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The Carnival of Financial Camaraderie Financially Digital Edition!

2012-05-26T14:20:50Z

Happy Saturday and a Happier Memorial Day Weekend (if you are in the US) to everyone! This is Financially Digital’s first hosting of the Carnival of Financial Camaraderie. I want to give a big thanks to the folks over at myuniversitymoney.com for giving me the opportunity to be a part of such a great blog carnival - so after your done be sure to check them out because they hosted the one before this one and are hosting the one after :)

The goal of the carnival is to help empower both students and professionals to learn and really own their financial experiences. I wanted to challenge myself to try to add some kind of theme to Financially Digital’s edition but after sorting through 100’s of submissions I just couldn’t figure out a way to string them together without losing some awesome posts. So like a real carnival I’ll leave it up to you to just make your way around, jaw agape in wonder, and have you pick your own favorites. Unlike a real carnival the sights here are designed to help you do better with your money and not con you out of it - you will also not see anything that resembles anything like a “world largest pig/bear/miniature horse attraction”.

So without further adieu I am going to throw in some editors picks at the top and then carnival up the rest of the submissions!

Editors Picks:

Mike presents Partnership Failures and Lessons Learned posted at The Financial Blogger. Always quality stuff here and Mike is a great guy, you will definitely learn something from his lessons.

Barbara Friedberg presents NEW MONEY SERIES FOR THE SERIOUSLY BROKE COLLEGE GRAD posted at Barbara Friedberg Personal Finance. You must check out this new series for broke college grads. Part 1 focuses on tips for cheap living and travel. Great for those internationally minded readers.

Kristen presents 11 Free Travel Apps to Save Money posted at My Dollar Plan. Travel can be pricey but lucky for us, there are some travel apps that make it that much easier to not break the bank during travel!

Squeezer presents Why Social Security should not be your sole source of retirement income posted at Personal Finance Success. What happens if one depends on Social Security for retirement? I explain the risk and other options that are available.

Dr Dean presents Innovative Ideas posted at The Millionaire Nurse Blog. Are you looking for new ideas? Do you want to learn how to look for ideas in a new way? This is an innovative way to expand your search for creativity.

MMD presents Six Easy Steps to Figuring Out Your Retirement posted at MyMoneyDesign. When someone says you should save 10% for retirement, what does this actually mean? Will you hit your goals? How do you even know what your goals are? I’d like to offer you my advice for a simple and streamlined introductory approach to figuring out your retirement goals.

Amanda L Grossman presents Is Your Frugality Invoked to Stretch Dollars or to Stockpile the Savings? posted at Frugal Confessions. There are two possible outcomes of frugality. One is to stretch your dollar so that you get a lot more in purchases. Come see what the other is.

Sustainable PF presents Why 'No More Lattes' Rarely Works posted at Sustainable Personal Finance. Who wouldve known that all this time we have been pouring caffeine-laced devils brew down our throats every morning?!

Kevin presents Do's and Don'ts with your Credit Card posted at Thousandaire. The concept behind credit cards is a simple one: charge now, pay later.

Crystal presents Hilarious Hypocrisy posted at Budgeting in the Fun Stuff. Do you even think the wine lady understands how hilarious her life decisions are? How many of us are completely overlooking our own giant blind spots?

Don presents Money Rules When Spending Money posted at MoneySmartGuides. I was recently in Chicago for a charity event. The events were held at the hotel I was staying at so I ended up eating a handful of meals in the hotel.

More Awesomeness:

KT presents Easy Energy Saving Tips...posted at Personal Finance Journey. Energy costs seem to rise almost every day, and it can be hard to keep pace with them, especially if you find yourself on a tight budget. While it might be something that some people can just about cope with, for others, simply meeting the cost of their basic energy needs can be awfully difficult.

101 Centavos presents Travel Notes: Just Say Ahn-Nyeong Hah-Seh-Yo and Kon'nichi Wa posted at 101 Centavos. Just a couple words is all you need to know when traveling abroad. Hello and thank you and a big smile will open a lot of doors in the East, especially in a business setting, and most especially coming from Americans, renowned foreign-language ignoramuses.

Sandy presents Stay At Home Dads on The Rise posted at Yes, I am Cheap. I’ve discovered a new term, the “Mancession” – a reflection of how badly the recession affect employment for men

Jen presents How to Start Saving Money Even if you're always broke posted at Master the Art of Saving. Yep, that's right...broke people can save money too.

Beating Broke presents TradeKing and Zecco Announce Merger posted at Beating Broke. I think it’s a bit interesting that TradeKing and Zecco are merging. There are, obviously, several online trading giants out there (talking babies anyone?) that they are competing with and if they remain separate, they can’t really compete. Together, they might be able to do so.

SB presents How to Control Stock Trading Impulses posted at One Cent at a Time. People with investible money often gets attracted to stocks after reading an article or two. It is important to not buy out of impulse. Take time, do research and set some guidelines to control your impulses

Jacob @ My Personal Finance Journey presents Biggest Threats to Getting Out of Debt posted at My Personal Finance Journey. Paying off debt isn’t easy, but you probably already realize that. Perhaps knowing which obstacles to expect will help you overcome them as you go. This post describes possible sources of trouble when trying to get out of debt.

Dave presents Fighting About Money? Remember The 3 P’s! posted at Financial Conflict Coach. If you find yourself fighting with a spouse/partner, parent, child, family or friends about money- try using the “3 P’s” to calm things down.

Shawanda Greene presents 7 Timeless Tricks for Mastering the Job Interview posted at You Have More Than You Think. Classic, yet often ignored, advice on how to impress during a job interview.

Robert presents How Safe Are Your Finances from Your Kids? posted at The College Investor. The USDA has calculated the costs of raising a child for both single parent households and dual parent households, and it can cost anywhere from $118,590 to $250,262 to raise a child to 18 years of age. And then you get to college!

Jeff Rose presents Should You Buy Mortgage Protection or Term Life Insurance? posted at Good Financial Cents. If you are shopping to buy your first home, you might find yourself with a decision whether to buy mortgage insurance. Here's a look at what makes the most sense for a first time homeowner.

FINAL THOUGHTS:

There were 100’s of posts to make it through. Just so you all know how I did this - my method essentially - was that I started with the earliest submissions and picked the ones that I thought best represented how you can make the best out of your financial experience or learn something. If you didn’t make the list it’s not that I didn’t like you! I’m always up for adding more love though to this round up. So if I missed you please throw your info in the comments below and I’ll keep this carnival growing, after a review of it of course.

Start Up Infographic for Small Business Week

2012-05-24T01:05:46Z

It's still Wednesday and I wanted to make sure that I had a post up for everyone. I've been scouring the web for all things business development this week and I happened to come across this awesome infographic from the good folks at udemy. I wish I had these graphic design skills because it would make everything I write about so much more interesting...but that's a skill set for another day.

This infographic takes all the different roles and hurdles start-ups of all kinds have to face in the big blue ocean that is the business world. As you get towards the bottom of it start to pay attention to who the consumer's of your goods are. I hope this food chain doesn't scare you or deter your efforts but it's important to put your energy into a frame of reference. Especially if you are like me - every new idea isn't always a winner so make your choices and allocate resources wisely.

I would love to hear about your businesses and where you think you are in this ecosystem. If you can't find yourself in this infographic where do you think you should be and what creature of the briney deep might it look like?

Small Business Week!

2012-05-22T21:24:05Z

It’s Small Business Week! This is like Christmas for small businesses - or rather a holiday that makes it about them. Maybe it’s more like a beauty pageant but everyone that’s a small business wins?! Well you get the idea. It’s great for a few reasons that I talk about in my video today along with some solid resources that we can all use a refresh on every once and awhile. One of the morals of the story is to go out and support the small businesses in your community. We all get so busy and in our own routines that we can miss some great local spots. It’s those spots that help to continue to support our local communities. If you aren’t a business owner yet then take this week to think about what you might want to put out and produce for the world. There is going to be a ton on the web all about the different stages of developing business plans and models. You can even enlist the help of a guy like me here at Financially Digital :) Hope you enjoy the video and the links that go along with it!

Can An Accident Be Good For Your Financial Plan?

2012-05-22T13:48:45Z

We always talk about planning, saving, and preparing as a means to achieving our goals and aspirations. Sometimes things happen that can steer those plans off course. If you are one of my students then you know that I am constantly saying – life happens. When life happens even the best plans can catch a snag or in the worst case be derailed entirely. Having a plan is great but having the foresight and ability to come out of a negative with a handful of positives is even better. One unexpected in particular is recovering from some kind of accident.

Accidents can happen in any environment you can think of, but their causes do vary. It’s not just the moving vehicle variety that can slow you down. They could happen at home, in the office, in a supermarket or even in traffic, but if they do, there’s always a possibility that you could become injured after it happens. That can definitely put a kink in your plan. If you aren’t injured (which is hopefully the case) there will always be costs – opportunity, time, money, etc. It can be stressful but with a bit of help you can keep your plans moving with as little disruption as possible. Remember even in tough times – the goal should be to act as efficiently as possible. First thing, instead of wondering what to do, you should find someone to help act as your fiduciary. Someone to act as your fiduciary or support is important and will allow you to focus on your family or the rest of your plan. This is where there could be the possibility for a positive to come out of a negative. With help from experts like First4Lawyers, you could find that compensation for your illness or injuries could be yours, but how do you know if you’re entitled to it?

The main thing about knowing whether you’re entitled to compensation is whether the accident was caused by another party. There are several scenarios where, if the accident was because of someone else’s negligence, then you are entitled to make a claim. For example, if you were involved in a collision on the road where another driver smashed into your car, giving you an injury such as whiplash, then you can make a claim. Other incidents such as slipping on a wet floor when you weren’t notified of the risks involved can also give your reason to make a claim.

If making a compensation claim, there are some more things to take into account such as who’s at fault, how the injury you picked up will affect you physically and how, if at all, it will affect your finances. If you know who was to blame for your injury, have suffered a loss of earnings and face any additional costs for healthcare, then your claim has a realistic chance of being successful, while the compensation won can meet the costs faced in the aftermath of the injury.

One of the biggest components to getting your plan back on track is keeping organized. These incidents can happen in the blink of an eye and take time to recover from. So, even with the help of a fiduciary, it’s important that you keep records straight.

No one likes or should be looking for something bad to happen. If it does though you don’t have to fight it alone and it shouldn’t undo all your hard work up until that point. The more organized you are the more efficiently everything can be played out. I am not advocating that you go out and look for somewhere shiny to slip and fall but, everything has a cost. It’s important that you can recover from those costs and move on. It’s definitely not a lottery but a bit of a windfall can help get your plan back on track and possibly even give it a leg up.

What's going on with Facebook?

2012-05-21T15:07:49Z

Poor Facebook. Over 900 Million friends and the stock is taking a dip today - having some NASDAQ sized technical difficulties did not help the situation at all. There’s a ton on what’s happening right now over the descent of the Facebook share value. While Financially Digital isn’t a fast breaking news source, I did want to round up a bit of the news bytes to give a 30,000 foot view of what’s going on.

Let’s start at the IPO. NASDAQ had some difficulties in getting the shares listed properly. That 30 minute delay actually caused several hours of headache for investors. Everyone from large institutions to individual investors had to even wait some time to see if their trades had been executed. I know I wouldn’t be a happy camper if I were trying to get in and out of Facebook on the first day.

Was it too big? There were talks that Morgan Stanley was helping to keep the share value propped so that it wouldn’t fall below the IPO release on the first day. That makes sense because it’s no good for anyone if there is a exodus sized sell off by institutions on day one. But what about day 2. Today Morgan Stanley has reported to ease off with it’s support, coupled with the hysteria and pressure, is leaving Facebook a little anemic at the moment. Another thing to think about was the sheer volume of shares released. Did the underwriters do enough homework to see how much actual demand there was - maybe miss the fact that there could be a surplus of shares...basic econ 101 type stuff (they should take my econ class). There is also a difference between internet hype and actual commitment, which is getting harder and harder to discern against these days.

Where’s the value? I’m not saying Facebook can’t make money. Four Billion in revenue certainly proves that this is a viable business model. Also creating an online community that has attracted and connected over 900 million people is no small feat either. I mean I know people who use Facebook as their primary means of communicating with the world. What I don’t understand is where trading at 100+ price-to-earnings make sense for them. For the most part their revenue comes from advertisers, marketing, apps, and a few other places but that’s it. What’s Price-to-Earnings you ask: P/E = Market Value Per Share/Earnings Per Share. What this ratio tells us is how much people are willing to pay per dollar of earnings. So if the P/E = 100 then investors would be willing to spend $100 for every $1 in earnings. This is one of the oldest and easiest metrics to calculate but it can be one of the most challenging to interpret. like I said, where’s the value?

Should you buy? Well if you are looking at it as something cool to own a few shares of - like buying some Americana from an antique store right now I’d say go for it. It could be a bargain and if you hold it for long enough it could be worth something. If you are looking to make this a part of your portfolio I would be inclined to put this on my watch list. New stocks are very irrational - and with Facebook in particular all the hysteria doesn’t help. I would say give it a few days and just watch the prices. Let all the institutional dust settle and watch for a floor. It looks pretty promising right now as it’s dropping into the low thirties. Analysts like Wedbush Securities are still bullish on a target of $44/share so there might still be a bargain in there somewhere.

How Not Accepting Credit Cards Will Cost You

2012-05-15T02:49:48Z

There’s a lot of talk among some small business owners about the way credit cards have impacted our bottom lines. Every time a customer hands over that little piece of plastic, the bank has to take their cut. Some small businesses have gone cash-only, while others have chosen to tempt fate and require minimum purchases for credit – in defiance of their merchant agreements.

Yet, what some small business owners don’t realize is that accepting credit cards isn’t a burden on a business; it’s a boon. Accepting credit cards improves your bottom line in a number of ways.

One of the most interesting ways that accepting credit cards actually helps your business is in the items that you sell. Some recent research conducted by Professors Promothesh Chatterjee from the University of Kansas and Professor Randall L. Rose from the University of South Carolina shows that credit card customers are more concerned about benefits, whereas cash customers are more concerned about costs.

Greater recall, faster response

In the study, some subjects were primed for credit card use while others were primed for cash use. They were then shown products, as well as a list of benefits and cost-related information.

What the researchers discovered wasn’t surprising, but it does help to show just how accepting credit cards can benefit a business. Those consumers who were primed for credit use had a faster response to and greater recall of benefit-related ideas. Those customers primed for cash had a faster response to and greater recall of cost-related ideas.

In short, payment method is an important factor in determining which product a consumer is going to buy.

Among the other findings:

• Consumers primed for credit were more likely to make extravagant purchases. They were more likely to buy things that were high-profile, in spite of a higher cost.

• Credit card customers made more recall errors when it came to costs. They were less likely to remember cost information, because they weren’t focused on it.

• Cash customers, more than credit card customers, were concerned with everything cost-related. They were more concerned with things like delivery costs, setup charges, warranty fees, and even the time that installation would take. Credit customers weren’t as concerned about these kinds of factors.

• If a consumer were to enter a store without a payment method in mind, they could be primed for credit – even if they ultimately chose to use cash. Having credit card signs or credit offers in the store help to prime customers to use credit, and therefore make buying decisions on the basis of benefits rather than costs.

There are other ways, of course, that accepting credit cards will actually bring in more business, but this research is compelling. Your customers are likely to spend more simply by the fact that you accept credit cards in your store. Your average purchase amount will be higher, and you’ll likely have more volume. You’ll sell more high-profile products, as opposed to those value products with lower purchase price (and lower margins).

David Rodwell is a seasoned writer in business and personal finance who takes a particular interest in payment processing technology. You can find more of his articles located at CreditCardProcessing.net.

Keeping Your Passion: A Small Business' Lifeblood

2012-05-14T18:27:39Z

It’s not always sunshine and rainbows when you are running a business. It can be disappointing, expensive and lonely when you are trying to get your ideas off the ground. Not to mention the sea of nay-sayers that are trying to rain on your parade because they don’t have one of their own.

Mondays are good for a few things. They are good for setting the tone for the week, planning, nailing down loose ends, and for reaffirming why you do the things you do. I really like Mondays. I like them most because of the opportunity to really reflect on why it’s worth it to keep plugging along. What I’m getting at is more than just getting re-acquainted with your mission but really getting down to what you are passionate about. From their stems all kinds of good stuff like sense of self worth, self-beliefs, values, and even confidence to squeeze every ounce of awesome out of that week. For every Monday Warrior out there I have a few tips to help you get yourself in the zone - and keep you dry for the times that people try to rain all over what you are trying to accomplish.

1. Think about the solution you provide. At one point it was probably something you were struggling with or just something you loved. Is it the people you help, the product your produce, or some combination of the two? Whether you are grossing $1M or are still in the red with your small business think about why you decided to share what you are with the world. I know it’s not always easy to tune out negativity or skepticism - especially when it’s coming from those closest to you. Make sure that every time you sit down with the conscious intent on moving your idea or business forward it’s going in a direction you still want it to be. Use times like this to take an internal inventory. You will not only burn yourself out but lose your momentum if you aren’t excited about the overall goal of what you are doing.

2. Make/do something. It’s easy to be intimidated by long lists, especially if everything on it is a priority. So pick something and cross it off the list. Best if it something you can see come to fruition as a direct result of your efforts. Even better than best if that something is directly related to why you are passionate about what you do. Passion for your small business can come in a lot of shapes and sizes. It’s more than just pride it’s a real connection. Just imagine how proud you were after that first satisfied customer or as your first instance of being a real resource. When you cross something off of your to-do list it should bring about those feelings.

3. Try to collect on an invoice. It’s no surprise that payment times on invoices extend when economic times are tough. What’s worse is the way that can impact our emotions and focus within our small business. If you fall into this trap a quick way to turn it around, keep you excited, and satisfy some cash flow needs is to shoot for the low hanging fruit. What I mean is not only re-request invoice satisfaction but look for projects or jobs that would yield quicker/instant payments. Sure the invoice might be smaller dollar wise but any positive cash flow will not only help the business but also keep you engaged.

4. Work on some collecting some testimonials. Now posting testimonials in marketing materials and on the web is not a new notion. Showing prospective customers and clients what the possible experience they are in for is a great way to communicate. Why this is also important in helping to keep you passionate is because it will give you the opportunity to see how what you do affects others. Testimonials shouldn’t be the result of a favor - they should be the unique experience of a satisfied customer. These are the folks that are walking proudly in your parade, the same one others keep trying to rain on. You have a support system built into your current successes. If you are new business or a young one then try to surround yourself with supportive people. People whose feedback you value and those that will provide honest and constructive feedback.

Hopefully you can take at least one of these tips and use it to make your Monday a little better. I would love to hear about how you keep your passions strong for what you do. Feel free to share in the comments any tips or suggestions you use to beat out the start-up or entrepreneurial blues.

Mother's Day Edition

2012-05-13T19:35:09Z

Happy Mother's Day!

I wanted to throw up a quick post because this week I fielded a lot of questions about spending for holidays like today. First of all we should all be cherishing our mothers - they are half the reason you are who you are. Gifting can be kind of tricky, especially on a day like today. Before I even start in on my two cents make sure above all, any gesture is a gesture that will show your appreciation and most of all a little bit of love.

Now that all the sentiment is out of the way let's talk about efficiency. Any time you are spending for someone I always like to think of it as an opportunity for the gift receiver to make an investment in themselves. While flowers, treats, and stuffed animals are all very sweet are they really an efficient allocation of any amount of funds you are thinking about allocating. Here are three tips to help you through some last minute spending today or for future appreciation type holidays - like Father's Day coming up.

1. Gift Cards. Some people think that these are a little informal. I like to think of it as a way the reciever can choose what will be most beneficial for them. If your mom is thinking about getting more active this summer then a targeted sports store gift card might provide her with the incentive to get what she needs to get moving. The point of the gift card is to target a need - try to avoid those generic pre-paid visa's etc. Not only might they carry higher fees but you won't be able to guarantee that mom will get the things she's been talking about wanting. As a mom she might use that general pre-paid card on spending for other people, the house, etc - thinking of us, it's what they do :)

2. Skip the flowers, cards, and candy. Think about the budget for a lot of the novelty that goes into these kind of holidays. After those three you are probably running a bill close to about $30. Think about how you can use even a budget of $30 to provide mom with something that might make her life a little easier. While all those things make the moment seem nice, they really have no return on investment. Just like the gift card - think about what might provide the greatest amount of utility. Plus flowers on holiday's like today will have the highest mark ups.

3. From the heart. If your mom is as busy as mine is then she rarely has anytime for herself. Something as seemingly easy as a day off from cooking, cleaning, childcare, or any of the other full time responsibilities could mean more than any store bought item. It takes a little scheduling and sneaky planning but find out where you can lighten the load for mom and make it happen. Whether you do it or have someone else hold down the fort so you can spend some quality time together means that she will find a break and an opportunity to recharge.

Today wasn't really any heavy lifting but I hope it helps give you some perspective. If I was too late today then start thinking about dad, or teachers, or administrative assistant because they all have their special days too. Never ever underestimate the power of a little appreciation - it really goes a long way and helps keep people more productive, believe it or not.

Confidence and Entrepreneurship

2012-05-10T13:52:51Z

Before you go straight to the video I want to talk about confidence and being overconfident. I have done a lot of consults with businesses and sales teams and one of the fundament skills we asses is confidence. More importantly your confidence in yourself. Your belief in your mission and the value that you provide is the first thing clients and customers will see as you walk through the door. How can you be the ambassador of a brand then if you are not only not confident in your small businesses product or mission but also in your own abilities. Self belief, self worth, and self respect are paramount to your successes.

What happens when you have a little too much confidence though? Maybe too big an ego? Well, frankly that can be a turn off (for lots of people). Having an over inflated ego might have your perceived as someone who doesn't need new clients or customers. Someone who has and knows it all already. Worst of all someone who has no room left to grow. Sometimes when you are over confident your relationships are impacted - what I mean is that people might question your reliability and trustworthiness. Then there's always coming off as "sales-y".

Moral of the story is that you have to find a balance. Success comes from those that are invested and advocates for the brands that they represent. They are confident in their ability to provide goods and services to those that are looking to be, feel, do, or even look better - in any number of ways. Your confidence is what makes people feel they can trust in your judgement and your ability to act as their fiduciary and it comes from your self-belief. So after you watch this video and even check out the the Inc.com link think about your confidence levels in what you do (even in your personal finance prowess). Or if you are most of these things maybe it's time for a self-belief check-up. Enjoy!

Wow! You're a sell out!

2012-05-07T21:49:59Z

Are you a sell out? What is “selling out”? I want to talk about why we do some of the things we do today. Recently I’ve come into contact with a few businesses and individuals that might be fit to wear the sell out mantle. While I am not a flame throwing kind of guy, nor am I one to stop anyone from improving their situation - I am one to believe that successful businesses and people are so because they are value driven, not monetarily driven.

What is a sell out? A sell out is someone or some institution that compromises their integrity, values, mission, or purpose for monetary advancement. What about an institution whose only goal is to make money - are they ever a sell out?

This is a very subjective topic and a very sensitive one to boot. No one likes to be labeled a sell out but money is what makes the world go ‘round. Let’s talk about why people sell out. Selling out can mean that you are joining the mainstream. It can mean that you are now producing goods or services that don’t align with the mission that was in place at the endeavor’s start. It can mean you are going from the red to the black on a balance sheet. What it usually means is that your cash flows have now increased. Increased cash flows are the big goals in personal finance and business so why is it so frowned upon. As brands and businesses evolve there can be a disconnect between the early niche adopters and everyone else. No one said it was wrong to be successful but how you are perceived to reach that success is what your stakeholders pay attention to because it also reflects their values as consumers.

It’s not hard to see the incentives that drive the sell out. Entrepreneurs toil for endless hours over periods of years. All that work happens under the radar and with little success until one day everything clicks and you are the next Instagram. What drives you is your mission and possibly the hope for a positively functioning business model. While the Instagram’s of the world are a one in a billion type of situation there are smaller brands that are making changes to grow their user and fan bases everyday. On the other side does a brand making money really change their identity?

To avoid the negative stigma that comes with being labeled a sell out I think the biggest weapon a brand can employ is transparency and appreciation. You have to appreciate all the support you’ve had along the way because it were those meager beginnings that kept you motivated. It’s also important to constantly communicate they “why’s” of your business. It’s ok to pivot and change directions as long as your mission and values grow and pivot with you. Consumers identify themselves largely by the things they choose to spend their money on. It’s only fair that you keep them informed and always give them the choice to continue their support - not misrepresent and then one day be called out as a sell out. While any press is usually good press, a challenge to your integrity on the big screen might not be very positive.

What are your thoughts on selling out? While there are purely philanthropic businesses out there is it ok for brands to change their values in the pursuit of the almighty dollar? Would you be ok with a sell out as long as the brand kept you informed along the way?