Wednesday, February 29, 2012

Leap Into Financial Confidence

Happy Leap Year Day! 2012 has given you a whole extra 24 hours, now what are you going to do with it?

You may just have some very exciting plans, and heaven forbid me from derailing them. But if you don't, our friends over at the Certified Financial Planner Board of Standards have some suggestions (don't they always?).

The Board's consumer advocate, Eleanor Blayney, says individuals should take a few of these bonus hours to "peel back the layers of their financial lives" and do a true self-assessment. "Sharpen your pencils, fire up your computer or tablet and take stock of where you are right now,” she suggests.

Take your most recent tax return, your last pay stub, and the latest statements for your retirement and investment accounts and ask yourself the following questions:

         What is your gross and net income, and what are your expenses?
         What do you have in terms of financial assets (savings and investment accounts, real estate, retirement plans, etc.)? 

         What are your debts, both in terms of amounts outstanding as well as what you pay each month?

         What workplace benefits do you receive? 

         What insurance coverage do you have to protect your health, income, life, property, or need for physical assistance?

         How are your assets titled and who gets them when you are no longer here?

Answering all these questions, at one time, in one place, is a key first step to building a sound foundation for a financial plan. “Knowing your starting point is necessary for figuring out how far you have to go to achieve your goals, or if, indeed, those goals are feasible,” Blayney says. “By focusing on exactly where you stand, you’ll be taking a big leap toward financial confidence in 2012.”

Tuesday, February 28, 2012

Debt Consolidation? Don't Go There

Nearly all Americans - 75 percent of us - have debt; and more than half of us worry about our loan balances, according to a new poll from the National Endowment for Financial Education (NEFE).

For cash-strapped consumers, debt consolidation loans might seem like a quick fix to solve money woes. But quick fixes are rarely that, and there's plenty of peril in these loans - and plenty of complications that aren't mentioned in their advertising campaigns.

New NEFE-supported research reveals that the ads for these loans do not give consumers a full picture of the total costs, and don't warn them that they can make their financial situations even worse. With a debt consolidation loan, a consumer’s multiple debts are combined into a single loan with a longer term, resulting in a lower monthly payment.

But stretching out a loan gives you a greater overall debt burden: A five-year loan for $20,000 at 10 percent interest would mean a $425 monthly payment and total interest of $5,496. Extending to 15 years would knock down the monthly payment to $215, but it would increase the total interest to $18,685 - quite a big difference!

Some debt-consolidation loans include hidden fees and penalties, including application fees. The worst part is that these loan packagers often label themselves "credit counselors" - so the borrower is lulled into thinking they are acting in his or her best interest, when actually the lending institution is selling the loan at the highest rate possible, for its own benefit.

Read more about the right ways to get out of debt and find additional income to pay down debt, at Smart About Money.

Monday, February 27, 2012

Survey Says

What's going on in the minds of small business owners? Things are looking up.

Confidence in January remained basically unchanged from December, though the index is currently at its highest level since one year ago, after dropping throughout most of 2011.

And a Gallup survey about hiring intentions is at its highest level in four years. Gallup and Wells Fargo asked 600 small business owners to assess conditions within their companies as well as their outlook.

Here are some key findings:

By 22% to 8%, more U.S. small-business owners expect to increase than decrease the total number of jobs at their company over the next 12 months.

Small-business owners are more optimistic about hiring now than at any time in the past four years.

When asked what type of workers they would hire if they were able to hire and had hiring needs, 26% of small-business owners said they would hire full-time employees, while 72% said they would prefer to add temporary or contract workers (36%) or part-time workers (36%).

Just over half of small-business owners report it is very (21%) or somewhat difficult (32%) to find the qualified employees they need for their businesses.

Friday, February 24, 2012

Insurance for Freelancers

Freelancers get lots of perks, but they tend to be lifestyle-related - as opposed to benefits and salary-related.

The biggest complication for most freelancers is the thorny question of insurance and health care costs. I'm fortunate that I've been covered by my spouse's plan all these years, but many of my freelance writer friends are not, and buying insurance privately is tough.

There is some good news on the horizon. As part of the 2010 health care reform bill (aka Obamacare), nonprofit co-op health care programs are being initiated, with the goal of having at least one in each state. According to Kaiser Health News, "Seven organizations will receive a total of $639 million in federal low-interest loans to launch new, consumer-governed health insurance plans in eight states, the federal government announced Tuesday. The new plans, authorized by the 2010 health law, are scheduled to open for business in 2014. They will be available on the new state health exchanges, or marketplaces, mandated by the law, and primarily will serve Americans under age 65 in the individual and small-group insurance markets."

There's still a wait until all this kicks into gear in 2014, however. Meanwhile, here are some additional options compiled by GoHealthInsurance:

Individual Health Insurance: You can take health insurance coverage into your own hands by buying individual health insurance. There are a variety of options for your budget and health needs. For those with a tight budget consider a high deductible plan with low monthly payments.

Chamber of Commerce: Most people do not realize that their local chamber of commerce could be a good option for insurance. Many chambers of commerce offer small business plans that might be a potential option for you. Visit your local branch to learn more about this type of plan.

Freelancers Union: Freelancers seeking health insurance might find what they are looking for with the Freelancers Union. The organization is free to join and its sole purpose is to support freelancers across the country. You can even opt for dental and disability insurance.

COBRA: The Consolidated Omnibus Budget Reconciliation Act of 1985 offers health insurance options for those individuals who recently resigned or were fired from their position. If you are leaving your current office to become a freelancer, COBRA could be a good option for you. But, keep in mind, it is not a long-term solution. Once you sign up for COBRA, you have 18 months to utilize the plan, and after that, you will need to seek a more permanent solution like individual health insurance.

Wednesday, February 22, 2012

National Entrepreneurship Week

As far as we're concerned, every week is "entrepreneur week" at Bloomberg Businessweek's SmallBiz channel.

But occasionally, others dedicate a special week or two to focus on small business. This week, the Consortium for Entrepreneurship Education is celebrating the heritage of entrepreneurship in America and of entrepreneurship education for the next generation.

As part of the festivities, the U.S. Small Business Administration is hosting a webinar every afternoon this week at 12 noon Pacific/3 p.m. Eastern time. The emphasis is on financial empowerment and building entrepreneurship skills using business basics, social networking and business strategies.

Get the full list of topics and log-on information here.

Tuesday, February 21, 2012

Tax Day is April 17

That's right: April 15 is a Sunday and April 16 is a Washington, D.C. holiday so tax day is April 17 this year.

That gives you less than two months to pull your papers together, or at least get your electronic records in order. I have a source (a tax accountant, natch), who says he loves tax season because it brings all Americans together in a way very few other "holidays" do. For a few weeks or months, we all experience the agony of the missing receipt and the mistaken addition of a column of figures. But we do it as fellow countrymen and countrywomen, damn it!

Well, I'm not so sure he's onto something with that. But I am happy to report that my return is completed and ready to be e-filed. I also helped my son do his first-ever tax return last weekend - and I'm happy to say we're both getting refunds!

I would never attempt to do my own returns, because working at home and being self-employed makes them very complicated. But my son who works just part-time used the IRS' Free File service, which is available to anyone. There's also a free file tax software program that's available for taxpayers with 2011 adjusted gross income of $57,000 or less, which encompasses about 100 million Americans, or 70 percent of all taxpayers.

Friday, February 17, 2012

Free Twitter Ad Space

Here's a timely offer you may not be able to resist:

American Express, in partnership with social media giant Twitter, is announcing that its Cardmembers and merchants will be given exclusive first access to Twitter’s new advertising solution for small businesses. Amex will give $100 in free Twitter ads to the first 10,000 eligible businesses that register at

The exclusive offer will give business owners the ability to leverage promoted ad products on Twitter and engage its more than 300 million users – a pool of potential customers largely untapped by entrepreneurs.

Businesses that sign-up today will be able to kick their Twitter campaigns off at the end of March.  The new advertising solution will open to the general public later in the year.

Thursday, February 16, 2012

Comic Financials

For many small business owners, the toughest part of success is tracking and understanding the nitty-gritty financials. They may be terrific at making their product, or delivering their service. They are good marketing people and excellent at sales.

But staying on top of the numbers and reading the financial statements is a different story. And yet it's not optional if you truly want to succeed at business.

Now, an excellent book that I've recommended in the past is available in a new format: As a comic book!

SmarterComics has teamed up with L.A. financial whiz Karen Berman and her co-author Joe Knight, of the Business Literacy Institute, to release a comic book version of their book, "Financial Intelligence: A Manager’s Guide to Knowing What the Numbers Really Mean."

What a terrific idea! Check it out.

Wednesday, February 15, 2012

Entrepreneurship Education

It's a great impulse to get some education on entrepreneurship before you start a small business or become self-employed. There's a lot to know - and it's better to learn before you make a costly mistake.

However, there's a lot of bad business training offered online or in person. Some of it is out-of-touch, outdated, sketchy or basically a sales pitch. Worse are the out-and-out scams that seek to separate naive wanna-be entrepreneurs from their nest eggs.

Read my column today to learn how to vet business education classes.

Friday, February 10, 2012

Free Stuff

Unless they are burning through investor funds in the heady technology startup world, most small business owners are penny-pinchers. Give them a free resource and they'll take full advantage of it!

So, from, here's a list of freebies you might not have heard of: – Free data storage
Mail Chimp – Free direct marketing
NYCEDC – Available incubator spaces in New York (similar sites exist in other cities)
FaceTime – Video conferencing from your Mac or iPhone
FreeAdvice – Free legal advice on LLCs, partnerships, etc.
AccountingCoach – Free training on accounting for non-accountants
FreeCycle – Free equipment sharing
FreshBooks – Free invoicing, time tracking, and billing software

Thursday, February 9, 2012

America Means Business

Isolated as so many of us are behind our computer screens or in our social media bubbles these days, it's interesting to see how in-person networking events are multiplying and changing.

I've noticed, and this is purely anecdotal so take it with a large helping of salt, that when people do get together in person, it has become more special. It's not necessarily a common thing anymore, so what would be routine gatherings are ramped up to become "landmark events" and mega-conferences.

Here's one on entrepreneurship that you may want to make plans to attend, particularly if you're on the East Coast. To take place in New York City on June 13 - 15, 2012, America Means Business will be packed with educational, networking and social events that will "show you how to bring your dream to life."

Here's how the organization describes the event, where registration is free through May 25 and $10 thereafter:

America Means Business will feature dozens of inspirational keynotes, informative panel discussions, “How I Did It” case studies, basic startup education by SCORE, networking opportunities, an exposition, and many other events about how to start and grow a business and everything in between. 

Tuesday, February 7, 2012

Web Chat

A record number of Americans - and people around the world - started their own businesses in 2011. The number was up so much in the U.S. that the researchers initially thought their data was faulty!

If you're considering a new venture, it's important to get prepared. A very successful entrepreneur I interviewed recently took two full years between dreaming up a dynamite business idea and launching it. As she told me, "You don't plant a seed and harvest it the same day. It takes time to cultivate that seed, and you can't rush it."

Here's a way to get off on the right foot and get some expert advice on what you should be thinking about with business startup. The U.S. Small Business Administration’s Janice Washington, an experienced business consultant and former business owner, will be featured Feb. 16 in a web chat on “New Year, New Business: How to Start it Right."

It doesn't cost anything and the hour you spend learning could improve your business skills and help you get training to boost your business ideas. Participants can join the live web chat, and also post questions before the chat takes place, by going online to and clicking on the web chat event under "What’s New." To check out the archives and read written transcripts of past web chats, go here.