” because it, too, was a reaction record.
Among advocates of ultra-high spins, the prevailing logic has often been that Top 40 is going to be saddled with the image for repetition anyway, so why waste time fighting it when you could be playing a hit record? More recently, some have thought of it as an appropriate strategy for a PPM world where a station’s cume is larger and its Time Spent Listening is shorter. In today’s instant gratification world, why not hear the strongest record every time you tune in?
And for some PDs, ultra high spins are not just a matter of playing the strongest song available at any given moment; they’re also about burning the hits out for the other guy and creating a war of attrition. And, indeed, a number of the stations confronted with that type of Top 40 station did indeed get out.
But as programmers ponder Hot 95.7 or Q102 or B103.7 and wonder if they, too, need to play the hits every 45 minutes, they should consider the following:

As that suggests, the “moneyball” formula for maximizing the hits could be just a few spins-per-week slower than the one for destroying them. WPOW (Power 96) Miami is another station that tops out in the mid 90s on its hits and is, for a variety of reasons, doing better than it was two years ago when it was over the 100 mark.
Hot 95.7 has been an exciting launch in an industry that doesn’t get a lot of new major-market Top 40s. And as with Joseph’s “Hot Hits,” which was much more than its rotations, it’s exciting in a number of ways. It’s also in a rare market where the opportunity is to go more rhythmic and more current than the incumbent. One hopes that 2008 will see a lot of audacious station launches, and that each of them will look a little different as PDs assess what the market will give them. Chances are the answer will be “45 minute rotations” only under very special circumstances.

10 Signs Your Relationship Is Moving Too Fast

Are things moving fast in your relationship? How do you know when your relationship is moving too fast? Well my friends, in this post, we’re going to unpick it. Here’s 10 signs your relationship is moving too fast, and – most importantly – what to do so that it still moves forward, but just at a healthier pace.

Are Things Moving Too Fast?

Find yourself wondering if your relationship is moving too fast? Or perhaps you feel like it’s not, but society is telling you, it is. It’s tricky, I get it. Because sometimes, fast can still feel so right.

To you, there may not be an issue. But remember – it’s not just you.

Your pace may not be the right pace for your new partner. And your pace may to actually be the best pace for the two of you.

Why Relationships That Move Fast Fail

See as good as things may feel, relationships that move too fast are actually more likely to crash and burn.

Yes you may FEEL happy, but more often than not, you’re not actually as happy as you could be.

I mean, are you becoming too dependent on this person? Are you getting the balance right? If not, why? Are you looking for this person to fill a void? Are you moving things along too fast to try to “secure” them?

Relationships that move too fast often fail because, on top of all of these things, when things move too fast:

How Fast Is Too Fast in a Relationship?

But how fast is too fast in a relationship? I mean, what is considered moving too fast in a relationship?

Well, the thing to remember here is that every couple is different. So this entirely depends on the type of people you are, and the stage of your life that you’re at – what you’re looking for.

There’s not one set time frame that every single person needs to follow. “This” by one month, “this” by six, “this” when it reaches one year, two years, and so on, and so forth.

Instead, you’re better looking at the signs your relationship is moving too fast – to better gage if there’s any cause for concern.

10 Signs Your Relationship Is Moving Too Fast

So what are the key signs your relationship is moving too fast? How do you know when things are moving too quickly? Well, here’s what you want to look out for –

1) You’re Spending A LOT Of Time Together

It’s exciting when you find someone you click with. You want to be with each other all the time… But you still need that space and time apart – even if you feel like you can’t get enough of the person!

If you’ve already slipped into a routine of seeing each other every night or every other night, it could be one of the signs your relationship is moving too fast.

However, it’s not just about spending a lot of time together.

2) You’ve Lost Your Own Life a Little

Another sign that your relationship has become too much, too soon (and will only continue in an unhealthy way) is when you’ve lost your own life.

Why this is a sign your relationship is moving too fast? Because again, the trust isn’t fully there. Nor is the balance. Your new partner has become your world and you’re scared of losing that.

3) You Feel Anxious When You’re Apart

So you’re spending all this time together. When you’re apart, you should still feel the same way – happy and excited about your new relationship.

If you’re not and you become anxious , needy or demanding , it’s actually one of the signs your relationship is moving too fast.

You don’t have the balance. You’ve become dependent on them.

You also haven’t had enough time to develop the trust in them, and the trust in your relationship. This is probably because it went too fast so it feels too good to be true in a way.

But it’s not, not always. And it doesn’t have to crash and burn.

But you do need to take a step back and realise that things are moving too fast, to then nurture the relationship instead of unintentionally suffocating and destroying it.

4) You Feel Uneasy – Or They Do

Your mind and instincts are actually amazing things. See, “If it’s right, it feels right.”

And you’ll never actually fully comprehend this until you meet “the one” – your special person. Because when it happens, everything falls so easily into place.

Feeling uneasy? That’s a sign that somethings a little off… and it’s not necessarily the person, it’s not necessarily that they’re NOT the one (they could still very well be!) but the relationship how it is – isn’t quite 100% if you can’t quite relax or they can’t.

And why is it like this? Well, often because the relationship has moved too fast – like we said when we mentioned feeling anxious when you’re apart.

However with this one, you may also feel it when you’re together.

This is because things are moving faster than you’re either ready for or are comfortable for. So you’ll get niggling feelings and everything becomes that little more complicated.

This leads me onto my next point…

HOW HEALTHY IS YOUR RELATIONSHIP? CLICK HERE FOR A FREE RELATIONSHIP REVIEW

5) You Know Things Have Moved Fast

It sounds so simple, but sometimes we can be in denial – we tell ourselves the things we want to hear and push back the things we don’t.

We try to find “reasons” or “excuses”. But you can’t always hide the truth.

See one of the biggest signs your relationship is moving too fast, is when you – and everyone around you – recognises that things have moved pretty quickly… only you can’t seem to slow down the pace.

One minute you’d just met, next you’re together – moved in, woah, woah, woah!

And sure, you may have got swept away, it may have felt right… and maybe it is right. But if it is, and this person is really the one, then what’s the rush to speed things along from here?

And I know, I get it. It feels good. Being with this person feels good. It feels difficult to slow it down – you don’t want to slow it down, so you may convince yourself there’s no problem here.

But what does your gut say? Is this the kind of pace an outsider would look on and would say is healthy?

On the flip side, maybe you rushed into a relationship because there were issues or warning signs, things that you swept under the carpet and you thought the security of a relationship would fix.

So ask yourself – if you’ve been googling the signs your relationship is moving too fast – what brought you here? Are you being totally honest with yourself? Did you get together in the right way, for the right reasons, at the right time?

6) There’s Been No Hiccups

If you’ve made it through dating, to relationships, and are still in the honeymoon phase with 0 hiccups at all, then it could too, be a key sign your relationship is moving too quickly.

Why? Because every relationship has challenges . We’re not saying they have to be great big, blowups, but as time goes on – things are going to crop up.

So if nothing has yet cropped up, and you’re still smooth sailing miles ahead, it’s an indicator that you rushed on over there.

When this happens, you don’t need to go back. You just need to recognise the fact that there will be some “rocky tides” ahead. Be realistic, as opposed to swept away in this ideal that you’re in.

It’s great that you’re going strong, but it takes time to get to know someone and without certain things happening – it’s impossible to know someone completely , and all aspects of their personality.

7) You’re Running Before You Can Walk

Another big sign your relationship is moving too fast is if you’re running before you can walk – you’re moving things along, rushing things over to the next stage, and recreating this “ideal picture” you had in your head.

Maybe you’ve been single for – what feels like a lifetime – and you finally find someone you click with, so are getting super comfortable, super fast.

Or perhaps you got into a new relationship not long after the end of you last one, and have found yourself treating your new partner in the same way you did your ex…

You want the same (or a certain level) of connection and commitment. You want to feel a certain way, you want to act like a proper couple, and so you create that or – in some cases – force that, before the relationship is fully really.

See, if you entered into this new relationship not long after the end of your last relationship, it can be tempting to treat it and your new partner in the same way you did you past relationship and ex.

You’ve reached the same “couple level” as your recent past relationship. It’s easy to do, but it’s not healthy to do. Which is why you have to recognise it!

Another similar trap with this, is getting carried away, thinking about and talking about the future and how it’s going to look.

It’s good to know what you want and is important to find someone who wants the same things, but you shouldn’t be mapping out your entire future (house, kids, wedding!) when only knowing someone a matter of months.

Are you getting ahead of yourself? Are you fantasising? Trying to make this what you’ve always wanted in your head? Think about it…

8) You Haven’t Actually “Qualified” Them

Another similar sign that your relationship is moving too quickly, is if you’re already together, but there’s still so much about them that you don’t know.

I mean, did you really qualify them properly ? Did you get swept away by how they made you feel, that you didn’t stop to think about all the other things that matter?

Do their values match yours? Do they want the same things? How much do you actually know about them? How deeply do you know them? If there’s still a lot of unanswered questions, there’s a good chance your relationship has moved too quickly.

On the flip side, you may feel like you know EVERYTHING about them, because you had “heart to hearts” and opened up to them, before fully knowing if they are worth of your trust.

At the end of the day, it does take a long time to get to know someone properly. And if you hadn’t realised this, or have just reminded yourself of it now – you just need to take a step back to put things into perspective again.

It’s not a bad thing, and getting to know them further will be exciting. But just keep in mind where you’re really at, instead of potentially getting carried away with yourself. Like we said – it goes back to running before you can walk.

9) You’re Hitting Milestones Too Fast

So what else can you look out for? How do you know if your relationship is moving too fast? Well, look at where it’s at and what you’ve reached in what length of time.

If you take a step back and consider your timescale… and it feels rushed along at the pace of weeks and months as opposed to months and years, then you have to recognise the pace you’re traveling at and if it’s too much, too soon.

I mean, at this rate you’ll end up proposing too fast too! So hold it up. Learn the dating & relationship milestones you should be going through, and work through them at the right pace.

10) You Fallen Fast and Hard

Last but not least, one of the biggest reasons your relationship may be moving too fast, is because you yourself, fell very fast and hard . When this happens, it’s easy to get swept away.

See, it’s good to have these feelings – it’s good to feel so strongly for a person… amazing actually, right? But only when it’s healthy, only when it’s real, only when it’s with the right person.

How do you feel about the relationship? Are there any doubts? And where are they coming from?

Because that will also come into things when determining whether things are moving too fast for you, or too fast for what would be best for the two of you.

Are Things Moving Too Fast?

Every person, every relationship, is different, like we said. The only thing that makes it easier, is these key signs – they will remain the same.

When a relationship is moving too quickly, you’ll be able to tell by these signs – by these key indicators or feelings.

So be honest with yourself, talk openly to your partner about it – and be willing to listen to their answer, without influencing it or getting upset if they don’t say what you want to hear.

Recognise the signs your relationship is moving too fast and take action to slow it down . It’s actually not as difficult (or painful!) as you may think!

How Fast is Too Fast?

Industry leaders balance excitement with reality when setting company growth rates.

Every brand wants to be bigger and more profitable. But leaders and experts in the quick-service restaurant industry say finding the correct growth rate is a delicate balance of having a clear appreciation for resource and talent capacity and an understanding of one’s appetite for risk.

Dan Simons, who runs Vucurevich Simons Advisory Group, a restaurant-consulting firm based in Maryland and Texas, says the appropriate expansion rate shouldn’t be based entirely on the popularity of a
concept.

It also depends on having the right resources and people in place to maintain consistency, deliver results, and build scalable support for operators, he says.

“It is this approach, of course combined with a compelling brand and product, that really leads to success and the ability to grow rapidly,” Simons says.

For Jack Butorac, president and CEO of Marco’s Pizza, growth rate is determined by a mixture of expectations, resource allocation, a little finesse, and a gut instinct that comes from a wealth of experience.

“I have the infrastructure that can be easily enhanced, and we have the building blocks in place in marketing and training,” Butorac says of the reason why the chain can call itself the fastest-growing pizza concept in the U.S.

Marco’s Pizza is a franchised chain founded by Pasquale Giammarco, who came to the U.S. from Italy with his family when he was nine years old. Butorac joined the team in 2004, spurring the brand’s franchise growth by focusing on its authentic Italian fare and history. The concept now has about 320 units in 26 states.

“We rebranded it, but didn’t change any of the products, and repositioned it,” he says. “That’s when we started growing.”

This past fall, Butorac put a corporate team in place to help area reps develop growth plans. After compiling the growth plans from each rep, Butorac consults with upper-level management to determine the appropriate rate of expansion.

“I will scale it back, because these are sales guys and they are a little optimistic. Based on where and how they are developing, we will ask the franchisees and the area reps what we need to support this growth,” he says.

“We are looking at about 150 stores next year; I can easily handle that,” he adds. “But if they came in and said it was 1,000, that would take a little bit more thought.”

Butorac says revenue earned from new franchises goes to building more resources, ultimately dictating the overall growth pace for the concept.

“Over the 30 years I’ve been in business, with the concepts that have failed, generally debt has been the major issue, because the consumer decided the concept was not relevant and they stopped going and they had this debt structure,” says Butorac, noting that Marco’s Pizza has very little debt.

Butorac also isn’t concerned with growing too slowly because, he says, it’s not in the brand’s DNA. “My makeup is that we are not growing fast enough,” he says.

Simons, who was a manager at casual-dining chain The Cheesecake Factory when the fledgling concept grew from five to 25 locations, says another growth test for a quick serve is on the home front.

“My belief is that until a concept really proves itself in a local market in a variety of locations—urban, suburban, unique—they should not consider expansion outside their initial trade area,” he says.

One of the biggest pitfalls of growing too quickly is that management training and development systems aren’t in place, causing a dilution effect in management. Another roadblock is encountered when the concept is inexperienced in dealing with unique challenges and doesn’t have the expertise to address under-performing stores, Simons says.

“So they end up with struggling units and they simply don’t have the expertise to solve the problems, and the growth just keeps adding more problems,” Simons says.

“Until a company can look in the mirror and say they can train and develop high-caliber managers in X number of months—and, combined with that, they know how many additional months of experience it takes a manager to become seasoned—then they really cannot forecast their growth,” he adds.

Tony Lamb, founder of shaved-ice concept Kona Ice, began franchising his concept in 2008. He says the brand had three times the number of franchise requests than he initially sold. “I wanted to control the growth,” he says. Lamb, who has a background in marketing rather than in the quick-service industry, started with 10 franchised stores in 2008 and grew to 50 units by the next year. Kona Ice launched 100 franchises in 2012 and will launch another 125 throughout this year.

The growth has been spurred in part by the infrastructure Lamb has put into place.

“It was always for me, ‘Build the infrastructure, let it grow, and pull back. Build the infrastructure, let it grow, pull back,’” the Kona Ice executive says. “Very easy, I could do 150–175 [franchise] sales next year, but I don’t want to stretch it, I don’t want to push it. I’m saying 125 and people are saying that’s audacious, and I’m thinking that’s conservative.”

Lamb relies on a number of factors when determining growth rate, including how many deposits Kona Ice has from potential franchisees for the next year.

For Kona Ice, growth also depends on certain markets, like Dallas and Houston, being completely saturated, as well as which markets are untapped.

Lamb also uses the sheer number of calls from entrepreneurs who are interested in a Kona Ice truck as another variable in determining his growth rate.

“People get on the phone with me, and they are just giddy and they are all about the pretty colors and the beautiful truck,” he says. “My broker and salespeople say I am always trying to talk everyone out of it, and for most purposes, I am. Because if I can talk them out of it, then they really weren’t involved anyway.”

How Fast Is Too Fast to Get Engaged?

You’ve fallen head over heels with your partner—and while it’s only been a few months, or maybe a year, you’re already thinking about taking it to the next level (aka getting some new bling on that finger). And with all these celeb couples exchanging rings so quickly, it seems like it’s becoming the new norm. But how do you know if you’re truly ready? Yes, for each couple it’s different, but there are some things everyone should think about before popping the question, or saying «yes,» no matter how ready you feel. Here are a few big categories you and your partner will definitely want to discuss before taking that first step down the aisle.

Finances

Mo’ money, mo’ problems—but also, no communication, lots of problems. Finances are a big deal in relationships, and one of the most important to talk about, in fact. Whether you’re dealing with student loans, credit card debt or simply budgeting, you and your partner should be very open about how much you’d like to put away in savings and how much you may need to pay off. If you’re still working toward paying off a sum of money, your partner should be aware, and vice versa. There shouldn’t be any surprises when it comes time to create a joint account, if that’s something you want to do. For that matter, you’ll need to talk through the pros and cons of combining your finances or if it’s better to keep things separate.

This may seem like a pretty basic conversation. (Do you both want kids? If so, how many?) But there are so many more minutiae to hash out. For instance, when would you like to start a family (if you decide to do so)? You may have always planned to wait until you were in your thirties, but your partner may have expectations of a honeymoon baby. Then, you should talk about the nitty-gritty: Is someone going to stay home with the baby? Do you plan on putting them in public or private school? What about a savings account for college? And what religion would they be raised as? This may seem overwhelming, but these are pretty general points when it comes to a family, and if you’re not ready to talk about them, you may not be ready for that ring.

Religion

Whether this is important to you or not, it’s a meaningful discussion you should have with your partner. This will help inform you both what your ceremony will look like, your life together and even your possible children’s lives. If your partner is adamant about going to mass on Christmas Eve, but you grew up celebrating Hanukkah, you’ll need to debate what you’ll do in the future. This may mean making compromises, but as long as you both end happy in your spirituality, or maybe lack thereof, it’s a win for you as a couple.

Future Home

Sure, you love the constant lights, action and movement of the city now, but do you want to grow old here? Maybe you’ve always dreamed of moving to the suburbs once you’ve decided to start a family. If you and your partner aren’t on the same page, things will get tricky around the time one of you start itching to finally «upgrade» to a two-bedroom house, or downsize from a place in the ‘burbs to a loft in the city. This may seem like a small point, but it can influence your future careers and lifestyle.

Communication Style

Communicating is the cornerstone of all relationships, and it’s important you be on the same page. Do you text every few hours, or do you catch up when you get home? And if you’re going through something, whether it’s at work, home or in your relationship specifically, do you talk to your partner about it, or bottle it up inside? And that brings up another point—how you argue. Some people shut down when confronted, some lash out—and it’s necessary to know what type each of you are so you can have a productive fight. That’s right, fight. Arguing is actually healthy for couples, but only if they’re beneficial discussions and not simply the same dispute bubbling up again for the sixth time. If you know each other’s fighting style, you can have a more calm, conducive debate and come to a solution rather than screaming at each other until someone storms out. (Psst, there’s an app to help you out with all of this—find out more about Lasting here.)

If you’ve had all these discussions and you’re both happy where you stand as a team, great! It might be time to start having «the talk.» If you’re in a serious relationship, but haven’t even touched on these topics, don’t stress. These are simply stepping stones to your next big adventure together.