Tuesday, July 28, 2015
When it comes to living a balanced and happy life, money is just one of the many resources any one of us has at our disposal. It's a powerful one. It's a tool that allows us to give, obtain, and experience. But if you're ever in a spot where money is limiting or controlling you, remember that you do have other resources you can turn to that can be equally as powerful.
Your Knowledge and Skills
Everyone has experience in something. While that something may seem mundane or easy to you, it's valuable to someone else out there. In traditional situations, we put our knowledge and skills to work literally, spending our time at them in exchange for a salary.
There are other ways to apply your skills. You can use them to help your community. You can use them to barter with someone who would provide a valuable service to you with their own knowledge base, avoiding the exchange of money completely. You can also provide them to help your network, growing your community and establishing trust and name recognition for yourself later down the line.
The definition of your community will vary so much depending on who you are. It may be your family. It may be your church group. It may be your professional network. It may be close friends that you've had since you were young. You may belong to many communities, and recognizing and caring for each one as a resource is an important concept to internalize.
When you hit hard times, your community will be there to help you out. Just ask them. The type of community will determine how and when you go about that. (You wouldn't approach your professional network the same way you'd approach your family.) But the beautiful thing about communities is that someone is always there willing to lend a hand.
They will be, that is, if you have nurtured them. Community isn't just about taking; it's about giving. Mind your networks the same way you would your finances. If you're not contributing, you can't always expect to be able to make a withdrawal.
Time is possibly our most valuable resource, and it's one we all have an equal amount of on any given day. How we choose to spend that time determines so much in respect to our quality of life. We can spend it working to obtain more money. We can spend it serving our communities. We can spend it honing our skills. We can spend it relaxing. We can spend it laughing. We can spend it spent and completely stressed out. But when we recognize it as one of our resources and tend to it in the same way as we would our finances, we're more likely to get the most out of it.
That's not to say that everyone has the same freedom with their time. You may have kids, which take up a huge chunk of your time. (Not that they're ever not worth it.) You may have a job that demands you allot a serious portion of your time to your work. Whatever those demands are, evaluate what matters most to you. That is what you should be spending most of your time at. It likely means sacrificing in other areas, but it also means living a fuller, happier life. Time is the one resource we can't rebuild, get back, or gain interest on, so it's important to use it wisely.
Are there any other resources I missed? I'd love to hear your thoughts in the comments.
Monday, July 27, 2015
January is the time for resolutions but how many people take stock later in the year? Have you even thought about yours since you made it?
So I’m asking you now, whether you started this year with goals or not, to sit down with a pen and paper and do a little project with me. I want you to answer these questions- not just with a ‘yes’, ‘no’ or a one liner, but really think about them. Write down everything that comes to mind. Don’t worry, I won’t be grading it at the end so you’re free to really let loose. Let’s go!
1.) What were your resolutions for this year, or if you had none, what were your general expectations for the year ahead?
2.) Did you start this year with a plan, or with measurable goals and if so, how are they progressing? Maybe you were due to finish something or start something new. Has it happened yet? Now is a good time to adjust the goals if you need to, or make new ones.
3.) So far this year, what has held you back the most? Write down how you felt and a few things you can do to get around this.
4.) What has helped you, lifted you up or inspired you? Write down some things that this inspiration has helped you accomplish. Think about how you felt at the time and how you can generate the same sort of feeling again.
5.) What, right now, are you grateful for? List some big things and some small ones, some things that affect you and some that are for those you care about.
6.) What things have you gone out of your way to do for others this year? What has been done for you? Even a polite wave from a driver can make you smile for a day. List a few things you’ve done or received.
7.) What thoughts, feelings, wishes or intentions have you put out into the universe so far this year? Think about your overall state- happy, angry, jealous, thankful? Imagine your thoughts and intentions as a form of energy
8.) List some things the universe has given back- a few green lights when you were in a rush, or something bigger like a windfall? Maybe something happened unexpectedly but you had the resources to handle it, or maybe things just got a little easier for a while.
9.) What did you receive this year for working really hard? This can be in your personal life, not just professionally. Remember time when you’ve put in effort for something and were rewarded for it.
10.) Going back over the previous questions, what would you like the second half of this year to look like and how will you make it happen? Think about what you’ll put in, what you can give and how to ride out the rest of this year with grace.
Write out the answers to these questions, along with any thoughts you have on the way. Seal it in an envelope- make notes if you want about your plan for the rest of the year- and put it in a safe place. Crack it open New Years Eve and see how things went!
Post by Amy Hopkins
Tuesday, July 21, 2015
No matter how well your business is doing at the moment, it is important to always be looking for ways to diversify or expand your operation as a form of "future proofing" your business. Don't wait until there is a downturn in your core target industry to look at ways to capture new business, increase your market share or otherwise expand operations. Below you'll find four tips you can implement now to make sure you're equipped for growth and whatever the future brings.
What advice would you give to a business looking to grow their market share and expand their operations?
1. Look at New Marketing MediumsSMS messaging can be a far more effective way to reach your audience than 'traditional' digital mediums like email newsletters. More and more people are using their smartphone as their primary device which means the way they want to get content is constantly evolving. Recent data suggests that 99% of texts are read, and of those, 90% are read within the first 3 minutes of being sent and ultimately, marketing doesn't get much more direct than that! Make sure you are constantly looking at how, when and what you communicate to existing and potential customers and ensure that your marketing strategies evolve with consumer behaviour. For more information, consider contacting specialist companies such as SMS Global.
2. Consider Wholesale OptionsIf you're not in a position to open a second location, can you look at making part of your product range available for wholesale? This strategy works time and time again for artisan or niche market food suppliers who can align themselves with likeminded suppliers (e.g. healthy packaged meals in gyms, baked goods in cafes) to increase their reach and market share without the overheads associated with setting up a second or larger location. You could also look into the feasibility of a pop up second location or market stall to increase your revenue and introduce more people to your product.
3. Complement Your Product or Service OfferingIs there a way you can increase the amount each customer spends with you in a way that genuinely adds value to their experience? For example, someone who provides lawn mowing services might be able to include swimming pool cleaning and maintenance into a package or a hairdresser could offer waxing or tanning services as part of their salon treatments. Try to think of things that you can easily provide without necessarily needing a dedicated full-time staff member or large inventory expenditure.
4. Monitor Your Market & Competitors RegularlyWhile your business needs to have a unique service offering, watching the competition (or brands you aspire to emulate) can be a great way to predict trends, identify gaps in the market and ultimately increase your own revenue. It's important not to fall into the trap of mirroring your competitors - rather find a way to convert what works for them into success for you or even better, look at what consumers want that they aren't currently offering and see if you can use this to increase your own market share.
What advice would you give to a business looking to grow their market share and expand their operations?
Welcome to the third and final installation of Personal Finance ABCs! If you've missed the past couple of weeks, check out Part 1 where we reviewed A-I, and Part 2 where we covered J-R. In Part 3, we'll be looking at the subsection of numerous, yet simple aspects of personal finance for letters S-Z.
S is for Side Hustle- If you read a lot of personal finance blogs, there's no way you've missed the side hustle. Whatever you goal is, whether it's paying off debt, saving for a large purchase, or increasing your income in general, side hustling is a great way to get there. You can do almost anything for your side hustle, too. You can take surveys. You can walk dogs. You can get a traditional part-time job. You can even do something crazy like writing a personal finance blog. Side hustles usually work best long-term when you're playing to your own, unique talents and interests. Otherwise, it's easy to get burnt out. If your goal is short-term, most people find they can do almost anything for a small window of time.
T is for Taxes- We all have to pay taxes. It's inevitable. But if you earn enough from your side hustle or are self-employed, keeping an eye on them is even more important. If you build enough income from either, you will be required to pay taxes quarterly, and if you are registered for GST, you will have to set aside money for that, as well. Not paying your taxes results in massive fines, so it's better to plan and pay than to get to the end of the tax year and realize you can't.
U is for Unemployment- Unemployment is sometimes a part of life. It can derail our plans, send our finances into a tailspin, and make us feel generally hopeless. But there is hope. In Australia you can get unemployment benefits through Newstart if you are 22 years or older (with some exceptions for students and apprenticeships,) and get help finding a new job. While it's not the same as having a job, it's a ay to get back on your feet while enduring some temporary cutbacks.
Vision Boards- Goals are more obtainable when we write them down, and more likely to be realized when we see them on a regular, daily basis. Creating a vision board (and a motivation wall in conjunction with it,) is a great way to do just that. Kylie is an expert at it, and you can check out her vision board tutorial here.
W is for Workaholic- In your quest for a sound financial life, it can be easy to become obsessive. To worry about every last penny that you could possibly earn, and spend all of your time trying to make it. While it's good to be fiscally responsible, it's also important to live all parts of your life fully. Money is just the means; it's not the end.
X is for Xtreme- What does Xtreme mean in personal finance? It means retiring in your 30s. It means paying off your mortgage ASAP, even if you just purchased the house. It means working at your side hustle so hard, that it becomes a full-time income, and you quit your job to pursue self-employment. Just like Xtreme sports, Xtreme personal finance isn't a bad thing. It's intense, and it can be quite the wild ride. But it's doable and possible if you've got the right personality for it.
Y is for Yield- Yield is the return on your investment. This can be applied to actual, monetary investments, of course. But it can also be applied to work or time spent at something. Did the six hours you spent on a project yield enough of a return for you to be interested in doing it again? If you're not sure, divide the profit by six, and see if you're happy with what you made hourly.
Z is for Zero-Interest Opportunities- This is a strategy that can be used when you're paying off debt. For instance, if you have a balance on a credit card that charges 24% interest, you'd be wise to look at opening up a credit card with an introductory 0% interest rate. (Usually these rates last for a set amount of months.) You typically have to pay a 3% fee to transfer your debt onto a 0% card, but that's much better than paying 24% month after month. Once you've transferred your money, you'll be able to attack the actual balance that much quicker. For particularly high balances, you may have to use this strategy again after the zero-interest promotion period expires to avoid getting hit with the higher rates again.
Hope you enjoyed this series! Do you have any alternative suggestions for any of the letters? I'd love to hear them in the comments!
Tuesday, July 14, 2015
Welcome back to the Personal Finance ABCs, where we're reviewing the simple, yet numerous aspects of personal finance! Last week we covered A-I, and today we'll be tackling J-R.
J is for Judge Not- We all know how the rest of that phrase goes. But just in case: "Judge not, lest ye be judged." The "personal" in personal finance means that everybody's is going to look different. Maybe you think couponing is a waste of time. Others surely don't, and it helps them manage their resources in a fiscally responsible way. Maybe the girl in front of you at the department store just spent $300 on a pair of shoes. You don't know that she's racking it up on credit; it may be a luxury she's been saving up for. Whatever other people choose to spend their money on (or not spend their money on,) keep in mind that it's a very personal decision. Their decisions do not necessarily make them inferior. You certainly wouldn't want someone on the outside looking in to be tearing apart your financial decisions without knowing your circumstances fully.
K is for Kijiji- That's a shout out for all the Canadian readers out there. If you're in Australia, you're likely more familiar with Gumtree, and in the US the pop classified site is Craigslist. Whichever site you're using, these can be a great tool for helping your finances. Whether you want to downsize and make some money off of your old "stuff," or are looking for some furniture on the cheap, these sites can help you get there.
L is for Leverage- Leverage can be applied to many areas of finance. If you're investing, and decide to do so on the margin (or invest with borrowed money/debt,) you are leveraged. You also use financial leverage when you take out a mortgage or any other type of loan. When you start talking about career, you can use your past work or experience to propel yourself forward financially, as we'll see in letter N.
M is for Money- Obviously, a large part of personal finance is centered around money. But money isn't all there is to it. Money is the tool we use to get what we want, like freedom. It's also the measuring stick we use to gauge our progress. But personal finance is also about psychology. It's about tempering ourselves to live within our means. It's about putting off what we want today so that we will be able to have what we need tomorrow. It's about using money to give ourselves the time we want to spend with family, or giving to causes or people that are important to us. Money is the means in personal finance, but it is by no stretch of the imagination the end.
N is for Negotiate- When it comes to personal finance, if you aren't negotiating you're missing out. You can negotiate on near anything where it's culturally appropriate including monthly bills, less-than-perfect product that you're interested in purchasing, and major purchases like homes or cars. Negotiation isn't just for saving, though. It's also for increasing your resources. Negotiating early on in your career can pay off dividends as every salary increase you have after that will be building off of that initial number. If you're already far enough into your career, you can leverage your past work, experience, and contributions to negotiate for a higher raise rather than just accepting what they give you.
O is for Opportunity Cost- Opportunity cost is the loss you incur when you make a decision. Almost everything has an opportunity cost. When you choose to keep your money in savings rather than investing it, the opportunity cost is the the loss of interest you could be making off of those investments. When you choose to invest rather than keeping it in savings, the cost is the opportunity to have access to those liquid funds when/if you need them. Work has opportunity costs, as well. If you choose to cut your hours, the opportunity cost is the money lost. When you choose to take on more hours, the opportunity cost is the time lost where you could have been doing other things.
P is for Planning- There is so much planning in personal finance. When you make a budget, you're planning your spending for the month. But the real power of planning comes in when you plan how you'll save over the long-term. A great way to plan is to set a long-term goal, and then break it into manageable chunks by year, month, or even week.
Q is for Quicken- Or Mint. Or YNAB. Or any other personal finance software. If paper and pen isn't serving you well, digital options abound and can help you keep track of and maintain a clear picture of where your finances are. Personally, I'm a bit of a cheapskate in this department and have set up my own Excel spreadsheet. Use whichever tool works best for you.
R is for Ratio- Ratios are commonly (though not universally) used to allocate money in personal finance. If you are investing, you may allocate a certain percentage of your investments to specific types of investments. For example, younger people tend to have a higher percentage of stocks in their holdings, and then a lower percentage of bonds or other less volatile investments. As people get older, they tend to shift this ratio, putting a higher percentage in bonds and lowering their exposure to stocks. Ratios can also be used in budgeting. You may want to save a certain percentage of your income, and spend no more than a specified amount on housing, food, etc.
Be sure to join us next Tuesday for the final installment; letters S-Z!