Don’t Get Burned On Black Friday

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Black Friday is coming up, and while the day seems to be taking on less and less importance with the advent of stores opening on Thanksgiving, there will surely be some big time shopping going on.

While you can save some money, there are a few hard and fast rules that you need to keep in mind so that you don’t turn Black Friday into a big money waster instead of a big money saver:

  • Have a list – Black Friday deals are published well in advance these days. You should know exactly what you want and from what stores you plan on buying the items from.
  • Stick to your list – Many places make you go to the back of the store to get your great deal. And, you’ll likely have to wait in line. During all that time, you’ll be exposed to plenty of other items that you might be tempted to buy. If it’s not on your list, don’t buy them! Otherwise, you’re likely taking all of the savings from your pocket and giving it right back to the store. At that point, you might as well stay in bed!
  • Have a backup plan – If your list includes an item like a tablet that you have earmarked as a gift, know in advance what you will do if the item is sold out before you can get one? Will you pay more? Will you look elsewhere? Will you go for an entirely different item? If you don’t have any plan, chances are you’ll panic and either end up with something you don’t want, or something you paid too much for. Or both.
  • Know how you will pay for it – If you’re planning on putting your purchase on a credit card, do you have the money set aside to pay for it. If not, then the $50 item can cost you double that by the time you pay it off many months later.Knowing that, is it still worth it?
  • Know when to quit – Last year I bought my girlfriend a camera for Christmas.It was already over the budget we’d set for ourselves, but I tweaked things to make it work. As I was buying it, they tried to talk me into a bundle add-on which included some additional stuff, and it was $500 worth of stuff that was being added on for $200. The allure of saving an extra 60% on this extra stuff stopped and made me think, and for many they would have jumped in, spending $200 that they didn’t have budgeted. Luckily I stuck to my guns, but I know many don’t.
  • Don’t lose your smile – Most Black Friday deals are centered around the holidays. Yes, the holidays that are meant to celebrate and bring cheer and kindness and all the other warm fuzzy things that we associate. As you’re waiting in line or fighting the crowds, don’t forget this. If you’re putting yourself or others at risk of injury just to save a few bucks, then in my mind the savings aren’t worth it, no matter how great they may be.

Happy shopping!

Can’t Compete with the 1%? Retire elsewhere and join their 1%

I was thinking the other day about what it means to be the 1% after all the 1% is based on American household incomes. The 1% in other countries such as Mexico, or Thailand is certainly different than the one here. Sure there are still multi-billionaires in every country but your US dollar buys you more in many developing nations. You could retire in another countries 1% and live the life of luxury.

In fact Many people have plans to retire away from where they are currently living and working. Some people already have vacation homes that they plan on moving to full time after they retire. Some people know exactly where they want to go, maybe some place they love to visit or where their family lives.

Still others have intentions to move, but aren’t quite sure where to start. Moving over long distances at any point in your life can be a big decision, one that can have a major impact on your future. This is even truer for entering retirement where your resources will be more limited and you have to concern yourself more with lifestyle needs like health care and transportation.

Here are a few things to consider:

  • Seek lower costs” – There are plenty of areas around the U.S. that have lower costs of living. Obviously, depending on where you live now, the difference in cost could be very extreme. Picking an area that has lower cost of living overall (especially if you are looking to buy a home), can have a major impact on lowering your retirement expenses.
  • “Look for somewhere safe”  - Of course this one seems obvious but theres more to safety than simply the crime rate. Look for somewhere that will protect your interests, somewhere that wants well off people to retire there. Somewhere that has a stable economy, that will not have high inflation, somewhere where taxes are low especially on your investments (whatever those may be). Look for somewhere where your retirement property will not lose value.
  • “Look for great amenities” – You should look for a place that will allow you to stay active and productive in your retirement. When looking for a new place to live, make sure to keep the available amenities in mind. Whether is it an all-inclusive community, or the availability of amenities within short walking or driving distance.
  • Health care options are essential” – Healthcare will become more important as you age. You don’t want to retire to an area where the closest medical center or hospital is too far away for convenience. Also, make sure the available options that are close at hand are quality, with good doctors and technology at hand.
  • Calculate the tax impact” – Taxes can have a big negative impact on your retirement income, and it’s unfortunate that many people do not take the time to consider this impact before entering retirement. If you are looking to move to a new state, keep in mind the impact of the state taxes before you move.There is a wide variety of tax rates to choose from state by state, so don’t lose sight of how it will affect you and your potential move.
  • Aim for proximity to family and friends” – We’ve heard plenty of unfortunate stories of people who move to a location far from family and friends only to be unhappy there. Maybe it was to a place they loved vacationing to or a place they always dreamed of living. But it can get very lonely, and this can be especially true if you have kids and grandkids. In the long run, it’s important to consider how living near family and friends can positively impact your life.
  • Consider the political, religious and social climate” – This may not even be something you would think about during a move. There are plenty of areas around the country that are more highly charged than others politically, religiously, or socially. If you have a particular leaning, you may want to consider what views others in the community have. Otherwise, it may become difficult to make new friends with like-minded views.
  • Job opportunities” – If you are looking to work for at least some of your retirement years, as more and more people today are planning, make sure you look for a place that provides you with job opportunities. Otherwise, your plans to go back to work may not come to fruition, straining your retirement income.
  • Transportation options” – While driving yourself around may not be an issue now or for years to come, there may come a point where you no longer can drive yourself. Consider looking into what public transportation options are available where you are looking to move for future use.
  • Better weather” – This is often the reason people will give for wanting to move, especially if they live somewhere with extreme temperatures. But you have to do your research! Temperature can vary wildly by state and by season, and some people may not consider the extremes. If you are moving from Wisconsin and bitterly cold winters, you’ll probably love Florida’s winter temperatures. You may not love the summer temperature though! While nowhere is going to have your perfect weather, you have to decide what is most important to you and what kind of extremes you can tolerate.
  • Test it out first” – We’ve discussed this here before. When making a big move, you never want to jump into buying a house right away. You should always look into renting for a time to make sure that you really love where you’ve chosen. That way, if you find out six months down the road you haven’t chosen the right location, you are in a much better position to fix the issue than if you are tied down into homeownership.

Thinking Differently

Thinking differently should be a goal that everyone strives for, but most people choose not to. I wish I could cite statistics for that claim, but one only needs to look around them to see that everyone follows a very similar track.

Entrepreneurs have to follow a different track in order to be successful. Successful entrepreneurs are not successful by accident. Even if an idea is accidentally successful, an entrepreneur can kill it with mis-management.

People like Henry Ford, Steve Jobs, Sergey Brin and Larry Page didn’t end up where they are by thinking like everyone else. They saw a problem, they had different philosophies and they fixed it. What drives thinking differently?

1. Be Discontent

Most people can identify a problem or inefficiency, but they often carry on because it’s “not their job” to occupy their time with it.Discontentment entails identifying a problem, and disliking it so much that you choose to occupy your time with it.

I’m not talking about obsessing, but rather feeling a duty to fix the problem because you know that few others will. Sergey Brin and Larry Page (founders of Google) were discontent with the methods of internet search that were available, so they fixed it.

2. Question the ordinary

Going along with discontentment is questioning the norm. Why is this inefficient process (or whatever the subject is) considered acceptable? Don’t be afraid to ask ‘why?’ Again, people can identify a problem, but few seem to care about asking why. Others are afraid of asking ‘why?’ because they might lose their job.

If a company is willing to fire me because I’m willing to question an inefficient process, then I’m not the right fit for that company.There is no room for sacred cows in business, and if you can’t bring yourself to question it, you’re a part of the problem.

Henry Ford saw potential for vehicles that were powered my machinery and not horses. He questioned the ordinary, the norm, and he eventually succeeded fantastically. This is thinking differently.

3. Don’t make mountains out of mole hills

All the time, I hear people make huge mountains out of mole hills (more like ant hills). Some use it to martyr themselves, others use it to occupy their time, but they all have one thing in common: it wastes my time.

Thinking differently doesn’t mean to bellyache and complain about the littlest thing. I try to consider a situation and ask myself “how much will this moment matter in 10 years?” If I laugh or scoff, then I know it is too little to care about.

Be discontent, but don’t waste your time complaining about ridiculous things that won’t matter. There is a difference between:

  • Noticing a huge productivity inefficiency that could cost millions, and taking action.
  • Complaining for hours and stewing over the new requirement of adding a cover page to your reports.

4. Take Action

Finally, thinking differently requires taking action. Sitting idly and complaining about the circumstances is par for the course for your average person- taking action is thinking differently.

The most successful products and services are fueled by discontentment, and someone having a strong enough spine to take action.

  • Google – Fueled by the desire for a better search engine.
  • Facebook – Fueled by the need to connect more people and open up information.
  • Ford – Horses couldn’t cut it anymore, customers just didn’t know it yet.

Success is found in thinking differently. If it helps, think of it as supply and demand. Would you pay more for someone who thinks differently, or for someone who thinks like millions of others do?

If a lot of people disagree with you, or you have a lot of doubters, that is a rough sign that you’re probably thinking differently. Do you think differently? What works for you?

Entrepreneur Grants

Are you trying to start a business? Do you need capital to expand your business? Entrepreneur grants are an option you may need to consider.

Types of Entrepreneur Grants

Money Dollar 300x236 Entrepreneur Grants

There are different types of entrepreneur grants such as minority grants, grants for women, grants for start-ups, grants for specialized businesses, and even grants for low income individuals.

The availability of grants can be based on your location, so it’s a good idea to start by looking at local funding.

The MBDA is the Minority Business Development Administration and is a great place for any minority to start that is interested in the opportunities available to them (including loan options).

Any funding will need to come from local government or private grants though as the Federal government doesn’t offer grants to businesses.

Government Issued Entrepreneur Grants

Government issued grants are probably where most people start looking.

These grants are funded by tax dollars and often come with a lot of contingencies.

Entrepreneur grants can come from either local or state programs, but it’s important to note the Federal Government doesn’t provide grants to businesses.

Sometimes a grant may be available from nonprofit organizations and groups that support a wide variety of federal programs.

The SBA (Small Business Administration) doesn’t provide grants directly, but they do offer some resources to help you understand and locate grants. Consider reviewing their Grants Facts Sheet and their Loan and Grants Search Tool.

Private Entrepreneur Grants

The grants that people are not familiar with are private entrepreneur grants. Private entrepreneur grants are funded by corporations and foundations, and you normally don’t have to pay back the grant. Foundations award grants to entrepreneurs that help meet the issues that are important to them. The key to finding grants is to think about your type of business and your profile as an individual, then searching based on your criteria.

A great example of private entrepreneur grants are the grants offered by the Kauffman Foundation. Browse through their grants and requirements to see if you meet the requirements!

Getting Entrepreneur Grants

The first step of the grant process is to make sure you are eligible for the specific grant you’re applying for. You want to be as accurate as you can about your information if you want to win the grant. Some of the common requirements include stating the purpose of the grant, a solid business plan, history of your business, financial information of your business for previous 3 years, your financial statement, information on your employees, and your personal resume.

Entrepreneur Grant Mistakes

There are many mistakes that people make when seeking entrepreneur grants. The most common one is not paying attention to the information packages and sending in an incomplete grant application. Another one is making sure they’re applying to the right type of grant. Finally, the mistake people make after they GET the grant is making sure they abide by the strict regulations that come with the grant.

A common mistake is trying to skew the purpose of the grant. For instance, if you run a gas station that is trying to be more energy efficient, you probably shouldn’t apply for a renewable energy grant. Just because it is somewhat related, and you can somewhat justify it (barely), you’ll probably be turned down. Worse, if you embellish well enough, you would need to pay it back once your embellishment is discovered.

In conclusion, entrepreneur grants can be one of the best ways to start or grow your business. However, it’s important you know every single detail about entrepreneur grants if you actually want to get one. Finding the grants is difficult, obtaining them is a competitive process, and the funding can go away with the latest budget cuts. They are worth pursuing, just do it carefully.

Day 250 – Brilliant Lunch Idea.

Capitalist in Progress:

This is interesting. I get fed at work however I while it may be frugal for you on a pay now it does come out of the companies profits. If you’re a shareholder it may not actually be more or less frugal. Depends… Anyone else considering this?

Originally posted on The Pursuit of Riches:

Money Spent: $0.

For months now, I’ve been packing my lunchbox in the morning in an attempt to live more frugal and healthy. From last night’s leftovers to the carefully composed salads: I’ve been scooping it in containers like a pro.

Although a little more time consuming, it has proved to be a whole lot cheaper to bring a brown bag, than to step outside and pay eight dollar for a salad, sandwich or Vietnamese rice dish.

But my first week at my company’s headquarters, I learned about another way of lunching that is both frugal for your wallet AND your time. If you’re working in a small-ish office or have a group of colleagues you typically have lunch with, this might work for you, too. After all… isn’t food the glue that keeps us all together? Exactly.

I have the luxury of having my boss’ mother looking out for…

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Famous Entrepreneurs List

I was looking at the top famous entrepreneurs list because I was curious who the most famous entrepreneur were. I noticed the list was only concerned with net worth.

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While net worth certainly has its advantages, it isn’t the only thing that counts, so I decided to come up with my own Famous Entrepreneurs List.

This famous entrepreneurs list starts out based on net worth (I picked the top 100 from the Forbes 500), but that was just to give me a place to start.

After that, I ignored net worth and used metrics, which I discuss below the list.

Famous Entrepreneurs List

# Name Business/Ind. Score
1. Bill Gates Microsoft 100.00
2. Mark Zuckerberg Facebook 22.17
3. Warren Buffett Berkshire Hathaway 14.46
4. Eike Batista Mining, Oil 13.74
5. Mike Bloomberg Bloomberg LP 9.50
6. George Soros Hedge Funds 8.24
7. Carlos Slim Helu Telecom 7.32
8. Larry Page Google 7.21
9. Paul Allen Microsoft 6.31
10. Sergey Brin Google 6.12

I was quite surprised to see Bill Gates top the famous entrepreneurs list considering that Mark Zuckerberg operates the largest social network on Earth.

My guess is that Bill Gates has a better PR group. Below is my Famous Entrepreneurs List, let me know in the comments if you’re on it.

Famous Entrepreneurs List Methodology

My list is not perfect by any means, but I believe it is more accurate than a lot of the other lists you might find. I won’t go into all of the mathematics, but I took the Forbes 100 richest list and omitted anyone that I didn’t consider an entrepreneur (mostly people who inherited wealth).

Famous Entrepreneurs List: Google, Facebook Likes and Twitter Followers

I chose 3 metrics to measure their “fame” by which were: Google Search mentions, Facebook Likes and Twitter Followers. I arbitrarily assigned a weight to each of those metrics. After that, I pulled the raw numbers for each person on my famous entrepreneurs list, and calculated the result. With the results, I sorted the top ten, then curved the result, and the list you see is the result.

Famous Entrepreneurs List Dependability

This was done for fun, and there is really no quantitative way to truly measure entrepreneur fame, but I think that my famous entrepreneurs list is fairly representative of who the most famous entrepreneurs are (or at least the ones with the best PR team).

In the spirit of transparency, here are some of my Famous Entrepreneurs Lists’s shortcomings:

  • Google search results may be skewed by name similarities. There is more likely to be more Bill Gates in the world mentioned in Google, than Carlos Slim Helu. This ultimately will skew Bill Gates’ numbers higher.
  • All results were pulled against American versions of the websites. It’s very possible that results could vary had I researched the metrics on the sites based on the person’s country of origin.
  • I had to make judgement calls on if the sites were official. Unfortunately, people love making fake profiles, and this can cause data skew.
This list may not be perfect, but I think it is the most accurate famous entrepreneurs list currently available!

5 Essential Websites for Entrepreneurs

Successful entrepreneurs share many things in common including a drive to find and use the best tools on the Internet to help them save time and money as they grow their businesses.

When starting a business, entrepreneurs often don’t have the resources available to them to hire people, so it is important for entrepreneurs to leverage technology and free resources where possible.

Although there are many websites that can help an entrepreneur to succeed, the following five sites are the best on the Web for educating entrepreneurs, funding their projects and organizing their busy schedules:
The U.S. Small Business Administration supplies owners of small and medium businesses with a wide array of information devoted to running and managing a business. The site also provides access to loan, grant and disaster relief assistance, as well as counseling and entrepreneurial development assistance.

SCORE is another site dedicated to helping owners of small to medium sized businesses. The site provides access to educational tools, professional tips, free or inexpensive workshops and counseling. Entrepreneurs who need regular advice are also given access to business mentors in 60+ industries.

Success doesn’t come from acquiring an education from only one source. Stanford University Entrepreneurship Corner, or ECorner, provides educational videos and podcasts on a variety of subjects hosted by prominent world business leaders. Courses run from a few minutes to over an hour depending on subject matter and are free to use. Stanford also offers a monthly newsletter and teaching guides supplemental to course topics.

Kickstarter is a crowdfunding site that can help entrepreneurs acquire the funds they need to turn ideas into reality. The site uses the Internet’s ability to bring people together from all over the world in one place to help fund projects. To get started, an entrepreneur simply creates an account, outlines their project as directed, submits it for Kickstarter for review and then, if approved, waits for the project to draw interest from site visitors. As of this publication, Kickstarter charges a 5 percent fee based on the total amount acquired for a funded project and Amazon charges for processing credit card payments.

Evernote is an application that allows users to save various types of notes and other content such as study notes, To Do lists, images, sound files, Web content (full Web pages, highlighted selections, articles and links), travel information and scanned documents to a secure online account. Evernote also allows them to sync information between their online account with Evernote software on their computers and mobile devices.

It is easier to save a dollar than to make a dollar!

Consider yourself like a company. Your annual income is the same as a company’s revenue. Companies have expenses, so do you. After a company covers all their expenses, whatever is left over is their net profit. Net profit is the money a company keeps. Your savings is your net profit!

To understand that it is easier to save a dollar than it is to make a dollar, you must first consider how hard it is to save each dollar.

A company calculates its net profit percentage by dividing its total income by its total revenue. Follow along with this example, but use your own income and savings.

The average person in the U.S. earns about $32,000 per year and saves about $1,200 of their income each year. Using a calculator enter $1,200 and divide this by $32,000 equaling .0375. Rounding this to .04 is the same as saying the average person has a 4% savings rate (net profit).

OK so what do we do with this “net profit percentage”? Think about it this way. If you only have 4% net that means for every $100 dollars you earn only $4 dollars is going into savings, or more importantly $96 dollars is being spent in order for you to save a measly $4.

Now take a look at this same math in a little different way. If you were to waste $100 on a pair of shoes, or that new gadget you’ve been wanting (but don’t need), where does the $100 dollars come from?

$96 out of every $100 is already spoken for, the money you want to spend will come directly out of your savings!

Now time for the pain, assume you wasted $100 dollars and realized after the fact that you didn’t really need that gadget. How long would it take you to recover the $100 dollars wasted?

To calculate this you would divide $100 by your “Net Profit%” or savings rate. $100 divided by .04 equals $2,500. This might sound a little crazy at first, but take a moment and think about it. If you are only saving $4 out of every $100, to recuperate all the money you spent ($100) requires $2,500 of income to have enough money to pay all your bills and be left with $100.


Did you find this interesting? Leave a comment and let me know!

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An open cover letter to that person possibly reading my job application

Capitalist in Progress:

Brilliance and hilarious. What do you do to set yourself apart from the average joe in the job market?

Originally posted on Leftovers from Friday:

To whom it may concern,

Thanks for taking the time to read this letter!

I assure you, at least in terms of breaking up the monotony that is hiring a new employee, it’s the best decision you’ve made today.

 I’m sure you’ve received dozens like it, promising exciting job-applicable traits like “Team-Player!” and “Hard-Working” and “Dedicated” and “Passionate!” I’m sure all of them have various examples of such traits like “That one time I saved a several hundred thousand dollar deal from falling through the cracks just because I spell-checked every word in a 200-page memo (showcasing their dedication, attention-to-detail, meticulousness, potential brilliance)” or “That other time I was involved in landing an account that you may know of by the name of HUGE TECH COMPANY (demonstrating their perseverance, persuasion, competitiveness).” I’m sure they are well-spoken individuals, promising longevity, increased revenue, innovative ground-breaking ideas, extensive connections and above all, a personality…

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The Startup Salary

I’ve started interning this summer at a startup in San Francisco. I posted earlier about the cost of living in the Bay Area and it’s just astronomical. I’ve been thinking though about what it means to be in a startup and if that is where I want to be in the future. I received an offer for this summer from a mortgage services company doing software / services, Sprint, a Banking services company, and this startup that creates advertisements with artificial intelligence. I recognize that the startup pays less than the other jobs because it’s not in finance and because it’s a startup.

The average starting tech salary for a large company ranges from 80-100k. Well known plays such as Google, Microsoft, etc may pay even more up to 125k. Of course depending on your experience and specialty your salary may vary. If you live in Seattle, Boston, or basically anywhere other than San Francisco / the bay area your salary will go a bit further. Working in a startup in SF / Seattle will give you a salary before taxes of around 50-80k. Please note all of these wages are for entry level engineering positions out of a traditional 4 year undergraduate institution.

The difference in salary ranges from 30-50k+ per year. That means you may make 1/2 or less per year working in a startup. Of course startup equity may rise in value far faster than a large company but large companies often offer some serious value in stock options that may boost ones salary even higher.

From what I’ve heard from my friends many larger companies (excluding the king of perks google) do not offer the same benefits of a startup such as more flexible hours, free / catered food,  work from home, unlimited vacation days, or other similar benefits. They may also have more strict requirements such as drug testing (past internship) or may offer less room for your own creativity and or ideas.

Right now I’m making 4,200 a month as an intern. I’m working from may-the end of august. So Let’s say I work 3/4 may, june, july, and august (3 3/4 months). Thus I earn before taxes 4,200 * 3.75 = $15,750 during my summer internship or $50,400 per year as an intern. I am seriously considering joining this startup if I get a job offer. I love the people, like my work, and love the freedom I have to experiment and explore with new technologies. My only issue are the wages. I received in addition to my wages comped travel so that’s another $500. All in all this summer I will have received $16,250 in value, plus free food all day. That means I pay for my dinners (after work) when I go out with friends as my only food expense. Lets say I spend $10 at lunch each day 5x a week. That’s $50 a week, $200 a month, $750 an internship summer, or $2,400 a year. In addition I also get breakfasts and snacks. Perhaps I would spend $5 on those foods each work day, that’s equal to $25 a week, $100 a month, $375 an internship summer, or $1,200 a year. In all I get an additional $1,125 in food on top of my wages. If I lived in the city and made my meals at home and brown bagged my lunches my value of savings would be lower but because I commute and I love eating new foods I would probably spend money eating out at new restaurants. I also receive before tax commute so I save maybe $25 a month on that. So total value I receive during the internship would be around $17,400 before taxes or around $54,000 a year should I work throughout the year.

Of course I hope if I get a job offer from them I would receive more than an intern salary let’s say at a low amount at least 15% more. Thus I would earn $62,100 a year in pay + value of easily consumable benefits. That’s pretty low compared to a well set up company. Probably around $20k lower than industry average. My future salary offer will need to be at least $62,00 for me to even consider working at the startup. The cost of living is too high otherwise. I’m ignoring equity because startup equity may not be that much greater than good stock options due to risks associated.

What do you think? What would you do?