Posted on 26. Nov, 2013 by Money Cactus.
There comes a time in every parents life when they reach a cross-roads in their decision making abilities.
Private or public schooling?
What appears to be a relatively trivial choice from the distance and warm glow of your child’s birth, becomes a very distressing and real life dilemma (albeit a first world one) in far less time than you first thought possible.
The great debate
As someone who tends to watch their money reasonably closely, my initial reaction to the whole debate is to dismiss private schooling and opt for the public option, firm in my willingness to provide active support and assistance in my children’s education.
Unfortunately things aren’t so cut and dry. While the idea of effectively paying for a brand new car every 1-2 years doesn’t sit too well with me, there are far more considerations to take into account than just the financial ones.
Public schooling has a lot going for it these days and may are even becoming quite elite in their own right, but private schools still hold a certain amount of sway when it comes to educational opportunities, social preparedness and extracurricular activities. My wife and I are both very keen to see our children have the best education we can provide for them, so this decision has been quite a difficult one.
Although some suggest that private schooling is effective at all levels and particularly so during the early development years, we are leaning towards a public primary school followed by a private secondary school for both of our children.
Hopefully this choice proves to be a good. While we will be doing everything we can on the home front to ensure we support our kids, only time will tell. In any case, we like to think that being actively involved will be worth far more to the development of knowledge and good habits than working longer hours to fund the required cost.
Funding an education
While it’s nice to have the decision made and a plan in place, we know that we need to be mindful of the illusion of breathing space that our decision has created. Secondary education will roll around in a short amount of time, so we need to get to work on establishing an education fund for both of our girls.
After finally settling on a decision and a plan of attack, I thought that we had our long range planning under control, but as with most well laid plans our foresight got the better of us.
Although it is still early days, my wife and I both feel that we would like to encourage our children to attend university. Given the importance we have placed on education, it is a logical progression. Of course this means further tuition costs, which we need to build into the education fund.
I’m in the process of investigating education savings plans and although I live in Australia, I’ve been quite interested in reading about the US 529 saving plans and similar options like the RESP grant in Canada. Things are a little different for us here, but there are a few different strategies I could use to leverage regular savings and grow this over the next 8-10 years (before it starts to get used!).
A little help?
As you may have guessed, my wife and I have very little to base our judgement on (we both attended public schools), so any additional thoughts and comments are welcome, particularly if you have experienced a similar situation yourself.
Please feel free to add a comment below and weigh in on the debate!
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Posted on 08. Nov, 2013 by Money Cactus.
Starting a new business is both incredibly daunting and exciting all at the same time. Finding customers, developing and refining your products and services and working out how to further spread the word are amongst some of the most pressing issues to concern yourself with.
When the money finally rolls in, you give a huge sigh of relief and then prepare yourself to rinse and repeat. But before you get carried away with the next customer or project, it is worth giving some thought to how you handle the much sort after funds you have finally received.
Business banking isn’t often at the top of most to do lists, but having an organised system for you business finances can make your business transactions a whole lot easier and significantly decrease your financial risk at the same time.
Many new businesses process a great deal of their transactions online these days, which makes receiving money very easy. The only trouble with this is that the funds received may not necessarily end up in the right place.
Paypal might make things simple and leaving funds in your account makes your own payments easy for you to process in return, but there is a big risk involved in leaving large sums sitting in your account. The possibility of someone hacking your Paypal account is very real, but even more importantly Paypal is not a bank which means you will miss out on your money making you money.
This is also true for an everyday business accounts offered by your bank. Having payments made to a working account keeps this easy to follow from an accounting perspective, but leaving all of your funds in the one account isn’t the best use of the asset.
No matter the size of your business the importance of business saving accounts should not be underestimated. It is important to realise that your unspent business capital can be safely used to make you money in the background, while your business continues to tick away and be foremost in your mind.
Putting aside a small amount of time to calculate the sum of working capital you require to run your business is a very worthwhile exercise. Not only does it help you better understand the amount of cash flow you require to operate, it also means you can confidently make decisions about moving money from within your business into a separate high interest savings account.
Your business accounts should be no difference to your personal accounts, so setting up separate accounts to manage your money is never a waste of time.
Everyone loves it when their money makes them money, is yours working for you?
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Posted on 07. Nov, 2013 by Money Cactus.
In case you’ve forgotten, the Facebook IPO in 2012 was a big mess. The company’s $100 billion valuation and $38 per share were disastrously off the mark, and the overhyped, overvalued launch was further muddled by computer glitches that resulted in $10 million fines against NASDAQ. The Facebook stock price has since recovered with flourish, but not before dispensing a lot of headaches among private investors and the financial world at large. So that brings us to the highly anticipated Twitter IPO of 2013.
Twitter is the best known Silicon Valley company to go public since Facebook, though the early valuation estimates of 13.6 billion were modest in comparison to Facebook’s $100 billion. Helping Twitter’s IPO prospects are positive buzz and the overall state of the marketplace. 2013 has been the best year for IPOs in the U.S since 2007, and equity markets are continuing to climb as fears subside regarding the U.S. debt ceiling crisis. Furthermore, the mutual fund market, along with speciality segments like exchange-traded funds (ETFs), are heating up alongside optimistic stock index futures.
As for the buzz — based on red-hot demand by institutional investors, Twitter raised the top end of its IPO price by 25% to $23 to $25 per share on Monday November 4. Despite the late increase, which flirted with repeating the Facebook debacle, investors remained optimistic enough that Twitter was able to close shop on its first 70 million shares a day earlier than the Day 1 opening bell at the New York Stock Exchange.
But in the strange world of the stock market, optimism doesn’t always reflect figures and data. For example, in 2012, Twitter reported a net loss of $79.4 million on revenue of just $316.9 million in 2012. Analysts argue that the strong demand and rosy outlook on Twitter is justified based on other key factors. For one thing, any company with a social marketing strategy is probably going to leverage – and invest in – Twitter in some fashion or another. Furthermore,recent data shows Twitter activity, such as ratings and recommendation, driving increased viewership for broadcast TV. Once big advertising dollars start boosting the Twitter revenue stream, the optimism around Twitter’s stock value will start looking relatively conservative.
Let the great social network IPO race begin!
Image by Rosaura Ochoa
Posted on 25. Oct, 2013 by Money Cactus.
No matter how high up the ladder of banking jobs your current role happens to fall, it’s always a good idea to lend an ear to what others in your field have to say. Be they nuggets of wisdom that will help you climb to the top or someone else’s opinion you might not agree with, the insights of others often leads us to having our own “aha” moments. We spoke to several current and retired banking professionals to get some of their tips on how to do your best in the field.
1. Put it into numbers
“Numbers count when relaying your contributions to your boss, co-workers and clients,” says Tonya Tiggett, chief success strategist at Speak Our Language. Prior to founding this communications consulting company, Tiggett spent 13 years at JP Morgan Chase, where her role in learning and development enabled her to help hundreds of bankers with career strategy.
“This sounds like an obvious statement for people working in an industry driven by numbers, and yet most people leave out statistical or quantitative information when tooting their own horn or that of their own team. Distilling your efforts numerically or quantitatively gives your message the punch and wow factor you need in order to be considered as a key contributor and as someone worthy of a bonus or promotion,” she explains.
“How much revenue have you contributed to the bottom line? How much time or money have you saved others? What percentage improvement was realised on a project or training as a result of your efforts?” Tiggett suggests asking yourself these questions to help quantify your achievements.
2. Brag a little
Finding banking jobs is no easy feat in this day and age. One way you might be able to stay in the game and succeed further is by not exactly bragging, but keeping others up to date on your success.
Tiggett puts it like this: “Sharing successes solidifies your reputation as a key contributor, and strategically equips your boss with specific and multiple examples to consider when weighing stretch assignments, a raise, [a] bonus or your promotion. It also arms him or her with critical information in conversations with upper management, and the bonus is — it makes you look good and your boss looks good for hiring you!”
3. Make your annual review easy on your boss
Terry L. Wynne, Ed.S., is a licensed professional counselor and board-certified coach who specialises in career counseling. She also has a decade of banking experience to her credit. Wynne suggests providing your supervisor with a list of your yearly accomplishments at least a month before your annual review.
“Be sure to include any presentations and travel for the company,” she says before going on to echo Tiggett’s advice to put your achievements into numbers. “Quantify your accomplishments. For example, instead of ‘Answered customer service calls,’ list, ‘Answered as many as 25 incoming calls a day and directed them to the proper employee.’ Also give the results of your accomplishments such as ‘Gave presentation to management recommending how to improve customer service. Management implemented recommendations resulting in 25% improvement in efficiency as measured by weekly productivity reports.’”
Wynne, today the owner of Atlanta-based career coaching and professional services company The Professional Edge, notes that even if your review is unfavourable, providing a list can win you points. “If you don’t receive as good a review as you expect, you have a solid basis for discussion. However, your professional list is much more likely to show your manager that you are a proactive employee who keeps accurate records and hopefully will earn you a good review and a well-deserved raise,” she says.
4. Join a professional organisation
The bit of advice that seems to come up regardless of whether you’re looking for banking jobs or any others is that you can never do enough networking. Tiggett gives the following anecdote to illustrate just how helpful it can be.
“A banking analyst, Mónica, spent years trying to get out of her dead-end job. She joined an internal employee resource group (ERG) as a board member where she met [a] fellow board member who ended up offering her a job in a different line of business, at a higher pay grade, and with a significant salary bump. This job offer came only within months of seeing that Mónica’s skills and work ethic on ERG projects would transfer to her colleague’s team’s open position. Being actively involved in the internal or external community will bring such opportunity,” she says.
5. Be nice to your customers
This comes from retired banker Mike Arman, who spent three decades in and around banking jobs and the banking business. He reminds us all that what we do can come back to us, for good or for ill.
“Be accessible to your customers and BE NICE TO THEM. You don’t know which acorn will grow into a mighty oak (and become a very profitable customer), and you don’t know which minor account holder (who you once deliberately and publicly snubbed) may become a state or federal prosecutor. Either way, your customers will remember you, and you’ll be far better off if their memories are favourable,” he advises.
Image by Jonathan_W (@whatie)
Posted on 10. Oct, 2013 by Money Cactus.
Most currency exchange companies do it – they proudly advertise ‘ we offer 0% commission on currency’ in their store windows, online and in their marketing material. But what does 0% commission really mean when you exchange currency for another currency?
Not such a great deal after all
It sounds like such a great deal doesn’t it? You exchange your currency at the airport, your local bank or with your travel agent and they don’t even charge you for the service. You feel smug and like you just got really good service and a deal you could not have got elsewhere.
But wait. Was that really a 0% commission service you just received? Think about it this way. Would a business looking to make a profit really offer one of its main services or its primary service for nothing? Or would they find another ingenious way to charge you for the privilege of exchanging your money? Unfortunately, it is the latter, but many people do not realize this when they use a foreign currency exchange service.
Why 0% commission isn’t always as it seems
Before you go on holiday think about your currency well in advance and when shopping around for currency, don’t be swayed by 0% commission rates. Look instead at the exchange rates being offered. The devil is in the detail here and it pays to shop around. What many currency exchange companies do is advertise 0% commission but give you a very poor exchange rate. The bad travel money deal is concealed within the rate. Always remember the golden rule: the true cost of a travel money purchase is the difference between ‘’the real rate’’ and ‘’the tourist exchange rate.’’
Ditch the airport bureau
Banks, airport exchange services and many other currency exchange companies used by the public, use this tactic. The best way to avoid paying more for your currency than you need to is to buy your travel money online. Comparison sites like MyTravelMoney will scan the web for you to find the best currency exchange deals. You have the ability to compare live rates and book currency for 24 hour next day home delivery.
Always read between the lines when it comes to personal finance
Few things in life are completely free especially when it comes to personal finance and currency exchange is one of them. Unfortunately, currency is the last great ripoff in finance and one of the only times where you never obviously know the true cost of transaction. If you really want to make your money stretch further whilst abroad, it pays to be a savvy exchanger and to shop around. Whether you need to exchange currency for a holiday abroad or looking for a cheap money transfer deal, don’t settle for the first deal you stumble across.
Image by Jeff_Werner