You are here: Home / 2013 / Archives for March 2013

Why Adults Should Have a Piggy Bank

March 29, 2013 By Leave a Comment

piggy bankIf you are someone who uses cash regularly, then you could really benefit from a piggy bank. Yes, you! Piggy banks are for adults too. After all, why do we teach our children to use them if we wouldn’t use them ourselves? Piggy banks are great because they help keep your loose change organized, and they’re perfect for setting goals.

While I realize that there are better ways to earn interest on your money, like putting it in a high yield savings account or a CD, a piggy bank is just the first step. Below are more reasons why they are beneficial.

1. You can see your progress.

For those of you who love visuals, a piggy bank is perfect for you. This is especially true if you use a clear glass jar as your “piggy bank.” You can literally see your savings growing or at least feel the weight of it! Every day that you add your change means one more day that you are closer to your goal. You can always put a label on your piggy bank or write your goal on it with a marker to remind yourself what you are saving for.

2. It keeps loose change organized.

How many times have you done laundry, only to find a few quarters at the bottom of the dryer? Or, perhaps you often find a few nickels in the couch cushions? This is loose change that could be going towards a goal! The way to keep organized is to empty your pockets every day when you get home from work and put it in the piggy bank. If you are a woman who throws loose change at the bottom of your purse, dump it out at the end of each day. You’ll feel accomplished, and your bags will be neat and ready for the next day.

3. It’s amazing how it adds up.

Every now and then, there are news stories of people who purchase entire cars with the loose change that they have collected over the years. However, if that goal is a bit too lofty, you can always aim to buy a nice meal out or a new pair of shoes with it, which would only take a few months of savings. It’s a really great feeling to take your spouse out to a movie with just change you collected. It almost feels like you are doing something fun for free!

4. It builds great habits.

The one way to build a habit is to start out slowly. Too many abrupt changes can lead you to quit too soon. So, to start making saving your change a habit, put a reminder in your phone. Put the piggy bank right by the door when you put your keys. If you forget, it’s no big deal. Just try again the next day.

5. You set a great example for your family.

If you are regularly using a piggy bank, then your friends and family will take note. How great would it be to set an example for your kids or for your nieces and nephews? They can learn that saving is fun and easy too! Plus, they’ll love dumping out the change and counting it.

So, what are you waiting for? Grab a mason jar or an empty jelly jar and start putting your change in it today! Remember that you don’t have to actually go out and buy a piggy bank. It’s just a way of thinking that will have a very positive impact on your life.

How do you save for a rainy day? Do you have a combination of investments and regular savings or just a change jar?

photo by shardayyy

Filed Under: Investing

How to Keep Your Employer from Knowing You’re Looking for a Job

March 27, 2013 By Leave a Comment

With all the various methods for instant communication available today, keeping your job hunt a secret from your employer is more difficult than ever. And keeping it a secret is probably exactly what you need to do. In many companies, you can be fired for even attempting to look for another job. It’s often referred to as disloyalty to employer, which is a firing offense.

While it isn’t possible to guarantee complete secrecy, there are a number of steps you can take that will minimize the likelihood of your employer finding out that you are looking at least until you are ready to let them know.

Use a headhunter, but not too many of them

One of the best ways to conduct a job search in secret to use a headhunter. A lot of people do this when looking for a job, but there are additional steps you need to take in order to cloak your effort.

Only work with one or two at a time. By working with only one or two headhunters at a time, you will be better able to maintain some control over the number of contacts they make. If instead you’re working with half a dozen recruiters, there is a very good chance that news of your search will get back to your employer. You simply cannot control that many people.

Be sure to emphasize that the search must be done in private. We often assume that a headhunter automatically knows to keep your search private. But never overlook the obvious let them know that it is private, and that they are not permitted to release your name to a prospective employer unless that employer has first expressed interest in your skills. In the recruiting industry, this is referred to as providing blind resumes. These are qualification-only resumes that provide no identifying information.

Let them know that the search must be very specific. Unless you are desperate to find a job, any job, instruct the recruiter to introduce you only to a very narrow range of employers and jobs that you would consider interviewing for. The last thing you want have is for them to blast your resume out to 100 or more employers at a time. That’s like announcing your search in the newspaper!

Keep your applications to a minimum

We just talked about keeping a recruiter from blasting your resume out all over the place. You need to follow the same advice. In most communities there are only a limited number of employers in a particular field, and most people who work in the industry know the major players. If you let every employer in town know that you are looking for a job, it may be just a matter of time before your employer catches wind of what you’re up to.

Network - but don’t ask for a job

When you network in the hunt for a job, try to do it from a different angle. Instead of being blunt about your desire to seek employment, instead try to establish common ground with someone who may be likely to hire you.

The idea is to build up a working relationship with other people in the industry by talking shop, and to get them to solicit you rather than the other way around. Since the prospective employer will have a specific interest in you, they will be careful not to disclose your exchanges back to your employer.

Never search on company time or on company equipment

It’s always tempting to conduct a job search on company time. After all, it’s always easiest to contact prospective employers during normal working hours. Since you are at work at the same time, you might want to make phone calls from your job. But don’t! In most organizations, someone always has a glass to the wall and is listening in. And nothing in an office moves quite as quickly as gossip!

Make any job hunting phone calls on breaks, on lunch hour, and after hours, and always outside the office.

Likewise, don’t ever use company equipment to help you in your job search. That includes company telephones, email, or word processing. Employers increasingly monitor the traffic on the systems, and you should always assume that someone is either listening or watching what you’re doing on company equipment.

Don’t discuss it with others

Have you ever heard the term loose lips sink ships? When it comes to searching for a job, discuss it with as few people as possible and with no one in the office.

It’s very rare that work friends fall into the category of true friends. You often don’t find that out until there is some point of conflict. A friendly coworker might resent your decision to leave the company, or might even conclude that he can improve his own position in the hierarchy by ratting you out.

If you are planning a job search, you’ll want to engineer the entire process on your own terms. But spilling your guts to too many people, or to the wrong person on the job, could turn the job hunt from a choice to a necessity in short order.

Have you ever had an employer find out you were looking for a job before you were ready to tell them?

photo by thetaxhaven

Filed Under: Life Experience

5 Ways to Save Money on Your Car

March 27, 2013 By Leave a Comment

saving on your carThis is a guest post by Stuart at Contract Hire a Car.

Everyone is concerned with how to save money; you probably have thought a million times about ways to cut expenses. One of the biggest ways to save money is by cutting back expenses on a vehicle. Here are the top 5 ways to save money on your car.

Do Your Own Repairs
The mechanic will charge an arm and a leg to do service work. They will add additional surplus charges to the parts and the other extra fees can be absorbent. A typical pair of brake pads and rotors can cost under $100, add labor to that and it can quickly increase to $200 or $300, depending where you live. There are online tutorials and various other websites that can help even the novice learn how to repair any part of their car. Watch a few online videos and soon car repairs can be a huge way to save.

Keep Up On Preventative Maintenance
Preventative maintenance is just that, it prevents a major occurrence. Routine oil changes and checking the air filter can save a great deal of money. An engine that has had the proper oil changes will always fair better than those who have ignored preventative measures. Maintenance makes common sense and it can prevent a costly mechanical breakdown. If a mechanical failure should happen on the road, adding a tow to the bill can be an absorbent expense.

Shop for Insurance
Insurance companies advertise on television all the time. It may pay to shop around and find a few good bargains to associate with current coverages. There is always a better deal, just be sure the coverage levels are the same or better than what you have now. If you have way too much coverage for an old beater, consider downgrading a bit for a big savings. Some cars are not worth carrying full coverage on, so weigh the costs and consider what the best option is.

Save On Gas
Gas is one of the biggest expenses there is in owing a car. Rather than driving everywhere, try carpooling or biking on occasion. The method a person drives can also be harsh on the gas mileage a car gets. Those who travel in excessive speeds or do a lot of in town driving may pay more at the pump. Always go the speed limit and avoid those busy streets when the freeway will offer premium mileage out of a tank of gas.

Wash and Wax
While it may seem like a good option to drive through one of those washes where they do everything for you, clean your car yourself. If a person has a hose with a water saving nozzle, washing the car at home can be a big savings. The cheapest car wash is around $10.00 in most cities; add that up on a monthly basis and it can be quite expensive. Washing and waxing can be a costly expense, as well as detailing. Making a car shine with a fresh coat of wax and sparkling interior doesn’t have to break the bank.

photo by Moyan Brenn

Filed Under: Frugal Living, General Finance

Debt Freedom in Seven Simple Steps

March 27, 2013 By Leave a Comment

With credit cards, home loans, school and car loans, many people carry a lot of debt. Living a debt free lifestyle is a dream for many people. While it is difficult for most people to get out freedomof debt; it is not impossible. Here are six tips on becoming debt free.

Figure out how much you owe

To start out, a debtor should know how much they owe. Now, this may seem like a painful step, but it is crucial for a debtor to know where they stand. When tallying up the debts, a debtor should note the payment amounts, interest rate and debt amount. Once a debtor knows exactly what they owe, they can start devising their plan.

Create a budget

To devise the perfect payoff plan, a debtor must know more than the debt amounts. A person in debt needs to write-up a budget so they can create a solid payoff plan. A debtor must list all of their monthly expenses such as rent and insurance while also listing for other expenditures such as food and gasoline. With a budget, a consumer will know how much they can denote to their debts.

Pay off high-interest debts first

A debtor should pay as much as possible on their highest APR debts while simultaneously making the minimum payments on their others debts. Then, as one pays off the higher APR debts, he or she can move on the second highest APR and so on.

Negotiate better deals with your creditor

While a solid payoff plan will get the process going, a consumer should do more to pay off their debts. Believe it or not, a consumer can call up their creditor and ask for a lower interest rate. This does not always work, but oftentimes a consumer will be successful, and the debtor will receive a lower interest rate on their debts for a fixed period. Since it only takes a few minutes to make the call, a debtor must take this step if they are serious about being debt free.

Take advantage of balance transfers

Most consumers are familiar with credit card balance transfers. If a debtor has a high interest rate card and the creditor will not budge on the interest rate, one should consider initiating a balance transfer. Oftentimes, one can transfer a 29 percent APR balance to a zero balance card. One must keep in mind; a balance transfer will usually cost the creditor a three percent fee. In the end though, a balance transfer can help a creditor pay off debts quickly.

Generate extra income

Finally, a consumer should seek out ways to earn money off pay off their balances faster. A debtor can easily earn some extra cash by working a second job or selling excess household goods. When increasing income or getting extra cash, a debtor will pay off debts faster.

Look into bankruptcy alternatives

If things become desperate, there are a number of alternatives to bankruptcy. If you simply can’t find enough cash to make the minimum payments on your debts, there are a number of options available to you. In the US, many people choose debt restructuring or a Chapter 13 Wage Earner plan. In the UK, options include Individual Voluntary Arrangements (IVAs) and Debt Management Plans (DMPs).

It’s never too late to wrestle back control of your finances, so stop burying your head in the sand and start taking your financial future seriously.

photo by theangryblender

 

Filed Under: Debt

What Forex Strategy Should You Opt For?

March 27, 2013 By Leave a Comment

When it comes to investing in the Forex market, it makes sense to develop a strategy and rules. Investing within guidelines and parameters can not only help you to feel more confident about your analysis, it can make it easier to determine what went right and what went wrong. Carrying out a scatter gun approach to Forex trading means you will be reliant on luck to make money, which is no way to approach the Forex market.

There are two main types of strategies for the foreign exchange market, which are:

Technical Analysis

Fundamental Analysis

Learn the trading basics! It is commonly found that technical analysis is more commonly carried out by the marketers that are classed as being small to medium sized Forex investors. A good level of technical analysis will take on board the actual factors that have impacted on the market as opposed to the factors have the potential to impact on the market. This means that there is a number of market sources which can be utilized in the analysis and there are plenty of facts and figures that can be examined. It also removes any emotional element like hope, fear or possible expectations in the market which can also have an impact on the overall trends.

Technical analysis usually leads traders to have the opinion that the price is a reflection of all the movements occurring in the market. A technical analysis trader will focus on a number of factors which have been deemed to be of significance. It also bases itself on the fact that the same outcome will lead to the same results, which brings in the predictable nature of the market.

Fundamental analysis takes a different approach

Fundamental analysis is quite different though and this is where a wider range of influences are considered on the behavior of a nation’s currency. This means that traders will look at the political stature of a country, the economic outlook and the overall financial situation to make an opinion on the likely behavior of the currency.

This is a more in-depth level of analysis because the factors that impact on the economic and social landscape of a country are many and varied. For instance, both of these elements can be impacted upon by unemployment levels, interest rates, the amount of imports and exports, inflation, relationships with other nations, tax decisions and so much more. It is also a fact that many of these influences are inter-related which means that a change in one can lead to an impact on another.

While fundamental analysis is a lot more in-depth and requires a greater level of study, it can provide a more proactive analysis of how a country’s currency will behave. The technical analysis is more of a reactive nature and then looking for outcomes and patterns repeating themselves.

Having a strategy is important when Forex market and it is important to choose a strategy that you feel more comfortable with. It may be that you are more comfortable with technical or fundamental strategies so it is worthwhile trying out both forms of analysis. However, if you are doing this, it can be of benefit to carry out a paper strategy or trade with as small an amount of money as possible. When you are honing your skills, there is no need to place a lot of money at stake.

photo by images of money

Filed Under: Investing

The Art of Re-branding

March 27, 2013 By Leave a Comment

A re-brand is not just about stationery. It’s about issuing a powerful message to a carefully targeted audience.

However, re-branding offers businesses a chance of creating a new identity and if necessary shedding the baggage of any previous mistakes and wiping the slate clean with a fresh new look. With this in mind, stationery is all important to any business providing it is completely on brand. The humble business card is very often the first foot in the door when introducing new business to an area or a new client base and makes a big statement if designed well.

From plumbing services to hairdressers, a business card should have the wow factor and is in itself a pocket sized advert. If we look at the huge market in stationery and advertising literature we can compare the wide variety of Instant Print services available online, many of which offer a full range of advice, design, artwork, typography and layout with a high quality finished product second to none.

Instant print leaflets keep costs low by using the latest technology, digital and lithographic print for a professional finish within 24 hours. With so much choice for your business card, deciding which finish and card quality you require is all about your brand image for instance if you are a hairdresser you may want a sexier and more vibrant business card brand style than your estate agent counterparts. When choosing the texture and color palette of your brand take some time to consider how this will be reproduced on your business cards and if you decide on a mammoth logo then take advice from your instant print specialist about how this can be redesigned for your business cards.

With a selection of finishes for your business cards, matte, gloss or even velvet laminate , from artwork to door within 24 hours your calling cards are an essential part of the brand image and should not be left lack luster when giving your company a face lift.

photo by skeddy

Filed Under: World Finance

How to Save Money on your Credit Card

March 25, 2013 By Leave a Comment

credit cardsIn times of financial hardship, credit cards can be a life saver. Not only can you extend your limit to buy the things you really need, but you can also claim back reward points, which can be used to supplement your next bill. For those you are unable to manage their money however, credit cards can be extremely dangerous, and can leave you with vast amounts of debt, as well as a sketchy credit history.

Whether you’re a fan of credit cards or not, there’s no doubt that they play an essential part of everyday life for people all over the world. In many cases, credit cards can be good tools to have they will improve your credit rating the more you use them, but only when you pay your bills on time. If you fail to pay on time, or miss your minimum payment altogether, then credit card companies will be straight on your case, and rarely let up.

Because credit card companies make borrowing money a lot easier than applying for bank loans, it’s no wonder why people find them so attractive. Applying for quick credit usually means that you’re in need of fast finances, and if you’re already behind on your bills, then credit cards are not the way to dig yourself out of the debt hole.

We’ve all been there at one point or another, mindlessly spending money we don’t have on gadgets we absolutely need, holidays and clothes. If you’re credit has never spiralled out of control, then you’re one of the lucky few, and sadly millions of people every year are forced into insolvency because they’re unable to pay back what they’ve borrowed.

Black Holes

Credit card companies and banks openly take advantage of society’s desire to spend, spend, spend, and that’s why they make it so easy to get a credit card. From late payment fees to account charges, these companies make billions every year, but make no effort to deter the public from applying for credit that they simply can’t pay back.

When it comes to paying your bill, credit card companies offer customers a minimum amount, a figure that will keep the creditors at bay until your next statement. Little do people realise, is that paying the minimum is actually bad for your credit rating, showing that you’re over spending without being able to pay back a decent percentage of your debt. Worryingly, millions of people all over the world are applying for a credit card, and thus becoming slaves to credit card companies

Positive Financial State

No matter what age you are, it only takes one wrong financial decision to destroy your credit rating, so you must ensure that you don’t fall into the credit card trap. Your attitude towards borrowing is the first issue you have to address.

Credit is not real money its borrowed time until you are required to pay back what you owe plus interest! If you do own a credit card, make sure you take advantage of the benefits, instead of letting the creditors take advantage of you. Don’t allow the interest to pile up only borrow what you can afford to pay back.

photo by moneyblognewz

Filed Under: Budgeting, Credit, Debt

4 Steps to Take When Unemployed

March 22, 2013 By Leave a Comment

Unemployment is not a beloved term in our language, and it is one of the last situations an adult wants to find themselves in.

But sadly, for those who entered the workforce right before or during the Great Recession, unemployment has become a fact of life. The most recent numbers from the Bureau of Labor Statistics put the unemployment rate at 7.7 percent.

While this may seem to be an improvement over years like 2010, which saw 10 percent unemployment rate, this specific rate only reflects the number of people who report being unemployed and are searching for jobs. Those who are unemployed who simply have given up searching for more than a year are not included in the figure. Also not included are people with only part-time jobs or those underemployed, i.e. working a job that is far below their qualifications. This gives us an inaccurate picture of the economy.

Unemployment often has little or nothing to do with a person’s abilities or efforts. Many times, it is determined by outside factors beyond their control. What this means is that everyone should be informed and knowledgeable about what to do if they should become unemployed suddenly, like I was for over a month, and the steps critical to maintaining good finances until you can find a new job.

Here are some tips that I learned for my brief stint unemployed.

1. File for unemployment benefits immediately

Contact your state’s unemployment office. Do this as soon as you become aware of the situation. Thanks to the Internet, you claim file your unemployment claim online and don’t have to visit an office. The process takes some time, however, so anticipate several weeks before you receive your benefits. Additionally, when you’re filing your claim, ensure that all the information you send them is precise and accurate, because even the slightest discrepancy (such as the wrong date of your last work day) can cause a delay in receiving benefits.

To receive benefits, you will have to have at least three job contacts each week, which you may or may not have to send to the unemployment office to verify. Create an excel sheet and document all the necessary information for each job you apply to. Thankfully, some companies will send you a confirmation email with all the information you need.

2. Make sure you and your dependents are enrolled in a health insurance plan

Contact your company’s health insurance provider and inquire about their policy concerning coverage and when it expires once you’re unemployed. It is important to have your new coverage take effect as soon as your current coverage ceases in case you have an illness, a health condition that requires a prescription, or you require an operation. The last thing you need while unemployed is to get stuck with a hefty medical bill.

There are several insurances plans available in the event you become unemployed. One of them is Cobra, which must be done within 60 days. You can also check out einsurance.com or, if you’re strapped for cash, catastrophic health insurance at places like compare.ehealthinsurance.com, which covers only the most critical procedures.

3. Assess your finances

Determine your spending level versus your income each month. If there is a deficit, find out if there is any unnecessary expenditure you can eliminate.

Examine your credit card debt, how great it is, when the payments are, the minimum payment and whether or not you can pay them off entirely. Hopefully, you will have at least six months of emergency savings which will help out in this area.

If you have any extra or unwanted items in your home, sell them online at amazon.com, craigslist, or ebay.com and use the money to cover expenses.

4. Utilize every option when searching for jobs

Networking is the name of the game. If you don’t have an account on linkedin.com, create one as soon as possible. It works as a professional networking site, allowing both potential employers and employees to search for people to hire and find potential jobs. Many companies allow you to include your linkedin.com profile as part of your job application, and for some applications all you have to do is submit your profile.

On your account you want to post all your resume information, including contact phone number and email. You then want to find others you know professionally and connect with them. If they happen to be connected to an employer for a company you’re applying to, you can send them a message and ask for a possible introduction.

Additionally, job sites like indeed.com and monster.com make it easy for you to find and apply for jobs in your local area. Employers also check sites like monster.com, where you can upload your resume, and contact you if they are interested.

When creating a resume, three things are essential; it has to be organized, clear, and easy for a potential employer to read. There are numerous sites that offer sample resumes (The Art of Manliness has a great article). You want your resume to stick out, but don’t exaggerate or over-inflate your abilities and skills. Triple-check it for spelling and grammar. Then give it to your friends and family to read. At the same time, ask them to keep their eyes and ears open to any job opening that might be good for you.

Just remember; most of the time a resume is the first impression a potential employee will get of you (unless you’re introduced first). The interview comes second. Make it a good one.

After you’ve applied for a job, contact the company to confirm they received your application. It will also show you’re persistent and thorough, two qualities all employers are looking for.

Lastly, be willing to take jobs you might not necessarily like, but they pay the bills. It is better than unemployment, and you can always apply for other jobs as you work and collect a paycheck.

photo by smemon

Filed Under: Investing

7 Ways to Keep Up With Mortgage Payments

March 21, 2013 By Leave a Comment

mortgageIn today’s economy many are struggling to keep their homes and pay off their mortgages. These 7 easy tips can help you keep up with your mortgage payments and pay your mortgage off even sooner and it won’t be any more expensive than what you’re already paying.

Pay One Extra Payment Every Year

Extra payments are automatically added to the principal of the loan, not the interest. By applying this to the principal you’re not paying any interest on that amount of the loan and you will shave approximately 5 years off of the life of your loan. To come up with funds for the extra payment consider tax refunds or work bonus checks. Painless payment and no extra cash out of pocket.

Make Bi Weekly Payments

As in above, making a bi weekly payment will shave off approximately 5 years of the home loan. Simply pay half of the mortgage twice per month in lieu of one lump payment each month. Bi weekly payments mean 26 bi weekly payments or 13 complete payments per year in lieu of the usual 12. Again, just one extra payment every year.

Eliminate Private Mortgage Insurance (PMI)

Most lenders require Private Mortgage Insurance (PMI) if the down payment is less than 20 percent of the loan. If the home value goes up or as the principal of the loan is paid off lenders can often be petitioned to drop this form on insurance thus saving you the tidy sum of a few hundred dollars per month. Generally speaking, once the mortgage balance is below 80 percent the lender can waive this PMI insurance.

Check Your Home Value Periodically

How much is your property valued at? An assessment could save several hundred dollars per annum. Let’s face it, taxes can be expensive. If your home hasn’t be assessed in the last five years you could be paying more in taxes that your home is actually worth. Once you have a current tax assessment in hand you can petition the assessor and possibly reduce this part of your payment.

Reset That Mortgage

Have you been making that extra payment every year? If so, you may be able to reset your mortgage with this seldom used trick. If you’ve been reducing the principal of the mortgage in this fashion the term of your loan is reduced, but when the loan is reset the monthly principal and the interest are recalculated and there will be a lower monthly payment as well as a shorter term loan. This could wind up saving you at least $100 per month or $1200 annually. Don’t forget to continue making that extra payment every year. The savings on this tip can really add up over the course of the loan.

Loan Modification

A loan modification allows you reduce the rate, terms or principal balance of the loan. If you’re going through a financial hardship due to a death, job loss or other circumstances don’t wait until it’s too late to contact your lender for an evaluation. Explore this option as soon as possible. It may extend the overall term of the loan and reduce the principal.

Refinance

Have you been making those payments on time? Have you been paying an extra payment for a few years? If so, your credit score may have gone up and you may be eligible to refinance at a better rate. Although there is a fee to refinance and that means money up front, most home owners recoup their initial refinance cost within four years. If this saves just $100 per month it’s well worth the effort.

Using these tips will help you to pay your mortgage off more quickly and have a financial peace of mind.

photo by stockmoneys

Filed Under: Debt

Money Choices of Billionaires

March 21, 2013 By Leave a Comment

There are more and more billionaires being made every year, and 2013 started with just under 1,500 people in the world being worth more than $1 billion. What do all of these people have in common? Aside from an extraordinary amount of luck, they made wise decisions with their money. Their business acumen is impeccable, and they have learned a few simple secrets about handling their money and investing wisely.

Hiring a lawyer from Acclaim Legal Services to help you handle your finances is just the first step, but finding investments is the next step in reaching your financial success. As you work with your attorney to find the best investments, keep these words from the wise in mind:

Find Investments That Will Pay Off Long Term

There are businesses that will yield immediate dividends, but how successful will they be in the next 5 to 10 to 30 years? A business that sold personalized floppy disks may have killed in 1990, but they would have become obsolete in 2000. Find a business that will be a valuable investment in the long run, one that will keep paying dividends for years to come. Look at the business model, the product or service they are offering, and the plan for the company. If it is reasonable to expect that the company could continue to yield high returns for years to come, it may be a good investment.

Let Your Fear Be a Marker

If you are afraid that a company you are considering investing in may not be a good idea, it may be time to listen to what your subconscious is telling you. Things that seem too good to be true usually are, and your first impression of the company may usually be right. Many wise men will tell you not to listen to your fear, but experts like Warren Buffet use their business and personal sense to get a feel for their potential investments. If they don’t seem like good ideas, they do research. With that research, they usually find out that their instincts were usually right. If your mind tells you to be wary with a particular investment, it’s worth listening to it.

Stay In Familiar Territory

If you have a food company, why would you suddenly branch out into shipping or the import/export business? Unless you have expertise in that area or an expert that can help you navigate through the complex industry, you’ll just be starting yourself off from scratch. Why not stick with what you already know. If you are successful in one industry, stay in that industry and find a new sector that has not yet been completely tapped out or tapped into. Just like Coca Cola found that selling non-cola soft drinks under a different name was the best way to expand their brand, you may want to consider a way to stretch your brand in the same industry — or at least in familiar territory.

Never Gamble it All

Many rich men have lost their fortunes overnight, and it was because they gambled everything they had on one business venture — or even 100. There is nothing that guarantees that your company will succeed, no matter how much capital you have to start off with. Never gamble all of your money on a company’s success, as you’ll go from riches to rags overnight if you should fail.

Warren Buffet has a measly $20 billion of cash on hand at any given time, while the rest of his prodigious wealth is invested. The amount of money that he keeps as a reserve is a pittance when compared to his vast fortune, but at least he’ll always have something to fall back on should something devastating ever happen to his companies, corporations, and other investments. You should always have a cushion on hand, as you never know when you’ll need a bit of cash or some liquid assets handy.

Be Adaptable

If you think that technology is the investment of tomorrow and you sink all of your money into tech, what will you do when solar power or food is the next big investment? Don’t stick with one thing, but change with the times. If you see that one of your investments isn’t paying off as much as you would have like, it may be time to accept the loss, pull your money out, and try some other investment that will pay off.

Don’t stubbornly try to make an investment pay off just because you think it should or the numbers show that it “could”. Be willing to take a hit, and be flexible and adaptable with your investments. Never be so sure of anything that you are willing to bet all of your money on it, but be adaptable and change as the world around you continues changing. Today’s “sure thing” may be tomorrow’s “could have been”.

photo by guyfwicke

Filed Under: Life Experience
banner