Wise Money Matters - Get Out Of Debt and Finally Enjoy Life

In this economic downturn, people are in constant fear of where their money is safe. We have banks failing, the stock market crashing, and the housing market at it’s knees. It seems like there is no safe place to put your money. I saw this great video from CBS which helps clear up a lot of the fears.

I find that meetings are some of the biggest productivity hinderances I have in a week. You often spend a lot of time getting nothing accomplished. This was most prevalent at my last job.

The pointless office meetings

I used to work as the IT and Media Director at my church. The pastor’s wife of the church was basically the office manager for a very long time. She ended having some fairly serious medical issues and stopped managing the office as she spent time getting surgery and recovering from those surgeries. The one thing she didn’t stop doing was the monthly office meetings.

The difficult thing about this monthly meeting was that since she was no longer in the office on a regular basis, she rarely knew exactly what was going on in the office. This really turned the office meeting into an update on what was going on in the church.

Honestly, this was really counter-productive. I would have to listen to the maintenance guy talk about what was needing to be fixed and the youth director about what events they had coming up. None of those items had any impact on my job what-so-ever and the items that did were usually handled by the person in charge of the particular item contacting me directly.

Sometimes these meetings would be 2 or 3 hours long yet the only things that directly impacted me would take less than 15 minutes to discuss. I would have preferred that she schedule 10 or so meetings in the same amount of time and had 1 or 2 of us at a time switching in and out of meetings. It would have wasted a lot less of my time while still accomplishing the same or more.

Eliminate large meetings

They are so often counter-productive. Especially any meeting that has more than 3 or 4 people will just waste time. Usually for any given issue, you want the 3 or 4 most knowledgeable people on the topic to come to a solution to the problem. Preferably it should be 2 people making the decision. Once you bring the whole company or an entire team to solve one problem and you get side tracked way too easily.

Switch to email or phone

Most issues can easily be resolved with a simple phone call. Most brodcasted messages can be done via a bulk email. Such things can take 5 minutes and only a few people actually waste those 5 minutes in the phone call or creating the email. A meeting requires people to stop working and move to the meeting location (5-15 minutes). Then you have to get people settled and focused on the meeting (5 minutes). Then you talk about the items on the agenda (varies depending on number of items). Somebody is bound to have an opinion on the issue which causes a rabbit trail conversation (15 minutes). Finally, you have to relocate yourself back to your work area (5-15 minutes). And statistics show it takes anywhere from 5 to 15 minutes to focus on something after you have been interrupted. So we have somewhere around an hour worth of wasted time that could’ve been saved with a simple email or phone call.

Trust people

If you are in charge of a team or department or even a company, it’s often hard to trust the people under you to do the job to your specifications. The best thing to do is to give clear and concise directions as well as limitations at the beginning of a project and simply let the people do their job. You don’t have to schedule a team meeting simply to find out what’s going on in a project. Keep up to date with individuals on the team to prevent any major hiccups but trust that the job will get done. Delegation is key. When you trust people to do their job and give them freedom in that, you will often be surprised to find that people will rise to the occasion.

If you can’t trust the people under you, then you need to get different people for the job. If you can’t trust anyone but yourself, then you need to lighten up.

If you follow some of these tips, you will be eliminating a whole lot of wasted time and becoming much more productive.

I’ve been at my new job for a couple months now and one thing I’ve noticed is how you really get what you pay for sometimes. Here’s an example.

The cheap way

The guy who ran the IT department at my work before I filled the position was not really a network administrator. He was a computer programmer with a little bit of network experience. He also made it a huge priority to save the company money whenever possible. While this seems like it would be great for the company, it’s proven to be more expensive than we originally thought.

He purchased about 10 small Linksys network switches for the company. Linksys is the consumer branch of Cisco Systems. These switches cost somewhere from $50-$100. They are a great deal considering that one large Cisco enterprise class switch will cost you between $1500-$3000. The problem I have run into since he left was that 5 of the 10 Linksys switches have gone dead since I started here.

So instead of saving the company money, it’s costing the company money in terms of purchasing replacement products and company downtime. The company downtime costs us way more in the long run than $1500-$3000.

The right way

One of the first things I’ve done since I got here was install a brand new $2000 switch to replace the 10 cheap Linksys switches. Immediately people started commenting how things seemed to go faster and everyone was having less problems. So while we saved $1000 in the short run purchasing the cheap switches, we lost a lot more in the long run by doing so.

Buying cars

Cars are another great example. When I was looking at purchasing the first of 2 newer vehicles a few months ago, I was debating between the Ford Focus, the Honda Civic, and the Toyota Corolla. I knew that both Toyota and Honda had amazing reputations for reliable vehicles. My cousin had a Honda Accord for over 10 years and sold it for $2000 with 180,000 miles on it. It still ran in perfect condition.

The thing was is that the Ford Focus was several thousand dollars less expensive than either of the other two vehicles. It would seem like at first glance that the Ford Focus would be the wiser decision of the two. Luckily I did my research.

The car website, Edmunds.com, has a great tool which lets you compare two vehicles over 5 years to see which vehicle would provide the best value. They stated that after repairs and depreciation, the Ford Focus would actually cost me more than the other two vehicles.

I also talked to a friend of mine who is a mechanic. He told me that the Ford Focus used mostly plastic parts where the Honda Civic used metal parts. He mentioned that, in his experience, certain parts on the Focus were almost guaranteed to fail after 2 years while the Honda Civic would not fail the entire life of the vehicle. He mentioned that while it was slightly more expensive to fix a Honda or Toyota if a part failed, it happened so infrequently that you would probably save money by going with such a vehicle.

So after all of this, I ended up buying a Toyota Corolla.

Price often is better

There are times, however, when price is more important. Soda is by far the best example of this. People spend a lot of money on name brand soda like Pepsi, Coke, or Dr Pepper when store brand alternatives are often half the price. Often times the same ingredients are used in the store brand items yet people will spend big dollars on the better marketed products. I’ve heard people say there is a huge difference and in some cases there is, but I’ve also had people think that the drink I served them was the legitimate name brand product when in fact it was the store brand. The clever marketing often tricks our minds into thinking there is a huge difference between products when their really isn’t.

I’ve done a lot of research on TV’s. Everyone says that you get what you pay for. Lot’s of people buy off brand TV’s from China for ridiculously cheap and they end up breaking quickly. However nobody needs to spend the money on the top of the line Sony either. Vizio is a solid brand that sells budget TV’s. This is a great example where you don’t need the most expensive but also don’t want the hassle of the cheapest. Find a good reputable brand somewhere in the middle.

The best recommendation is to do your homework. For instance, when I purchased the network switch for my company, I decided to go with HP ProCurve instead of Cisco Catalyst. A lot of reviewers had mentioned that the HP enterprise products were nearly as good as the Cisco enterprise products but at 2/3 the price. After reading dozens of such reviews I decided to go with the cheaper unit but I stayed in the enterprise class products.

When you do the research you will know whether you are getting a deal or just getting a headache. If you don’t have the time to do the research, then my highest recommendation is to spend the extra money for mission critical equipment (such as a vehicle or the like) and opt for the cheaper products on items that are pure luxury or preferencial products. But don’t assume that cheapest is always best or that most expensive is always best.

So we all know the infamous Darth Vader from the Star Wars movies. He is arguably one of the best villains of all time. But love him or hate him, he made a few critical errors that so many people make. Let’s learn from the mishaps of the great Darth Vader.

Don’t put all your eggs in one basket

So if you remember the basic story behind the Star Wars Trilogy… oh and I should clarify that I’m primarily talking about the original trilogy and not those horrible movies about Anakin… but anyways, the basic story is about the Rebel Alliance trying to destroy the Death Star. That’s the crux of the overall conflict.

Now what’s wrong with this? The thing that is wrong is that the Empire decided to put all of their eggs in one basket. They put so much focus on the Death Star that destroying it would be a huge victory for the Rebel Alliance. And as we all know, it eventually was a big victory.

The same happens in our own lives. We think we have the winning stock or the perfect business plan or the key customer, but the problem is that if we put all of our resources into a single thing, we usually end up losing everything when that single source of income gets eliminated. When the Rebel Alliance destroyed the first Death Star, it left the Empire in a vulnerable state. When you lose everything in an all out effort to get rich quick, you will definitely be in a vulnerable state.

Be wary of involving family

Mixing family and business or money is a dangerous place to be. When Darth Vader brought Luke Skywalker into the family business of the Dark Side, it caused some definite conflicts. Luke wanted his dad to come back to the Light Side but Vader wanted Luke to join the Dark Side and all hell broke loose. In fact, it made Vader make a tough decision between watching his son die or killing his boss. Not a good place to be in.

When you let family get involved in financial matters, things can get ugly. Loaning money to family is almost always a recipe for disaster. If the family member can’t pay back the money it can strain the relationship. It’s hard to take a family member to court to get the money back but it’s also money that came out of your pocket.

Bringing family members into the family business is also hard. Often times the family member doesn’t perform up to expectations and you are faced with the tough choice of whether to fire them or not. If you do fire them, your relationship can become strained. If you don’t fire them, your business suffers. It’s like being between a rock and a hard place.

Don’t be like Darth Vader

Seriously. The weird breathing suit. The short temper. It just doesn’t work.

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You can often find great deals on going out of business sales and with the economy in the slump that it is, you can often be setup to capitalize on it. For instance, Shoe Pavillion is going out of business in my city. So my wife and I decided to stop by and see if we could get any good deals and in fact they were great deals. I got 2 pairs of shoes. One was marked down and then I got an additional 30% off of the marked down price.

Timing is key

While going out of business sales is great, timing can be key. Usually such sales go in phases. Often the first phase is something basic like a 10% off sale.

A friend from work recently went into a Circuit City to purchase a flat screen TV. He found the TV he wanted, purchased it and just as he was getting ready to walk out the door, he noticed the “No Returns” sign on the door. This is common when a company is going out of business but my coworker didn’t realize it until he was ready to leave. He felt uncomfortable that he was going to walk out with a $1200 purchase with no possibility of returning it. So he decided against it and was able to get his money back since he hadn’t even left the store yet. He went over to Best Buy and actually found the same exact TV for $200 cheaper than Circuit City. So that 10% off wasn’t really all that great when the prices are marked up to begin with.

I’ve heard of similar stories about prices at Linen and Things. They tend to be priced a little high anyways so a 10% discount really only brings you down to a reasonable price. I honestly wouldn’t bother too much with the initial 10% discount phase.

When we walked into Shoe Pavillion they were advertising 20%-40% off all items but as we were entering the store, they were in the process of changing their signs to 30%-50% off all items. We seemed to walk in at the exact right time. This is the phase where you want to get in on these sales. It can be tough if you want something specific because often the store is becoming a bit bare, but the deals are incredible.

Be wary of the “Sale Mentality”

The Sale Mentality is when you buy things that you don’t really need simply because you get a really good deal on them. My wife tends to fall into this a lot. She sees something that is cute or neat that she will rarely use but buys it anyways because it’s 70% off. If you aren’t going to use it, even 70% off is too much. Heck, I would argue that free is too much as it just creates clutter. This is why I stay clear of Yard Sales unless I’m looking for something specific. You can convince yourself that since it’s only $1, it’s worth it even if you don’t really need it. I say put that $1 in savings instead where it will better benefit you than some random useless item. The same idea holds true for going out of business sales.

But if you play the game right, you can use the economic crisis to your advantage. See… there are good things that have come out of this economy.