“When you ain’t got nuthin’, you got nuthin’ to lose.” ` Bob Dylan

At least, that’s what I think he said.

The Great Recession has proven that almost everyone has something to lose, even if that something is as personal as self confidence. It’s easy to sit back and opine about the heady days of 2007, when credit was generous and houses never went down in value, when unemployment was just north of four percent and taxes were low. And while some tout the last three months as the “Summer of Recovery,” our unemployed neighbors who are losing their homes would beg to differ. So would those who’s retirement portfolios have dropped over 40 percent. So would those of us re-examining our household budget.

Given that hindsight is always 20/20, we can look back and see where bubbles were and venture guesses why they grew in the first place. We can also look back and advise others about what to do and what not to do in a recession. The truth be told, the following 10 items should probably be avoided even in the best of times, but certainly in a downturn like we’re currently experiencing.

10 Things You Should Never Do In A Recession

1. DON’T take your job for granted

With real unemployment hovering above 16 percent (that’s one in SIX people), having a job right now is a blessing – even if you don’t particularly care for it. If your job is putting food on the table, allowing your to keep up with your mortgage and other financial obligations, be thankful and give it your all. Hundreds of thousands of unemployed folks would love to trade places with you.

2. DON’T take on additional consumer debt

In a recession, you should avoid consumer debt like the plague. Student loans? Maybe. Business loans? Possibly. Mortgage loans. Probably. Consumer debt and loans? Absolutely not.

3. DON’T co-sign a loan

In a depressed economy, co-signing a loan for someone is a recipe for eventual disaster. The reason someone needs a co-signer is that the lending institution believes that they won’t pay. If they don’t, the loan falls on your shoulders. Are you prepared for that?

4. DON’T get an adjustable rate mortgage

With the uncertainty surrounding everything from health care insurance premiums to how much your taxes will go up, getting an ARM loan isn’t very smart. An ARM puts the uncertainty on your back rather than the banks. Besides, with 30 year fixed rate mortgages at historic lows, it makes no sense to NOT lock in a historically low rate.

5. DON’T live beyond your means

Living within your means is THE mark of maturity. Learning to say no to today’s current desires with an eye on the future means evaluating what you think you want today with what you know you’ll really want in the future.

6. DON’T plunge into risky investments

I know all the investment gurus are fond of quoting Warren Buffett’s line – “ Be greedy when others are fearful and fearful when others are greedy” – but you and I don’t have the means to do the research he does, nor do we have the time and experience to invest like him. Go back and re-read How A Second Grader Beats Wall Street, simplify your investments and sleep better at night.

7. DON’T ignore your emergency fund

That emergency fund could very well be your lifeline should something happen with your job. Don’t ignore its importance and use the excess money from living below your means to fatten it up to about six or more months of living expenses.

8. DON’T have a single income source

In a recession, knowing how to make extra money can be the difference between thriving and barely surviving. Just a few hundred dollars extra per month can help you jettison debt, buy some groceries, meet your mortgage payment, or pay your medical bills.

9. DON’T buy a new car

If you need one, a used car is okay, but carefully evaluate your needs and do your best to remove the emotion from it. If your life was a business and you were the new CEO, would you authorize a new car? If you already jumped on a new car and you’re looking to get out of your lease, check out How To Get Out Of A Car Lease.

10. DON’T lapse your insurance

I’ve seen too many people get skewered by lapsing their insurance. It seems like some unforeseen conspiracy, but lapsing an insurance policy appears to be a sure way to guarantee a loss. Mostly I’ve seen this on car insurance, but health insurance as well as life insurance can also come into play.

What other things should someone NEVER do in a recession?

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It’s easy to feel ripped off when it comes to car insurance. Different rates in different states just doesn’t seem like a credible business model to most consumers, but each state has its own laws and its own insurance commission. Still, the variation is HUGE — from over $2,500 per year to a low of $900 per year. What isn’t easily seen in the table below is the variation that can occur between companies within the same state.

The fact is, each company has its own actuaries and statisticians and though state insurance commissions set maximums on what insurers can charge, markets are still allowed (for now) to determine how low the companies can go before they cry “Uncle!” It’s up to you and me to make certain we’re getting the lowest rate from the best insurance company we can find.

Where does your state rank?

Annual Car Insurance Rates by State

Ranking	State	Annual Cost
1	Louisiana	$2,510.87
2	Michigan	$2,098.29
3	Oklahoma	$1,868.39
4	Montana	$1,857.96
5	California	$1,774.41
6	South Carolina	$1,772.83
7	South Dakota	$1,772.83
8	District of Columbia	$1,753.19
9	Georgia	$1,751.42
10	Illinois	$1,679.15
11	Connecticut	$1,678.90
12	Arkansas	$1,648.80
13	New Mexico	$1,603.65
14	Rhode Island	$1,595.97
15	West Virginia	$1,589.69
16	Alaska	$1,572.21
17	Wyoming	$1,552.98
18	Maryland	$1,550.13
19	Kansas	$1,524.51
20	Kentucky	$1,515.30
21	Colorado	$1,480.97
22	Mississippi	$1,474.94
23	New Jersey	$1,473.73
24	New York	$1,463.21
25	Texas	$1,462.65
26	Florida	$1,453.20
27	Pennsylvania	$1,420.78
28	Delaware	$1,405.80
29	Missouri	$1,390.59
30	Minnesota	$1,381.09
31	Alabama	$1,380.38
32	North Dakota	$1,365.22
33	Hawaii	$1,306.97
34	Indiana	$1,302.51
35	Nevada	$1,282.50
36	Washington	$1,279.84
37	Utah	$1,234.30
38	Virginia	$1,233.36
39	Nebraska	$1,210.74
40	Oregon	$1,194.69
41	Idaho	$1,183.47
42	Tennessee	$1,170.12
43	Arizona	$1,152.50
44	North Carolina	$1,130.45
45	Massachusetts	$1,043.80
46	Iowa	$1,039.04
47	New Hampshire	$1,011.23
48	Wisconsin	$1,010.93
49	Ohio	$999.86
50	Vermont	$968.58
51	Maine	$902.85

Sources: Insureme.com and Quadrant Information Services. Rates were calculated for over 2,400 vehicles (2010 model year); based on a 40-year-old single male driver who commuting 12 miles to work daily and includes $500 deductible on collision and comprehensive coverage.

After you see what your neighbors are paying, make sure you’re getting your best insurance rate by getting a free quote from reputable companies like:

• Insureme.com
• NetQuote.com
• Esurance
• AARP Insurance (The Hartford)
• Allstate

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The recent downturn in the economy has had an effect on more than just consumers. Governments are desperately seeking money for their spendthrift ways and one way to insure they get it is to regulate cash transactions. It appears that governments would like to do away with cash altogether, making hard currency something only seen in museums. Certainly, the death of cash as we know it would make tracking transactions a lot easier for governmental agencies.

In the United States, large cash transactions aren’t banned yet, but there are severe penalties (read: significant jail time) for failing to report a large cash transaction. For example, your bank is required to file a currency transaction report with the federal government for every deposit, withdrawal, or exchange over $10,000 in cash. Some banks voluntarily lower that amount – some are as low as $3,000, presumably to stay on the good side of the IRS. Basically, if you sell your car for $10,001 in cash and then try to deposit it, the bank has to turn you in to the government; sell it for only $3,001 and they voluntarily turn you in. “Have a nice day!”

Additionally, if a bank “knows, suspects, or has reason to suspect” that a cash transaction over $5,000 is “suspicious”, then a suspicious activity report must be filed with the government. I guess the bank has to act as FBI agents as well as snitches.

But the reporting requirement goes beyond just banks. Small businesses have to report  those same cash transactions as well, and thanks to the “health care bill” recently passed, those reporting requirements extend all the way down to $600. As Jeff Schnepper explained in an article for MSN Money, if you are in business and receive in excess of $10,000 cash in a single transaction, you must report it to the IRS or you will go to prison. According to Schnepper, cash used to be king but now it’s evidence.

If you’re in a business and receive more than $10,000 in cash from a single transaction, or from related transactions within a 12-month period, you have to file Form 8300 and report the buyer to the IRS. Don’t file, and you go to jail.

The IRS isn’t kidding. I had a client who was a dealer in Corvette sports cars. He told me he didn’t have time to file the forms. I told him several times to file. He thought he knew better. He went to jail. So did his children who were involved in the business.

US gold transactions must also be reported

ABC News has reported that ANY gold transaction in excess of a paltry $600 must now be reported to the IRS. That $600 figure doesn’t just apply to gold either. All businesses, large and small, are now responsible to track and report the miscellaneous income associated with services rendered by independent contractors or self-employed individuals. That tracking has an expense and it will be born, not by the business, but by the consumer, as all business expenses ultimately are.

Large cash transactions in some countries are banned

Yep, believe it or not, more and more countries are orchestrating how almost all business is transacted by making large cash transactions illegal.

Italy

As part of Italy’s new “austerity measures”, all cash transactions over 5,000 euros (approx $6,400 USD) will be banned.  Passed in the name of cracking down on tax evasion, this seems quite severe to me when you consider that it also applies to cashier’s checks.

Mexico

A bill before the Mexican legislature would completely ban the purchase of real estate in cash. In addition, the new law would ban anyone from spending more than MXN 100,000 (about $7,659) in cash on vehicles, boats, airplanes and luxury goods. $7,659 isn’t a whole lot of money when it comes to those types of items. Don’t think you can just ignore this law if it is enacted.  Violators will face up to 15 years in prison.

Currently, 75% of all transactions in Mexico are completed in cash.

Europe

In Europe, many of the “austerity packages” being introduced include severe restrictions on the use of cash. For example, in Greece, all cash transactions above 1,500 euros ($1,923 USD) are effectively banned starting in 2011.  According to Greek Finance Minister George Papaconstantinou as reported by Reuters:

“From 1. Jan. 2011, every transaction above 1,500 euros between natural persons and businesses, or between businesses, will not be considered legal if it is done in cash. Transactions will have to be done through debit or credit cards.”

With Visa and MasterCard getting a cut of every card transaction, think of the money they will make in Greece alone.

Cash is ABNORMAL

Anyone using cash, especially large amounts of cash, is looked upon as abnormal and suspicious. We’ve been taught for three decades that anyone spending a large amount of cold hard cash is trying to hide something and is probably a criminal or tax cheat.

Certainly, a lot of criminals do use cash exclusively, but millions upon millions of normal, law-abiding citizens simply prefer to use cash as well.  Should we take the freedom to use cash away from the rest of us just because a small minority abuses it?

Unfortunately, the freedom to use cash is being slowly stripped away from citizens in an increasingly large number of countries, not just to clamp down on the criminal element, but to pad the coffers of inefficient and spendthrift governments.

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Franchises offer a lot of benefits for entrepreneurs. The biggest benefit is the “system” that a franchise develops and then sells to franchisees. With a franchise, you get instant name and brand recognition, and the assistance of a team or professionals who have “been there, done that.”

But all that glitters is not gold in the world of big time franchises. Put on your thinking cap and ask yourself, why would a company wish to franchise its operations? Why would they give away their most closely guarded secrets, their unknown formulas for success, and their highly classified and confidential information? For money, of course.

Back several years ago I filled out all the necessary paperwork to get a Uniform Franchise Offering Circular from a well known sandwich franchise. After they crawled over my bank accounts, my credit history, my assets and liabilities, my grades from elementary school, and my sister’s cat’s first owner’s grandfather’s ex-football coach’s nephew twice removed, they told me everything I needed to know. Sort of. Most of what I learned, I figured out by talking to other franchisees, and what I learned made me say NO!

Why I didn’t buy a franchise

You have to pay to play

The up front franchise fees were horrendously large, and that was just for the “privilege” of using their name! Before you ever walk through a potential site, before you taste the first dollar, before you even open a business checking account, that fee has to be paid. It can be a large six figure number for the larger franchises and in many cases, it has to be paid every few years, just to maintain the “relationship.”

You have to pay each day

The royalty fee for the franchise I was considering was 7 percent, but I’ve seen royalty fees as high as 12 percent. I’m sure some are even larger and some are probably a bit smaller. This money is swept from your bank account each night. Sell 300 combo meals at 7 bucks each and the franchisor will debit your account that night $147. That might not sound like much compared to the $2,100 you grossed, but when your food costs were $1,260 and you paid three employee’s salaries of $240 plus the cost of utilities and the cost of advertising, and the cost of insurance, and the lease on your facility … you get the picture. You essentially have two new partners in your business and both have their hands out: Uncle Sam and the parent company.

You have to buy their stuff

As part of this franchise agreement, a franchisee had to buy 100 percent of all food items from the parent company. I can understand that. Franchises want consistency above all else and you can’t have some rogue franchisee selling Oscar Mayer bologna and passing it off as Black Forest Ham. But to demand that all napkins, straws, cups and paper products, the cash registers, the software to run them, tables, stools, benches, artwork, plastic silverware, the aluminum foil, uniforms, coffee filters, mustard packets, salt, pepper, and ANYTHING else used in the restaurant has to come from the parent company, well, it smells a little greedy to me, especially when their prices on those items are 10 – 25 percent higher than Costco.

Competition can be tough

Franchises claim to give franchisees an “exclusive” right to a certain geographical area, and many honor that agreement. Some do not but get around it legally. It’s in the franchisor’s best interest to get as many sales as possible in a given territory and it’s perfectly legal under many franchise contracts to amend the agreement so that the size of your geographical area effectively shrinks and competition moves in. If the parent company controls your prices, your profit is decreased while the franchisor’s is increased.

Financing means debt up to your ears

Many franchises don’t offer financing, but some do. If you need financing, I’d suggest obtaining it through a third party. Asking a franchisor to finance your entrepreneurial dreams is like asking the car dealer to finance your wheels. You DON’T get the best rate, even though the process seems easier than using a third party. Think about it, not only do they make money from you up front, and by the day, and from your purchases, but also from the interest you have to pay? Yikes, not me.

Lack of creativity could drive you to tears

In many franchises, you cannot change anything. I understand that franchises don’t want some guy selling Harley-Davidson parts at a hamburger franchise, but in the long history of franchising, it was the franchisees that brought innovation to the table. That’s how McDonald’s came up with the Filet-O-Fish! Who knows the customers better than the guys that are nose to nose with them daily? Why is it that corporations refuse to listen? A system is great, but it shouldn’t result in slavery.

Beware of the real estate craze

Franchises generally  determine where you will put your store. Though you can submit requests, they have the final say, and that can mean big bucks on the purchase or lease of land and buildings. Of course they want you to be successful, but many don’t recognize that there’s some balance to that! Sure I can put a store on an outparcel next to the shiny new mall, but I can’t sell enough sandwiches to cover my $30,000 per month lease!

Brand recognition cuts both ways

Imagine working night and day to build your business. Then one day, some crazy loon puts a cadaver finger in a chocolate vanilla swirl milkshake and promptly rushes to a lawyer … and to CNN. Suddenly there’s a lot of bad press and your business goes south as a result. Maybe the CEO of the parent company gets caught in some indiscretions with his 17 year old neighbor. Maybe  the local church youth groups decide to boycott your store in protest. Brand recognition indeed does cut both ways.

Advertising don’ts and advertising dues

Some franchises won’t allow you to do any advertising unless you run it by them, their ad department, and their legal team first. The problem is that from the day you open you doors, you’ll be hit up for donations to schools, yearbooks, Little League, MADD, SADD, RADD, and Eagle Scout projects. Why do franchisors NOT want you advertising without their permission? Why, money of course! Many franchises demand that you contribute a percentage of your gross sales each month to the advertising pool, especially if the franchises advertises nationally. While this advertising certainly does instill brand awareness, for my money, nothing beats getting involved in the local community and helping out the people who will frequent your establishment.

The parent company has nothing to lose

What exactly DO they have to lose? You pay for the right to use their name. You pay them daily. You buy their products. You buy their services. You pay your lease, they don’t. You pay your employees, they don’t. You pay your insurance, they don’t. You pay YOUR salary, they don’t. You pay your utilities, they don’t. You pay for your FICA, medical insurance, building repairs and maintenance, office expenses, community organization dues, your accountant, your taxes, your depreciation expenses, your “lost” inventory, and all the other costs needed to effectively run the business. What do they pay? Nada. Who’s making the money? They are!

Maybe the best idea is to start your own sandwich shop, or chicken wing stand, or burger joint and sell franchises once you have it up and running. Trust me, people are doing it all the time.

While I’ve outlined a lot of the negatives I encountered, that doesn’t mean you shouldn’t do your own investigation into any franchise you’re interested in starting. Not all franchises are the same and if you have an interest, go over that UFOC with an extremely fine toothed comb, then have a lawyer look it over for any big negatives that might pop up down the road. No, not all franchises are bad, but not all of them have your best interests at heart either. Do your homework, get some professional guidance, and then do what you feel is best for you in your situation. For me, a franchise wasn’t it.

I guess it all boiled down to control. I didn’t want someone else telling me how I HAD to use my capital.

• Cups photo by RiRi Trautmann
• Filet-O-Fish photo courtesy of Wikipedia Commons

This article was included in the Carnival of Personal Finance at Sustainable Life Blog.

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Getting past a call screener is easier than you think. Of course, some people are totally confident in their ability to use the phone and get to a decision maker (we generally call them high powered salespeople). However, 90 percent of us are reluctant to pick up the phone and make a “cold call” if we think there’s a call screener involved (we usually call these job seekers).

If you’re not experienced in using the phone, believe it or not, it’s a mostly friendly and helpful world out there. Most executives I know DO screen their calls but generally are courteous and polite and go out of their way to project a good image of themselves and their company. The same holds true for others such as secretaries or administrative assistants … and call screeners.

Still, there is a certain misconception that all assistants will keep you from speaking with their bosses. They do screen calls, but it is part of their job to make sure that contact is made when appropriate.

Know the real reason you’re calling

When you plan to seriously connect, you have specific goals and you use a standardized procedure for making a large number of calls.

Use these tips to get past a call screener

• The best way to get around a call screener is to use a referral from someone well respected by the person you wish to connect with.
• If that isn’t feasible, start by using the name of the person who is the “screener.” Once he or she has been identified, their manner will become more personal.
• When asked your name, identify yourself with an organization if possible. Remember, the more difficult and expert the screener is, the more valuable that person is likely to be, especially as an ally in your future relationships with the firm.
• If you don’t get through on your first attempt, and you can’t get a suitable time to call back, suggest a time when you will call the screener back. Until you have established direct contact, don’t leave messages.
• When you call back, use the screener’s name with the receptionist. After establishing that the person is difficult to reach, try this procedure: “Since he (or she) is so hard to reach, would you do me a small favor? May I call back at ten o’clock to see if he would be interested in speaking with me for a few minutes?” If you must leave a message, leave one of potential benefit to the person you are calling.
• Consider reversing your attempt to speak with the decision-maker. Instead, ask for an internal referral to another line manager in the area in which you wish to make contact.
• After a few minutes of discussion with the call screener, ask two or three penetrating questions about the firm’s needs. When asked difficult questions, those who don’t know the answer are more inclined to refer you to someone who can – hopefully that will be the person you want to speak with.
• If the screener tries to forward your call to someone other than the person you’re wishing to connect with, get the name of the person to whom you will be speaking. Call back later for that person or request an immediate transfer. After a few days, call back the screener and explain that while the person she referred you to was helpful, they couldn’t answer the questions you had in mind and you still need to speak with the person you originally called.

It all boils down to persistence. Whether you’re looking to make a big sale, trying to get in touch with a venture capitalist, or seeking a job, persistence is the one character trait that all successful people claim was vital to their success.

Don’t give up!

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Yeah, I know. Summer officially ends September 20th or so, but when the kids go back to school, let’s face it: summer’s over. We’re caught up in back to school-itis. Here are some great articles and posts I read this week. Check ‘em out!

Democrats, Republicans, and the Federal Debt Since 1979 – you might be surprised.

Lowest Paying College Degrees – going in with your eyes open if you choose one of these degrees.

Is College Still Worth the Debt? – hmm, maybe. I think it depends on how much debt and how much you can expect to earn with your degree.

How To Finance Your Degree The Smart Way – debt isn’t your only option! Be sure and check out ALL scholarship opportunities.

Expense Ratios as Predictors of Mutual Fund Performance – it really does make a difference (just like How A Second Grader Beats Wall Street predicted).

The Switch: From Paying Interest to Earning It – wow, what a concept!

MonaVie Blackmails Me – this is precisely why I LOATHE multi-level marketing companies. That and my personal experience … but these people take the cake.

What Is A Secured Credit Card? — if you have to ask, you just might need one!

Stores can now refuse small credit card charges – I hope you make it a habit to carry some cash.

2011 Tax Calculator for Income Tax Planning – it’s never too early to do some tax planning.

What do you Think of Sure ‘Investments’ Articles? – Evan always hates the word always!

Making an Offer on a Home: How to Negotiate a Deal — it’s always a good idea to be prepared for negotiations on your largest purchase.

3 Essential Building Blocks for Greater Happiness – I bet you won’t think of these three.

Military Deployment Financial Checklist — a great resource for the people who are putting their lives on the line to keep our country safe.

Free Online Tools for Tracking Your Goals – a goal that isn’t tracked and measured is just a dream.

How To Get Free Credit Monitoring — I’m still paying for mine, but maybe there IS an alternative

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When I was in college, I stumbled upon a study method that always resulted in an “A” when I used it. It centered around taking notes in class, then rewriting those notes. I found that the more I wrote, the better I could remember. Writing things down by hand allowed me to dictate my future.

Some believe that writing a list trivializes and oversimplifies but in my case, a list made things come alive (it still does). Can you imagine going to the grocery store to purchase items for a new, complicated recipe without having a list? You’ll probably have to make at least one more trip, maybe two, to pick up items you forgot. I know I did, I mean, would …

Lists are powerful self motivators. They outline what needs to be done and allow your mind to focus on implementation rather than on remembering what needs to be done. They allow you to focus on connecting with people rather than worrying about remembering your bullet points. It’s one thing to go to a business meeting with an idea of what you want to say, do, or accomplish, but it’s quite another to have an organized list.

But why do we resist such a simple idea? Why do we fail to apply this principle to our lives? Why do we spend less time planning our lives than we do planning a picnic? Probably because we know that if we forget the ketchup, we will be ridiculed by the kids! But isn’t your life as important as a picnic?

Make a list or two, and read it daily

• List your goals and what you need to do to accomplish them
• List your debts and how you’re going to beat them
• List what you’d like to do before you die (your bucket list)
• List your current friends to remind yourself of those close to you
• List old friends you’d like to reconnect with and then reconnect with them
• List books you’ve read and those you’d like to read

When you write a list you are writing history before it happens. You’re planning your future. Goals gain power when they’re written, and they get more powerful every time we write them down.

For me, nothing motivates like my own handwriting. People often look to what others have written for motivation, but I believe that living life by a list allows me to motivate myself by what I’ve written.

How about you? Do you use lists?

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Finding a job in the midst of an economic recession can be a daunting task. The job market seems confusing, positions scarce, and applicants plentiful while the myths abound more than ever.

I believe the key is to seek more than just a job, but to seek a position. A job is general, whereas a position is specific to its role and responsibilities.

8 Job Market Myths

1. If I can’t find the right position for me, it probably doesn’t exist

This is a typical, though inaccurate conclusion drawn by many frustrated job seekers. According to study after study, over 85% of all job vacancies are not available through traditional resources. The fact is managers and CEO’s create positions for the right people every day.

The truth

Don’t worry about a lack of available positions, concentrate instead on how to find what you really want and honing your interview skills.

2. I know how to position hunt

Most people position hunt with a resume, the traditional but ineffective method for finding a job. Consider this: standard resumes produce one inquiry for roughly every 85 resumes a company receives, but only half of those inquiries result in an interview. Since one interview takes place for every 170 resumes received and the average company conducts 10 interviews before making one offer, 1,699 resume senders are very disappointed.

The truth

Put old ideas behind you and learn to network

3. I can always go to an employment agency

Of course you can, but remember that less than 7 percent of all professional, managerial, and executive positions are ever listed with agencies. One survey I read revealed that he average employment agency is able to set appointments for only one of every 20 candidates who contact them. The others just don’t match their active position list.

The truth

Don’t rely on traditional employment agencies for help since over 93 percent of the available top positions are not listed with them anyway.

4. A recruiter will actively market me to potential employers

That may have been true at some point in the past but today’s reality is that the average recruiter is in the business of filling vacancies for companies. There is a big difference. As a position seeker, understand that companies pay big commissions (up to 50% of first year salary) to recruiters and that cash buys loyalty as well. Instead of marketing a candidate to the company, recruiters may try to fit an available worker into a vacant position.

The truth

If you aren’t careful, a recruiter or job agency may try to manipulate you into a position you aren’t looking for. If the recruiter starts “selling” you on a company or position, move on.

5. The Internet or the classifieds are where I should look

The Internet is a great resource for information, but if you’ve ever posted a position on one of the major job boards, you know how many resumes and application you get – thousands, sometimes tens of thousands. You may indeed find a position through the Internet, but chances are much better that there will be someone more qualified than you. If you desire a top position within a company, there is only a slim, tiny, miniscule chance the company is even looking to the Internet for an employee.

The truth

Answering ads and sending online applications is fine, but don’t get your hopes up. Newspaper and Internet classifieds account for only a very small percentage of available positions so spend only a small amount of time here.

6. Employers have all the power

Ha-ha, umm, no. While it’s true that employers have the power to hire and fire, they’re as concerned with finding good employees as position seekers are about finding good positions. Recruiting and training costs are a major concern to all industries. Part of the problem is that many position seekers postpone position screening until after they’re hired. Too many people find out their job ISN’T what they wanted only after working for a few months.

The truth

An employer needs you as much as you need him. Instead of going after a single position, run yourself a job campaign and pursue a number of offers. You are in the driver’s seat.

7. The higher up I go, the more secure my position

This myth isn’t even funny anymore. More than 500,000 middle managers and senior executives got the ax within the last few years and with the economy continuing to slide backwards despite Washington’s failed efforts, they probably won’t be alone. In fact, as you climb the ladder, you’re held to a higher and higher standard as you become responsible for the actions of more and more people under you. It can truly be frightening.

The truth

Be prepared. Develop your job search strategy now before you have to create a plan B. This is a great idea even if your position seems secure today.

8. The best-qualified people always get the best positions

Not true. The people who get hired are the ones who first learn HOW to get hired … and then they practice and hone their skills.

The truth

The ones who get hired are the ones who know how to research their target company, uncover it’s greatest needs and wants, and can adapt their skills and experience in such a way that the interviewer believes they are the answer to their prayers.

Photo By Debs (ò‿ó)♪

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Have you made the switch to online banking yet? I made the switch myself several years ago and I gotta tell you, I love it. There are many benefits to handling your bank account online, many of which your traditional banker won’t admit.

Let’s face it: dollars are dollars and whether you use them through a bank having a brick and mortar presence or use them through a bank entirely online, dollars are still dollars. What’s funny (or maybe it’s not so funny) is that traditional banks offer many of the same online resources as online banks, yet their fee structure remains constant.

What is YOUR traditional banker not telling you?

Online banks are cheaper to use

My experience has been that online banking is far less expensive than traditional grounded banks. My PerkStreet checking account is free to use plus I get tons of rewards and cash back! Their fee structure for everything from stop payments to NSF’s are substantially less expensive than my traditional bank.

Online banks may have better loan rates

That’s been my experience. Whether you’re looking for a mortgage or wanting to finance an automobile, there’s a very good chance an online bank can get you a better loan rate.

Online banks have far fewer expenses

By not wasting money on fancy marbled foyers and lobbies, multiple branches, or personnel (tellers, branch employees, security guards), online banks are able to drastically reduce their expenses and funnel those savings to their customers in the form of lower fees.

Online banks pay you more interest

An online savings account through ING pays me substantially more interest than my traditional bank ever did. It’s ridiculous actually. Plus, ING offers referral  bonuses to those opening a new savings account as well as to the referrer. If you’d like a referral link, send me a note via my contact page (first come, first served).

If you’re interested in earning interest on your checking, check out Electric Orange from ING DIRECT or PerkStreet Financial.

Online banks are just as easy to use, if not more so

My experience with an online bank account may not be typical, but I haven’t found anyone who disagrees with my assertion that online banks are extremely easy to use. I use mine to automate my bill payments, pay other bills, check my balance, and transfer funds between accounts.

Online banks refund most ATM fees

Most online banks refund ATM fees, especially if you use an ATM within one of their national networks. Other online banks refund every ATM fee. It makes things so much easier to know cash is just ANY ATM away.

Online banks are just as safe as traditional banks

Maybe even more so. Why? Customers using online banks tend to check their accounts several times each day and discover identity theft, fraud, or any other problem much more quickly than people who wait on a paper statement once each month.

Since traditional banks use the same Internet resources as online banks, there isn’t really any difference in their security. Online banks are no more susceptible to fraud than traditional banks, so security isn’t an issue, just your personal sense of security.

Online Banks

• EverBank
• PerkStreet Financial℠
• WTDirect
• HSBC Advance
• ING DIRECT

This post was included in The Carnival of Personal Finance #272 Yogi Berra Edition at Budgeting In The Fun Stuff. Thanks for the inclusion!

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When I was in high school, I had no worries, no cares, few bills, and no clue. I earned money mowing lawns, working in the meat market in my local grocery store, babysitting, sacking groceries, and building a home. But I spent every thin dime I made. On what? I have no idea. There isn’t one thing left to show for all that work. Then, I went to college. College didn’t really do anything to prepare me for life in the real world.

Could college make you poor?

Yes, it can. College life isn’t like real life and the years I spent living in college fantasy land did very little to prepare me for the important aspects of living such as finding a job, living on a budget, interviewing, or effective time management. Here are ten ways that college made ME poor.

1. I took out multiple student loans and I didn’t use the self discipline required to succeed. I simply wasn’t motivated to study. I was borrowing and going into debt just to stay in school because that was what I was supposed to do. I didn’t have a real goal, graduation seemed so far away, and I was easily distracted.

2. Free money, in the form of grants, only furthered my distorted view of reality. Need money? Just apply for it! Let someone else pay my way. Where’s my check?

3. The credit card vendors at the tables in the student center tempted me with that T-shirt! Do you know why they gave free T-shirts for credit card applications? Because college students would sign anything to get a free one, especially freshmen. Do you know why colleges allowed credit card issuers to entrap students into a lifetime of debt? Because they paid the colleges. This is no longer legal, but I was long gone from college and deep in debt by then.

4. The free health care myth distorted my world view even more. All I had to do was flash that student ID and I got “free” health care. It still hadn’t sunk in to my head that nothing is free. Someone has to pay for everything and in reality, health insurance was part of my tuition and fees. I’m the one who paid for it … and still was 15 years later in the form of student loan repayments.

5. I got free software, too. Just by being a student, I was eligible to use the software put out by a myriad of companies, and that’s how they get you hooked on their product. It’s called the “Puppy Dog Close” amongst salesmen. Allow a family to take a puppy home to “try him out” for a few nights and they will never want to get rid of him.

6. ZERO teaching on personal finance. After graduating and beginning to work is when people should be making quality personal financial decisions, not when they should begin learning how personal finance works. There was never any teaching about an emergency fund, investing for retirement, buying a home, savings accounts, living on a budget, or frugality. College taught me only about all the freebies, nothing about responsibility.

7. Cheap housing only perpetuated my skewed view. The dorm was cheap but my apartment was even cheaper. It was only $235/month … split 4 ways. Split the gas bill, the power bill, the cable bill, and the food and you have a student living on less than $200/month. While it’s great that I didn’t spend much on living expenses, coupled with the lack of training I had on personal finance, I spent everything I made on dining out, gifts for my girlfriend, and clothes.

8. Are meal plans available to anyone but students? Getting a 16 meals per week plan at college cafeterias where I could eat all I wanted at every meal didn’t cause me to learn about saving money on food. It only caused me to get used to having anything I wanted and as much as I wanted any time I wanted.

9. There was never any time management teaching. When was the last time YOU could schedule your workday to be only on Tuesdays and Thursdays from 10 AM until 4 PM? Is there anything realistic here?

10. No teaching on interviewing or preparation for getting a real job. I knew all about regression analysis, capital structure, strategic management decision making, strategic marketing, and global human resource management, but I didn’t know how to interview, how to mimic the body language of my interviewer, how to deal with office politics, or how to negotiate my salary.

Nothing in real life is like college.

Nothing in college really helped me prepare for life. I had a great time, I made a lot of friends, I met my future wife, I did a lot of fishing, I learned how to borrow lots of money, but I didn’t learn anything about real life. I didn’t learn anything about handling my finances, or about managing my time, or about budgeting my money, or about getting an interview, or about the dangers of debt.

None of these 10 items were that bad alone, but taken as a whole, I believe they skewed my view of how life works, how employment works, and how debt works. Since most colleges don’t teach these important principles, those most in need of this education are left to try and figure out this information on their own after they graduate or drop out for a lack of money. Some will succeed in learning it and most will struggle, but all would be better off if they had learned it before entering the work force.

What’s the Solution?

Teach your children before they go off to college about:

• Personal financial management, especially budgeting
• The dangers of debt, particularly credit card debt
• How to interview for a job
• How to develop a work ethic
• How to manage time so they get the most accomplished
• That life is nothing like college life, and college life is nothing like real life

Photo by Michael Cavén

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