Credit cards can change annual percentage rates under specific conditions. Learn what you can do if you receive a credit card rate increase notice.
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الاثنين، 27 أغسطس 2018
Questions About Books, Cell Phones, 401(k)s, Private Schools, and More!
What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to summaries of five or fewer words. Click on the number to jump straight down to the question.
1. Drawbacks of the library
2. Private school worth it?
3. Credit card for fixing credit
4. Abundance of green beans
5. Struggling with student loans
6. Decent dish towels
7. Tax bracket comparison
8. Thoughts on permanent portfolio?
9. Late model cell phone strategy
10. Talking about finances with family
11. Older personal finance books
12. Other reading
As the routines of the school year re-emerge in our home, I find my responsibilities and time commitments changing.
During the summer, I wake up early and try to use the earliest parts of the day to write. I generally rely on topic ideas and outlines that I assembled in the spring so that I can spend as much time as possible with my kids during the summer months. This means that I’m mostly at my writing desk when working.
During the rest of the year, I have full days in which to write and to prepare article ideas and outlines for the future (such as next summer). This means I spend a lot of time reading and researching during the fall, winter, and spring, taking notes and making outlines in addition to writing.
This week is my first full week in “fall mode” after “summer mode,” which means lots of time at the library and lots of time reading and thinking about ideas. It’s a nice change of pace.
Q1: Drawbacks of the library
I just wanted to offer a counterpoint against your advice of using the library. I have stopped using my local library and just buy books on the Kindle or at bookstores these days. Our local library only allows you to check out new releases for one week and has heavy fines for each late day. They also fine you if you reserve a book and then fail to pick it up within their hold window. I accrued almost $100 in fines in a single year there. I can buy the 5-6 new books I read in a given year rather than dealing with that nonsense.
– Alice
The fines you describe seem pretty excessive and outside of the norm of my experience with libraries. Not all libraries have such big fines – my local library has a three week lending period for virtually all books and the fine for being late is small (a quarter per day) and even has a grace period of a week. There’s no fine for missing out on picking up a hold, either. Not only that, I have asked for fines to be waived before and they’ve almost always just done it, no questions asked. (I usually pay the fines, though.)
If you’re in a situation where the local library is extremely heavy handed with fines, it’s very reasonable to sit down and assess the cost you’re incurring with those fines versus simply buying books from used bookstores or other sources (buying from elsewhere, trading, etc.) to meet your reading needs.
You might want to look into Little Free Libraries near you. There are a few near me and I often go there and drop off books I own and have read and probably won’t reread, and I also pick one up if I see something interesting (I do more “dropping off” than “picking up” overall).
Q2: Private school worth it?
Several years ago, my husband and I moved to a state with a pretty poor public education system in order for both of us to secure high paying jobs. We had twins five years ago and they’re now in a private preschool which is pretty expensive, more than the daycare we were using. This private preschool feeds into a private elementary school and secondary school and their tuition rates are even higher. For our twins, the cost will eat up most of what we have gained by moving here.
So we have three choices, as I see it. One, we enroll our kids in the private school. It’s expensive, but probably the best educational choice. I have some personal misgivings about private school in general but this one seems fine. Two, we enroll our kids in public school starting next year. Worst educational option, but best in terms of finances. Three, move to another area with good public schools and accept what will likely be some salary hit. Probably the middle of the road option for both education and finances.
What should we do? Looking for some advice.
– Clarinda
First of all, I would put a priority on my children’s education, so I would probably eliminate the option of just sending them to the bad public schools in your area. That leaves the other two options. Where I live, the public schools are pretty strong and I have no qualms about sending my children there at all, so public schools in a state with strong public schools or private schooling at a good private school are both reasonable.
I think I would choose between those two options based on other factors. Are you happy where you’re currently living? Do you have lots of social ties there? Would you be happier in another area? Do you have family or friends you wish you were closer to? Are there good job opportunities in those places you would consider moving to?
Let those factors nudge you. You might find that when you start looking at those things, one of the options emerges as the most sensible one.
Q3: Credit card for fixing credit
I am looking for a credit card to help fix my credit.
– Kevin
If you have bad credit, one of the best ways to start fixing it is with the help of your local credit union. This is something that credit unions excel at – they can help people rebuild their credit with several different tools.
One common tool they will often provide is a secured credit card. A secured credit card is basically a credit card with a deposit. You put down a small deposit and they issue you a credit card. You use that card like normal, but if you don’t make payments, they use the deposit to cover it. This allows the credit union to issue credit cards to people with poor credit, because the deposit helps the credit union cover the risk of giving a card to someone with bad credit.
As your credit recovers, they may be able to help in other ways, such as an unsecured credit card or a collateralized loan. It will take time, though – there is no magic solution to bad credit.
Just find a credit union in your local area and stop in to talk to one of their representatives. They’ll likely be able to help.
Q4: Abundance of green beans
What do you even do with more green beans than you can ever eat? We’ve been freezing them but they just keep coming and coming. We planted too many obviously.
– Alan
There are lots of culinary uses for green beans, but there comes a point where too many is just too many! We made this mistake once and almost made ourselves permanently sick of green beans.
My best advice to you is to talk to any and all people in your life who also have gardens and start bartering green beans for any other vegetables they’ll offer for them. Swap green beans for tomatoes or okra or whatever you can get. This is how we get rid of extras – we often swap them with neighbors or even give them some of our beans (under the implicit assumption that they’ll give us some of their excess of something when their crops are producing).
You should also consider donating them to a local food pantry. Most local food pantries will happily accept donations of fresh vegetables and they almost always are in high demand.
Q5: Struggling with student loans
I need help. I have been struggling to keep up with my student loan payments and have not had enough money to pay. I am 24 days late now and need help.
– Kelly
If you’re struggling to have enough money to pay for your student loan, the first thing you should do is contact your lender and ask about hardship forbearance options. Many student loan providers have programs where they will reduce your payments for a while or even eliminate them for a while when you’re struggling financially.
There’s a catch: usually, the interest will continue to accrue while you’re not making payments. Still, this can give you enough breathing room to get things under control and rebuild a little before you begin tackling the loan again.
Regardless, it’s best for you to contact them sooner rather than later. The longer you sit around with no contact and no payments, the worse the impact will be on your credit report. Call them up and see what you can work out together. It’s not in their interest or your interest for you to default on your loan.
Q6: Decent dish towels
They don’t make dish towels like they used to. I have bought several new dish towels in the last ten years and none of them actually dry anything. They just move water around on cups and pans. Where can one get decent dish towels without spending $20 a pop?
– Claire
Most dish towels do a fine job if you don’t use any fabric softener on them, so no liquid fabric softener in the washer or dryer sheets in the dryer. If you use those things, the towels come out feeling softer but they’re rather aquaphobic, meaning that they actually push water away rather than absorbing it.
Give all of your dish towels a washing or two with very plain laundry soap and no dryer sheet and see if that helps.
If it doesn’t, you might want to just get some new dish towels. I can personally verify that these are really, really good for the price. They do a great job of drying all kinds of things.
Q7: Tax bracket comparison
Please be aware that if you invest in a traditional 401k or IRA, you’re reducing your income and thus have to pay less tax in your current HIGHEST tax bracket, while in retirement it’s quite possible that this income will be taxed in lower tax brackets. Example: you earn $110k now as a married couple filing jointly. Your highest tax bracket is 22% . Any contributions to the 401k that you now make are deducted from your income, saving you 22% of that contribution in taxes. When you retire, say you’ve got $30k of social security income (taxable), $10k of Roth income (untaxed) and you choose to also take $20k of income from the traditional 401ks/IRAs (taxable). Now your taxable income is $50k; and after the standard deduction of $24k you pay income tax on $26k, you pay 10% on the first $19k and 12% on the remaining amount; for an “average” tax burden on your $50k of income of only 5.4% . (And remember that you also took $10k form the Roth accounts, so your total posttax income would be $57k). This is why I believe that traditional accounts can be an excellent idea, especially if you’re a relatively high earner now, but will be able to live on a bit less in retirement. (Say, you’re solidly in the 22% tax bracket now and will probably be mostly in the 10 and 12% bracket in retirement … but even if in retirement you “hit” the 22% bracket, most of your income then will be taxed at a lower rate). Even if the tax rates go up a bit in the next decades, they have to go up an awful lot to make the lower brackets in 2049 higher than the higher brackets now. So don’t just compare your “highest” tax brackets now and in retirement. Compare your highest tax bracket now to your average tax % when retired.
– Kevin
There are two big advantages of a Roth.
First, let’s say you’re early in your career on a path where you expect to be earning a much better salary as you move along. You earn, say, $75,000 or so per year for the first decade of your career, but later on, you’re probably earning $200,000 or more. During those early years, putting money in a Roth IRA is a huge advantage because your tax rate early in your career is likely to be much lower than your tax rate in retirement off of an $200,000 salary. It’s untaxed income no matter what your retirement situation is.
Second, a Roth IRA gives you a ton of flexibility compared to your 401(k) at work. You get to choose your own investment house and you get to choose from a wider variety of investments.
If I knew that the 401(k) at my job was as good as any IRA out there and I also knew that I would never earn a higher salary in my career, then the 401(k) is probably a good idea (with some tax assumptions). In general, however, I’m not going to make those assumptions, especially if the person asking for advice is young – I’m assuming their salary is going to go up in the future and thus socking away money that will earn tax-free returns in the future is good.
Q8: Thoughts on permanent portfolio?
I was listening to a podcast recently and the host was talking about the “permanent portfolio” but I didn’t follow all of the details. What is it and do you think it’s good?
– Gene
Was it episode 345 of The Voluntary Life? I listened to that recently and the host did mention the “permanent portfolio” a bit.
The “permanent portfolio” is an investment strategy first popularized in the 1980s. Basically, it’s a strategy for investing that should weather almost all changes in the economy quite well with minimal effort, meaning it shouldn’t fall apart when the stock market falls.
The idea is that you invest in equal amounts of four asset types: growth stocks, precious metals, bonds, and treasury notes, and then just let it sit and invest automatically. You take no additional action unless you need money or you notice that one of the four asset types is worth 35% or more of the total value or 15% or less of the total value, at which point you rebalance and equalize everything. (You can also “rebalance” by shifting around your contributions a little by contributing more to the things that are falling behind.)
You might practically do this by buying into equal amounts of Vanguard index funds – VIGRX, VBTLX, VUSTX, and VGPMX.
I think this is a good strategy if you’ve reached the point where you need to live off of your investments. This portfolio won’t have great long term returns, but it will have pretty consistent returns over time.
My only hesitation is the precious metals part. While I understand the historical reasons for it, I’ve seen precious metals be incredibly volatile in recent years in ways that seem to be untethered from other economic activity. I also have a minor hesitation about the exclusion of real estate.
If I were doing it, I’d probably consider using VGSIX in addition to the four above, or possibly cut out the precious metals option. However, I don’t think I’d jump to this unless I were living off of my investments, as that would become the goal of my investment strategy.
If your goal is self-sustainment of your lifestyle, it’s a good strategy; if you have other goals, you should use other approaches.
Q9: Late model cell phone strategy
Just wanted to share with you that I basically use the same strategy for cell phones that you use for cars. I buy a “late model used” (a phone that’s not of the current generation and often a refurbished one) and then use it until problems pop up (software stops working well or something breaks on it). It’s served me well since about 2009 and I see no reason to change!
– Stan
I do the same thing, actually. I’ve been using my current cell phone (an iPhone 6) for a couple of years now and I see no reason to switch yet. There are a couple of annoying scratches on it, but not bad enough to really bother me.
When I do replace it, I’ll get one that’s at least a generation old and, as you noted, a refurbished one if I can find it.
I’ve never had any problem with this strategy either. I used to “need” the latest and greatest phone, but it really didn’t ever do anything essential that an older phone couldn’t do. Older phones can make calls, send texts, check websites, do some GPSing, and other basic things.
Q10: Talking about finances with family
How do you talk about finances with your family? If money comes up, how do you deal with it?
– Mandy
Frankly, it doesn’t come up very often. When it does, it’s usually a serious discussion about something that’s of importance to all of us, like figuring out issues related to my parents’ estate.
On the rare occasions when it does come up, I never, ever talk about specific numbers or any details of our specific financial state. To me, such specific details are only of importance to Sarah and myself. I do talk about goals (“Sarah and I are aiming to retire in our early to mid 50s, hopefully”) and general strategies for getting there (“We just automate all of that and the money goes right out of our checking account and we don’t even have to think about it”).
Talking about specific dollars and cents tends to create emotions that we simply don’t want in our family relationships, and it also introduces direct comparisons, which we also don’t want. What good is it for me to compare our net worth to that of my brother? None at all. It doesn’t do either of us any good. Let’s say I’m better off than he is – does that make him feel bad? Probably. Does that make me feel good? Not in any real way – I’d mostly just feel awkward. Let’s say he’s better off than me. Does that make me feel bad? Probably a little. Does that make him feel good? Maybe, but, again, it’s probably awkward. Why do this?
If anything specific does come up, I check out of that conversation as soon as possible.
Q11: Older personal finance books
Do old money books have value? My grandpa has several and says that I’m free to have them. They are from the 70s and 80s. Still worthwhile to read?
– Jordan
Yes and no.
The core principles and philosophy of personal finance hasn’t changed since the days of Charles Dickens. Spend less than you earn. Avoid debt. Put your money to use somewhere. Have a good head on your shoulders about how you spend money. Those kinds of things are timeless and always good.
What does change are the specifics. The actual mechanical methods of investing change. The methods by which we shop change. Specific investing strategies change.
If you’re looking for bedrock principles and food for thought, older personal finance books are just fine. If you’re looking for specific strategies, then older books won’t help.
Q12: Other reading
What books do you read for fun?
– Jamie
I often recommend personal finance and related books here on The Simple Dollar, but that’s nowhere near all that I read. I am a voracious reader, often knocking out two or even three books in a week. I usually have one fictional and one nonfictional book going at the same time.
Regarding fiction, I mostly read literary fiction, science fiction, and fantasy. I’m currently reading Dragon Haven by Robin Hobb.
With nonfiction… I read everything. Science, philosophy, self improvement, history… it’s all over the place. I generally get obsessed with a topic and read about it constantly until I feel like I “get it” on some level, then move onto something else. Right now, I’m reading Origin Story by David Christian.
I generally put aside at least an hour a day for uninterrupted reading. With nonfiction books, I often take notes as I’m reading as that helps me absorb and remember key ideas and information.
Got any questions? The best way to ask is to follow me on Facebook and ask questions directly there. I’ll attempt to answer them in a future mailbag (which, by way of full disclosure, may also get re-posted on other websites that pick up my blog). However, I do receive many, many questions per week, so I may not necessarily be able to answer yours.
The post Questions About Books, Cell Phones, 401(k)s, Private Schools, and More! appeared first on The Simple Dollar.
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How to Promote Your Local Business with These 15 Marketing Strategies
To survive, local businesses need to learn how to adapt to the modern way of marketing.
If you are seeing a plateau or decline in sales, it’s time for you to mix up your marketing strategy.
Even if your small business is profitable right now, you need to stay ahead of your competition to remain successful in the future.
Analyze the latest marketing trends. Recognize the consumer buying behavior. Learn how to get more money from your existing customers.
Unfortunately, only 33% of small businesses reach the 10-year mark. The rest fail.
I don’t want you to become the sad statistic. This was my inspiration for writing this guide.
If your company is new, you need to do everything possible to stay strong for years to come.
Local businesses that have been around for decades may be ready for a marketing facelift. Your strategies that worked 20 years ago probably won’t be as successful in 2018 and beyond.
I narrowed down the top 15 marketing tactics for local business owners. Use this guide as a reference for your future marketing campaigns.
1. Set up your free listing with Google
How are new customers finding you?
If you’re old-school, you may be relying on word of mouth, radio promotions, print ads, and direct mailing. But last year, 97% of consumers searched the Internet for a local business.
Furthermore, positive online reviews make 73% of consumers trust local businesses.
That’s why you need to make sure your local business is listed on Google.
When people use the Internet to search for something, they start with Google.
Setting up your free Google listing makes it easy for consumers to find you when they search for terms related to your business.
Your listing will have all your information:
- address
- phone number
- hours
- directions
- link to website
You’ll be able to add photos to give people a better understanding of the way you operate.
Customers will also be able to add photos. They’ll write reviews about your local business for other people to see, which will have a major impact on your successful.
You need to learn how to get your customers to recommend your brand to others.
Your star rating is the number one factor used by consumers to determine whether they’ll buy from your local business.
In fact, 94% of customers will use businesses with a 4-star rating.
2. Start blogging
As you’ve just seen, consumers use the Internet to find local businesses.
That means you need to understand the basic principles of SEO if you want to increase your chances of getting ranked as a top result.
Roughly 47% of clicks go to the top three positions of Google search results.
Blogging will help you tremendously with your SEO strategy. Just look at these numbers:
More website traffic, more followers, and more leads will ultimately translate to increased profits.
Publishing new blog posts means your website will be updated more frequently with fresh content, which will increase your chances of getting a higher search ranking.
Plus, your posts are a great place to add keywords prospective customers may be searching for when browsing online.
Once you’re able to establish a steady group of readers for your blog, they’ll visit your website on a regular basis. The more they visit your site, the greater the chances you’ll have of getting them to convert.
3. Join a local group
Local businesses need to remain active in their communities. Joining a local group is a great way to stay connected with residents and other business owners.
I suggest joining your local Chamber of Commerce. There will be a small annual fee, but it’s worth it.
Attending these meetings and events will expose your brand to other businesses.
Will your competitors be part of these groups? It’s possible. But that’s even more of a reason for you to be there.
Let’s say you own a local t-shirt company.
Another local business may be hosting an event in town and need custom shirts made. Rather than ordering the shirts online, they’ll be more inclined to use your services if you both belong to the same local group.
That’s the whole idea behind joining. The businesses look out for one another and always try to support local brands.
4. Give back to the community
Being part of a local community also means you need to give back.
If you’re charitable, don’t be shy about your involvement. Consumers want to hear about how your local business supports charitable causes.
Research shows 91% of customers say they are willing to switch brands if it means supporting one associated with a charitable cause.
And 85% of consumers will have a more positive image of your local business if you support a charity they care about.
You can even ask your community and customers which charities you should support. Studies show 39% of people want to help decide on the charities a business supports by a voting system.
It’s a safe bet to associate with local charities.
This will definitely help you and your business become closer to your community.
You can approach this in many ways.
For starters, you can make an annual contribution to a charity.
You can also run special promotions with a certain percentage of sales on a particular day or week goes to a cause.
Giving back to your community doesn’t always mean donating to a charity.
For example, let’s say you own a local restaurant. You can provide food for a public high school graduation event. These types of parties run by the school are intended to keep students safe and sober on the night of their graduation.
5. Run contests
Contests are a great way to get people excited about your local business.
The best way to run these contests is through online platforms. Leverage your social media profiles for this strategy.
Run contests that encourage user-generated content. For example, ask your followers to post pictures related to your business. Then pick a winner based on who gets the most likes on their photo.
The whole idea behind these contests is to grow your social media following.
If people see their friends and family posting about your local business on their social profiles, it will increase your exposure and increase the chances of them following you as well.
Now you’ll be able to post promotional content aimed at your new followers that converts them into customers.
6. Verify your information on Yelp
In addition to your Google listing, your local business will also have profiles set up on other platforms, whether you signed up or not.
For example, you may have a Yelp profile because customers rated and reviewed your business.
It’s important that you make sure all your information such as your store hours, phone number, address, and website is accurate on these platforms.
More than 90% of consumers make a purchase after viewing a business on Yelp.
If a customer tries to contact you and the phone number is wrong, or if they show up to your store thinking you’re open and you’re actually closed, it’s going to hurt you.
It’s in your best interest to claim your business on Yelp so that you can control the information in your listing.
7. Implement a customer loyalty program
If you’re looking for a fast way to increase sales, you need to learn how to create a customer loyalty program.
The best part about this marketing tactic is you can make more money without having to acquire new customers. Your focus will be on getting your existing customers to spend more money.
The goal of your loyalty program should focus on two things:
- increasing purchase frequency
- increasing average purchase amount
By accomplishing these two things, you’ll be able to drive growth through sales.
More than 82% of consumers are more likely to shop at stores with customer loyalty programs.
Your loyalty program could be something as simple as a punch card. On the 10th visit, the customer gets a free reward or something like that.
Or you can set up a system that’s a little bit more in-depth. Reward your highest spending customers by implementing a loyalty program based on different spending tiers.
The best way to track this type of program is with a customer profile or mobile app, but we’ll discuss that in greater detail shortly.
8. Offer discounts
Consumers are price-sensitive.
As a local business, you need to recognize this and adjust your pricing accordingly.
Some of you may be hesitant to offer discounts because you feel like it lowers the value of your brand. Plus, your current prices may not yield profits if you offer discounts.
If that’s the case, you should consider raising your base prices. Then offer discounts on those new prices.
Psychologically, this is more appealing to your customers. They want to feel they’re getting a deal.
If your local business has an ecommerce store, an active discount code will increase your chances of getting more sales.
Whether you’re selling online, in-store, or both, it’s important your business offers coupons and discounts to your customers.
9. Increase your social media presence
We briefly discussed social media earlier when we talked about running contests to promote your local business.
You need to establish an active presence on as many social media platforms as possible.
Sure, you might be on Facebook. But that’s not enough. Last year, more than half of small businesses increased their social media investment for platforms like Instagram, Twitter, and YouTube.
If you have a local B2B company, you also need to prioritize networks such as LinkedIn.
Just 43% of small businesses share content and engage with their followers on a daily basis. That number should be much higher.
I know what you’re thinking. Running a small business is tough.
You’re already putting in long days, and you just don’t have enough time to focus on your social media strategy.
Don’t get overwhelmed. Check out my favorite time-saving social media marketing tools to help you automate the process.
10. Partner with a local influencer
To take your social media marketing strategy to the next level, you should consider working with local influencers.
These are people in the community who have a large social following.
You can pay them to promote your local business on their distribution channels to increase your reach.
The best part about this strategy is it’s relatively inexpensive. Each post will likely only cost you a couple hundred bucks at most, and you can even pay them less if you offer them some free stuff as well.
Influencers have extremely high engagement rates with their followers, and their audiences trust their recommendations.
11. Set up a customer referral program
Implementing a customer referral program is one of my favorite ways to acquire new customers without doing any work.
The idea behind this strategy is to get your current customers to do all the heavy lifting.
It’s a strategy that focuses on both customer retention and customer acquisition, which are the top two most significant retail drivers.
For your referral program to be successful, you need to offer an incentive to both parties.
Reward your existing customers for each referral. This gives them the motivation to get out there and refer your local business to as many people as possible.
As for the new customer, they’ll need some type of incentive as well to get them in the door.
If they’re satisfied with their purchase, they’ll start referring new customers as well.
This can turn into a highly profitable cycle for your business. That’s because 86% of consumers say their close friends influence their decisions to make a purchase.
Simply put, referrals work.
12. Add subscribers to your email list
Don’t underestimate email marketing.
While it may not be the newest or sexiest marketing tactic, it’s one of the most effective strategies out there.
According to research, 81% of small business owners say email marketing drives customer acquisition. And 80% of them say they were successful in using email marketing to retain customers.
This strategy is extremely profitable. For every $1 spent on email marketing, your local business can expect to see a $44 return.
In fact, 77% of your email ROI will come from campaigns that are targeted, segmented, and triggered.
But your email strategy won’t be effective if you don’t have subscribers.
Focus your efforts on getting more customers to join your list, and the rest will take care of itself if you stay on top of your campaigns.
13. Launch a mobile app
It doesn’t matter what type of business you have or what industry you’re in, I can promise you your customers are using mobile devices.
If you have the funds available, you need to consider launching a mobile app for your local business.
That’s because the majority of mobile time is spent using apps.
Studies indicate 63% of consumers prefer an app compared to a mobile site because it’s more convenient.
And 57% of users like apps because they are faster than mobile sites.
You may not think an app is necessary for your local business right now, but it will be in the future. Even if you’re not ready to start this process today, you need to plan to do it soon.
Once your app launches, it will help you personalize the customer experience.
You can use your app to facilitate your customer loyalty programs and customer referral programs, which I talked about earlier.
If you already have a live app or you’re in the process of building one, refer to my guide on how to improve the profitability of your small business mobile app.
14. Set up Google Alerts
Google Alerts will help you monitor what’s being said about your business online.
Reports will be emailed to you anytime your local business or other keywords are published on the Internet.
This will help you stay on top of the latest news, whether it’s positive or negative.
For example, let’s say some blogger writes an unfavorable post about your brand online.
You’ll be able to see it and act accordingly right away as opposed to finding out about the post weeks later.
Or, on the flip side, if a local news publication writes a positive article about your business, you can share that content on your website and your social media channels.
15. Improve your customer service
Your local business needs to provide excellent customer service:
How does good customer service help your business?
Well, as I previously discussed, prospective customers will use a number of different tools and platforms to research your business.
They’ll read reviews online, check social media, and take advice from their friends and family.
If you’re able to provide high-quality customer service, it will be evident in the way you’re perceived online. As a result, your current customers will keep coming back, and you’ll get new customers walking through your doors as well.
Conclusion
As a local business, you can’t afford to fall behind your competition.
Take a look at your current marketing campaigns, and ask yourself whether they’re generating the results you’re looking for.
It might be time to switch up your marketing strategy.
If you’re looking for new ways to promote your local business, use this guide as a reference.
I’m not expecting you to implement all these strategies overnight. But go through the list, and prioritize some of these tactics based on the needs of your business.
What types of marketing strategies are you using to promote your local business?
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The American Nightmare: 10 Years Later
Over and over, we heard the same word: nightmare.
Most didn’t just lose a home. Unemployment, medical debt, divorce and bankruptcy often accompanied the foreclosure.
Few blamed the Wall Street bankers for trading their biggest investments irresponsibly. No one blamed rising home values that went unchecked. Some blamed their mortgage lenders, but most people blamed themselves, even though they knew the crisis was much bigger than them.
For the people who shared their stories, the foreclosure crisis isn’t in the distant past. Many still haven’t regained what they lost.
In “The American Nightmare,” The Penny Hoarder tells the story of lives forever changed by the housing crisis.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
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Millions of Millennials Spend More on Coffee (and Other Things) Than Retirement
As a millennial personal finance writer, I sometimes find myself aghast at the ways my fellow millennials are spending money. One only has to look at this Refinery 29 ‘Money Diary’ from a 26-year-old to see what I’m talking about. She’s unemployed, yet she pays for cable TV, Netflix, Spotify, a gym membership, and an expensive smartphone plan. Her retirement savings? $0.
At least she can take comfort knowing that her spending isn’t all that different from most people her age. Only about a third (34%) of millennials are saving anything at all for retirement, according to the National Institute for Retirement Security.
A separate Fidelity survey found that millennials who do save for retirement are socking away an average of 7.5% of their salary. The median income for Americans age 25 to 34 (roughly the heart of the millennial cohort) is $794 a week, or $41,288 a year, according to the Bureau of Labor Statistics. So that 7.5% works out to an average of $3,096 in annual retirement contributions among savers.
Average it all out — one-third of millennials saving about $3,096 a year, two thirds of them saving zero — and our very back-of-the-envelope math shows the average millennial saving a little more than $1,000 a year for retirement.
All this got me thinking about the many areas in which millennial spending outpaces retirement savings. I dug into the data to find spending categories where some relatively simple cutbacks could save the average millennial quite a bit of money — extra dollars that could potentially be put toward retirement accounts or other financial goals.
Coffee
The average 25- to 34-year-old reported spending $2,008 per year at coffee shops, and according to a survey by the money app Acorns, 41% of millenials admitted to spending more on coffee in the past year than they had invested in their retirement accounts.
I love my morning brew as much as the next person, but those stats are alarming. Those who want to save money but can’t bear to cut back on their caffeine intake should look into brewing their own coffee at home. You can then enjoy great tasting coffee for a fraction of what you will pay at a coffee shop.
Health and Wellness
Millennials spend about $1,800 per year on health and wellness, with a large chunk of that going toward expensive monthly gym memberships.
To be clear, I’m a major proponent of getting enough physical activity every day and living a healthy lifestyle. I just think you can accomplish a lot on the cheap with things like body weight exercises, and there are many resources that can help you get a top-notch workout in for no money at all.
- Related: How to Build a Really Effective and Meaningful Home Exercise Routine You’ll Actually Want to Do
Restaurants
All that Instagramming of fancy meals doesn’t come cheap. A recent Bankrate survey showed that millennials are dropping an average of $2,800 per year on restaurants. Eating out a lot isn’t unique to millennials: Americans now spend more at restaurants than at grocery stores. But millennials do order out more often than other generations.
In my opinion, this is the easiest area where we millennials can see some serious savings. For one thing, it’s simpler than ever to create tasty, low-cost, nutritious meals in your home. If you focus on learning some basic kitchen skills and cooking for yourself, you can save so much money — and you’ll probably be healthier to boot.
A key area to look at is preparing your meals in advance, or what is often called batch meal prep. This is when you create a bunch of delicious meals all at once on a lazy weekend day, and then eat them throughout the week or freeze them for a quick reheat on other busy occasions. If the average millennial gets into the habit of doing a meal prep Sunday and then eating those at lunch instead of eating out, they should save at least a thousand dollars per year.
- Related: The $15 Retirement Plan
Cell Phone Plans
Millenials were the first smartphone generation, and it shows in the way we spend on our cell phone plans. That Bankrate survey found the plans we buy to keep up with our mobile phone addictions are costing us $2,000 per year.
That number might seem ridiculously high to regular readers, as I know it did to me. But the numbers don’t lie. It appears not everyone is optimizing their cell phone plan. Luckily, there are many cheap cell phone plan options that will instantly provide relief for those stuck paying high monthly bills. You might not be able to stream YouTube all day long anymore, but that’s a small price to pay for having extra cash to save for retirement.
There’s also the high cost of buying fancy smartphones in general, something that 76% of millennials admit they’re guilty of doing. The newest phones can be over $1,000 a pop, which puts a serious dent in any budget. Such a purchase can cost a lot more in the long term than one might think, and it’s very much worth looking at cheaper alternatives.
Gas
Millennials are coughing up more than $3,000 per year on gasoline for their cars, or about $250 a month. While many of us rely on cars to get to and from work, that’s still an awful lot of money. There are quite a few ways to spend less on fuel, whether it’s researching the cheapest gas stations in your area, switching to a more fuel efficient vehicle, using public transportation whenever possible, cutting back on weekend driving, or even moving closer to your job.
Summing Up
Retirement can seem a long way off in your 20s — but the earlier you can start saving for it, the less you’ll actually have to sock away, thanks to the magic of compound growth. Every dollar you invest now instead of spending will work on your behalf for years to come.
And it’s not just about retirement: Nearly half of Americans, of any age, cannot cover a $400 unplanned expense. Anywhere you’re able to cut back on spending can help put you on firmer financial footing — and for millennials, one or more of the above categories might be a good place to start.
More by Drew Housman:
- Is It OK to Share Your Netflix Account? The Legal Lowdown on Login Sharing at Nine Popular Websites
- I Tried to Make Money Online and All I Got Was This Nagging Feeling I Was Being Scammed
- Take That, 9-to-5: Two Brooklynites on How They Make a Living as Professional Dog Walkers
The post Millions of Millennials Spend More on Coffee (and Other Things) Than Retirement appeared first on The Simple Dollar.
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Here’s What Happens to Your Finances When You File for Chapter 7 Bankruptcy
But for many people, it can feel like the only way to escape the vice grip of debt and move on with their lives.
Before you can begin the filing process, you have to determine what kind of bankruptcy you qualify for and which is right for your financial future. The most common types of bankruptcy for individuals, Chapter 7 and Chapter 13, differ in how they manage your debt, according to the United States federal court system.
Those who choose Chapter 7 will likely be required to sell off their assets and use the money to repay as much debt as possible. The remaining debt will be forgiven in most cases.
Those who opt for Chapter 13 may also get a portion of their debt forgiven, but they won’t have to sell their property. Instead, they will have an opportunity to work with their creditors to get current on their payments and come up with a timeline to pay off their debt.
Do You Qualify for Chapter 7 Bankruptcy?
If Chapter 7 bankruptcy feels like your best option, the court system says you:
- Must pass a means test that calculates your current monthly income to make sure that after regular household expenses, such as rent or mortgage, you don’t make enough to repay at least 25% of your debt.
- Must complete a court-approved credit counseling course.
- Can’t have had another bankruptcy case dismissed within 180 days of your new case.
- Can’t have had debt forgiven in a previous Chapter 7 bankruptcy case in the past eight years or a Chapter 13 case in the past six years.
How to File Chapter 7 Bankruptcy
Before you can get on with the process, you’ll need to submit several documents to the bankruptcy court that serves your area.
First, you will have to submit a formal petition to the court that says you intend to file bankruptcy. The petition form and other paperwork can be found online.
Once you submit the petition, you will then need to fill out forms stating your assets and debt, your current income and expenses, a financial statement, and any contracts and leases you are still under.
If the debt you’re hoping to get discharged is primarily consumer debt, you’ll need to file even more paperwork, including:
- Proof that you took a credit counseling course.
- A copy of any debt repayment plan created through credit counseling.
- Pay stubs that prove your income in the 60 days before filing.
- A statement of monthly income along with any anticipated increase in income or expenses after filing.
You should also expect to pay fees. Courts will charge a $245 filing fee, a $75 administration fee and a $15 trust surcharge. (That adds up to $335.)
Generally, those fees will be due when you file, but in some cases, you can work out a plan to pay in four monthly installments. You’ll also want to factor in the cost of an attorney if you choose to hire one.
Is Chapter 7 Bankruptcy Right for You?
The major downside to Chapter 7 bankruptcy is obvious: You will have to give up many of your possessions. But the upside is great, too: You can get much of your debt discharged and be able to start fresh.
That means if you owe far more than your property is worth, Chapter 7 bankruptcy could make financial sense.
Still, while some of your property won’t be taken and sold to repay creditors, much of it will be. Chapter 7 bankruptcy might be better for renters who don’t stand to lose their homes or for others with few assets.
For one contributor to The Penny Hoarder who told her bankruptcy story under an assumed name, filing Chapter 7 wasn’t just a financial decision; it was an emotional one, too.
After filing bankruptcy when she was more than $100,000 in debt with a $28,000 salary, she battled feelings of guilt, shame and failure as she worked to get her finances back on track.
Take that into consideration when you’re making your own bankruptcy decision.
What to Expect After You File Chapter 7 Bankruptcy
Immediately after you file a petition for Chapter 7 bankruptcy, the majority of your creditors will have to put lawsuits, wage garnishments and even collection phone calls on hold, according to the court system.
This might bring temporary relief, but it won’t last forever.
While those cases are on hold, a court trustee will work with you and your creditors to schedule meetings where you will be required to answer questions about your financial history and your ability to repay your debt under oath.
In cases where Chapter 7 bankruptcy is approved, nearly all who file a petition see debt relief. The court system suggests speaking with an attorney before you file to make sure your kind of debt can be discharged under Chapter 7.
That’s because not all debt can be forgiven. In most cases, student loans, tax bills and any criminal restitution will still need to be repaid.
There is a possibility that creditors will come after you for payment even after your bankruptcy is approved. If that happens, it won’t be a surprise. Creditors must file petitions to say they want to continue to pursue payment.
Desiree Stennett (@desi_stennett) is a senior writer at The Penny Hoarder. She writes about how government and court actions impact your wallet.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
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This Is What Happens to Your Debt When You File Chapter 13 Bankruptcy
Chapter 7 and Chapter 13 are the bankruptcy types individuals like you and I are most likely to encounter. (You can learn about Chapter 7 bankruptcy here.)
The process can get tricky fast, so keep reading to learn who’s eligible for Chapter 13 bankruptcy and how it works.
What Is Chapter 13 Bankruptcy?
Chapter 13 bankruptcy is known as a “wage earner’s plan,” because it allows working people to make a plan to repay their debt over a three- to five-year span.
While filing Chapter 13 bankruptcy may reduce or discharge much of your debt, there are a few key exceptions: alimony, child support, some taxes, federal student loans and criminal fines.
To be eligible for Chapter 13 bankruptcy, you must:
- Have unsecured debts (credit cards, student loans, medical bills) of less than $394,725.
- Have secured debts (property, vehicles) of less than $1,184,200.
- Have already gone to credit counseling individually or in a group.
- Be working with a regular income.
- Be current on your taxes.
If you’ve filed for Chapter 13 bankruptcy in the past two years, you’re ineligible to petition for bankruptcy again.
Is Chapter 13 Bankruptcy Better Than Chapter 7?
Chapter 7 bankruptcy is often referred to as “liquidation bankruptcy.” A court-appointed trustee takes your assets and divides the funds among your creditors. You may be able to keep your home, although exemptions for property vary by state.
Chapter 7 bankruptcy is a quicker process, lasting only a few months. If you fail the Chapter 7 means test that determines your ability to pay part of your debt, you can convert your petition for bankruptcy to one for Chapter 13.
Chapter 13 is often seen as a more attractive method of filing for bankruptcy for homeowners, because it gives you a chance to save your home from foreclosure if you’re behind on your mortgage. However, you must make all mortgage payments on time during the Chapter 13 payment plan or you’ll risk losing your home.
Another key difference between Chapter 7 bankruptcy and Chapter 13 is that in the latter, your debt due to a separation or divorce may be discharged or reduced.
During your Chapter 13 payment plan, you’re not allowed to take on any new debt without court approval. Chapter 7 is not as strict.
What Happens When You File Chapter 13?
You must pay a $235 filing fee and a $75 administrative fee to file for Chapter 13, which can be paid over four installments with permission from the bankruptcy court. The bankruptcy forms ask about creditors, the amounts you owe to them, your income, your property and your monthly expenses.
Even if only one spouse is filing for bankruptcy, both parties in a married couple must provide this information.
Debt collection stops once you file your petition for bankruptcy, so that an impartial trustee can be appointed and meet with your creditors to work out a repayment plan. You’ll also attend this meeting to answer questions about your finances and your debt repayment plan. Then, within 14 days of filing for bankruptcy, your repayment plan must be submitted to the court.
Attorneys fees can often be paid back over the course of the Chapter 13 payment plan.
How Chapter 13 Repayment Works
When you file Chapter 13, you make all debt payments to a trustee, who then sends the proper amounts to creditors. You don’t have to interact directly with the parties you owe money to.
Depending on your repayment plan, you’ll make fixed payments on a regular basis by payroll deduction or direct payments. These payments start within 30 days of filing for bankruptcy, even if your payment plan hasn’t yet been approved in a court hearing.
How much will you pay? Typically, all of your disposable income, with an allowance of 15% of your gross income for charitable contributions. If your monthly income is less than the state median for a family the size of yours, you’ll pay for three years; if you make above the median income, you’ll pay for five years.
If you have past-due amounts on a home, car or other loans with collateral, you’ll be able to pay back those balances over the length of your payment plan.
Is Filing for Bankruptcy Right For You?
Deciding to file for bankruptcy is a deeply personal choice and one to make after careful consideration.
For some, debt feels like an insurmountable obstacle, for which bankruptcy provides a way through. It also stops the barrage of calls from debt collectors while you work toward paying off debt that doesn’t get discharged in the bankruptcy process.
The black mark on your credit will last up to 10 years, but a history of missed payments and a stretched credit limit look just as bad to potential creditors.
One family The Penny Hoarder spoke with found bankruptcy to be more challenging than they originally expected. Instead of having the freedom to make simple purchases, they felt trapped by the process. They eventually used a large tax refund to leave bankruptcy early.
For others, the shame that often comes with filing for bankruptcy is worth it for a fresh start.
Lisa Rowan is a senior writer at The Penny Hoarder.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
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