Search Results for “ignore-your-budget/573/Clearing Up Social Debt in 3 Steps”

Book Review: Social Nation

I recently had an opportunity to read Social Nation: How to harness the power of Social Media to attract customers, motivate employees & grow your business by Barry Libert. Heckuva title.

Libert is the the CEO at Mzinga, which is a company that connects other companies–and their customers–using social media to collaborate and communicate. Social media is, quite simply, using the internet to drive interactive communication. This includes Twitter, Facebook, and forums. Sometimes, it’s just discussion, sometimes, it’s sharing user-generated content.

Social Nation “will show you, as an employee, customer or partner, how to use new social technologies, make yourself heard, and produce better products and services.” It bills itself as a “complete toolbox” for social media. Does it match the hype? Let’s see.

The book is broken into three sections.

Part 1: The Future of Business is Social

Libert asserts that the future of business is social. That is obviously true, to a degree. A solid viral marketing campaign can drive more eyeball to a product than a full-page spread in the New York Time or a 30-second spot during Super Bowl halftime. However, there are a lot–possibly a majority–of business-to-business companies that will gain no value from a social media campaign. Would a regional supplier with an exclusive distributorship for a top-name line of faucets benefit from being on Twitter? No. On the other hand, 17% of our time online is spent on social applications and the fastest growing demographic on Facebook is 35 years old or older. There is certainly some value to be gained by have a social media presence in some markets.

This section(all of chapter 3!) also contains a link to a test to determine your social media skills. I haven’t taken the test, mainly because I don’t feel like registering for another site. This struck me as nothing more than lead generation, which is a shame. It could be a useful tool.

Part 2: Seven Principles for Building Your Social Nation

This section has seven chapters, containing 7 case studies that detail the 7 principle of social media, as defined by Libert and Mzinga.

The principles include:

Let the culture lead the way, as demonstrated by Zappos.com.
Involve your fans. The big takeaway from chapter 8 is that, when you create a community, your job is to facilitate involvement, not to control it. If you try to run it with an iron fist, it will choke and die.
Reward others and you will be rewarded. Apple lets developers keep 70% of the money they make in the app store. That encourages developers to develop, making everyone more money. Give. Karma will take care of the rest.
There are 4 other principles, but some are just common sense, and I don’t want to give away the contents of the book.

Part 3: Start Today and Create Your Own Social Nation

aka

Chapter 11: How to Get Started and 10 Pitfalls to Avoid

Section 3 has just one chapter, but it’s a good one. It explains the difference between followers and fans, the value of each and how to bond with each. The difference? Fans are actively involved. Followers are far more passive.

This section/chapter also goes into some things to avoid, like abandoning a social media strategy too early, failing to market your business, underestimating the power(positive and negative) of a social network.

Is it worth getting the book?

Social Nation bills itself as a complete social media toolbox, but it falls a bit short. The book tackles social media from a purely strategic point of view, ignoring the tactical concerns. It’s clearly geared toward helping a company plan its social media strategy from a 10,000 foot perch. For the people in the trenches, or anyone with a grasp of strategy that’s looking for the details on running a social media campaign, it’s not enough. That said, if you are trying to plan a social media strategy, or you have no idea where to start, this is a great book for you. It holds a lot of value, but stops some distance before “complete”. Definitely worth a read if you are involved is social media planning.

Giveaway

I’m giving away Social Nation. If you’d like to have a chance to get it, just leave a comment, telling me how you like to see companies use social media. Fair warning, this is the book I read, so it’s “used”. I take care of books, so you can’t tell that it’s used.

Publishers, Publicists, and Authors

If you have a book you’d like me to review, please contact me.

Clearing Up Social Debt in 3 Steps

Finance

Debt can be thought of as a disease–probably social. Most of the time, it was acquired through poor decision making, possibly while competing with your friends, occasionally after having a few too many, often as an ego boost. Unfortunately, you can’t make it go away with a simple shot of penicillin. It takes work, commitment and dedication. Here are three steps to treating this particular affliction.

1. Burn it, bash it, torch it, toss it, disinfect. Get rid of the things that enable you to accumulate debt. If you keep using debt as debt, you will never have it all paid off. That’s like only taking 3 days of a 10 day antibiotic. Do you really want that itchy rash bloodsucking debt rearing its ugly head when you’ve got an important destination for your money? Take steps to protect yourself. Wrap that debt up and keep it away.

2. Quit buying stuff. Chances are, you have enough stuff. Do you really need that Tusken Raider bobble-head or the brushed titanium spork? They may make you feel better in the short term, but after breakfast, what have you gained? A fleeting memory, a bit of cleanup, and an odd ache that you can’t quite explain to your friends. Only buy the stuff you need, and make it things you will keep forever. If you do need to indulge, hold off for 30 days to see if it’s really worthwhile. If it’s really worth having, you can scratch that itch in a month with far fewer regrets.

3. Spend less. This is the obvious one. The simple one. The one that makes breaking a heroin addiction look like a cake-walk(My apologies to recovering heroin addicts. If you’re to the point that personal finance is important to you, you’ve come a long way. Congratulations!). Cut your bills, increase your income. Do whatever it takes to lower your bottom line and raise your top line. Call your utilities. If they are going to take your money, make them work for it. If they can’t buy you drinks or lower your payments, get them out of your life. There’s almost always an alternative. Don’t be afraid to banish your toxic payments. Eliminate your debt payments. This page has a useful guide to debt and how to clear it off.

Update: This post has been included in the Festival of Frugality.

Ignore Your Budget

Finance

For the first year of our journey out of debt, we had a strict budget, with all of our discretionary money spent out of an envelope system. We had an envelope for groceries, one for discretionary spending, one for clothes and one for baby crap. At the beginning of the month, we’d divide the money into the envelopes according to our budget spreadsheet. If we used a card for anything, we’d take a matching about of money out of the appropriate envelope and put it in a box to get reconciled the next month.

Ugh. Almost 2 years later, it has turned into too much work and too much nagging about everything either of us put on a card.

We decided to simplify the system a few months ago. Now, we still have a budget. It’s even a zero-based budget, but we ignore it. We only look at it if something changes for the worse. If something changes for the better, the extra money just gets automatically rolled into our debt snowball, so there’s no need to worry about updating the spreadsheet.

Instead of envelopes, we kind of eyeball it. We budget $450 per month for groceries, so we aim to spend $100 on our weekly grocery run. That leaves some room for losing track of how much we are putting in the cart, or a last minute addition to the list. It also leaves room for our secondary grocery trip to buy bread and milk later in the week. We do go through a lot of milk at my house. We budget $55 per month for diapers, but the deal we are currently getting with Amazon Mom is only costing us $30.79 for 6 weeks of diapers. We ignore the difference.

This—and our heavily automated bill pay and savings—lets us keep our finances on track, without stressing over every dollar or fighting over every little thing that comes home unplanned. I used to fire up Quicken and balance the checkbook every week. Now, that happens at the beginning of the month, usually. If I forget, it doesn’t matter. At the beginning of February, I balanced the checkbook for the first time in almost two months and we never came close to exercising our overdraft protection account. In fact, we had some extra, so that got sent directly to our debt.

Overall, it’s been good to test out a new system. We have almost no financial stress and managing our money takes about a couple of hours per month instead of per week. It’s all win.

3 Reasons You Hate Your Budget

Finance

: Image via Wikipedia

One of the first steps in clearing up your financial mess is to set up a budget. You need to figure out how much money you are making, how much you are spending, and what you can do to keep one of those numbers smaller than the other. If your income is smaller than your expenses, you’ve got work to do. If not, yay!

Even if you don’t obsessively cling to your spreadsheets and calculator, you need to spend the time to establish a budget–at least once–to know where you stand. When you do, you’ll find out it sucks. With good reason.

1. It takes too long to set up. Setting up a budget can be a long, drawn-out pain in the butt. Fortunately, it doesn’t have to be, but you won’t know that until after you make your first budget, then see some fairly drastic changes, and make a second budget. That one will be easier. For the first one, just concentrate on making a list of all of you regular bills and how often they are due. Don’t be surprised when you miss some. I missed a couple of our quarterly bills. All told, it took a year to get our budget completely done.

2. It doesn’t lie. Once you have all of your expenses down on paper, you are done hiding. You can’t tell yourself it’s all puppy dogs and ice cream when you are staring at the giant red pit that is the negative balance of your bad decisions. Nobody likes the messenger who brings bad news. When your budget shows you how big the hole is, you are going to hate it. That’s when it’s time to confront the problem head on and get out of the hole. Find the problems and rip ’em out. Cancel the cable, taxidermize the cats, and start buying generic underpants. It’s time to take an honest look at your situation. If you can’t handle where you are, how are you going to get where you want to be?

3. It’s not fun. When your friends go out, but you stay home because you’re broke, you will hate it. Y’ou’re also gonna hate comparing your old cell phone to the iPhone in the hands of the d-bag contemplating bankruptcy. Like Dave Ramsey says, “Live like no one else, so that later you can live like no one else.” Skipping some of the fun now will turn into security later. When you get to that point, it will have all been worth it.

Why do you hate your budget?

Money Problems – Day 7: Paying Off Debt

Finance

Today, I am continuing the series, Money Problems: 30 Days to Perfect Finances. The series will consist of 30 things you can do in one setting to perfect your finances. It’s not a system to magically make your debt disappear. Instead, it is a path to understanding where you are, where you want to be, and–most importantly–how to bridge the gap.

I’m not running the series in 30 consecutive days. That’s not my schedule. Also, I think that talking about the same thing for 30 days straight will bore both of us. Instead, it will run roughly once a week. To make sure you don’t miss a post, please take a moment to subscribe, either by email or rss.

On this, Day 7, we’re going to talk about paying off debt.

Until you pay off your debts, you are living with an anchor around your neck, keeping you from doing the things you love. Take a look at the amount you are paying to your debt-holders each month. How could you better use that money, now? A vacation, private school for your kids, a reliable car?

If you’ve got a ton of debt, the real cost is in missed opportunities. For example, with my son’s vision therapy being poorly covered by our insurance plan, we are planning a much smaller vacation this summer–a “staycation”–instead of a trip to the Black Hills. If we didn’t have a debt payment to worry about, we’d have a much larger savings and would have been able to absorb the cost without canceling other plans. The way it is, our poor planning and reliance on debt over the last 10 years have cost us the opportunity to go somewhere new.

The only way to regain the ability to take advantage of future opportunities is to get out of debt, which tends to be an intimidating thought. When we started on our journey out of debt, we were buried 6 figures deep, with a credit card balance that matched our mortgage. It looked like an impossible obstacle, but we’ve been making it happen. The secret is to make a plan and stick with it. Pick some kind of plan, and follow it until you are done. Don’t give up and don’t get discouraged.

What kind of plan should you pick? That’s a personal choice. What motivates you? Do you want to see quick progress or do you like seeing the effects of efficient, long-term planning? These are the most common options:

Debt Snowball

Popularized by Dave Ramsey, this is the plan with the greatest emotional effect. It’s bad math, but that doesn’t matter, if the people using it are motivated to keep at it long enough to get out of debt.

To prepare your debt snowball, take all of your debts–no matter how small–and arrange them in order of balance. Ignore the interest rate. You’re going to pay the minimum payment on each of your debts, except for the smallest balance. That one will get every spare cent you can throw at it. When the smallest debt is paid off, that payment and every spare cent you were throwing at it(your “snowball”) will go to the next smallest debt. As the smallest debts are paid off, your snowball will grow and each subsequent debt will be paid off faster that you will initially think possible. You will build up a momentum that will shrink your debts quickly.

This is the plan I am using.

Debt Avalanche

A debt avalanche is the most efficient repayment plan. It is the plan that will, in the long-term, involve paying the least amount of interest. It’s a good thing. The downside is that it may not come with the “easy wins” that you get with the debt snowball. It is the best math; you’ll get out of debt fastest using this plan, but it’s not the most emotionally motivating.

To set this one up, you’ll take all of your bills–again–and line them up, but this time, you’ll do it strictly by interest rate. You’re going to make every minimum payment, then you’ll focus on paying the bill with the highest interest rate, first, with every available penny.

DOLP

This is the plan promoted by David Bach. It stands for Done On Last Payment. With this plan, you’ll pay the minimum payment on each debt, except for bill that is scheduled to be paid off first. You calculate this by dividing the balance of each debt by the minimum payment. This gives you an estimate of the number of months it will take to pay off each debt.

This system is less efficient than the debt avalanche–by strict math–but is better than the snowball. It give you “quick wins” faster than the snowball, but will cost a bit more than the avalanche. It’s a compromise between the two, blending the emotional satisfaction of the snowball with the better math of the avalanche.

Snowflaking

For each of these plans, you can give them a little steroid injection by snowflaking. Snowflaking is the art of making some extra cash, and throwing it straight at your debt. If you hold a yard sale, use the proceeds to make an extra debt payment. Sell some movies at the pawn shop? Make an extra car payment. Every little payment you make means fewer dollars wasted on interest.

Paying interest means you are paying for everything you buy…again. Do whatever it takes to make debt go away, and you will find yourself able to take advantage of more opportunities and spend more time doing the things you want to do. Life will be less stressful and rainbows will follow you through your day. Unicorns will guard your home and leprechauns will chase away evil-doers. The sun will always shine and stoplights will never show red. Getting out of debt is powerful stuff.

Your task today is to pick a debt plan, and get on it. Whichever plan works best for you is the right one. Organize your bills, pick one to focus on, and go to it.

Assuming you are in debt, how are you paying it off?

5 Steps to Save

Finance

: Image by BitHead via Flickr

“Saving is too hard.”

“I don’t know where to start.”

“How much should I save?”

“Who the heck are you to tell me what to do with my money?”

“Shut up, Jason.”

These are the things I hear when I start talking about getting a good strategy in place to save some money. Financial matters are intimidating to a lot of people. They’d rather not think about their money any more than they absolutely need to, if that much. Here, I’m breaking it down to some simple steps to make saving easy.

1. Get motivated. Why do you want to save some money? Are you trying to make a secure future, or do you just want to buy a new toy? These are the kind of questions you have to ask yourself. Nobody else can tell you why you want to make changes to your lifestyle, and nobody else’s reasons matter in the least. Saving money is something you have to do for you.

2. Figure out how much you can save. Generally, you’re going to need a budget so you can figure out what you can afford to save, but not always. If you are making ends meet, then you get a raise, you can obviously afford to bank the difference. If you do that, you’ll never even notice the missing money. If you try to save so much your mortgage goes unpaid, you’re plan is doomed to failure.

3. Open an account at a new bank. The biggest problem I used to have when I was trying to save was that it was too easy to get the money. Every time I checked the balance of my checking account, I saw the balance in the savings account. Worse, it took seconds to transfer that money from my savings account to my attached checking account. Every time I wanted to see if I could afford whatever toy I was looking at, I’d see money that wasn’t earmarked for anything in particular. Naturally, that money got spent more often that it was ignored and allowed to grow. Now, I can completely forget about the money.

4. Automate. I’ve automated everything I can. All of my bills are paid automatically, except for one company that insists on quarterly paper invoices. I’ve got $665(neighbor of the beast!) automatically transferred to my INGDirect account, to get divided between my various savings goals, including a fund for my semi-annual property tax payments and a fund to pay for the braces we haven’t actually had to buy yet, but will in a couple of years. The money disappears into a bank I don’t use for my day-to-day expenses and grows completely out of sight. Every once in a while, I look at the account and get surprised by how much has accumulated.

5. Get rich. Once you’ve got the other four steps in place, all you’ve got to do is let it work. Over time, you will build wealth in a way that may surprise you. Your goal at this point is to do nothing new. Every once in a while, you can pull out some money and tuck it into an investment account to get some real growth going for you.

“Thank you.”

“You’re the best.”

“What would I do without you?”

“How can I show you my appreciation? <wink><wink>”

“What the heck are you doing with my wife?”

These are the things I always hope to hear after sharing my strategies to save money.

Search Results for: ignore-your-budget/573/Clearing Up Social Debt in 3 Steps

Part 1: The Future of Business is Social

Part 2: Seven Principles for Building Your Social Nation

Part 3: Start Today and Create Your Own Social Nation

Chapter 11: How to Get Started and 10 Pitfalls to Avoid

Is it worth getting the book?

Giveaway

Publishers, Publicists, and Authors

Debt Snowball

Debt Avalanche

DOLP

Snowflaking