Big 3 Automakers Need Lesson in Frugality

With AIG already swimming in billions of taxpayer dollars, the big 3 American automakers showed up with their hands out to Congress wanting a mere $25B. When I say showed up, I really mean that they flew in in private jets from a fleet of several. According to Good Morning America, the cost for them to fly in from Detroit to DC in $36 million planes was an estimated $20,000 roundtrip as opposed to Northwest Airlines $288 for coach and $837 first-class.

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How to Survive Christmas on a Budget

Many people have already started the dreaded annual event – Christmas Shopping! No other two words appearing together strike more fear in our bank accounts than those. ‘Tis the season to overspend, then regret it all year. But, take heart! There is help!

Since the government is finally admitting that we are in a recession, something that millions of Americans already new, it is time to be smart with our Christmas spending. Here is some sound advice.

• Make a budget and spend within it.  Figure out how much you can spend on Christmas without letting vital bills go past due.  Make a list of those on your Christmas list and prioritize those you want to spend more on, i.e. children.
• Leave the credit cards at home.  Credit card companies are raising rates for no reason at all.  Even if you have a perfect payment history with them, you may find your rates doubling or tripling.  This can make differences in payments from tens to hundreds of dollars a month.  So, the less you can put on a credit card, the better off you will be.
• Be smart with electronics.  Instead of buying new, consider purchasing factory refurbished products.  They often have the same warranty as new, but can save you sometimes as much as 50%, but usually around 20-25%.  For example, Dell* has an outlet (see links at the bottom of this article) that sells computers that have been ordered and canceled, or returned for some reason.  They are checked out before they are shipped.  We bought our son a refurbished X-Box* last Christmas and it has not had a problem.  We could not have purchased it new, so this was a good compromise.
• Consider home-made gifts.  Bake some cookies, make some candy, knit a sweater.  Most of us have a talent we can use for someone.  Use your computer to create some ‘coupons’ good for yardwork or housework and give to mom and dad or grandma and grandpa.  They will love it.

Christmas is about giving, but it does not need to be about expensive gifts.  Giving yourself can go a long way.

* I am not endorsing any products in this article.  Dell outlet is at www.dell.com/outlet

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Online Business Ideas – Drop Shipping

If you are like a lot of people in today’s economy, you are looking for ways to make extra money and are looking at the internet to help you with that. You know there’s got to be ways to make money because others are doing it, but you don’t know where to start.

Research shows that more people are turning to the internet for product research, product and store comparisons, and purchasing the item they want. Even though, for now at least, fuel prices are coming down, people still tend to use the convenience of the internet for their shopping.

Opening a store, even an online store, typically requires inventory, but most of us don’t have the capital to put up a large inventory. Face it, the reason we are wanting to open a store is to make some money. To help people in this position, companies are offering drop shipping services to entrepreneurs.

Basically, it works like this. You create your on-line store showing the products you want to sell. You can either create your own website and domain name, or for a small fee, the supplier will usually offer this service for you. You will have a professional-looking website for a nominal price. Your customer purchases from you and your order the product from your supplier to be shipped directly to your customer. It costs a little to get started, but nothing like purchasing and holding inventory.

As your store profits more, you can make the decision to stock your big sellers for faster turnaround. You can also open a kiosk at the mall with your inventory, or sell in flea markets.

For information on drop ship selling, please see the Home Online Business Guide.

Credit Crisis Has a Silver Lining

The current credit crisis has hurt most people in America. From small businesses who rely on ready credit to finance their inventory until it is sold, to individuals watching credit card companies jack up their interest rates for no good reason, most of us are feeling betrayed.

We Americans have gotten into the habit of living beyond our means. We got used to easy credit. You can’t afford it? No problem, just put it on your credit card at only 9% interest. Whoops, we posted your payment a day late, so NOW, you are subject to the default rate of 29%. Want a $300,000 house, but bring in only $50,000 per year? No problem, we have a mortgage just for you.

Then *POP*. There went that bubble. So, where’s that silver lining?

We have a way to go, but those of us caught up in that bubble burst are having to re-prioritize our expenses and find ways to pay off our current debt without taking on any more. Here’s the silver lining part. Once we re-align our finances and work our way back to solvency, which admittedly can take several years, we will be in a much better financial position. We will also have the lessons learned from these years to take into our later years. We will be more wary of credit and use it more wisely. We will be able to spot questionable mortgages and steer towards the more conventional fixed-rate loans that have been proven to ride out the hard times.

We have to work hard to pay down, or pay off the debt we have now to bring our debt ratio down to something much more manageable, but we can do it. We may have to trade that Hawaiian vacation for something closer to home, put off buying that new car for a couple more years, or waiting to pay cash instead of dropping more onto the credit cards, but the payoff will be worth it.

Our silver lining is that once we survive and fight our way back, we will be all the much stronger financially.

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New President – New Economy?

Apparently, Americans were ready for a change.  A new president, Barack Obama, will be sworn in January.  It’s no surprise that the economy was one of the factors driving this election.  President Bush is being blamed, rightly or wrongly, for the current economic crisis and people were afraid of 4 more years of the same thing.  McCain could not shake the Bush Stigma that seemed to be attached to him.

However, if you are expecting a magic bullet to shatter the economic woes of this country, I think you may be heading for  disappointment.  It took time for this country to get into this mess, and it will take some time for us to get out of it.  People are quick to blame a new president for his predecessor’s actions, or to praise when he is actually riding the successes put in motion by the previous guy.

Whoever you voted for, Obama is to be our new president and he needs our support as a nation.  We need to give him time to turn things around.  We need to realize that things may very well get worse before they get better and it may not be Obama’s fault.  I am more conservative than Obama, and I woud be saying the same thing if McCain had won.  I believe that any new president is going to have a tough row to hoe for the next few years.

For better or worse, Barack Obama is the new leader of our great nation.  Let’s give him a chance.

Make Money the Easy Way – 5 Easy Tips to Put More Money in Your Pocket

How would you like an extra paycheck every month without working? In these tough economic times, we seem to be faced with more choices every day. Choices of basic survival, not just which movie to see, or which restaurant to eat at, but choices of whether to put gas in the car so we can go to work, or put groceries in the house to feed our families. Most of us are wondering how to make extra money to help make ends meet. I have put together 5 tips to show you how to make money the easy way.

Tip #1: Take an inventory. Make a list of products and services you are paying monthly fees for, then identify those you can do without either permanently or temporarily. If you have a cell phone and a land-line phone, consider cancelling one of them. Take a look at your cell phone bill — do you really need that data package? If you have cable or satellite, consider changing to the lowest-priced package, or cancelling altogether and using an antenna. I can save about $200/month by cancelling non-essential subscriptions.

Tip #2: Eat at home. My wife and I can easily spend about $180/week or about $720/month by eating out every night. By eating at home, we cut that down to about $70-$100/week or about $400/month — over $300/month in savings. It is much healthier, too.  Of course, it gets a bit boring eating at home all the time, but we try to eat out no more than twice a week.

Tip #3: Manage your environment: Our house is empty from about 7:30am until about 4:30pm. That is 9 hours each day, or 45 hours each week, that our house is unoccupied by anyone (but our 2 great danes). That is about 27% of the time our house does not need to be comfortable for humans. Invest in a programmable thermostat to manage your heating and cooling. This will allow you to set the temperature back 3-5 degrees when the house is unoccupied. This device has saved me about 20% in my heating and cooling bills.

Tip #4: Choose your transportation: Sometimes, there is no other option but to drive a car or truck. But, when there is, take advantage of it. When the weather is nice and the destination close by, walk. Not only is this free, but healthy. Another free and healthy mode is to dig that bicycle out of the garage and use pedal power. For longer trips, public transportation, if available, is less expensive than gasoline. If you have a motorcycle or scooter, then those are a good choice, too. Beware of the temptation to purchase a vehicle with better fuel economy as you can easily spend more money in payments and insurance than you would have spent in gasoline alone.

Tip #5: Choose your fuel: Use the lowest octane fuel available when you fuel up. Most cars are designed to run with 87 octane and do not need the more expensive premium fuels. If you have a flex-fuel vehicle that runs on ethanol, you will usually find this fuel about 30 cents cheaper/gallon than 100% gasoline. However, if economy is your goal, I have found that burning ethanol costs me about 1.5 cents per mile more than gasoline. This is because ethanol has less energy than gasoline. If environment is more important to you, then ethanol is your choice.

Of course, there are many more ways to economize in these times, but these are very simple methods that most of us can live with. When the economy bounces back, and it will, we can always add these luxuries back into our lives. I have shown you ways I saved $800-$1000/month, which is equivalent to an extra paycheck.

This article was written by Chris Corrigan and is used here with permission.

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