Money Walks

When you get your first job offer, how will you know if the salary is reasonable? The first thing you need to do before you enter the job market, whether it’s your first job fresh out of college or a new step into a career path, you need to research what the going rate or salary is in your area that also matches your education and skills.

When it comes to negotiating salary and benefits, most of it just boils down to knowing how much you’re worth in the marketplace. You need to identify which benefits are important to you and associate these benefits with a price tag offered by the employer so that you can evaluate the real value of the offer. The total compensation encompasses much more than just a salary, but also benefits and bonuses such as relocation package and signing bonuses.

When negotiating with your prospective employers, you need to find out what benefits and bonuses the company offers to employees in the position that you’re applying for, what the average pay increase is, and what benefits might be added later.

As far as when to discuss salary negotiations, you should delay any questions or requests until you’re well into the interviewing process and you also want to avoid telling your interviewers how much you currently make. You shouldn’t be thrown into a salary range that’s lower than your current going rates just because you were underpaid at your previous job, and discussing your salary too early in the game can take you out of the running if your current salary is too high. The main goal here is to have enough time interacting with the managers and interviewers to have a chance to “sell yourself” and to convince them why you’re the right person for the job before going into discussion about salary.

Keep in mind, the objective of them asking your current salary or the salary you’re looking for is generally to pay you as little as possible. Employers, for the most part, will always offer less than what they can afford. So the general rule of thumb is this, whatever the offer, always ask for 12%-15% more than what they give you. The reason for this is because when they put together your initial offer, they compose the letter assuming that you will ask for an increase. The employer usually allocates 15% higher than the initial offer for their budget on you, so if you don’t ask for the increase, then the company is more than happy to give you your base pay since they were able to reel you in with their minimum offer. When asking for the 12-15% increase, you might not always get the exact 12-15% but any increase is better than nothing. In the worse case scenario, they say no and that’s it. They’re not going to retract their offer because you asked for an increase, it can’t hurt to ask.

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Hello and welcome to the Carnival of the Capitalists. I hope everyone had a great thanksgiving weekend and a smooth black Friday. I want to start off by thanking Jay of Bizosphere for giving me the opportunity to host this great carnival. If this is your first time hearing about the carnival you can read the details from their main site and submit to their next edition, if you have an awesome article you would like to share, using this blog carnival form.

I had a great time reading through all the entries, 21 articles made it to this edition. Following the guidelines of the carnival theme, as long as the article was not older than 3 weeks and it was quality work it was included here in this edition. Okay, without further delay I present you the Carnival of the Capitalists.

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Capitalism
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Banks + Debt = Evil

http://www.pqinternet.com/94.htm

Buffet on Diversifacation

Most people end up di-worse-si-fying their portfolios by adding stocks in unfamiliar sectors for the sake of diversification

What Is A Cap Rate

The lower the cap rate, the more the market values the future appreciation of the area.

Estate Tax or Death tax?

Paying taxes is like pouring water down a drain. Yeah, some good happens (the drain gets cleaned and is kept functioning), but so much is wasted

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Personal Finance
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Will A Bank Sleep With You? Understand Credit As A Relationship

Do not try to lie to a women, they have a sixth sense for this kind of stuff. So do banks

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Business
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Business Investment Strategies That Work Every Time

The secret to investment success is the consistent application of time-proven strategies, not the use of complex, hard-to-understand investment vehicles created by investment bankers out to take your money

Five Powerful Techniques to Help Your Business Stand Out

It is impossible to know how to brand your company if you don’t have a clear vision of what you offer, why it is different from others who may offer similar concepts or products, and how to convey all of this to your customer

Business Cards:A Valuable Investment or a Waste of Paper?

Business cards don’t work in all cases though. They will only work as well as you do

Interviewing Employees: Avoiding Problem Workers

Beware of any job applicant who badmouths their previous employer. All they are saying to you is that you will be the next evil one on their list

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Management
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The illusions of superior professional mutual fund manager performance

If investment mutual fund managers were truly skilled at beating the market, then you would expect mutual fund manager performance prowess to persist over time

The Startup Team or the Startup Idea:What’s More Important?

If you surround yourself with great people, the great ideas will flow like good wine.

Please, Lord, Not Another Trademark Leadership Concept

We don’t need more “creative” ways to write about leadership. We need more good leaders we can use as role models, examples and mentors

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Marketing
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Get Demographic Market Research For Free

Don’t rely on visual cues such as “oh I saw at least 10 old people in the pharmacy.” Be scientific and be cost effective.

The Psychological Effect of 99 cents

Manipulating the price to make it look like a bargain is a powerful psychological strategy used in marketing for the best ROI

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Economy
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The Most Anticipated Recession Ever

households in the lowest third of the income distribution have experienced a ‘devastating impact’ from high fuel and food prices, with 60% reporting a worsening financial situation.

Ron Paul Wants to Abolish the Federal Reserve

abolish the Federal Reserve and replace it with a computer

So Now you know

The Fed’s 3-year-ahead inflation forecast also surprises me a little, in that the highest inflation rate that any member anticipates for 2010 is only 2.0%

Good News on the Declining Dollar, Savings & More

Many people who denounce our national savings rate do not realize that the savings rate statistic does not include most investments nor does it include assets in retirement plans or even home equity

Informations and the Commons

Today in Professor Rustici’s class, we discussed the tragedy of the commons…

What is the Bank of England Base Rate and Why is it Important?

The Bank of England interest rate is the rate at which the Bank lends money to high street banks

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Sales
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Don’t Let your Car’s value Go Down “Like a Rock”. Buy the Vehicle that Keeps it’s value the Best.

Its 2008 Best Resale Value Awards found that Volkswagen produced vehicles will keep their value the longest.

So that concludes this edition of the Carnival of the Capitalists. If you are interested in submitting or hosting in the near future you can stop by the carnival home site and learn more on how you can contribute. Thanks for stopping by and have a great day.

There was an article that made it to the front page of yahoo that linked to an article on The Wall Street Journal about a homeless man, John Wesley Jermyn, who is often seen either on roller skates or dancing, inspired a new brand name of clothing line called “The Crazy Robertson”. If you have 98 dollars to dash out, you could have one of his graphic hoodies.

What caught my eye was that he now also have an agent and a manager, to manage his profits of his clothing line. At this point I’m thinking wow, a manager and an agent, I guess he suddenly made it pretty big and has a pretty nice stack of money in some bank account somewhere but thats far from the truth. Although its not much money, Mr. Jermyn has specific ways he wants to be paid. Interestingly, he doesn’t want any cash or anything that is of any value, at least our definition of value. All he wants is food, liquor and some paper for his art projects.

“But so far he has refused to accept much cash, preferring to be paid in food, liquor and paper for his art projects, according to Teddy Hirsh, one of the label’s founders.”

In order words, he only wants what of any value to his life, which happens to be food, liquor and art projects. Not a new Ipod, or a computer, or some expensive unnecessary gadget from Best Buy. He basically lives his life according to his own lifestyle that he is used to and doesn’t like to involve any money in his daily life and therefore does not depend on society for anything. I like this article because I like that he values his life style and won’t change even if he had money. It is evidence that show it is possible to live without all the extra stuff we have and long for.

Mr Jerymn and I live on the same planet but apparently two completely different lives. So much of our daily lives involves monetary issues and we strive to perfect our social order, but sometimes I wish I was in an environment somewhat similar to Mr. Jerymn’s shoes, or roller skates rather and skate along freely. When we see Mr. Jerymn, we see him as being trapped and being extremely limited. But in a way, it’s quite the opposite, we’re the only ones who deal with all these problems we deal with money. It’s a interesting concept but really, money is the only thing that limits us and clearly, because Mr. Jerymn does not reply on money, he is free and unlimited.

Keep on dancing Mr. Jerymn, you rock!

It looks like my money market account’s interest is finally stabilizating at 4.50%, which is .4% lower than the last time I had mentioned my money market account which is over at gmacbank. Which is okay with me, not like I’m happy that it went down but the amount of money in my account right now doesn’t make any significance difference losing that .4%. Losing the interest rates is all handy and dandy but today I encounter something that was more of a worry than just losing some interest rates.

For the most part, I try to stay away from checking my investment accounts as much as possible because then I would not be inclined to touch or do anything with the account but yesterday I checked my account and I’m glad that I did. As I was going over my account summary, I realized that there has not been to much activity going on in the account. Thats mainly because I haven’t been putting any thing into my account, so the only thing in my statement was my interest rates that were credit into my account for the past 4 months. While looking over the statement, it made me realize that I was actually making some decent money and I thought to myself, “wow, I’m glad that I had started this account a while back. Look at all this interest it’s making and how much I would have been missing out on”. But thats when I realized and said, “wait a minute, these numbers don’t seem to be adding up right”. Then after careful review of the account summary, I was right, they weren’t adding up right. Each month was credited some money from the interest rate but was not the full amount that month had earned.

Now what I am to think. There has got to be an explanation right? I mean, gmac bank is a pretty big online banking firm and I doubt that they’re trying to cheat me out of my money so I decided to give them a friendly call to see what the problem was. Maybe it was some kind of a monthly fee I didn’t know about?

So I called them up and this woman answers. The conversation was pretty quick, after giving her all my account info and my security questions, the conversation went something like this:

Me:” So I was looking over my account summary for my money market account and noticed that my interest rates weren’t adding up, whats the issue here”?

Gmac representative: “Okay, let me take a look at it.”

(Silence and some keyboard tapping noises…)

Gmac representative:”Hmmm…this is pretty interesting. I’m not exactly sure what’s going on here. Let me take out a calculator to verify that they’re not adding up.”

now I’m thinking…wow. Its an obvious miscalculation, I mean you can look at the credited number and see that it doesn’t add up ( kinda like you know 1+1 is not going to be a two digit number)

me:” …ok”.

(more silence and some calculator tapping noises…)

Gmac representative:”wow, you’re right. It doesn’t add up. I’m really not sure what’s going on here.”

Me:”So it’s not any kind of fees that maybe you’re deducting each month?”

Gmac representative:”No, when we deduct fees, we list them as such. What we’ll have to do is put in an investigation ticket in and someone from the department will contact you within 2-3 business days”.

Me:”…oh…ok”.

Gmac representative:” Is there anything else I can help you with”?

Me:” No”

…

So that was pretty surprising. I mean, even if the interest rates don’t add up to that much, its the trust thats the issue here. Whether it’s two dollars or two hundred dollars, money is money. I’m not sure what would have happened if I didn’t call them about this issue. How long would it have taken until it was fixed or would it ever have gotten fixed? I’m not so sure.

I’m curious, has anyone else experience anything like this before? Maybe you might want to check your investment accounts and see if your interests are adding up.

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On my last post, I talked about the importance of setting your goals and as with any road maps, before you can determine how to get from here to there you need to know where “here” is. In other words, where do you stand financially? This is where the net worth statement concept comes into play.

The net worth statement is a very simple concept, it is a snapshot of your financial health. To break it down, your net worth is the difference between all the things that you own of value and all the debts you owe. In other words, it is your total assets minus your total liabilities.

So why do we need a net worth statement?

Net worth statement gives us a snapshot of your current financial condition, basically, tells us how we are doing financially at this moment in time. This is important and you need this information in order to effectively set the financial goals that you want to work towards, determine your progress along your way, and make adjustments, also why it’s important to update your net worth on a regular basis. Your net worth will also come in handy when you decide to apply for a mortgage, credit cards or any types of loans.

How to prepare your Net Worth Statement.

Not having a strong grip on your financial situation can really hurt you in times of need, like a job loss or health emergency. It’s really hard, if not impossible, to plan for your future if you don’t know where you are today. So lets start making you your Net Worth statement today.

You can begin by taking out a piece of paper and start listing all the things of value that you own. Include everything, even those you still owe money on like your house or your car, etc. You want to use their full values as of today. Don’t worry about the balance of the loans related to these assets, they will be included in the liabilities section so your equity in the assets you list will not be over looked. However, for your bonds, stock options, and retirement accounts, use your current value and not the value at maturity or the value on the date you’re fully vested. For this portion, you should talk to your broker/employer and ask for statements showing the current value of these accounts.

For life insurance policies, you should only list those that have a cash value. Majority of life insurance policies are provided through the employers and are terms policies good only for the time that you are working for that company, so these are not considered assets.

For cars and all other vehicles, use the Kelley Blue Book value, which is the estimated price of the vehicle if the car were to be sold to another consumer or a car dealer. For every other assets, use your best estimate of the fair market value.

So here is a general list of some common assets sorted by category:

Cash Equivalents: Banks and money market accounts, CDs, and Cash on hand.

Investments: Stocks, Bonds, Mutual funds, Index funds, Savings Bonds, and Stock Options.

Retirement Funds: 401(k)/Pension funds and IRAs.

Real estate: House, Land and Rental Property.

Personal Property: Vehicles, Campers and RVs, and Boats.

Household Goods: Furniture, Jewelry and Electronic Equipment.

Money Owed to you: Rents due to you, Rental Deposits, Utility Deposits.

Other Assets: Life Insurance, Privately owned business.

So now that you’ve listed everything you own that has a monetary value, in order to get a true representation of your financial net worth, we’re also going to have to list money you may owe banks or other finance companies, also known as liabilities.

Some examples of Liabilities include the following:

Loans: Mortgages, Home Equity Loans, Vehicle Loans 401(k) Loans, Student Loans.

Credit Cards: Visa/Master Card, American Express, Discover, Department Store Credit, Gas Credit Cards.

Taxes Owed: Real Estate Taxes, Unpaid income taxes, Quarterly Estimated Taxes.

Other Debts: Unpaid Bills, Alimony, Child Support, Miscellaneous.

After you have listed everything you can think of, then you have to total up all your assets and liabilities. Now subtract your liabilities from your assets and that is your Net Worth. If your number comes out to be positive(assets are greater than your liabilities) then congratulations, you have a positive net worth. If your number is negative (liabilities are greater than your assets) then you have a negative net worth. If you have negative net worth, don’t let this discourage you. At least now you know exactly where you stand and can finally map out your route to a positive net worth. Now that you have your Net Worth, our next post will concentrate on deciding what your goals are and how to get started.

(This is the second article of the three part series)

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Okay, so we all know that goals keep us focused on a purpose. The truth is, all successful businesses and organizations have short term and long term goals and a written plan for reaching them. The first thing you need to do is to determine your financial situation and then decide what you want to achieve for your future also how you’re going to accomplish this task.

“Most people don’t plan to fail, they just fail to plan”

Writing out your goals is like saving, everyone knows they should do it but most don’t.

So why are financial goals so important?

Just like you wouldn’t leave on a long road trip without a road map, still many people go through life without a real solid plan for their future. The road to success can lead directly to your destination or to a dead end. Making specific financial goals and witting out plans for meeting them will help you focus your efforts on the end result.

Think of goals as your wheels on your car, they steer you in the direction you want to go and you will not get very far without them. So if you have not started planning for your future, then now is the best time to begin no matter how old you are. The earlier you start however, the more advantage you’ll have. Time is THE most important tool when it comes to saving and investing. If you wait too long to start investing and saving, you’ll have to work at it a lot harder than if you start as soon as possible. The best/smartest thing you can do in your twenties is to invest and to save. When you start at an early age, you’ll ultimately have to save and invest much less of your money and will still come out far far ahead of anyone who starts investing ten or twenty years later.

For example, someone whose twenty years old and invests $5,000.00 and earns an average of 8% a year, at retirement ( age 67 ) will end up with $186,160.06. Now the same amount invested at the age of forty would total less than $40,000.

Without a good solid plan, you can have the best intentions but lead nowhere. Start mapping out your financial route now, because your future depends on it. Be sure to come back to read my next post on how to calculate your financial net worth.
(This is the first article of the three part series)

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