MomVesting

Five Top Tips for Investing in a Business Venture

Christa Palm — Mon, 31 Dec 2012 12:00:00 +0000

When most people think about investing, visions of stock charts and IRA spreadsheets may dance through their heads. But investments don't have to stop there. Let's take a look at a non-traditional investment: investing in a small business venture:

Most small businesses are in need of one thing: cold, hard cash. Okay, maybe they need other things like good employees, office furniture or a beefed-up business model. But the original startup coinage is often the top priority for anyone with a business plan. So what do you do if you have the cash but someone else has the idea? Follow along for five must-know tips about investing in a startup company.

Make Like a Bank

Banks have a few ways of determining the risk of any loan they intend to offer, including checking a credit report and asking for a business plan. You can mimic banks by requesting both from any potential startup owners. From there, you can determine the startup company owners' credit worthiness – and their probable ability to handle the books in the new business. The business plan can help you iron out any details needed before you invest...or it can help you run for the hills on a business with no potential.

Write Up a Contract

No business venture is complete (or completely safe) without a contract. As the cash cow investor, you may be particularly vulnerable to a no-contract agreement. So it may be best to schedule a meeting with your attorney to make sure all of your bases are covered in the legalities department.

Keep it All Business

It may be tempting in friendly investments to keep things more casual, but many a family feud has started over money. For that reason, if you're working with friends or family on a business venture, it can be even more important to make sure everything is done by the book. Credit reports, business plans, contracts, deadlines, and business-like attitudes can all help seal the deal without souring the relationship.

Follow Your Gut

When it's all said and done, spreadsheets and business plans can only get you so far. The business has to make sense before you should drop a wad of cash on it. So as you're reviewing the information and talking to your potential business owners, you may want to set aside some time simply to listen to the inner voice. Ask yourself if the business is necessary and if it makes sense. If not, it's time to move on.

Consider a Higher Interest Rate

Most people don't want to gouge their friends and family, but when it comes to funding their business model, it's important to set a decent interest rate. Remember, if they are coming to you for cash, the bank must not have approved a loan, which means loaning to them is a higher risk investment. For that reason, it may be best to charge a higher interest rate to help offset the risk.

If you happen to be seeking an investment opportunity, lending to a small business could be the way to go. However, to keep your money safe, it's often best to request a credit report and business plan, sign a contract, stick to business, follow your gut and set a decent interest rate. Your new business and your fatter pocketbook could thank you.

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Investing in Family: De-Stressing the Holidays

Melinda Gregory — Mon, 24 Dec 2012 12:00:00 +0000

Join us as we revisit a great holiday-themed post. Happy Holidays!!

I don't know what there is about holidays, but sometimes they can have the uncanny knack to bring us copious amounts of stress. Maybe it's the travel hassle of getting to Aunt Margaret's house, or maybe it's three days of prep work followed by a nine hour marathon in the kitchen preparing the annual feast. Whatever it is, everyone seems to have their own brand of stress that comes on what could be a relaxing holiday filled with family togetherness. If you find your stress level rising as you gear up for this year's celebration, here are some ideas that just might help calm you down.

Kitchen and Meal Help

If you're the one everyone counts on to truss the turkey or bake the ham, there's no getting around spending time in the kitchen slicing and dicing. It really can be a hefty challenge to get a special meal on the table, hot and ready for the masses. If this is your point of stress, try reaching out to the other guests for some aid. This help could come in a variety of ways: you prepare the main dish and ask everyone else to supply the sides; you enlist a few willing hands to help make your work lighter and delegate who chops this and who sautes that; you put the kiddos in charge of the housekeeping and decorating while you cook. You get the idea. Don't be afraid to reach out; chances are, you'll find someone who's very willing to help and waiting for your point in the right direction.

Or, and I've been tempted by this many a holiday, you could take the ultimate help and order your meal from the local grocer or restaurant. Every year in my neck of the woods, two local stores advertise a complete meal that will feed X amount of people for a pretty reasonable price. While it may seem outrageous paying a price like that for one meal, consider what you'll probably be spending at the store to make the feast happen. You'll probably be surprised to find that it's around the same amount. If it takes a load of stress off of you and you're still providing a meal for family and friends, then it's a win-win situation.

Have a Laugh

Some of the funniest episodes of any show I've ever watched were the Thanksgiving-themed episodes of "Everybody Loves Raymond." In one, Debra, Ray's wife, has decided to serve fish in place of turkey at the holiday dinner; her mother-in-law takes it upon herself to bring over a huge, cooked turkey, and this is after Ray gives the fish a steam in the dishwasher. Another episode showed Debra, a pretty small gal, wrestling with a turkey in her attempt to get it to the oven. Pure hilarity!

The point in this small trip down TV memory lane? Whatever your role is in this year's holiday celebration, why not carve out twenty minutes to have a good laugh? Laughter really can do wonders in easing stress, and sometimes the message underneath the comedy coating can help you put things in your life and situation into perspective.

The holidays do not have to be a source of major stress for us. Give yourself a break, grab some help and laugh it up this season! And from our MomVesting family to yours, have a wonderful holiday.

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Investing in Health: Losing Weight Post-Baby

Christa Palm — Mon, 10 Dec 2012 12:00:00 +0000

From the pregnancy glow to the new baby's giggles and smiles, welcoming a little bundle of joy into your family is often a heart warming, happy experience. But despite those adorable tiny toes and cute little coos that invade your home, there can be one thorn in your side: extra post-pregnancy weight. If you have put on a little jelly in your belly, have no fear. Banishing the bulge is possible. Follow along for some tips and tricks from a newly slender mom.

My Story: Following the Best Doctor's Advice Ever

At my six week post-pregnancy check up, my doctor gave me some great advice: “Exercise daily, eat three square meals per day, and add in healthy snacks; the pounds will melt off. Don't eat any junk. Well, maybe just a little junk {wink}.” I followed her advice to a T, and I lost weight rather rapidly.

The key to my weight loss was watching my portion sizes in those three square meals, eating healthy snacks like fruit or yogurt, and walking every day. By three months post-partum, I was back into my skinny jeans (yay!). I was nursing, though, so my weight loss was boosted by my little calorie-burning machine, aka “The Baby.” Even so, nursing or not, weight loss is possible for the new mommas...but there are some common thoughts that can trip up everyone. Let's look at those common mishaps.

Some Tricky Weight Loss Bandits

Although my doc made post-pregnancy weight loss sound simple enough, there are a few traps to watch out for. Here are some of the common thoughts that can derail your weight loss efforts:

“Nursing Moms Can Eat with Abandon” – One of the wonderful benefits of nursing is the extra calorie burn. Mothers who opt to breastfeed can take in an extra 500 calories from their pre-pregnancy maintenance diet and not gain a pound. Obviously, then, eating the same amount of food or slightly less than consumed during pregnancy will result in weight loss. The calorie trap here, though, is that nursing can give mommas the munchies, and it's easy to eat too much. Watching food intake is key for nursing moms who want to shed a few pounds.
“I Can Starve Myself Thin” – Many people think that eating a tiny amount of food will result in weight loss, but starving yourself can have the opposite effect. When your body senses that you're eating too little, it will stop burning as many calories. This results in lethargy – a terrible state when you're already tired from taking care of a baby! – and no weight loss. Instead, eating at least 1200 calories for formula feeding moms or 1500 calories for nursing moms can produce the best results.
“One Meal Per Day is Fine” – Although it is tempting to eat one large meal per day when you're a super-busy new mommy, the tactic is terrible for your diet. Your body will go into starvation mode if you're not fueling it throughout the day. Aiming to at least snack several times throughout the day and eat a large meal with the family can produce better diet results.

Of course, every woman is different, and weight loss can be stifled by a metabolism change post-pregnancy. If you're having trouble losing weight, talk to your doctor about any potential medical issues. But for many mommas, following a sensible diet and exercising can help shed that unwanted baby weight.

How about you, MV readers: how did you lose your post-baby pooch?

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Kids' Christmas Gifts on Less

Christa Palm — Mon, 03 Dec 2012 12:00:00 +0000

When I was growing up, I had no idea that my family was poor. Extremely poor. Scrape-together-enough-money-for-necessities poor. We lived in a nice enough house. We always had food to eat. And we never felt deprived of fun toys. You all know the story about how my mother made ends meet and got out of poverty, but I haven't talked a lot about how my magical childhood filled with toys was possible. In the spirit of the holiday season, let me elaborate on how my mom made the Christmas magic happen on less.

Shop Cheap

Mom's Deal: Every year, my mother would hit the garage sales. She scoured the sales throughout the year for the best and brightest toys, hand picking the newest-looking or most desired toys for pennies on the dollar. She found countless unopened toys or toys that were barely used at all. Since my siblings and I were young (and didn't get cable TV with all the gotta-have-it toy commercials), we didn't have many burning desires for specific toys, and opening any present was a wonderful surprise.

Your Take: Although it's a little late this year to hit the garage sales, there's still a little time left this year to make the pennies stretch. Anyone looking to save a buck on toys this year can still hit up Craigslist, E-bay or online garage sale sites for cheap but great gifts. Also, thrift stores can be a great place to find some good deals. One warning: clean everything really well with bleach and pass on the really grimy stuff.

Ask for Help

Mom's Deal: Although my mom did a great job finding excellent, barely-used toys at sales, there was always a gift or two that landed on the must-have-brand-new list. For these gifts, my mother would enlist the help of family. Thankfully, my grandparents, aunts, uncles and even close friends were dying to buy the gifts that could light up us kiddos' eyes.

Your Take: If you're strapped for cash, let family be the gift heroes to the munchkins. I guarantee, when you're back on your feet, there will be plenty of time to spoil the kids yourself. There are also a ton of great programs that can help provide a memorable Christmas for the little ones. Check in with your local Department of Human Services for a list of organizations that may be able to provide anything from a holiday meal to gifts to necessities during your time of need.

Pay it Forward

Mom's Deal: Every year, the sibs and I would clean out the toy box. We'd set aside toys that we no longer needed, most of which we had simply outgrown. Then we'd get to play Santa to other kids in the same situation as us, donating our toys to the local Goodwill. Mom told us that by giving, we'd make room for new toys...and we'd make another kid's holiday super-special by paying forward our own good fortune.

Your Take: Take the time to help the kids donate. You, too, can pay forward your own good fortune. In today's world, you can even take advantage of cyberspace and post the toys for donation on a “Pay it Forward” Facebook page or website; these sites can get your name and gift needs out there. Once your donations are made, other families can then donate to you in turn.

The holiday season is magical for so many reasons, and celebrations are not limited to gift giving. But as a child, gifts often do play a large role in sharing the excitement. Therefore, when the cash cow is a little lean during the holidays, you can always play Santa with a little help from gently used items, family generosity, and a Pay it Forward mentality.

Happy Holidays to you and yours!

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Investing in Sanity: Baby Sleep Training

Christa Palm — Mon, 26 Nov 2012 12:00:00 +0000

If you have a new baby in the house, sleep very soon becomes a luxury. No matter how well your baby snoozes, your own often-interrupted sleep can begin to take a toll. Add in the fact that many babies have trouble sleeping or napping, and you have a recipe for two very tired parents. Thankfully, catching some zzz's is possible before year 18 rolls around. Let's take a look at some tried and true sleep training ideas from the trenches of motherhood.

Intro to Sleep Training

Before we get too far, it's important to point out that sleep training shouldn't begin too early. In the newborn stage of your baby's life, Baby has constant needs, and parental sleep will be a luxury. There's really no way around middle of the night feedings and round-the-clock baby care. But once Baby hits three or four months, she is usually capable of falling into a sleep schedule. Of course, capable doesn't always mean probable, so let's move on to a few sleep training tactics that might help you catch some rest (and some sanity!).

Figure Out Baby's Cries

Babies communicate their needs through cries, and each one can mean something different. Although it's tempting to tend to every possible need immediately upon the first yelp, it may be more helpful to listen to each cry individually and attribute it to each need. My daughter, for example, whimpers when she's tired, but she wails when she's hungry. Understanding each can help me put her down for a nap at the first sign of tiredness, before she becomes overtired and resists napping.

Understand that Babies can Become Overtired

While it might sound counter-intuitive, when a baby is too tired, sleeping becomes impossible. I know this firsthand because I over-scheduled my DD's little baby life to the point that she did not get quality naps. As the over-scheduled weeks wore on, she started to gradually get more and more tired (and more and more cranky), and she refused to nap. Finally, I realized how tired she was, and I spent a full day sleep training, after which my little bundle of crankiness fell back into a napping routine. For other parents, taking the time to decrease Baby's scheduled play dates can also help her re-set her own napping schedule.

Modified Cry It Out

One more tactic to consider when sleep troubles rear their ugly heads: it may be beneficial to do some hard-core sleep training with a little modified Cry It Out (CIO) training method. With this method, when Baby cries, always tend to all of her possible needs first (diaper, food, check for illness). Once they are taken care of, place the baby back in the crib and let her cry for a minute. Then console her, try to help her back to sleep, and place her back in the crib. Repeat this for as long as it takes the baby to fall asleep, gradually lengthening the time between your consoling.

For DD, CIO was the way to go, but I modified it even more to use her different cries as cues. If she cried at her top-decibel hunger cry, I fed her. But if she fuss-cried in sleepiness, I let her fuss until she fell asleep. It only took a few days of my modified modified CIO for napping to become part of her baby day repertoire once again.

How about you, MV readers: how did you sleep train your baby? We love to hear more tips from our experienced mommy (and daddy!) readers.

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Investing in Family: Thanksgiving Edition

Christa Palm — Mon, 19 Nov 2012 12:00:00 +0000

With the holidays unofficially beginning this week, it might be tempting to get caught up in the buzz. To hyper-schedule our lives. To purchase every single item on our list and check it twice. Possibly to brave the throngs of crazed-eye shoppers on Black Friday, all in search of the perfect shirt or toy at an unbeatable price. But before we submit to the holiday frenzy, it just might be time to slow down and give thanks.

We may wish to give thanks for all of our wonderful family and friends, for the roofs over our heads, or even for the simple yet complicated opportunity we have to live our lives. Life may not always be easy, but we still have so much to be thankful for, as individuals, as parents, as a nation and as a world.

So my wish for all on this Thanksgiving is that we can take a few moments to drink in the wonderfulness of our crazy families (despite Aunt Edna's insistence on pinching our thirty-year-old cheeks). Take a moment to smile at Edna. Take a second to breath in the milky-sweet scent of your brother's baby. Take an instant to hold hands with your husband. And give thanks to the universe for the beauty of life. Because that's what Thanksgiving and the holidays are truly about.

Happy Thanksgiving to all! May you and your family be blessed.

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Is a College Degree Worth the Money?

Christa Palm — Mon, 12 Nov 2012 12:00:00 +0000

It used to be that a college degree could take you places. College graduates were almost guaranteed a job that paid well enough to live on upon graduation. But nowadays, that no longer seems to be the case. Graduates are fighting with the unemployed and underemployed of the older generations for jobs – any jobs – even if it's not in their area of study. Does that mean that college is no longer worth the cash? Well, at the danger of over-using a favorite MomVesting phrase, let's go ahead and say it: It depends. Let's take a look at where college benefits graduates and where it becomes just another debt.

College by the Degree

An advanced degree can certainly be worth its weight in gold...if it's the right course of study. That doesn't necessarily mean that one diploma is worth more than another, but when graduates search for jobs, more specific courses of study can often produce better chances for landing a job in the field of choice. For example, there could be more job opportunities in computer science than in the English field.

The key to finding the right education path that can land a job is searching for the degrees that are most in demand. A simple Google search can tell you whether the degree you're interested in will offer jobs upon graduation, but to get started, here are a few of the high-demand fields: software engineer, pharmacist, registered nurse, physical therapist and accountant.

College as Life Experience

College doesn't always have to be the be-all-to-end-all. Instead of seeing college as the means to a degree, attending a university, four-year college or community college can be a means to obtaining much-needed life experience and social skills. Really, it's often the first time that young people are out on their own, and it can therefore be beneficial to youths preparing to handle bills, living with others and handling stresses on their own.

Here's where it gets tricky, though. How much is that life experience worth to parents? Or even to students? There may be a limit to how much time and money students and their parents are willing to put forth to learn about life. Maybe one year in a trade school or a few semesters at Job Corps could do the trick in lieu of the tens of thousands of dollars that it takes to obtain a four-year degree.

Whatever the case for your soon-to-be college student, it's important for both parents and students to weigh the potential degree and the need for life experience on a personal level. Not everyone wants or needs a four-year degree. But only you and your child can decide what's best in your young adult's life.

Good luck, parents! Weigh in below to help other parents decide if college is beneficial...or a bust.

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How to Save Cash on Diapers

Christa Palm — Mon, 05 Nov 2012 11:00:00 +0000

If you're the parent of an infant or if you are expecting, finding cheap diapers is probably on the top of your must-save-cash-somehow list. Fortunately, diapers don't have to break the bank. Unfortunately, finding these little pockets of absorbency on the cheap isn't always easy. But if you follow a few basic save-cash-on-diapers rules, you can walk away with a little savings in your pocket. Here's what I found through trial and error with my first daughter.

Go Cloth

Before my daughter was born, I had all sorts of wonderful planet-saving, cash-conserving ideas about using cloth diapers. I was going to use only cloth diapers from the get-go, and suddenly the landfills would be less full and my pocketbook would be bursting at the seams. Obviously, that didn't go as planned, and here's why:

Cloth Needs to be Purchased Early – To get the most bang for your buck, using cloth diapers in the first three months is key because you'll be going through ten to fifteen diapers per day during that three month newborn stage. At about three months, diapering slows to five to ten per day. Math whizzes can instantly see that at 32 cents per wash load for cloth versus 13 cents per diaper with disposables, cloth wins. (For those less gifted in mathematics, like me, see my long math** at the bottom of the page.) After all the calculations are complete, it's easy to see that buying cloth before baby arrives can help you cash in on savings. Tip: using disposables in the first couple days of meconium poo will save you headaches!
Cloth is a Commitment – Realizing that cloth diapering is a lot of work that takes an upfront cash investment and a long term personal investment of time and energy can actually help you stick with it. In my case, I bought two cloth diapers (a total lack of commitment in itself), and I didn't mentally prepare myself for the work involved. So, after I tried it out for a while, it was very easy to decide that my small investment in cloth diapers wasn't worth the hassle. Per my mommy friends' advice, though, purchasing at least two days worth of diapers can increase your personal investment and decrease the chances that you'll throw in the burp rag and quit.

Saving on Disposables

If you know you're not interested in cloth despite the savings, you can still save on disposables in two ways: either buy generic or stack coupons with sales for name brands. I tried out both savings systems, and for my lifestyle and my baby, generic diapers worked best. Why? Well, quite honestly, I don't have the time or inclination to watch sales and match with coupons. For those moms and dads who do enjoy a good hunt, though, many websites geared toward baby savings can help you find the best name brand deals in town. But in my case, grabbing a package of Target's Up and Up brand saves a Buttpaste-load of cash.

So that's my foray into baby diapering costs! If I missed anything or miscalculated, let me know. Otherwise, feel free to chime in with tips on how you save on diaper costs – we love to hear from our MV readers!

**Here's my math for cloth versus disposables: washing cloth costs about 32 cents per hot wash cycle with two cycles minimum needed per diaper load; disposables cost 13 cents per diaper. For the first three months of diapering, cloth costs $73.04 [$0.32 x 2 hot washes x 3 days per week x 12 weeks plus $50 initial cloth purchase (1/4 of $200 total purchase price)]; disposables cost $175.50 (0.13 x 15 per day x 30 days x 3 months). The rest of year one costs $226.80 ($0.32 x 2 hot washes x 3 days per week x 40 weeks plus 3/4 of initial cloth purchase) for cloth and $280.80 (0.13 x 8 per day x 30 days x 9 months) for disposables. As you go through the following months, cloth will continue to cost even less since you'll no longer have to account for the initial purchase price, and if you use the same cloth diapers on subsequent children, the savings will be higher.

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Meet the Shoulda Woulda Coulda’s

MomVesting — Mon, 22 Oct 2012 11:00:00 +0000

Join our guest blogger Mitchell Pauly of SnarkFinance.com for a serious topic with some funny twists: "Meet the Shoulda Woulda Coulda's."

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Meet the Shoulda Woulda Coulda’s: they are a proud, if not slightly delusional, subset of the Do Nothing’s. Although they are perfectly aware that they live in self-righteous irony, they persist in utilizing their favorite word as both a shield and a weapon. This word, of course, is “should.” “Should” is the basis of every cop-out in history; it is both justification and hollow motivation; it is an empty promise. It is to the Shoulda Woulda Coulda’s what God was to the Blues Brothers – a justification for their actions, or more specifically, their inactions.

How We Make Use of “Should”

Of course, we are all members of the Shoulda Woulda Coulda’s depending on which aspect of our lives is being referenced. Psychologically, “should” is a loaded word...it's like your girlfriend saying she had a lot of “fun” in college. It’s a word we use to express our own self-disparagement, as in “I should go to the gym” (because you don’t want to or haven’t been) or “I should learn a second language” (because you recognize the benefit, but are turned off by the commitment). Essentially, “should” is a word inserted into a sentence to express our deeper conflict on a subject, most typically in a negative sense.

“Should” and Psychological Barriers

Psychological barriers are the things that stand in our way when we are trying to get something done. They apply to the mundane tasks that together add up to major and meaningful change. Most people are as familiar with their barriers as they are with cosmology; if everyone was in touch with their barriers two things would be different about our world: 1) psychologists would be out of their jobs, and 2) we would all be rich, successful, in shape and basically Brad Pitt or Angelina Jolie.

There are two types of psychological barriers: active barriers and passive barriers. Together they combine with “should” to create a ménage à trois of behavioral stagnation

Active Barriers – Active barriers are the physical barriers that prevent us from reaching a goal, like plastic wrap on a food item or Steve Buscemi auditioning for the role of “good looking man.” Usually they are easy to get rid of (remove the wrapper); other times they are impossible (sorry, Steve). In general they are not worth thinking too much about; they are either in your control or not, but they are rarely in the middle.
Passive Barriers – Passive barriers do not actually exist, either in an actuality or psychologically. For example, if you are craving a burrito but no burrito-armed restaurant is near you, you'll get a burger; the distance and your reluctance to walk/drive it was a passive barrier. Another example would be a reluctance to wear glass eight-inch heels because they would make you feel self-concious. In both instances, the “barrier” is an inconvenient fact or opinion we didn’t like. We could have driven to the burrito joint, and we could throw societal opinion to the wind and don glass heels. We don’t because we don’t want to, not because we can’t. Typically, passive barriers are the greatest impediment to reaching our goals. “Should” is a catch-all for expressing passive barriers and can act as a guide towards discovering them.

Overcoming Barriers: Create a “Should” Log
Much how your mother had a swear-jar for every time you utilized a four-letter word of color, you as an adult should have a “should” log. A “should log” is a place were you record all the topics on which you used the word “should” in discussion. And it's easy: Every time a new topic is breached, jot it down in a new column. Every time a topic is revisited add a check mark or, if you are super diligent, a quick note on the specific part of the given topic you were speaking to. After a while, take a look at where your “shoulds” typically fall. Don’t get caught up on granularity at first: try to identify general overarching areas. For example, you might find you say “should” often when talking about the gym, taking evening classes and volunteering. A passive barrier for you therefore may be a reluctance to commit to activities that require participation several times a week or activities which will create a schedule. Essentially, you are leveraging your own subconscious’s underlying unease with its own passive barriers.

Passive barriers are not bad per se; it's not being in touch with them that can be harmful to our ability to achieve our goals. After discovering your passive barriers, you may decide the goals they are inhibiting you from achieving aren’t really realistic. By scaling down on your goals you may better align your happiness to your hopes. Of course, you may recognize that you’re a full fledged member of the Shoulda Woulda Coulda’s, which is like being a member of Lambda Lambda Lambda without the revenge. You may recognize that that is a membership you want to revoke...and should.

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Bio:
Mitchell Pauly is a Financial Professional with experience working for Fortune 500 companies and small businesses. He enjoys investing and personal finance, comedy and sports. In his spare time he writes for various publications about personal finance, with a mind towards young adults and parents of young adults. Check out the premier of Mitch's new website, SnarkFinance.com.

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