What if You Just Don’t Feel Like It?

Ever have one of those days? It’s a struggle to get out of bed, and once you do you feel like you are walking around with weighted boots on your feet? What’s the solution to this common problem aside from going back to bed? Because your energy levels and health have a significant impact on your productivity and the ability to achieve successful results, here are a few tips to overcome sluggishness when it comes about.

Just start: Even though you don’t feel like getting out of bed, starting a project, or exercising, you must resist the temptation to give in to these feelings. All you need to do is get past that initial resistance and just start doing. Once you are out of bed, you just won the first battle against sluggishness. Did you ever notice that after you start something then you end up continuing the task and finishing?

Routine and daily scheduling: The more you schedule important tasks the more you will eliminate the thought process of what to do. For example, if you wake up at 6 AM every morning to go for a run then it will be easier and easier to do as this becomes a habit. Also, if you schedule tasks on your calendar then it creates a sense of importance and things get done.

Avoid sluggishness: The best way to overcome sluggishness is to avoid it in the first place. Take a look at your life, including habits, routines, schedule, diet and anything that impacts your energy levels. Years ago, I dramatically cut sugar out of my diet by reducing the amount of sugary beverages I drank and my energy levels skyrocketed. I do miss drinking sweetened iced-tea and soda, but I sure don’t miss the drain on my energy.

Look around you and take notice of the energy levels of people around you. Generally those with higher energy levels are more productive and quite possibly more positive to be around.

Say “Hi” to Your Customers

When I was in college I worked at the now defunct supermarket chain, Grand Union, as a cashier. I really didn’t want to work there at first, but working there helped to pay for all of my expenses while attending college. Thinking way back, I remember that when customers came in line I usually didn’t even look at them or say “Hi” until one day after talking with my dad.

I must have been complaining about dealing with customers when he asked me one simple question.

“Do you say “Hi”i to your customers,” he asked.

“No,” I answered, thinking why should I?

“Why don’t you start saying “Hi” to your customers from now on,” he commanded.

Surprisingly, I actually listened to my dad even though I knew best as a teenager, and it transformed my work experience immediately. Instead of having disgruntled customers, they now seemed to be transformed into casual friends. It was amazing that one word changed both my experience and that of my customers.

Why was this so effective and powerful? I can only make a couple of assumptions as I’m not a psychologist, but this is what I think:

  1. It created a dialogue between the customer and myself
  2. I was viewed as a person, rather than some mindless cashier, or worse
  3. Usually people are nice to people who are nice to them
  4. Lastly, people want to be recognized, even in the smallest of ways

Were people nice each and every time? No, but it was rare that I had a bad experience with a customer from then on. Don’t forget to say “Hi” to your customers, or your local cashier. Who knows, one day they become your CPA!

Focus on These 3 Areas to Multiply Your Business Success

Having a business is not easy, and even successful business owners know this. But what is the secret to running a successful business and multiplying your results? You must focus on these 3 areas:

Operations: Operations is a very broad category, but it can be viewed as any activity that supports or creates and delivers the services or products that you are selling from start to finish.  Many small business owners are very good with providing their service or selling their product. However, there are usually great improvements that can be made with efficiencies, employees, and using time and resources wisely.

Marketing & Sales: Surprisingly, some small business owners perform almost no marketing activities, but are actually marketing their business by their reputation, the way they deliver their services, the characteristics of their products, and the overall customer experience. Virtually all must sell to some degree as many interactions are sales opportunities. Think of restaurants that try to “upsell” a larger size or additional items, such as much needed desserts! Smart marketing and effective sales can help you to multiply your revenues, and it does not have to be expensive.

Financial: This is all of the boring stuff, such as accounting systems, cash flow, internal controls (to ensure more reliable financials and to reduce fraud), and managing receivables and payables. I have yet to see a business that does not either have cash flow issues or tax issues if they ignore this part of their business. Finances are a crucial part of every business and are mistakenly ignored or paid very little attention to. With proper attention to finances, a business can easily become more profitable, have greater cash flow, pay less taxes and interest, reduce stress levels, and have a greater sense of control.

An interesting observation is that all three areas are very interdependent upon each other. An improvement in one are will help the others, but on the flip side, if one are is lacking, then the others will suffer as well. If you need help with any of these, then please let me know.

Don’t Sell Your House

Usually your first house is a “starter” home that you purchased because it fit into your budget at the time. A few years later you then sell your house, move up to a bigger home, and may even repeat this process several more times. But what if you didn’t sell your home and rented it out instead? Let’s look at the pros and cons of doing so:

Pros:

Easier Way to Have an Investment Property: If you were to purchase an investment property then you generally need a much larger down payment of say 20% – 30% compared to a mortgage for a home, which you may not have available. Additionally, the interest rate and payment terms are generally less favorable than a residential mortgage. Since you already purchased your existing home as your residence, you already have financing in place, which is avoids this issue.

Transaction Costs: Look at any settlement statement and you will see that the transaction costs greatly reduce the proceeds after selling your home. By renting out your home you will have avoided these costs.

Appreciation and Rental Income: If prices in your neighborhood are rising and there continues to be strong demand for housing then most likely your house will appreciate and so will the rent that you can charge. A rental property can also provide diversification to the stock market.

Cons:

No Down Payment for New Home: Homeowners usually use the equity from selling their home to purchase another home, but if you do not sell your home then you will have to either save up for a down payment or access your equity through a loan.

Negative Cash Flow: If your cash flow will be negative for the foreseeable future, then it doesn’t make sense to rent out your home. You have to also be able to have the cash to cover expenses when your house is vacant.

Leverage and Debt: Debt is a double-edged sword (that can be another article). You want to make sure that you aren’t so leveraged that it puts a large strain on your finances, especially if/when bad things happen.

You Are Now a Landlord: Who wants to be a landlord and clean toilets? This is a very common argument, but the answer should always be never because who likes problems? You should make sure that you have reliable handymen, plumbers, etc., and screen your tenants as much as possible. However, you should like the fact that you have created a financial asset for your well-being.

Most homeowners never even consider renting out their home, but it can be a viable financial strategy depending upon your situation. Just make sure to run the numbers first.

Are You Cheap or Frugal? Take the Quiz!

There is a fine line between being cheap and frugal. Being cheap has a negative connotation and is almost like a having a disease that makes it painful to part with your money, even when it is beneficial to you or others. Frugal can be defined as using your resources and money both prudently and economically. Which one are you? Take this simple quiz to find out:

  1. Do you leave an extremely small tip or “forget” to tip your waiter when going out to eat, even though the service was great?
  2. Did you ever order a box of munchkins from Dunkin Donuts, return the box half-eaten for a refund after declaring there are bugs in the box, when you actually dug up earthworms and put them in the box?
  3. Do you use coupons?
  4. Do you avoid spending time with family and friends because you don’t want to spend money on gas or gifts?
  5. Are you always looking for a good deal, such as buying used vs. new?
  6. To save money on paper, do you flip over used paper to the blank side, print on that side, and give it to someone else, even though the original side contained very, very personal details?
  7. Instead of buying plants at your local garden center, you secretly bring a small scissors to cut pieces of their plants to take home and grow on your own?
  8. Do you avoid paying back your family or friends when they purchase a group gift?
  9. Do you either cut your own hair or color it even though it looks absolutely horrible afterwards?
  10. Do you consider lower cost alternatives?
  11. Do you try to avoid paying for anything even when you agreed to the price or signed a contract to do so?
  12. Instead of fixing a problem, do you apply a band-aid approach or ignore it, especially a health issue, which ends up making the problem worse?

By the way, non of these are made up, even the silly ones. Don’t worry, everyone has a cheap habit that others find strange.

Answers:

If you answered yes to all or most of these, except for #’s 3, 5, and 10, then you are cheap. Although, sometimes you can cross the line to the cheap zone with these too if you take it too far!

Low-Cost Memorial Day Weekend Ideas

If you haven’t already booked a trip for this weekend and are looking for some fun, low-cost ideas then here are a few tips:

Parades: Many towns have parades this weekend, and if you haven’t been to one in a while then it may bring back some memories from when you were a kid. I have to admit that when I go to a parade with the kids, I do get tempted to chase after the candy that’s thrown to us parade watchers.

Town Pools: If you don’t have a pool, then you may want to join your town pool. Divide the cost by the number of times you use the pool and it really is a bargain.

Spending Time with Family & Friends: Relax and spend some time with your loved ones. Either host a barbeque or attend one, but don’t forget to bring something.

Yard Work: It will make your spouse happy and you’ll feel good that you’re making your house look nicer.

Go to a Park: There are so many parks throughout North Jersey to choose from. One of my favorites is Van Saun County Park in Paramus, which has picnic areas, train rides, a zoo, carousel, playgrounds, fishing, etc.

Go to a Farm: It may be a little early to pick berries or veggies, but many farms offer freshly baked items, dairy products, greenhouse veggies, and very nice scenery.

Whatever you do, make sure to remember that Memorial Day is a day to celebrate and honor those who died while serving in the armed forces.

Don’t Make These Easily Avoided Financial Mistakes

We are all not perfect and everyone makes mistakes. However, the key is to avoid these financial mistakes as much as possible:

Penny wise and dollar dumb: The actual expression is penny wise and pound foolish, but I still remember a partner from my first job saying this to a client (maybe it’s the American version). I guess it doesn’t matter how you say it as long as you make your point. The message is to not be cheap so that you save a few dollars, but it ends up costing you a lot more down the road. This can happen with almost any financial transaction so always be aware of what you are trying to accomplish.

Ignoring tax notices: Don’t be surprised to find out that your bank account has been levied or there are liens against your assets if you don’t address tax notices. Surprisingly, the notice may actually be wrong, but the IRS or states do not know this. If you do not resolve the notice timely, then penalties, interest, and collection costs may be added to your balance or you may not receive your refund.

Not filing your returns: Sometimes taxpayers hesitate to file their tax returns when they know that they owe money, but do not have the ability to pay their balance. Fortunately, there are usually payment arrangements that can be made in these cases. Also, every now and then I come across a situation where there is actually a refund due to a client, but they took too long to file their returns so they are not longer eligible to receive it. Now that’s painful!

Not saving anything: Just about everyone can save at least 1% of their income to make this a habit, and then can increase their savings rate over time. The earlier you start, the better and don’t convince yourself otherwise.

Too much long-term savings/illiquid assets: Sometimes the opposite is true when people tie up all of their money in their retirement plans or real estate, but do not accumulate short-term savings. What tends to happen is that retirement savings are tapped if there is a financial emergency or long-term financial set-back, which in turns ends up creating a tax issue.

Increase Sales or Cut Expenses?

What should be the focus? Should we increase our sales or cut our expenses? All of the marketing and self-development gurus tend to focus on increasing our sales, but other financial experts want us to focus on cutting costs and debts. Who is right and what should we do? Let’s look at the pros and cons of each:

Cut your expenses and debt: Being aware of our expenses and cutting unnecessary expenses is a smart move, along with reducing debts. However, cutting expenses will only go so far because you need to incur expenses to support your business operations. Reducing debts is also a smart move, but this should not be done to the detriment of using up all of your cash, otherwise you will go right back to increasing your debts.

Increase your sales: Every business should look for ways to grow their sales, as a business tends to naturally deteriorate over time. An increase of sales can and should lead to an increase of profits, but not always. Many times, a business will increase sales activity, but their profits may actually decrease, stay flat, or only increase incrementally. The main reason for this is due to the fact that a business needs to spend money on marketing, people, technology, and infrastructure to be able to support higher sales.

The optimum solution: Instead of focusing on either or, you should focus on both to some degree, which is what the most successful companies do. Instead of just growing your sales haphazardly, you should focus on growing your sales profitably. To accomplish this you will need to perform some simple math to make sure that you are focusing on profitable services and products and delivering them in a profitable way as not every dollar of sales is equal. Better profitability will also allow a business to have excess cash to help pay down debts and not get into more debt. Without a focus on profitability, a fast growing company will tend to have cash flow issues, and companies that focus on cutting expenses tend to cut themselves into irrelevancy.

9 Ways to Reduce Your Money Worries

When we lack money it creates a lot of stress and anxiety, and can be a source of tension in relationships. But how can we make our money work for us? Here are several ways we can take more control of our money to reduce our stresses:

  1. Change your thoughts: Reframe the way you think about money from being worried about it to being non-emotional about it. Nothing changes if you are worried about it, but worries may cause you to make worse financial decisions. This doesn’t mean that you should not care about money or be reckless.
  2. Be a good steward: If you think of your money not as your own, then you will manage it differently. It is a resource, no matter how great or how small, that we are given to be responsible with. Don’t be foolish with how you spend your money or the way you invest it.
  3. Save it first: Save your money first before you pay anyone else. Even if you start with saving 1 % of your income, it will create a habit that will last you a lifetime, and over time you can increase the percentage to more meaningful amounts. Although 1% may only amount to $20, $50 or so a week so there is almost no excuse to save this small amount, even if you are struggling. I like percentages because you save more when your income is higher and less when it is lower.
  4. Delay large purchases: Houses and cars are our largest expenses, but usually there is not a lot of thought put into these purchases. More time should be spent discerning larger purchases then small ones.
  5. Minimize useless debts: It seems as though anything can be financed today, from cell phones to plastic surgery. If your cell phone bill is $500 a month because you financed 5 iphones then you probably couldn’t afford the phones in the first place.
  6. Make more money: If your income is not high enough and your spending is not an issue, then figure out ways to make more money. If you need to switch jobs or hire a consultant for your business then do it.
  7. Give it away: I’m not sure if there are studies on this, but anecdotally, people who are more charitable seem to be happier than those who are not.
  8. Be timely: Pay your bills in a timely manner by being more systematic. Late fees and threatening notices are never enjoyable.
  9. Do something different: As with any problem, you need to change what you are doing because obviously it is not working. Yes, we are all stubborn.

By the way, it doesn’t matter if you make $50,000, $500,000 or $5,000,000, as you will have the same issues, with different variations. And, more money doesn’t mean fewer problems.

Another Misleading Ad

This is one that I have not seen before, but it came to my office recently. The letter stated the following:

2018 – ANNUAL REPORT INSTRUCTION FORM

The rest of the form is very official looking and has the appearance that it is coming from the State of New Jersey, which is similar to the shady advertisements regarding labor law posters. Whether or not this type of advertising is illegal is not for me to determine (there are disclaimers on the advertisement if you actually read the entire form), but it borders on shady. A few helpful tips to discern advertisements from valid governmental notices:

  1. Read the entire advertisement/form to determine if it is an advertisement or a notice from a governmental agency.
  2. The form asks for a check payable to a non-governmental agency.
  3. If there are processing fees than it is most likely an ad.
  4. Ask your CPA if you are unsure.