by: Jon Caldwell
The lifeline of most businesses rely heavily on the amount of marketing support can be supplied. There is no doubt that marketing collateral in the form of establishing identity and brand existence are key factors in helping make businesses known. These marketing collaterals can be likened to arming the key personnel in a business such as business cards, flyers, brochures and multimedia material to be able to provide the necessary information and image that a company wants to project.
Marketing collateral does not have to be high cost in nature. Resourcefulness and innovation of the company through its current roster of personnel can help ignite and produce the necessary collaterals a business can lean on. Understandably, cost and expenses are two of the things that business owners are not too keen on hearing. But the supplement of expected outcomes from the investment of marketing collaterals through advertising and promotions will provide a better overview of what to results to expect from such programmed marketing efforts by assigned people of the company.
The hardest part of establishing a business is to spread the word that such a company and its products or services are indeed available. The success of a business lies heavily in providing the necessary information of the existence of such, the purpose of which is to try and penetrate a market properly.
To start things off, the need for proper product or service orientation should be established. Consumers will not immediately rely on mere image and word of mouth. This is the job that is tasked for most marketing executives, to build on the product and make the consumers understand the benefits and fruits that the product brings. This is best done through the use of supporting promotional materials in the form of flyers, posters, and TV commercials if costs are permitted. Making such mediums available to consumers in the easiest way possible for them to get acquainted with the product being pushed is the best way to kick off a product’s existence in the market.
After a successful product orientation towards the target market that a company has focused on, the next thing to handle is the places where the product will be available. Supermarkets, department stores, convenience stores, and specialty shops, the mode of availability will be the critical aspect since this will largely depend if the product is readily available. For sure, people will not go out of their way to exert much effort in finding where the product may be. Thus it is the task of the business personnel to make sure that all possible distribution channels are covered, with the target market class under consideration as well. While flyers and posters may be spread all throughout affiliated stores and outlets, it is still the best practice to make sure that the product itself is available in target modes of distribution.
The set price for most consumer goods and commodities today play an important role in enticing consumer demand. While this is more psychological in nature, it cannot be discounted that business executives must determine an acceptable price to jack up their sales and consumer patronization. Pricing has its share of conflicts. Low prices may carry with it low quality product tags, while higher priced goods may push customers to look for alternative products. This is why it is essential that research and development teams must prepare a good comparison of product availability before finally deciding on a set price. The price should also consider the usual costs such as the administrative and operations cost, mark-ups and other related costs for manufacturing the product. The marketing collaterals will also fall under the administrative and operations cost, usually under the advertising and promotions part.
Defining the target market area as well as the consumer class will help determine the degree of saturation in the market a business should aim for. Identifying where the target market class resides or stays in is a good way to help in trimming down the area needed for saturation. Focusing the marketing collaterals in the area where the identified consumer class is situated is a good way to establish identity in the area. This should be a good way to start in effectively covering key areas for segregation prior to aiming for a larger market share.
The attention, complaints and distribution of the product or service still lied in the hands of the people hired to do the life blood of the company. Similar to a soldier going off to war, providing the sales force with business cards, marketing portfolios and other marketing paraphernalia is the best way to make an impact. Other than motivating the sales people to bring in the sales, making sure that they have the necessary materials to show are mirror-like images of the company. They represent the company and whatever they project speaks entirely for the business venture.
The Power Of The Right Message To The Right Market
by: Troy White
Two success stories to share with you on advertising effectively.
SUCCESS STORY 1 Network Marketing Money Machine
I received a phone call 2 months ago from a husband and wife team. They have done exceptionally well in the network marketing industry, and now was to go big on the speaking information publishing business.
We designed them a campaign that goes like this
Step 1 Squeeze page to capture emails from people
All a squeeze page does is capture contact information from people who visit your website. You need to entice them into why they should sign up snippets of content they get, free bonus books or audios, etc. When they enter their information name and email they are then sent to step 2.
Step 2 Thank you for sign up and Free CD giveaway
We gave away an audio cd detailed part of their system they use to earn well over a million a year in the industry. The cd is free, shipping and handling is $5. This gives people a very low cost way to get more familiar with you and your techniques. If they take the free cd offer, they click through to the order page with an option to buy into step 3.
Step 3 Upsell to higher end package at 20 -40 times the price of step 2
When people go to the order page for the cd offer, they are offered an option to buy a much higher pried package. In this case we did 2 higher priced options one at 20 times the cd s&h price, the other at 50 times that price. They can get just the cd or take them up on the upsell offers with much more information and product sent to them.
Step 4 For those who never took the offer for steps 2, 3 or 4 they get sold into step 2 through the auto responders they receive once they sign up on the free newsletter
THE RESULTS?
Because the copy was targeted perfectly to their market, and because they had a good number of people read the copy:
1.1800 people purchased the cd option 2.20% of those people bought upsell #1 (at 20 times the price) 3.5% bought upsell #2 at 50 times the price
Do the math! That is a serious money making AUTOMATED machine.
For every 1,000 qualified people they send to their site, they know roughly how much money they will make immediately.
QUESTION FOR YOU
How can you leverage these ideas and automate the sales process in your business?
SUCCESS STORY #2 First time author ROCKETS to #1
Another client of mine just launched his new book. You may have seen some of the promotions this week for The Power of You
We invested a substantial amount of time and resources putting a massive campaign together for him.
1.Teaser sales letters to get people to the main sales letter
2.$3,000 in bonuses to buy the book on the launch day
3.Long copy sales letter to sell the book and bonuses the key was that he needed people to buy on a single day so Amazon could do their calculations on if he had a best selling book (calculated by Amazon every hour based on total books sold from their site)
4.Recruited LARGE numbers of partners to endorse the book to their own client lists. They got to read the book first, then endorse the book to their own clients if they like the book. IMPORTANT NOTE: the partners received NO financial compensation for doing this.
I wrote the copy they sent to their lists, to recruit them as partners, to sell people the book, etc.
5.Arranged everything to happen on August 15th starting at 12:01 am.
THE RESULTS?
#1 on Amazon on the main book best seller list AND in all 5 registered categories the book qualified for!
PLUS, 3 days later it is STILL #1
Thousands and thousands of books sold (still waiting on final numbers) each of those books is a lead generator for him (ads on the inside of the books for other products) and a MASSIVE database built from the launch (people had to supply their emails to get the bonus materials)
Now he has #1 International Best Selling Author to his name.
QUESTION FOR YOU:
How can you leverage these ideas and have other people promote you to their lists? How can you use this to launch a new product, service or bundle?
The key here is to NOT say "that isn't my business". The key is to say "HOW can I make that apply to MY business?"
When you do that and then implement what you wrote you will see similar results as they have seen.
The power of the written word, combined with massive action
Two success stories to share with you on advertising effectively.
SUCCESS STORY 1 Network Marketing Money Machine
I received a phone call 2 months ago from a husband and wife team. They have done exceptionally well in the network marketing industry, and now was to go big on the speaking information publishing business.
We designed them a campaign that goes like this
Step 1 Squeeze page to capture emails from people
All a squeeze page does is capture contact information from people who visit your website. You need to entice them into why they should sign up snippets of content they get, free bonus books or audios, etc. When they enter their information name and email they are then sent to step 2.
Step 2 Thank you for sign up and Free CD giveaway
We gave away an audio cd detailed part of their system they use to earn well over a million a year in the industry. The cd is free, shipping and handling is $5. This gives people a very low cost way to get more familiar with you and your techniques. If they take the free cd offer, they click through to the order page with an option to buy into step 3.
Step 3 Upsell to higher end package at 20 -40 times the price of step 2
When people go to the order page for the cd offer, they are offered an option to buy a much higher pried package. In this case we did 2 higher priced options one at 20 times the cd s&h price, the other at 50 times that price. They can get just the cd or take them up on the upsell offers with much more information and product sent to them.
Step 4 For those who never took the offer for steps 2, 3 or 4 they get sold into step 2 through the auto responders they receive once they sign up on the free newsletter
THE RESULTS?
Because the copy was targeted perfectly to their market, and because they had a good number of people read the copy:
1.1800 people purchased the cd option 2.20% of those people bought upsell #1 (at 20 times the price) 3.5% bought upsell #2 at 50 times the price
Do the math! That is a serious money making AUTOMATED machine.
For every 1,000 qualified people they send to their site, they know roughly how much money they will make immediately.
QUESTION FOR YOU
How can you leverage these ideas and automate the sales process in your business?
SUCCESS STORY #2 First time author ROCKETS to #1
Another client of mine just launched his new book. You may have seen some of the promotions this week for The Power of You
We invested a substantial amount of time and resources putting a massive campaign together for him.
1.Teaser sales letters to get people to the main sales letter
2.$3,000 in bonuses to buy the book on the launch day
3.Long copy sales letter to sell the book and bonuses the key was that he needed people to buy on a single day so Amazon could do their calculations on if he had a best selling book (calculated by Amazon every hour based on total books sold from their site)
4.Recruited LARGE numbers of partners to endorse the book to their own client lists. They got to read the book first, then endorse the book to their own clients if they like the book. IMPORTANT NOTE: the partners received NO financial compensation for doing this.
I wrote the copy they sent to their lists, to recruit them as partners, to sell people the book, etc.
5.Arranged everything to happen on August 15th starting at 12:01 am.
THE RESULTS?
#1 on Amazon on the main book best seller list AND in all 5 registered categories the book qualified for!
PLUS, 3 days later it is STILL #1
Thousands and thousands of books sold (still waiting on final numbers) each of those books is a lead generator for him (ads on the inside of the books for other products) and a MASSIVE database built from the launch (people had to supply their emails to get the bonus materials)
Now he has #1 International Best Selling Author to his name.
QUESTION FOR YOU:
How can you leverage these ideas and have other people promote you to their lists? How can you use this to launch a new product, service or bundle?
The key here is to NOT say "that isn't my business". The key is to say "HOW can I make that apply to MY business?"
When you do that and then implement what you wrote you will see similar results as they have seen.
The power of the written word, combined with massive action
11 Steps To Creating The Perfect Business Plan
by: Aaron Foster
What should a business plan cover?
That’s the million dollar question.
For one thing, it should offer a thorough analysis of the need for the particular product or service you are planning to offer. It also needs to talk about how you are qualified to be making such an offering to the public.
A business plan should address your strategies in terms of production and marketing, how you will be organized, any legal aspects that you must address, and what your accounting methods will be. In short, a business plan should address the following questions:
* What do I want and what am I capable of doing?
* What are the most workable ways of achieving my goals?
* What can I expect from the future?
Keep in mind that there is not one specific format that you should use, or one best way to lay out your business plan. However, there are some steps you can take to make the process go a little more smoothly; we’ve listed what we think is the easiest method, below.
Step 1: Making the Commitment – be sure that you desire to work for yourself is truly greater than you desire to work for someone else.
Step 2: Analyze yourself – list your strengths and weaknesses. Determine how you can build off your strengths, and improve on your weaknesses. Remember, this can be a daunting task because you may have to own up to a few shortcomings you’re not prepared to recognize!
Step 3: Choose a Product or Service – this sounds silly, but just because you think you know what business you want to be in, it doesn’t mean your idea will be a profitable one. Take a look at the feasibility of your idea.
Step 4: Research Your Market – marketing research is crucial to the success of any business, large or small. The more you know about your potential market, the greater your chances of securing the customers you want, right out of the gate, and that means making a profit.
Step 5: Forecast Your Sales Revenue – after you take a look at the market your product is best suited for, estimate the percentage of that market that you think you will reasonably be able to take over. Take in to account the number of your competitors, their size, and the amount of market they already have. It is important to be realistic during this exercise.
Step 6: Choose a Location – is your new business going to be on the web? Or will you have a retail storefront? Will you consult out of your home office? Be careful to weight both your personal preferences and what makes the most sense for the ultimate success of your business. You might like the idea of working in your pajamas every day, but if your shingle needs to be seen by the public for maximum growth potential, a home office might not be your best option.
Step 7: Develop a Marketing Plan – here you will be forced to detail you plan to gain customers, and turn a profit. Discuss possible marketing channels, price points, advertising, and sales promotion.
Step 8: Develop an Organizational Plan – what skills and talents do your new business need to not only survive, but to grow as well? If you don’t have all these traits, how are you going to get them in the door? Will you hire freelancers? Are you hoping to bring on an employee right away? If these individuals, and their skill sets, are vital to your success, do not make a plan without them!
Step 9: Decide on Your Status – sole proprietor? Partnership? You need to decide how you’re going to approach this, and investigate the legal ramifications of each situation. As a sole proprietor, you’re in control, but you’re also solely responsible. In a partnership, you share the responsibility, but you also share the decision making and the profits. What works best for your budget AND your personality?
Step 10: Address Your Accounting – if you don’t know how much money is coming in and out of your business, you will never know if you are making a profit, or if you need to make changes. Keeping track of your numbers is one of the single most important things you can do for your business. Decide on whether you will do it in house, or outsource it to a professional; if you take care of it yourself, decide on what software you will use.
Step 11: Put it All into Numbers – this may or may not be necessary for you; it depends on what type of business you are starting. When you approach a financial institution for a small business loan, they will respond better if they see all of your plans in numbers; they are, after all, in the business of numbers. So, go back through all the above steps, and assign dollar amounts to what you can; when you approach the bank, you can tell them exactly how much you need, and show them where their money will be going. You can then show them, with a number, how much of the market you are planning to corner, and your growth, by percentage, over the next X years.
That’s it – wasn’t so hard after all, was it?
What should a business plan cover?
That’s the million dollar question.
For one thing, it should offer a thorough analysis of the need for the particular product or service you are planning to offer. It also needs to talk about how you are qualified to be making such an offering to the public.
A business plan should address your strategies in terms of production and marketing, how you will be organized, any legal aspects that you must address, and what your accounting methods will be. In short, a business plan should address the following questions:
* What do I want and what am I capable of doing?
* What are the most workable ways of achieving my goals?
* What can I expect from the future?
Keep in mind that there is not one specific format that you should use, or one best way to lay out your business plan. However, there are some steps you can take to make the process go a little more smoothly; we’ve listed what we think is the easiest method, below.
Step 1: Making the Commitment – be sure that you desire to work for yourself is truly greater than you desire to work for someone else.
Step 2: Analyze yourself – list your strengths and weaknesses. Determine how you can build off your strengths, and improve on your weaknesses. Remember, this can be a daunting task because you may have to own up to a few shortcomings you’re not prepared to recognize!
Step 3: Choose a Product or Service – this sounds silly, but just because you think you know what business you want to be in, it doesn’t mean your idea will be a profitable one. Take a look at the feasibility of your idea.
Step 4: Research Your Market – marketing research is crucial to the success of any business, large or small. The more you know about your potential market, the greater your chances of securing the customers you want, right out of the gate, and that means making a profit.
Step 5: Forecast Your Sales Revenue – after you take a look at the market your product is best suited for, estimate the percentage of that market that you think you will reasonably be able to take over. Take in to account the number of your competitors, their size, and the amount of market they already have. It is important to be realistic during this exercise.
Step 6: Choose a Location – is your new business going to be on the web? Or will you have a retail storefront? Will you consult out of your home office? Be careful to weight both your personal preferences and what makes the most sense for the ultimate success of your business. You might like the idea of working in your pajamas every day, but if your shingle needs to be seen by the public for maximum growth potential, a home office might not be your best option.
Step 7: Develop a Marketing Plan – here you will be forced to detail you plan to gain customers, and turn a profit. Discuss possible marketing channels, price points, advertising, and sales promotion.
Step 8: Develop an Organizational Plan – what skills and talents do your new business need to not only survive, but to grow as well? If you don’t have all these traits, how are you going to get them in the door? Will you hire freelancers? Are you hoping to bring on an employee right away? If these individuals, and their skill sets, are vital to your success, do not make a plan without them!
Step 9: Decide on Your Status – sole proprietor? Partnership? You need to decide how you’re going to approach this, and investigate the legal ramifications of each situation. As a sole proprietor, you’re in control, but you’re also solely responsible. In a partnership, you share the responsibility, but you also share the decision making and the profits. What works best for your budget AND your personality?
Step 10: Address Your Accounting – if you don’t know how much money is coming in and out of your business, you will never know if you are making a profit, or if you need to make changes. Keeping track of your numbers is one of the single most important things you can do for your business. Decide on whether you will do it in house, or outsource it to a professional; if you take care of it yourself, decide on what software you will use.
Step 11: Put it All into Numbers – this may or may not be necessary for you; it depends on what type of business you are starting. When you approach a financial institution for a small business loan, they will respond better if they see all of your plans in numbers; they are, after all, in the business of numbers. So, go back through all the above steps, and assign dollar amounts to what you can; when you approach the bank, you can tell them exactly how much you need, and show them where their money will be going. You can then show them, with a number, how much of the market you are planning to corner, and your growth, by percentage, over the next X years.
That’s it – wasn’t so hard after all, was it?
India - The Real Estate Player
by: Rahul Boss
In the new millennia of real estate India has emerged as strong, swift and bold player. Industry expert’s believe that the Indian real estate has huge demand potential in almost every sector, be it commercial, residential or retail.
"India is the most exciting real estate market in Asia," says Michael Smith, head of Asian real estate investment banking at Goldman Sachs. "It's one of the last major countries in Asia with an improving market."
The Real Estate explosion
This spurt of growth in the Indian real estate is in large part due to the by the burgeoning outsourcing and information technology (IT) industry. By 2010, the IT sector alone is expected to require 150 million sq.ft. Of space across major cities .New companies means new offices, houses, shops in short commercial, residential and retail space.
This growth is facilitated by favorable demographics, increasing purchasing power, existence of customer-friendly banks and housing finance companies, professionalism in real estate and reforms initiated by the Government to attract global investors. People have more purchasing power and exposure to organized retail formats has redefined the consumption pattern. Even small towns want to emulate the culture of their big city cousins. As a result, retail projects have been mushrooming across even B-grade cities.
This new way of life has quite drastically changed the face of India’s real estate, may it be the city centers the urban areas or the new yuppie towns. Small shops, old fashioned bungalows and office blocks have all changed into luxurious apartments, with club-houses, pools and sprawling greens. Instead of small shops we have humongous sprawling malls and office complexes.
The Global Effect
When Farallon Capital Management, a U.S. hedge fund, and its joint-venture partner, Indiabulls, snapped up an 11-acre property in central Mumbai in March 2005 for $54.5 million an acre, the purchase was called an act of idiocy by local developers. A few months later, when the same joint venture offered $95.5 million an acre for a nearby property, this was the second-lowest bid.
The first dynamic impact that announced a global change in the Indian real estate sector came when the Government introduced new policies in February 2005. It allowed 100 per cent foreign investments in construction projects with fast-track approvals. But the fatal attraction for foreign investors was the potential investment returns of 25 per cent or more in Indian projects that were nearly impossible to achieve in the US and European markets today.
Industry sources more than 90 foreign investors are already in the country tapping into the real estate investment avenues in India. Dozens of US funds are being raised for investments in Indian realty. Those raising the funds include Blackstone Group (US$ 1 billion) Goldman Sachs (US$ 1 billion), Citigroup Property Investors (US$ 125 million), Morgan Stanley (US$ 70 million) and GE Commercial Finance Real Estate (US$ 63 million) JP Morgan, Warburg Pincus, Merrill Lynch, Lehman Brothers, Warren Buffett’s Berkshire Hathaway, Colony Capital and Starwood Capital, and believe it or not this is just the tip of the ice-berg.
Morgan Stanley closed a deal worth about US$ 150 million with Oberoi Constructions in Mumbai. The Nakheel Group in Dubai entered into a US$ 10 billion deal with DLF for residential projects in Tier I and II cities. This was followed by three financial institutions -- Khaleej Finance and Investment (KFI) from Bahrain, Kuwait Investment Company (KIC) and Kuwait Finance House (KFH) -- from the Middle East promoting a US$ 200 million fund for investing in India.
Players At Home
Investors back home have also sat and started taking active participation in the real estate segment. Indian financial institutions are competing with each other. Prominent companies promoting real estate funds in India are HDFC Property Fund, DHFL Venture Capital Fund, Kotak Mahindra Realty Fund, Kshitij Venture Capital Fund and ICICI’s real estate fund, India Advantage Fund.
The Tata group has also joined hands with private equity firm, Xander, to raise US$ 1 billion for an institutional retail real estate fund. DLF has raised US$ 2.24 billion in the country's largest initial public offering and has also entered into a joint venture agreement with Indian pharmaceutical major Ranbaxy group company Fortis Healthcare to set up hospitals across the country with investments of about US$ 1.5 billion.
Conclusion
But with the boom comes the crunch, property prices in India are rising fast, real fast and not just in the biggest cities. As the tech boom spreads across the country, and as more Indians buy homes, and as the economy grows at faster than 8% a year, real estate is attracting more investors, many of them from abroad.
It is really no longer going to be cheap or easy to be a player in the Indian Real Estate Game.
In the new millennia of real estate India has emerged as strong, swift and bold player. Industry expert’s believe that the Indian real estate has huge demand potential in almost every sector, be it commercial, residential or retail.
"India is the most exciting real estate market in Asia," says Michael Smith, head of Asian real estate investment banking at Goldman Sachs. "It's one of the last major countries in Asia with an improving market."
The Real Estate explosion
This spurt of growth in the Indian real estate is in large part due to the by the burgeoning outsourcing and information technology (IT) industry. By 2010, the IT sector alone is expected to require 150 million sq.ft. Of space across major cities .New companies means new offices, houses, shops in short commercial, residential and retail space.
This growth is facilitated by favorable demographics, increasing purchasing power, existence of customer-friendly banks and housing finance companies, professionalism in real estate and reforms initiated by the Government to attract global investors. People have more purchasing power and exposure to organized retail formats has redefined the consumption pattern. Even small towns want to emulate the culture of their big city cousins. As a result, retail projects have been mushrooming across even B-grade cities.
This new way of life has quite drastically changed the face of India’s real estate, may it be the city centers the urban areas or the new yuppie towns. Small shops, old fashioned bungalows and office blocks have all changed into luxurious apartments, with club-houses, pools and sprawling greens. Instead of small shops we have humongous sprawling malls and office complexes.
The Global Effect
When Farallon Capital Management, a U.S. hedge fund, and its joint-venture partner, Indiabulls, snapped up an 11-acre property in central Mumbai in March 2005 for $54.5 million an acre, the purchase was called an act of idiocy by local developers. A few months later, when the same joint venture offered $95.5 million an acre for a nearby property, this was the second-lowest bid.
The first dynamic impact that announced a global change in the Indian real estate sector came when the Government introduced new policies in February 2005. It allowed 100 per cent foreign investments in construction projects with fast-track approvals. But the fatal attraction for foreign investors was the potential investment returns of 25 per cent or more in Indian projects that were nearly impossible to achieve in the US and European markets today.
Industry sources more than 90 foreign investors are already in the country tapping into the real estate investment avenues in India. Dozens of US funds are being raised for investments in Indian realty. Those raising the funds include Blackstone Group (US$ 1 billion) Goldman Sachs (US$ 1 billion), Citigroup Property Investors (US$ 125 million), Morgan Stanley (US$ 70 million) and GE Commercial Finance Real Estate (US$ 63 million) JP Morgan, Warburg Pincus, Merrill Lynch, Lehman Brothers, Warren Buffett’s Berkshire Hathaway, Colony Capital and Starwood Capital, and believe it or not this is just the tip of the ice-berg.
Morgan Stanley closed a deal worth about US$ 150 million with Oberoi Constructions in Mumbai. The Nakheel Group in Dubai entered into a US$ 10 billion deal with DLF for residential projects in Tier I and II cities. This was followed by three financial institutions -- Khaleej Finance and Investment (KFI) from Bahrain, Kuwait Investment Company (KIC) and Kuwait Finance House (KFH) -- from the Middle East promoting a US$ 200 million fund for investing in India.
Players At Home
Investors back home have also sat and started taking active participation in the real estate segment. Indian financial institutions are competing with each other. Prominent companies promoting real estate funds in India are HDFC Property Fund, DHFL Venture Capital Fund, Kotak Mahindra Realty Fund, Kshitij Venture Capital Fund and ICICI’s real estate fund, India Advantage Fund.
The Tata group has also joined hands with private equity firm, Xander, to raise US$ 1 billion for an institutional retail real estate fund. DLF has raised US$ 2.24 billion in the country's largest initial public offering and has also entered into a joint venture agreement with Indian pharmaceutical major Ranbaxy group company Fortis Healthcare to set up hospitals across the country with investments of about US$ 1.5 billion.
Conclusion
But with the boom comes the crunch, property prices in India are rising fast, real fast and not just in the biggest cities. As the tech boom spreads across the country, and as more Indians buy homes, and as the economy grows at faster than 8% a year, real estate is attracting more investors, many of them from abroad.
It is really no longer going to be cheap or easy to be a player in the Indian Real Estate Game.
What Is “The Secret” To Finding Real Wealth?
by: John J. Lynch
Did you know that less than one percent of the people currently living on this planet account for almost twenty-five percent of ALL the wealth? These powerful people certainly don’t want you to know this...they want you to stay as mindless drones whose sole objective is to keep THEM wealthy. What is the secret this small fraction of the population knows that the rest do not?
If you haven't seen the movie "The Secret", I implore you to watch it! The Secret is the most powerful law in the universe! If you have already seen it, watch it again. To watch "The Secret" online, copy and paste this url into your browser; http://www.thesecret.tv/home.html
Or you can watch "The Secret" On Demand via cable and satellite for audiences in the United States and Canada.
This small minority of people who are currently pulling the strings on world politics and world economics have mastered The Secret. These are the same people who want The Secret banned like it was once banned hundreds of years ago. Now The Secret has been un-earthed for all to discover its tremendous power once again!
There also have been great leaders who have mastered The Secret and made positive contributions to all of humanity. Leaders like Albert Einstein, Abe Lincoln, and Mother Teresa to name a few.
We are now living in an exciting new age of technology where humanity can do incredible things. The brick and mortar corporations who once ruled our economy unequivocally over the little guy are slowly losing their death grip due to the astonishing power of the internet!
So what is this secret you ask? In a sentence; "The Secret Is The Law Of Attraction". Simply stated, you get what you wish for...or your thoughts dictate what you get in life. Your health is dictated by your thoughts as well as your wealth.
Think of your thoughts as little tiny magnets...the intensity of these tiny magnets or thoughts are in direct proportion to the emotions you attach to it. The stronger the magnet, the stronger the attraction. This explains why a lot of people don't get what they wish for. They have not attached a strong enough emotion to their dream. Or they feel they don’t deserve their dream so they don’t bother pursuing it.
Let me give you an example of how the law of attraction works in a negative way. Think of the days when you got started off the wrong foot, then said to yourself "this is gonna be a long and terrible day". What happened? A long and terrible day...you got what you wished for! The degree of how terrible your day turned out was proportional to the intensity of the negative emotion you attached to the thought, right?
So how do these little "magnets" or thoughts attract what we want or don't want in our lives you ask? Well, and this is based on quantum physics that scientists have just learned in the last 10 or 15 years. There is an invisible universal mind if you will that contains all the dreams and thoughts of everyone who has ever lived or will live...past...present...future. This is quite the paradox you may think, how can this be?
The "time" element in this universal mind has been negated or altered. Quantum physics has recently shown us that a single electron can occupy two different spaces in an electro-magnetic field at the same exact point in time, once thought impossible. This goes against the laws of physics unless time has been negated or altered some how, the only possible explanation. So you may be able to connect with the dreams of someone who hasn't been born yet. Are you getting excited yet?
The Universal Mind is a sort of collective consciousness. The place where dreams are born. These dreams are invisible and waiting to take physical form.
How do you convert your dreams from the universal mind to the physical realm? By constantly thinking about your dreams with strong emotions and just as importantly - taking action! I am NOT talking about wishful thinking here...you must take action on your dreams!
It helps to have pictures of your dreams and look at them every day. Write your dreams down. Formulate a plan that is specific and with deadlines that will bring your dreams to fruition...and stay the course! “Don’t die with your dreams still inside you” as Dr. Wayne Dyer likes to say.
That is why I firmly believe you should pursue ventures you have a passion for...then you will find it easier to attach strong positive emotions to your thoughts and dreams.
This is the most powerful law in the universe, use it wisely my liege...
Good Luck and Stay the Course!
John Lynch
Did you know that less than one percent of the people currently living on this planet account for almost twenty-five percent of ALL the wealth? These powerful people certainly don’t want you to know this...they want you to stay as mindless drones whose sole objective is to keep THEM wealthy. What is the secret this small fraction of the population knows that the rest do not?
If you haven't seen the movie "The Secret", I implore you to watch it! The Secret is the most powerful law in the universe! If you have already seen it, watch it again. To watch "The Secret" online, copy and paste this url into your browser; http://www.thesecret.tv/home.html
Or you can watch "The Secret" On Demand via cable and satellite for audiences in the United States and Canada.
This small minority of people who are currently pulling the strings on world politics and world economics have mastered The Secret. These are the same people who want The Secret banned like it was once banned hundreds of years ago. Now The Secret has been un-earthed for all to discover its tremendous power once again!
There also have been great leaders who have mastered The Secret and made positive contributions to all of humanity. Leaders like Albert Einstein, Abe Lincoln, and Mother Teresa to name a few.
We are now living in an exciting new age of technology where humanity can do incredible things. The brick and mortar corporations who once ruled our economy unequivocally over the little guy are slowly losing their death grip due to the astonishing power of the internet!
So what is this secret you ask? In a sentence; "The Secret Is The Law Of Attraction". Simply stated, you get what you wish for...or your thoughts dictate what you get in life. Your health is dictated by your thoughts as well as your wealth.
Think of your thoughts as little tiny magnets...the intensity of these tiny magnets or thoughts are in direct proportion to the emotions you attach to it. The stronger the magnet, the stronger the attraction. This explains why a lot of people don't get what they wish for. They have not attached a strong enough emotion to their dream. Or they feel they don’t deserve their dream so they don’t bother pursuing it.
Let me give you an example of how the law of attraction works in a negative way. Think of the days when you got started off the wrong foot, then said to yourself "this is gonna be a long and terrible day". What happened? A long and terrible day...you got what you wished for! The degree of how terrible your day turned out was proportional to the intensity of the negative emotion you attached to the thought, right?
So how do these little "magnets" or thoughts attract what we want or don't want in our lives you ask? Well, and this is based on quantum physics that scientists have just learned in the last 10 or 15 years. There is an invisible universal mind if you will that contains all the dreams and thoughts of everyone who has ever lived or will live...past...present...future. This is quite the paradox you may think, how can this be?
The "time" element in this universal mind has been negated or altered. Quantum physics has recently shown us that a single electron can occupy two different spaces in an electro-magnetic field at the same exact point in time, once thought impossible. This goes against the laws of physics unless time has been negated or altered some how, the only possible explanation. So you may be able to connect with the dreams of someone who hasn't been born yet. Are you getting excited yet?
The Universal Mind is a sort of collective consciousness. The place where dreams are born. These dreams are invisible and waiting to take physical form.
How do you convert your dreams from the universal mind to the physical realm? By constantly thinking about your dreams with strong emotions and just as importantly - taking action! I am NOT talking about wishful thinking here...you must take action on your dreams!
It helps to have pictures of your dreams and look at them every day. Write your dreams down. Formulate a plan that is specific and with deadlines that will bring your dreams to fruition...and stay the course! “Don’t die with your dreams still inside you” as Dr. Wayne Dyer likes to say.
That is why I firmly believe you should pursue ventures you have a passion for...then you will find it easier to attach strong positive emotions to your thoughts and dreams.
This is the most powerful law in the universe, use it wisely my liege...
Good Luck and Stay the Course!
John Lynch
How to Profit from Public Auctions
by: Dale Hartley
What I'm about to reveal cannot be accomplished every time and at every auction. At most auctions you can do well for yourself, but not make out like a bandit. But at some auctions you can make out like a bandit if you use your wits. If you attend auctions half a dozen or more times a year, your chances will come.
For Newbies: It's Not Rocket Science
Don't be intimidated by live auctions if you've never been to one. Just go and observe for awhile. Within an hour you'll understand the dynamics well enough to jump into the bidding.
The first thing to do upon arriving is register and get a bidder number. The auction company may require you to show a driver's license. This prevents people from (a) winning an item, changing their minds, and leaving without paying; or (b) using the "controlled chaos" as cover to shoplift their winnings.
Once you have your number, hang loose and observe for a few minutes. At first you may find the speed of the auction and the auctioneer's chant confusing. Don't worry about it. Within a short time it will all fall into place.
One final word for newbies: Find out if there's a "buyer's premium." A buyer's premium is a mark-up you pay in addition to your winning bid. It's part of the purchase price before sales tax is added. For example, if the auction has a 10% buyer's premium and you win something with a $90 bid, your price at check-out will be $99 plus tax.
Check the fine print of auction ads or flyers. Notice of a buyer's premium will be spelled out ("10% buyer's premium") or abbreviated ("15% BP). There should also be signs on display at the auction site announcing the buyer's premium if there is one. If in doubt, ask when you register.
Exploit Auction Circumstances
Just as no two auctions will offer exactly the same merchandise or draw exactly the same crowd, so no two auctions will be carried out under identical circumstances. I'll show you some ways to legitimately take advantage of an auction's flaws and weaknesses.
Examples of auction flaws or weaknesses: A lazy or mediocre auctioneer...a disorganized auction staff...too much inventory being sold in too short a time...a low turn-out or a crowd that starts drifting away early. These are factors that put pressure on the auctioneer and determine how well or poorly the sale progresses. By exploiting the auctioneer's disadvantages, you can turn him from your financial adversary into your reluctant financial benefactor.
The first strategy, therefore is to (a) be aware of the importance of auction flaws and weaknesses, and (b) learn to recognize and exploit them. Now I'll give you specific examples of how this is done.
Divide and Profit
About three years ago I attended a regular monthly antique auction held at an auctioneer's warehouse. At this event he was overloaded with inventory and was trying to move as many lots as possible before his crowd began to drift away. The auctioneer's excess inventory and his haste to move as much merchandise as possible in a single day were weaknesses that I could exploit (and did).
One item I bought was a 1920's-era dining room suite in very good condition. It consisted of a table, eight chairs, and a china cabinet. Take notice of this: I didn't want the dining room. I didn't need it. I had no intention of taking possession of it (and I didn't). Yet I bid for it, won it, paid for it -- and profited from it! Here's how...
Normally the auctioneer wouldn't sell a valuable old dining room like this as a complete set. He'd get a better total price by dividing the set into three "lots" (the table, the chairs, and the china cabinet) and selling each lot separately. By doing this he forces people who want the whole set to bid not only against each other, but also against those who want just parts of the set. And once a "whole-set" bidder has won part of the set, he or she will bid aggressively to get the rest.
But on this day the auctioneer offered the complete dining room "all for one money" (as we auctioneers say) because he just had too much merchandise to move. So I bought it.
I paid $1300 for the set (only one other person was interested in the entire set, so I had little competition). I left this furniture in the auction barn and called the auctioneer a couple of days later. I told him I wanted to re-consign the dining room for his next sale one month later. I specified that he should sell it in three separate lots. At the next auction my dining room sold for $2400 total. Less his commission, I pocketed about $500 without so much as even touching the furniture. Not a huge windfall, but then again I didn't have to do anything except bid, pay, and make a phone call to the auctioneer. (And that was just one transaction among half a dozen that I profited from!)
Right Merchandise, Wrong Market
Remember that antique baby grand piano I got for $1,000? I bought that to keep, not to resell. It's worth at least $5,000. So how did I get it so cheap?
The piano was the right item being sold at the wrong place and to the wrong crowd.
The auction was held in a little Southern town of about 300 people. Just a post office, a railroad track, and this auctioneer's warehouse (not the same place that I bought the dining room). This auctioneer was well-established and drew his crowd from many bigger outlying communities. But his average crowd was between 100 and 150 people, most of them rural people with no interest in grand pianos. (Plus there was the additional problem of moving it. Once again, I was one of only two bidders.
Here's another example. This time I was buying to resell, and this was a smaller and more common-place type of transaction:
I was at an estate auction being held onsite at the deceased person's home. The auctioneer had a tent set up in the yard, and all the household goods were displayed inside the tent. Once again, this took place in a small town (about 5,000 people).
The auctioneer offered a cardboard box full of bric-a-brac. I had already spotted the box and knew I would bid for it. Among the assorted junk in the box was a pair of small Black Forest wall shelves. The shelves were supported by carved deer heads with glass eyes. As it turned out, neither the auctioneer nor the crowd knew what they were or their value. I bought the box for $65 and resold the shelves on eBay for $235 (i.e., right merchandise at the right marketplace). The rest of the junk in the box I tossed (yard sale type junk).
Buying to Resell
== eBay ==
You have to be careful when buying anything to resell on eBay. As a marketplace eBay has become a victim of its own success. It's overly crowded and competitive. I'm not a frequent seller on eBay, but when I do list items I have about an 80% success rate. And I only list items that I feel sure will sell. Yet I still have about 20% no-sales.
Other eBay hazards include the hassle of non-paying bidders and the risk of selling-but-not-profiting. You can sell-but-not-profit if your merchandise only attracts one or two bids. When this happens, the eBay and Paypal fees (not to mention the time and gas required to ship your items) can erode your gains.
But some items are consistently reliable sellers. If you know something about auto parts, jewelry, china, or any other product line with a niche market, you might be able to convert live auction purchases into eBay sales.
== Antique Booth ==
You can get started in the antique business on a strictly part-time and absentee basis. All you have to do is rent a booth in a local antique mall. The mall management will mind the store and make the sales. You only have to keep your booth stocked with inventory from estate sales, garage sales, and antique auctions.
If you already know something about antiques or collectibles, that's great. Because you already know more than I did when I started. I knew next to nothing. I only knew what I liked. Everything I've learned about antiques and collectibles is the result of going to antique malls and attending auctions.
== Flea Market ==
With a flea market booth you're not limited to antiques and collectibles, and you don't have to know anything about the merchandise except what it will sell for.
If you go the flea market route, estate auctions are still very good sources -- but you can probably do exceptionally well for yourself at business liquidations, storage unit auctions, and surplus or salvage auctions.
As you can see, the potential to profit from public auctions is limited only by your time and ingenuity!
What I'm about to reveal cannot be accomplished every time and at every auction. At most auctions you can do well for yourself, but not make out like a bandit. But at some auctions you can make out like a bandit if you use your wits. If you attend auctions half a dozen or more times a year, your chances will come.
For Newbies: It's Not Rocket Science
Don't be intimidated by live auctions if you've never been to one. Just go and observe for awhile. Within an hour you'll understand the dynamics well enough to jump into the bidding.
The first thing to do upon arriving is register and get a bidder number. The auction company may require you to show a driver's license. This prevents people from (a) winning an item, changing their minds, and leaving without paying; or (b) using the "controlled chaos" as cover to shoplift their winnings.
Once you have your number, hang loose and observe for a few minutes. At first you may find the speed of the auction and the auctioneer's chant confusing. Don't worry about it. Within a short time it will all fall into place.
One final word for newbies: Find out if there's a "buyer's premium." A buyer's premium is a mark-up you pay in addition to your winning bid. It's part of the purchase price before sales tax is added. For example, if the auction has a 10% buyer's premium and you win something with a $90 bid, your price at check-out will be $99 plus tax.
Check the fine print of auction ads or flyers. Notice of a buyer's premium will be spelled out ("10% buyer's premium") or abbreviated ("15% BP). There should also be signs on display at the auction site announcing the buyer's premium if there is one. If in doubt, ask when you register.
Exploit Auction Circumstances
Just as no two auctions will offer exactly the same merchandise or draw exactly the same crowd, so no two auctions will be carried out under identical circumstances. I'll show you some ways to legitimately take advantage of an auction's flaws and weaknesses.
Examples of auction flaws or weaknesses: A lazy or mediocre auctioneer...a disorganized auction staff...too much inventory being sold in too short a time...a low turn-out or a crowd that starts drifting away early. These are factors that put pressure on the auctioneer and determine how well or poorly the sale progresses. By exploiting the auctioneer's disadvantages, you can turn him from your financial adversary into your reluctant financial benefactor.
The first strategy, therefore is to (a) be aware of the importance of auction flaws and weaknesses, and (b) learn to recognize and exploit them. Now I'll give you specific examples of how this is done.
Divide and Profit
About three years ago I attended a regular monthly antique auction held at an auctioneer's warehouse. At this event he was overloaded with inventory and was trying to move as many lots as possible before his crowd began to drift away. The auctioneer's excess inventory and his haste to move as much merchandise as possible in a single day were weaknesses that I could exploit (and did).
One item I bought was a 1920's-era dining room suite in very good condition. It consisted of a table, eight chairs, and a china cabinet. Take notice of this: I didn't want the dining room. I didn't need it. I had no intention of taking possession of it (and I didn't). Yet I bid for it, won it, paid for it -- and profited from it! Here's how...
Normally the auctioneer wouldn't sell a valuable old dining room like this as a complete set. He'd get a better total price by dividing the set into three "lots" (the table, the chairs, and the china cabinet) and selling each lot separately. By doing this he forces people who want the whole set to bid not only against each other, but also against those who want just parts of the set. And once a "whole-set" bidder has won part of the set, he or she will bid aggressively to get the rest.
But on this day the auctioneer offered the complete dining room "all for one money" (as we auctioneers say) because he just had too much merchandise to move. So I bought it.
I paid $1300 for the set (only one other person was interested in the entire set, so I had little competition). I left this furniture in the auction barn and called the auctioneer a couple of days later. I told him I wanted to re-consign the dining room for his next sale one month later. I specified that he should sell it in three separate lots. At the next auction my dining room sold for $2400 total. Less his commission, I pocketed about $500 without so much as even touching the furniture. Not a huge windfall, but then again I didn't have to do anything except bid, pay, and make a phone call to the auctioneer. (And that was just one transaction among half a dozen that I profited from!)
Right Merchandise, Wrong Market
Remember that antique baby grand piano I got for $1,000? I bought that to keep, not to resell. It's worth at least $5,000. So how did I get it so cheap?
The piano was the right item being sold at the wrong place and to the wrong crowd.
The auction was held in a little Southern town of about 300 people. Just a post office, a railroad track, and this auctioneer's warehouse (not the same place that I bought the dining room). This auctioneer was well-established and drew his crowd from many bigger outlying communities. But his average crowd was between 100 and 150 people, most of them rural people with no interest in grand pianos. (Plus there was the additional problem of moving it. Once again, I was one of only two bidders.
Here's another example. This time I was buying to resell, and this was a smaller and more common-place type of transaction:
I was at an estate auction being held onsite at the deceased person's home. The auctioneer had a tent set up in the yard, and all the household goods were displayed inside the tent. Once again, this took place in a small town (about 5,000 people).
The auctioneer offered a cardboard box full of bric-a-brac. I had already spotted the box and knew I would bid for it. Among the assorted junk in the box was a pair of small Black Forest wall shelves. The shelves were supported by carved deer heads with glass eyes. As it turned out, neither the auctioneer nor the crowd knew what they were or their value. I bought the box for $65 and resold the shelves on eBay for $235 (i.e., right merchandise at the right marketplace). The rest of the junk in the box I tossed (yard sale type junk).
Buying to Resell
== eBay ==
You have to be careful when buying anything to resell on eBay. As a marketplace eBay has become a victim of its own success. It's overly crowded and competitive. I'm not a frequent seller on eBay, but when I do list items I have about an 80% success rate. And I only list items that I feel sure will sell. Yet I still have about 20% no-sales.
Other eBay hazards include the hassle of non-paying bidders and the risk of selling-but-not-profiting. You can sell-but-not-profit if your merchandise only attracts one or two bids. When this happens, the eBay and Paypal fees (not to mention the time and gas required to ship your items) can erode your gains.
But some items are consistently reliable sellers. If you know something about auto parts, jewelry, china, or any other product line with a niche market, you might be able to convert live auction purchases into eBay sales.
== Antique Booth ==
You can get started in the antique business on a strictly part-time and absentee basis. All you have to do is rent a booth in a local antique mall. The mall management will mind the store and make the sales. You only have to keep your booth stocked with inventory from estate sales, garage sales, and antique auctions.
If you already know something about antiques or collectibles, that's great. Because you already know more than I did when I started. I knew next to nothing. I only knew what I liked. Everything I've learned about antiques and collectibles is the result of going to antique malls and attending auctions.
== Flea Market ==
With a flea market booth you're not limited to antiques and collectibles, and you don't have to know anything about the merchandise except what it will sell for.
If you go the flea market route, estate auctions are still very good sources -- but you can probably do exceptionally well for yourself at business liquidations, storage unit auctions, and surplus or salvage auctions.
As you can see, the potential to profit from public auctions is limited only by your time and ingenuity!
Public Auctions: Bargains and Bamboozles
by: Dale Hartley
I used to dabble in antiques as a hobby and made a nice part-time income from buying and selling. To keep myself supplied with inventory, I attended live auctions regularly.
One thing led to another, and I decided to go to auctioneer school and get my auctioneer's license. Since I was already dealing in antiques, I thought it would be fun and profitable to auction antiques and estates.
Well, it was an adventure anyway, but I'm no longer a practicing auctioneer. Preparing for each auction, and closing the books afterwards, took far more time than I expected. And although I profited from each auction, the payoff wasn't that great in relation to the amount of work involved.
I'll spare you my auction school horror story, in which one student arrived with an extremely brutal strain of the flu and gave it to everyone else in the class.
And I'll spare you my impression of the fine instructors: "Now, this is illegal as hell, but here's what one guy does...."
And I'll spare you the typical estate auction client, whose Mama has just died and who wants to auction her 10 year old Montgomery Ward "antique" living room suite for not a penny less than she paid for it.
Yes, gentle reader, I'll spare you the gruesome details of the auction business and give you an insider's view of what you as an auction consumer should watch for.
Auctioneer Tricks
== PHANTOM BIDS ==
Suppose I'm auctioning an oil painting that's worth about $500.00. The customary (and legitimate) practice is as follows:
1) I start calling for bids at $500.00
2) When no one bids, I drop back to maybe $400.00
3) Then, when no one bids again, I drop back to
the "real steal" price of maybe $300.00
As soon as I call $300.00, several hands will go up. The correct procedure is for the auctioneer to acknowledge the first bidder he sees or, if he sees several at once, to just pick one and carry on from there. But here's the trick...
A slick and slippery auctioneer will see three hands go up at once (each intending to bid $300.00), and he'll point quickly to each, "$300.00, now $325.00, now $350.00" before they can drop their hands. Then he's off and running. It happens so fast that the bidders hardly realize what he did.
There are two things wrong with this:
First, none of those bidders offered a bid any higher than $300.00. They probably would have continued to bid up the price, but that's not the point. It's their decision whether to offer a higher bid. It's not the auctioneer's right to force a higher bid upon them.
Second -- and this is what's really nasty -- those two bids above $300.00 were "phantom bids" to the tune of $50.00. That's illegal. It's fraudulent. It's an offense reportable to the state licensing board. And it happens all the time.
So why would bidders allow an auctioneer to assign them higher phantom bids that they didn't make? A combination of factors: The auction is so fast-paced and adrenaline-charged that the auctioneer's sleight-of-hand may not immediately register. And they may think, "That's fine. I'm going to bid higher than that anyway." They also probably defer to the auctioneer's authority thinking, "Well, I had my hand in the air." And most people do not know this little secret:
By law, a bidder may retract his or her
bid at any time before the auctioneer says "SOLD!"
[ Uniform Commercial Code §2-328(3) ]
If you're an eBay user, you probably know that retractions are allowed only in rare and exceptional circumstances. Guess what? That's just an eBay company policy! By law, any bidder may retract any bid for any reason while the auction is still in progress. Of course, at a live auction this means interrupting the auctioneer and bringing the sale to a temporary halt, which is another reason bidders let auctioneers get away with such antics.
== SHILL BIDS ==
As most people know, shill bidding is a scam whereby the auctioneer has one or more cronies pose as bidders to run up the final auction price. This is common in online auctions, where fraud is easier to conceal (and where the seller can act as his or her own shill without the aid of others).
At live auctions, shill bidding is so transparent and risky as to be downright stupid. In all the auctions I attended, I only saw it once (and in that case it would have been obvious to the village idiot).
The online auction site uBid has an interesting policy that, in my opinion, encourages shill bidding whether intentionally or not. I am not accusing uBid or any of its sellers of shill bidding, because I have no evidence of such. I am only commenting on their policy, which is:
"If there are any bids within 10 minutes of the auction close time, the auction will be extended until there are no bids for 10 continuous minutes. There is no limit to the number of times an auction can be extended."
IF I were selling something on uBid, and IF I wasn't satisfied with the bids, I could simply cast a shill bid and keep the thing going indefinitely. IF I were to do such a thing, the entire transaction would be a sham and a scam.
At a live auction you can watch for phantom bids and shill bids by standing in the back of the the crowd and observing both the auctioneer and the bidders simultaneously.
== BACKING-OFF ==
Now, suppose that an auctioneer, while calling bids, gestures somewhere towards the back of a crowd and calls a phantom bid to help advance the price. And then suppose no one else bids. Uh-oh.
The crooked and greedy auctioneer is about to expose himself for the con artist he is, unless --
"Were you bidding, sir?" (Speaking to the phantom somewhere in the back of the crowd.) "Oh, I thought you put your hand up."
And then he backs-off to the next lowest bid and sells to that person. Whew, that was a close one!
This is why it's a good idea to sit or stand where you can observe both the auctioneer and the crowd, especially with an auctioneer you haven't patronized before.
Reserve or Absolute?
Suppose you see an advertisement for an "Estate Auction" listing the property to be sold, the date and location, and various other information about the sale, but no mention is made whether the auction is "absolute" (everything will sell to highest bidder regardless of price) or "reserve" (auctioneer may refuse to sell below a certain price). Every auction is either a reserve or absolute auction. But how can you tell when the auction ads don't specify? The auction company's very silence is your answer.
Per the Uniform Commercial Code [ §2-328(3) ], all auctions are deemed to be with reserve unless stated otherwise. If the advertising doesn't specify "absolute," then it's automatically a reserve auction. This doesn't necessarily mean that every item will have a minimum price. Most items probably will be sold absolute, even at a reserve price auction. It just means the auctioneer, acting on behalf of the seller, retains the right of refusal.
An auctioneer might have the seller's full authority to sell absolute -- this is common when liquidating estates -- but may still choose to leave the word "absolute" out of the advertising, just to retain some flexibility. If there's a light turn-out and very sparse bidding, for example, the auctioneer might want to pack it in rather than to let everything go for pennies on the dollar.
Buyer Beware
As soon as you win something at auction, the staff will immediately hand it over to you -- unless of course it's a piece of furniture or other large item. As the auction progresses, piles of merchandise will begin to accumulate around each buyer. Why, you may wonder, don't they just mark these items with your bidder number (like they do with large items) and hold them until you're ready to leave?
Be seated, Grasshopper. You have much to learn.
Under the arcana of auction law, the sale is consummated when the auctioneer says "SOLD!", not when you check out and pay. Therefore, the risk of theft or damage immediately passes to you...unless the auction company volunteers to safeguard your purchases. And this is why your auction winnings get dropped in your lap forthwith. Things do walk off or get damaged at auctions.. Better this should happen on your watch than the auctioneer's.
Auctions can be exciting and rewarding, but as someone who's "walked both sides of the street," I recommend approaching the entire experience as you would a carnival booth:
"Behold, I sent you forth as sheep in the midst of wolves: be ye therefore wise as serpents and harmless as doves."
-- Matthew 10:16
I used to dabble in antiques as a hobby and made a nice part-time income from buying and selling. To keep myself supplied with inventory, I attended live auctions regularly.
One thing led to another, and I decided to go to auctioneer school and get my auctioneer's license. Since I was already dealing in antiques, I thought it would be fun and profitable to auction antiques and estates.
Well, it was an adventure anyway, but I'm no longer a practicing auctioneer. Preparing for each auction, and closing the books afterwards, took far more time than I expected. And although I profited from each auction, the payoff wasn't that great in relation to the amount of work involved.
I'll spare you my auction school horror story, in which one student arrived with an extremely brutal strain of the flu and gave it to everyone else in the class.
And I'll spare you my impression of the fine instructors: "Now, this is illegal as hell, but here's what one guy does...."
And I'll spare you the typical estate auction client, whose Mama has just died and who wants to auction her 10 year old Montgomery Ward "antique" living room suite for not a penny less than she paid for it.
Yes, gentle reader, I'll spare you the gruesome details of the auction business and give you an insider's view of what you as an auction consumer should watch for.
Auctioneer Tricks
== PHANTOM BIDS ==
Suppose I'm auctioning an oil painting that's worth about $500.00. The customary (and legitimate) practice is as follows:
1) I start calling for bids at $500.00
2) When no one bids, I drop back to maybe $400.00
3) Then, when no one bids again, I drop back to
the "real steal" price of maybe $300.00
As soon as I call $300.00, several hands will go up. The correct procedure is for the auctioneer to acknowledge the first bidder he sees or, if he sees several at once, to just pick one and carry on from there. But here's the trick...
A slick and slippery auctioneer will see three hands go up at once (each intending to bid $300.00), and he'll point quickly to each, "$300.00, now $325.00, now $350.00" before they can drop their hands. Then he's off and running. It happens so fast that the bidders hardly realize what he did.
There are two things wrong with this:
First, none of those bidders offered a bid any higher than $300.00. They probably would have continued to bid up the price, but that's not the point. It's their decision whether to offer a higher bid. It's not the auctioneer's right to force a higher bid upon them.
Second -- and this is what's really nasty -- those two bids above $300.00 were "phantom bids" to the tune of $50.00. That's illegal. It's fraudulent. It's an offense reportable to the state licensing board. And it happens all the time.
So why would bidders allow an auctioneer to assign them higher phantom bids that they didn't make? A combination of factors: The auction is so fast-paced and adrenaline-charged that the auctioneer's sleight-of-hand may not immediately register. And they may think, "That's fine. I'm going to bid higher than that anyway." They also probably defer to the auctioneer's authority thinking, "Well, I had my hand in the air." And most people do not know this little secret:
By law, a bidder may retract his or her
bid at any time before the auctioneer says "SOLD!"
[ Uniform Commercial Code §2-328(3) ]
If you're an eBay user, you probably know that retractions are allowed only in rare and exceptional circumstances. Guess what? That's just an eBay company policy! By law, any bidder may retract any bid for any reason while the auction is still in progress. Of course, at a live auction this means interrupting the auctioneer and bringing the sale to a temporary halt, which is another reason bidders let auctioneers get away with such antics.
== SHILL BIDS ==
As most people know, shill bidding is a scam whereby the auctioneer has one or more cronies pose as bidders to run up the final auction price. This is common in online auctions, where fraud is easier to conceal (and where the seller can act as his or her own shill without the aid of others).
At live auctions, shill bidding is so transparent and risky as to be downright stupid. In all the auctions I attended, I only saw it once (and in that case it would have been obvious to the village idiot).
The online auction site uBid has an interesting policy that, in my opinion, encourages shill bidding whether intentionally or not. I am not accusing uBid or any of its sellers of shill bidding, because I have no evidence of such. I am only commenting on their policy, which is:
"If there are any bids within 10 minutes of the auction close time, the auction will be extended until there are no bids for 10 continuous minutes. There is no limit to the number of times an auction can be extended."
IF I were selling something on uBid, and IF I wasn't satisfied with the bids, I could simply cast a shill bid and keep the thing going indefinitely. IF I were to do such a thing, the entire transaction would be a sham and a scam.
At a live auction you can watch for phantom bids and shill bids by standing in the back of the the crowd and observing both the auctioneer and the bidders simultaneously.
== BACKING-OFF ==
Now, suppose that an auctioneer, while calling bids, gestures somewhere towards the back of a crowd and calls a phantom bid to help advance the price. And then suppose no one else bids. Uh-oh.
The crooked and greedy auctioneer is about to expose himself for the con artist he is, unless --
"Were you bidding, sir?" (Speaking to the phantom somewhere in the back of the crowd.) "Oh, I thought you put your hand up."
And then he backs-off to the next lowest bid and sells to that person. Whew, that was a close one!
This is why it's a good idea to sit or stand where you can observe both the auctioneer and the crowd, especially with an auctioneer you haven't patronized before.
Reserve or Absolute?
Suppose you see an advertisement for an "Estate Auction" listing the property to be sold, the date and location, and various other information about the sale, but no mention is made whether the auction is "absolute" (everything will sell to highest bidder regardless of price) or "reserve" (auctioneer may refuse to sell below a certain price). Every auction is either a reserve or absolute auction. But how can you tell when the auction ads don't specify? The auction company's very silence is your answer.
Per the Uniform Commercial Code [ §2-328(3) ], all auctions are deemed to be with reserve unless stated otherwise. If the advertising doesn't specify "absolute," then it's automatically a reserve auction. This doesn't necessarily mean that every item will have a minimum price. Most items probably will be sold absolute, even at a reserve price auction. It just means the auctioneer, acting on behalf of the seller, retains the right of refusal.
An auctioneer might have the seller's full authority to sell absolute -- this is common when liquidating estates -- but may still choose to leave the word "absolute" out of the advertising, just to retain some flexibility. If there's a light turn-out and very sparse bidding, for example, the auctioneer might want to pack it in rather than to let everything go for pennies on the dollar.
Buyer Beware
As soon as you win something at auction, the staff will immediately hand it over to you -- unless of course it's a piece of furniture or other large item. As the auction progresses, piles of merchandise will begin to accumulate around each buyer. Why, you may wonder, don't they just mark these items with your bidder number (like they do with large items) and hold them until you're ready to leave?
Be seated, Grasshopper. You have much to learn.
Under the arcana of auction law, the sale is consummated when the auctioneer says "SOLD!", not when you check out and pay. Therefore, the risk of theft or damage immediately passes to you...unless the auction company volunteers to safeguard your purchases. And this is why your auction winnings get dropped in your lap forthwith. Things do walk off or get damaged at auctions.. Better this should happen on your watch than the auctioneer's.
Auctions can be exciting and rewarding, but as someone who's "walked both sides of the street," I recommend approaching the entire experience as you would a carnival booth:
"Behold, I sent you forth as sheep in the midst of wolves: be ye therefore wise as serpents and harmless as doves."
-- Matthew 10:16
Curious Employee Foils Corporate Credit Card Fraud Scam
by: Scott Burke
MOLLY, THE ASSISTANT, Molly treasurer at XYZ Corp. in Miami, opened an e-mail from a former colleague who no longer worked for the organization. The e-mail read: "Hi Molly, there should be a refund of $716 on my old corporate Visa card from the IP Conference. I paid for, but did not attend, the conference and did not turn in the charge to XYZ for reimbursement. Can you have Visa issue a refund check to me? Thanks very much for your help."
The e-mail was from Jerry, a former XYZ executive who had been Molly's boss at one time. The message seemed innocuous enough. Jerry had legitimately charged a business conference to his corporate credit card, but he had canceled his registration because he left the company. Therefore, he was due a refund.
It would have been very easy for Molly to trust her former boss and get him the refund. Instead, because something didn't seem quite right, she chose to check on whether XYZ had already reimbursed Jerry for the conference.
To make this determination, Molly accessed Jerry's corporate credit card records online and retrieved his expense reports from the accounts payable file room. The expense reports confirmed that Jerry had not expensed the conference fee, but when Molly looked at his credit card statement, she saw a couple of odd items.
First, the most recent statement indicated that the former XYZ executive had made four payments to his credit card in one month. Second, the statement was two pages long, and Molly knew that Jerry rarely traveled for business. She scanned the charges and noted that most of them were from local vendors. In addition, none of the items looked like business charges. The charges included dinners at local restaurants, department and grocery store charges, and airline tickets for Jerry and his wife that Molly knew were for their recent vacation.
Out of curiosity, Molly queried the company's checks online to see if any of the payments made on Jerry's Visa account matched the dollar amounts of checks written by XYZ. Sure enough, she found that all four payments made to Jerry's credit card that month equaled amounts on checks that the company had written to Visa. Molly increased the scope of her search and observed that every payment posted to Jerry's corporate credit card over the previous 12 months was from a check written by the company. She also noticed that of the $88,000 in charges on Jerry's card over that time frame, none was for business expenses.
Molly printed copies of all of the checks and noted that, although Visa was listed as the payee on all of them, Jerry's corporate credit card account number was handwritten on each check. Molly approached the director of internal auditing as well as Jerry's former manager and requested an investigation into the matter.
While working for XYZ, Jerry was in charge of making sure that the organization paid delinquent balances on the corporate credit cards of people who had left the company. XYZ had an arrangement with the credit card company that it would guarantee payment for certain employees if those employees did not pay the balances on their accounts. Once a month, Jerry would provide accounts payable with a list of delinquent accounts on guaranteed cards, and accounts payable would cut the check to the credit card company.
However, on the bottom of every check request in Jerry's last year of employment, he had written, "Please deliver the check to me." Typically, accounts payable would mail the check directly to the credit card company, but because accounts payable knew that Jerry maintained a relationship with the credit card company, they adhered to his request and delivered the checks to him. When Jerry received a check, he would write his own account number on the check, and the bank would apply the payment to Jerry's credit card.
Jerry did not need to make sure that the delinquent credit card owners listed on his spreadsheet paid their balances, because he had fabricated the delinquency list that he provided to accounts payable. In many cases, the employees with the so-called delinquent balances had left the organization long before, and they had paid their balances in full before departing.
So, where were the control breakdowns? First, Jerry had sole authority over the credit card function. He managed the corporate credit cards, reviewed the delinquent accounts, had access to the employee statements, and dealt with the bank's account managers. No one reviewed his work. As soon as accounts payable walked the checks down to his office, he had all he needed to perpetrate the fraud.
The second breakdown was that the accounts payable clerk walked the checks over to Jerry. Although not necessarily right, it is understandable that accounts payable would not have the time to audit Jerry's delinquency list. After all, accounts payable was processing more than 1,000 checks per week with a staff of six. However, it was unacceptable for the clerk to deliver the check directly to Jerry. The check should have gone from accounts payable to the vendor. The vendor invoice--or delinquency data in this case--should have contained all of the pertinent information to allow accounts payable to appropriately route the check.
XYZ decided to report Jerry to law enforcement. Although $88,000 is not a significant amount of money for a $1 billion company, and the legal fees and other costs might be high, the company wanted to demonstrate to its employees that it would not tolerate fraud and would hold perpetrators accountable. Decisive and timely action such as this is critical to maintaining a sound control environment.
Not everyone is as diligent as Molly. The lesson she applied is an important one to teach operations personnel: Take the time to check anything that doesn't seem right. Because she spent a few minutes performing due diligence, Molly uncovered an $88,000 fraud.
Several symptoms may have flagged the fraud. If internal auditing had been testing the employee credit card charges, simply identifying the top 25 corporate card users and reviewing their charges would have flagged Jerry. Travel reimbursements of $88,000 in one year covers a lot of travel. Testing the accounts of the people with the most posted credits would have similarly flagged Jerry. Also, Jerry averaged three payments a month on his credit card over the course of a year, an unusual pattern that, if identified, should have been investigated.
Testing the top 25 corporate credit card users and searching for unusual patterns are the staples of any audit program that contains tests designed to uncover fraud.
LESSONS LEARNED
* Employees should take the extra step. If employees are presented with a transaction that they do not completely understand, they should do what was going on so that it became clear to everyone that XYZ would not treat fraud lightly. what it takes to understand the transaction. Molly was one of the custodians of the organization's cash, so when someone asked for money from the company, even a trusted former boss, it was important for her to understand the nature of the transaction.
* Segregate duties. This is a concept that is drilled into the brains of internal auditors ad nauseam, but it is not necessarily communicated as often to operational management. The organization's head treasurer, to whom Jerry reported, was an ex- auditor and ex-controller, and therefore should have been aware of this control concept. However, during the course of business, when times are good and everyone is busy, it is easy to overlook the fundamentals. Jerry had too much control, and because accounts payable trusted him, the clerks did not adhere to their own processes and send the check directly to the third party.
* Act quickly and decisively. Jerry was a long-time employee of" XYZ, and he was well-liked in the organization. It would have been easy for the company to ask Jerry to pay the money back and call it even. How ever, management and the board called for a full investigation, led by the internal audit group that included outside consultants, legal counsel, and the district attorney. Management also decided to not keep it quiet; they let the finance and accounting organizations know what was going on so that it became clear to everyone that XYZ would not treat fraud lightly.
* Thieves can get greedy. In this case, Jerry had already left the company. His fraud might have gone undetected if he had not returned for one last $716!
MOLLY, THE ASSISTANT, Molly treasurer at XYZ Corp. in Miami, opened an e-mail from a former colleague who no longer worked for the organization. The e-mail read: "Hi Molly, there should be a refund of $716 on my old corporate Visa card from the IP Conference. I paid for, but did not attend, the conference and did not turn in the charge to XYZ for reimbursement. Can you have Visa issue a refund check to me? Thanks very much for your help."
The e-mail was from Jerry, a former XYZ executive who had been Molly's boss at one time. The message seemed innocuous enough. Jerry had legitimately charged a business conference to his corporate credit card, but he had canceled his registration because he left the company. Therefore, he was due a refund.
It would have been very easy for Molly to trust her former boss and get him the refund. Instead, because something didn't seem quite right, she chose to check on whether XYZ had already reimbursed Jerry for the conference.
To make this determination, Molly accessed Jerry's corporate credit card records online and retrieved his expense reports from the accounts payable file room. The expense reports confirmed that Jerry had not expensed the conference fee, but when Molly looked at his credit card statement, she saw a couple of odd items.
First, the most recent statement indicated that the former XYZ executive had made four payments to his credit card in one month. Second, the statement was two pages long, and Molly knew that Jerry rarely traveled for business. She scanned the charges and noted that most of them were from local vendors. In addition, none of the items looked like business charges. The charges included dinners at local restaurants, department and grocery store charges, and airline tickets for Jerry and his wife that Molly knew were for their recent vacation.
Out of curiosity, Molly queried the company's checks online to see if any of the payments made on Jerry's Visa account matched the dollar amounts of checks written by XYZ. Sure enough, she found that all four payments made to Jerry's credit card that month equaled amounts on checks that the company had written to Visa. Molly increased the scope of her search and observed that every payment posted to Jerry's corporate credit card over the previous 12 months was from a check written by the company. She also noticed that of the $88,000 in charges on Jerry's card over that time frame, none was for business expenses.
Molly printed copies of all of the checks and noted that, although Visa was listed as the payee on all of them, Jerry's corporate credit card account number was handwritten on each check. Molly approached the director of internal auditing as well as Jerry's former manager and requested an investigation into the matter.
While working for XYZ, Jerry was in charge of making sure that the organization paid delinquent balances on the corporate credit cards of people who had left the company. XYZ had an arrangement with the credit card company that it would guarantee payment for certain employees if those employees did not pay the balances on their accounts. Once a month, Jerry would provide accounts payable with a list of delinquent accounts on guaranteed cards, and accounts payable would cut the check to the credit card company.
However, on the bottom of every check request in Jerry's last year of employment, he had written, "Please deliver the check to me." Typically, accounts payable would mail the check directly to the credit card company, but because accounts payable knew that Jerry maintained a relationship with the credit card company, they adhered to his request and delivered the checks to him. When Jerry received a check, he would write his own account number on the check, and the bank would apply the payment to Jerry's credit card.
Jerry did not need to make sure that the delinquent credit card owners listed on his spreadsheet paid their balances, because he had fabricated the delinquency list that he provided to accounts payable. In many cases, the employees with the so-called delinquent balances had left the organization long before, and they had paid their balances in full before departing.
So, where were the control breakdowns? First, Jerry had sole authority over the credit card function. He managed the corporate credit cards, reviewed the delinquent accounts, had access to the employee statements, and dealt with the bank's account managers. No one reviewed his work. As soon as accounts payable walked the checks down to his office, he had all he needed to perpetrate the fraud.
The second breakdown was that the accounts payable clerk walked the checks over to Jerry. Although not necessarily right, it is understandable that accounts payable would not have the time to audit Jerry's delinquency list. After all, accounts payable was processing more than 1,000 checks per week with a staff of six. However, it was unacceptable for the clerk to deliver the check directly to Jerry. The check should have gone from accounts payable to the vendor. The vendor invoice--or delinquency data in this case--should have contained all of the pertinent information to allow accounts payable to appropriately route the check.
XYZ decided to report Jerry to law enforcement. Although $88,000 is not a significant amount of money for a $1 billion company, and the legal fees and other costs might be high, the company wanted to demonstrate to its employees that it would not tolerate fraud and would hold perpetrators accountable. Decisive and timely action such as this is critical to maintaining a sound control environment.
Not everyone is as diligent as Molly. The lesson she applied is an important one to teach operations personnel: Take the time to check anything that doesn't seem right. Because she spent a few minutes performing due diligence, Molly uncovered an $88,000 fraud.
Several symptoms may have flagged the fraud. If internal auditing had been testing the employee credit card charges, simply identifying the top 25 corporate card users and reviewing their charges would have flagged Jerry. Travel reimbursements of $88,000 in one year covers a lot of travel. Testing the accounts of the people with the most posted credits would have similarly flagged Jerry. Also, Jerry averaged three payments a month on his credit card over the course of a year, an unusual pattern that, if identified, should have been investigated.
Testing the top 25 corporate credit card users and searching for unusual patterns are the staples of any audit program that contains tests designed to uncover fraud.
LESSONS LEARNED
* Employees should take the extra step. If employees are presented with a transaction that they do not completely understand, they should do what was going on so that it became clear to everyone that XYZ would not treat fraud lightly. what it takes to understand the transaction. Molly was one of the custodians of the organization's cash, so when someone asked for money from the company, even a trusted former boss, it was important for her to understand the nature of the transaction.
* Segregate duties. This is a concept that is drilled into the brains of internal auditors ad nauseam, but it is not necessarily communicated as often to operational management. The organization's head treasurer, to whom Jerry reported, was an ex- auditor and ex-controller, and therefore should have been aware of this control concept. However, during the course of business, when times are good and everyone is busy, it is easy to overlook the fundamentals. Jerry had too much control, and because accounts payable trusted him, the clerks did not adhere to their own processes and send the check directly to the third party.
* Act quickly and decisively. Jerry was a long-time employee of" XYZ, and he was well-liked in the organization. It would have been easy for the company to ask Jerry to pay the money back and call it even. How ever, management and the board called for a full investigation, led by the internal audit group that included outside consultants, legal counsel, and the district attorney. Management also decided to not keep it quiet; they let the finance and accounting organizations know what was going on so that it became clear to everyone that XYZ would not treat fraud lightly.
* Thieves can get greedy. In this case, Jerry had already left the company. His fraud might have gone undetected if he had not returned for one last $716!
Removing Inaccurate Information From Your Credit Reports
by: Stephen Snyder
I want to explore the one of the most important action you can take to increase your credit scores: removing inaccurate negative information from your three credit reports.
Be warned: should you decide to tackle this process yourself, it can be time consuming and frustrating.
What the Credit Reporting Agencies are Legally Required to do on Your Behalf when You Ask
The credit reporting agencies are required by federal law to remove inaccurate information from your credit reports free of charge. However, nowhere in the law does it say they have to make it easy for you.
Because the credit reporting agencies can't charge you to remove inaccurate information from your credit reports, they make you jump through hoops...climb over walls...and inconvenience you in any way possible to accomplish this.
And just try calling them and getting through their phone menus. Sheesh!
How to Increase Your Credit Scores by Removing Inaccurate Information from Your Credit Reports
The concept is quite simple...you want to make sure there is no inaccurate, outdated, misleading, incomplete, or unverifiable information on your credit reports...especially if it's negative.
Any negative inaccurate information that appears on your credit reports can have a dramatic impact on your credit scores.
And by dramatic, I mean bad.
I had a recent experience that once again proved how difficult it is to try to work with the credit reporting agencies.
I took time to review my credit reports a few months ago. With yellow highlighter in hand, I highlighted numerous inaccuracies on each of my three credit reports.
I hadn't tried to speak with the credit reporting agencies directly over the telephone for years. But I was feeling adventurous...I thought I'd give them the benefit of the doubt, so I performed a little experiment to see if their customer service had changed in the last 13 years.
I mean, how bad could it be?
It should go something like this: you call each credit reporting agency...they promptly answer the phone...you talk to a real person...your issues get resolved quickly...you hang up in a few minutes...and everyone moves onto something else.
Right?
Wrong!
Not today.
Maybe on The Brady Bunch...but in the real world of mandated free credit reports...it's just the opposite.
What I found was the entire experience was even more frustrating and stressful than I remembered. I almost needed to ask my doctor about anxiety pills.
It's Obvious that the Credit Reporting Agencies do not want to Talk with You Over the Telephone
One credit reporting agency even forces you to go online. Talking to a person is not an option!
What about all the people who don't have internet access or aren't computer savvy? I guess the protection of the Fair Credit Reporting Act doesn't apply to them.
You see, each credit reporting agency buries their telephone numbers deep into their websites. So deep it took me forever to uncover their contact information (and I consider myself to be pretty internet savvy).
And if that wasn't enough, one credit reporting agency forced me to purchase my credit reports directly through them if I wanted their telephone number to dispute inaccurate information.
Here I am calling the credit reporting agency to dispute items on my credit report, and I can't talk to anyone unless I know the secret code.
I already had my free credit reports.
I already purchased my credit reports-just not from them.
I even had my credit reports from my mortgage lender from a recent mortgage closing.
But the three sets of credit reports I already had weren't enough!
In order to talk to someone at one particular credit reporting agency, I needed a certain ID code from my reports. None of the codes on any of the credit reports I already had worked.
So I bit the bullet and purchased my credit reports AGAIN...this time directly from the credit reporting agency.
And the ID still didn't work!
I was about to call my doctor for the anxiety pills. I'm not kidding!
How they get away with this is beyond me. No wonder they frequently get in trouble with the Federal Trade Commission (FTC) for not abiding by the Fair Credit Reporting Act (FCRA).
It just became too frustrating and time consuming for me to fight with the credit reporting agencies to do something that is supposed to be my right under the FCRA.
I had enough.
I did exactly what they wanted me to do...I gave up...surrendered...waived the white flag...cried, "Uncle."
Hey, I have books to write; seminars to conduct; planes to catch; employees to manage; etc. Life is too short to waste my free time jumping through hoops to appease the credit reporting agencies.
So I hired a lawyer.
But I didn't hire just any lawyer.
Why a law firm is the best solution to helping you remove inaccurate negative information from your credit reports
I chose a law firm that specialized in this specific area of law.
After all, if you needed an eye operation-would you go to a foot doctor? Or when you filed bankruptcy-did you hire a divorce attorney? I hope not. Lawyers have specialties.
Don't use your bankruptcy attorney to help you with errors on your credit reports. Lots of people assume that since the bankruptcy attorney helped with the bankruptcy, the attorney would know all about the credit reporting agencies. This is rarely the case.
Bankruptcy attorneys are good at helping you file bankruptcy, but pretty much useless in helping you remove inaccurate negative information from your credit reports.
So I did lots of research on how to find the best law firm to help me.
Here were my expectations for a law firm:
1. They had to live and breathe the Fair Credit Reporting Act. The FCRA basically tells us our rights regarding our credit reports. If you have a few hours to spare, you can go here to read it.
2. I wanted former employees of the credit reporting agencies on their board of directors, within their company rank and file, or at least as consultants. Having an insider's perspective on how the credit reporting agencies work was essential for success and is what separates the real thing from the scumbag credit repair clinics that advertise on telephone poles.
3. They had to abide by the legal guidelines Congress created for this type of service. These guidelines are known as the Credit Repair Organizations Act (CROA).
4. I wanted to make sure they had many years in business with a clean record with the Federal Trade Commission.
A pretty tall order-I know.
But considering the FTC makes a regular sweep of credit repair clinics and shuts down the crappy ones...finding the right law firm was easier than I thought it would be.
Is the term “credit repair” naughty or nice?
Law firms that specialize in helping you remove inaccuracies from your credit reports are often grouped in with other credit repair services that are not law firms. But there are major differences between the two.
You see, the companies that give this service a bad name are the credit repair clinics with no real experience in the credit reporting industry. Maybe the people who started these clinics got lucky getting inaccurate information removed from their own credit reports and decided to make a business out of it?
So I began researching.
I read boring stuff like court opinions, court settlements, case law, depositions...you name it-I read it.
It became very clear who I should steer away from...anyone advertising they were in the "credit repair" business and didn't follow the Credit Repair Organizations Act (CROA).
Incidentally, I also became an expert in understanding CROA. Mainly because the way CROA is written-any person giving credit advice (like yours truly) could easily fall under CROA if they aren't careful.
And if you violate CROA, very bad things can happen. So I try to be very careful with everything I write. After all, I don't want to wind up with a new roommate named Bubba.
In early 2003, I was given a sneak-peek of a new credit-related product co-created by a very large company (that shall remain nameless because I still like them very much) and was co-branded with a semi-famous, yet irritating "know it all" blonde from CNBC.
I smelled trouble.
So I kept my mouth shut and didn't bring it up...because, as you know, I don't like pointing fingers and upsetting the apple cart.
Yeah right! Are you kidding?!
I told them exactly what I thought...
"This product, although very nice, will violate CROA and will land you in a class-action lawsuit."
They ignored my advice.
I'm not kidding. I looked their vice president in the eyes and flat out told him what would happen as if I had a crystal ball in my hand.
Just recently, that company began wrestling with a class-action lawsuit concerning the very same product. (The vice president and most of his management team are now gone.) As a matter of fact, right now all three national credit reporting agencies are fighting similar class-action lawsuits. The plaintiff's consider each of them credit repair organizations, which in-and-of itself isn't illegal...it's just illegal if you violate CROA.
One of the biggest myths surrounding credit repair is that people think it's illegal. Nope, it's not illegal. If done properly...and if they follow the federal guidelines...then it's as legal as voting at 18 or driving a car at 16.
You just have to follow the rules. And the rules are clearly spelled out in CROA. Many companies will try to sell you credit repair services-but few are on the up-and-up.
I've found only a couple law firms that consistently play by the rules
After years of research I have been able to find only a couple law firms that consistently play by the rules. I know this because they aren't being investigated by the FTC and don't have attorney generals lining up to sue them.
Surprised that credit repair is 100% legal?
I bet you are.
The credit reporting agencies work very hard to convince you that ALL of these companies are scams and they can't do anything more than you can do on your own.
That's so untrue. There are legitimate companies that provide this service.
It's no different than hiring a tax pro to prepare your taxes for you...or a lawyer to represent you in court if you are sued...or anything else that you can afford to pay someone else to do for you so you can keep yourself focused on your unique ability.
Sure, you can do those things yourself for free. But is it really free if you get audited or lose the lawsuit?
Bottom line: As long as the company follows the rules set forth in CROA...the credit restoration service they provide to you is ethical, legal, responsible, valuable, and time saving.
So again, credit restoration is not illegal. It's only illegal if the company that is offering the service is not following the guidelines that Congress has set up.
Of course, the credit reporting agencies will try to make you think differently. They do a good job convincing the public, lenders, their business partners, and many others that all credit repair organizations are illegal. It's almost as if they're trying to brainwash you.
Law firms vs. Credit Repair Clinics
While the credit repair clinics are all about scamming you with no regard to what's right or wrong...a legitimate law firm abides by CROA.
So what I'm basically saying is that you can fiddle around and try to remove inaccurate information from your credit reports yourself...or you can hire someone to do this for you so you can do more enjoyable things with your free time.
Personally, I decided to hire a law firm out of the pure frustration of trying to do it myself-and I know this stuff like the back of my hand!
If you really want to get right down to it...the credit reporting agencies forced me to hire a law firm.
The only reason the legitimate companies exist is because most of the credit reporting agencies make it impossible to easily talk to someone over the telephone to dispute incorrect information on your credit reports.
If the credit reporting agencies made it easy to correct errors on your reports, then law firms wouldn't have to deal with representing people who have been run through the credit reporting agency ringer.
In summary, the credit reporting agencies consider you guilty until you can prove yourself innocent . Be sure you do everything in your power to remove any inaccurate negative information from your credit reports. It will serve you well and help you increase your credit scores.
I want to explore the one of the most important action you can take to increase your credit scores: removing inaccurate negative information from your three credit reports.
Be warned: should you decide to tackle this process yourself, it can be time consuming and frustrating.
What the Credit Reporting Agencies are Legally Required to do on Your Behalf when You Ask
The credit reporting agencies are required by federal law to remove inaccurate information from your credit reports free of charge. However, nowhere in the law does it say they have to make it easy for you.
Because the credit reporting agencies can't charge you to remove inaccurate information from your credit reports, they make you jump through hoops...climb over walls...and inconvenience you in any way possible to accomplish this.
And just try calling them and getting through their phone menus. Sheesh!
How to Increase Your Credit Scores by Removing Inaccurate Information from Your Credit Reports
The concept is quite simple...you want to make sure there is no inaccurate, outdated, misleading, incomplete, or unverifiable information on your credit reports...especially if it's negative.
Any negative inaccurate information that appears on your credit reports can have a dramatic impact on your credit scores.
And by dramatic, I mean bad.
I had a recent experience that once again proved how difficult it is to try to work with the credit reporting agencies.
I took time to review my credit reports a few months ago. With yellow highlighter in hand, I highlighted numerous inaccuracies on each of my three credit reports.
I hadn't tried to speak with the credit reporting agencies directly over the telephone for years. But I was feeling adventurous...I thought I'd give them the benefit of the doubt, so I performed a little experiment to see if their customer service had changed in the last 13 years.
I mean, how bad could it be?
It should go something like this: you call each credit reporting agency...they promptly answer the phone...you talk to a real person...your issues get resolved quickly...you hang up in a few minutes...and everyone moves onto something else.
Right?
Wrong!
Not today.
Maybe on The Brady Bunch...but in the real world of mandated free credit reports...it's just the opposite.
What I found was the entire experience was even more frustrating and stressful than I remembered. I almost needed to ask my doctor about anxiety pills.
It's Obvious that the Credit Reporting Agencies do not want to Talk with You Over the Telephone
One credit reporting agency even forces you to go online. Talking to a person is not an option!
What about all the people who don't have internet access or aren't computer savvy? I guess the protection of the Fair Credit Reporting Act doesn't apply to them.
You see, each credit reporting agency buries their telephone numbers deep into their websites. So deep it took me forever to uncover their contact information (and I consider myself to be pretty internet savvy).
And if that wasn't enough, one credit reporting agency forced me to purchase my credit reports directly through them if I wanted their telephone number to dispute inaccurate information.
Here I am calling the credit reporting agency to dispute items on my credit report, and I can't talk to anyone unless I know the secret code.
I already had my free credit reports.
I already purchased my credit reports-just not from them.
I even had my credit reports from my mortgage lender from a recent mortgage closing.
But the three sets of credit reports I already had weren't enough!
In order to talk to someone at one particular credit reporting agency, I needed a certain ID code from my reports. None of the codes on any of the credit reports I already had worked.
So I bit the bullet and purchased my credit reports AGAIN...this time directly from the credit reporting agency.
And the ID still didn't work!
I was about to call my doctor for the anxiety pills. I'm not kidding!
How they get away with this is beyond me. No wonder they frequently get in trouble with the Federal Trade Commission (FTC) for not abiding by the Fair Credit Reporting Act (FCRA).
It just became too frustrating and time consuming for me to fight with the credit reporting agencies to do something that is supposed to be my right under the FCRA.
I had enough.
I did exactly what they wanted me to do...I gave up...surrendered...waived the white flag...cried, "Uncle."
Hey, I have books to write; seminars to conduct; planes to catch; employees to manage; etc. Life is too short to waste my free time jumping through hoops to appease the credit reporting agencies.
So I hired a lawyer.
But I didn't hire just any lawyer.
Why a law firm is the best solution to helping you remove inaccurate negative information from your credit reports
I chose a law firm that specialized in this specific area of law.
After all, if you needed an eye operation-would you go to a foot doctor? Or when you filed bankruptcy-did you hire a divorce attorney? I hope not. Lawyers have specialties.
Don't use your bankruptcy attorney to help you with errors on your credit reports. Lots of people assume that since the bankruptcy attorney helped with the bankruptcy, the attorney would know all about the credit reporting agencies. This is rarely the case.
Bankruptcy attorneys are good at helping you file bankruptcy, but pretty much useless in helping you remove inaccurate negative information from your credit reports.
So I did lots of research on how to find the best law firm to help me.
Here were my expectations for a law firm:
1. They had to live and breathe the Fair Credit Reporting Act. The FCRA basically tells us our rights regarding our credit reports. If you have a few hours to spare, you can go here to read it.
2. I wanted former employees of the credit reporting agencies on their board of directors, within their company rank and file, or at least as consultants. Having an insider's perspective on how the credit reporting agencies work was essential for success and is what separates the real thing from the scumbag credit repair clinics that advertise on telephone poles.
3. They had to abide by the legal guidelines Congress created for this type of service. These guidelines are known as the Credit Repair Organizations Act (CROA).
4. I wanted to make sure they had many years in business with a clean record with the Federal Trade Commission.
A pretty tall order-I know.
But considering the FTC makes a regular sweep of credit repair clinics and shuts down the crappy ones...finding the right law firm was easier than I thought it would be.
Is the term “credit repair” naughty or nice?
Law firms that specialize in helping you remove inaccuracies from your credit reports are often grouped in with other credit repair services that are not law firms. But there are major differences between the two.
You see, the companies that give this service a bad name are the credit repair clinics with no real experience in the credit reporting industry. Maybe the people who started these clinics got lucky getting inaccurate information removed from their own credit reports and decided to make a business out of it?
So I began researching.
I read boring stuff like court opinions, court settlements, case law, depositions...you name it-I read it.
It became very clear who I should steer away from...anyone advertising they were in the "credit repair" business and didn't follow the Credit Repair Organizations Act (CROA).
Incidentally, I also became an expert in understanding CROA. Mainly because the way CROA is written-any person giving credit advice (like yours truly) could easily fall under CROA if they aren't careful.
And if you violate CROA, very bad things can happen. So I try to be very careful with everything I write. After all, I don't want to wind up with a new roommate named Bubba.
In early 2003, I was given a sneak-peek of a new credit-related product co-created by a very large company (that shall remain nameless because I still like them very much) and was co-branded with a semi-famous, yet irritating "know it all" blonde from CNBC.
I smelled trouble.
So I kept my mouth shut and didn't bring it up...because, as you know, I don't like pointing fingers and upsetting the apple cart.
Yeah right! Are you kidding?!
I told them exactly what I thought...
"This product, although very nice, will violate CROA and will land you in a class-action lawsuit."
They ignored my advice.
I'm not kidding. I looked their vice president in the eyes and flat out told him what would happen as if I had a crystal ball in my hand.
Just recently, that company began wrestling with a class-action lawsuit concerning the very same product. (The vice president and most of his management team are now gone.) As a matter of fact, right now all three national credit reporting agencies are fighting similar class-action lawsuits. The plaintiff's consider each of them credit repair organizations, which in-and-of itself isn't illegal...it's just illegal if you violate CROA.
One of the biggest myths surrounding credit repair is that people think it's illegal. Nope, it's not illegal. If done properly...and if they follow the federal guidelines...then it's as legal as voting at 18 or driving a car at 16.
You just have to follow the rules. And the rules are clearly spelled out in CROA. Many companies will try to sell you credit repair services-but few are on the up-and-up.
I've found only a couple law firms that consistently play by the rules
After years of research I have been able to find only a couple law firms that consistently play by the rules. I know this because they aren't being investigated by the FTC and don't have attorney generals lining up to sue them.
Surprised that credit repair is 100% legal?
I bet you are.
The credit reporting agencies work very hard to convince you that ALL of these companies are scams and they can't do anything more than you can do on your own.
That's so untrue. There are legitimate companies that provide this service.
It's no different than hiring a tax pro to prepare your taxes for you...or a lawyer to represent you in court if you are sued...or anything else that you can afford to pay someone else to do for you so you can keep yourself focused on your unique ability.
Sure, you can do those things yourself for free. But is it really free if you get audited or lose the lawsuit?
Bottom line: As long as the company follows the rules set forth in CROA...the credit restoration service they provide to you is ethical, legal, responsible, valuable, and time saving.
So again, credit restoration is not illegal. It's only illegal if the company that is offering the service is not following the guidelines that Congress has set up.
Of course, the credit reporting agencies will try to make you think differently. They do a good job convincing the public, lenders, their business partners, and many others that all credit repair organizations are illegal. It's almost as if they're trying to brainwash you.
Law firms vs. Credit Repair Clinics
While the credit repair clinics are all about scamming you with no regard to what's right or wrong...a legitimate law firm abides by CROA.
So what I'm basically saying is that you can fiddle around and try to remove inaccurate information from your credit reports yourself...or you can hire someone to do this for you so you can do more enjoyable things with your free time.
Personally, I decided to hire a law firm out of the pure frustration of trying to do it myself-and I know this stuff like the back of my hand!
If you really want to get right down to it...the credit reporting agencies forced me to hire a law firm.
The only reason the legitimate companies exist is because most of the credit reporting agencies make it impossible to easily talk to someone over the telephone to dispute incorrect information on your credit reports.
If the credit reporting agencies made it easy to correct errors on your reports, then law firms wouldn't have to deal with representing people who have been run through the credit reporting agency ringer.
In summary, the credit reporting agencies consider you guilty until you can prove yourself innocent . Be sure you do everything in your power to remove any inaccurate negative information from your credit reports. It will serve you well and help you increase your credit scores.
8 Essential Tips for Personal Taxes and Accounting
by: Kent Irwin
A very important part of personal financial planning is tax planning. This article will help you take the mystery out of personal tax Planning by providing a financial planning perspective for your overall tax situation.
1. Be aware of the different types of taxes
Many people are not aware of the different types of tax systems that we have. Income: Federal, State and Local. Real estate tax. Tax on Investments: Dividends, interest, capital gain, and passive income on stocks, bonds, mutual funds, and investment real estate. Estate or Inheritance Tax: Federal and state tax due on the estate or the inheritor. Gift tax: tax on giver of large gifts. Entitlement Tax: Social Security and Medicare (FICA), Federal Unemployment (FUTA). Sales, self employment, and corporate taxation.
2. Consider working with a Qualified Tax Professional
Tax planning can be complex for many people, therefore it may be wide to work with a trusted professional tax advisor.
Tax advisors not only prepare your taxes but can help make decisions that will affect your future. They can serve as advisors for a whole host of matters and they can represent you if you face the dreaded audit. Consider the following when selecting a tax professional:
- Local: Someone that you can easily meet with face to face
- Personable: Someone that you can interact with and who cares about you
- Proactive: Some tax preparers simply look at your previous year's return and plug your current numbers into last year's format. This of course assumes that last year's preparer knew what he/she was doing. Try to find a preparer who knows your situation. A proactive professional will ask questions that will help you anticipate changes in your tax situation to help you properly plan in advance
- Reputable: Find a professional with a good reputation. Ask people you admire for a referral.
- Skilled: Look for an accountant that is very competent. You have to be smart to obtain a degree in accounting or law.
Fees: Find out up front what they estimate their fees to be, what they charge to file electronically and whether they will represent you in an IRS audit. Avoid any 'early refund' ploys. Some well known tax preparation companies 'provide' this service which charges a hefty fee (with a lot of small print) and a lot of advertised hype for you to get your refund 'early'. It is basically a high-interest loan. Just waiting for your actual refund will save you a lot of money.
3. Remember, tax preparation entails both art and science
The science involves the mathematical calculations that in most instances can be figured using calculators and software, and the infinite number of complex tax laws.
The art of tax planning comes into play with interpretation of any special circumstances. There are some areas of tax law that leave the government's intentions unclear. No law can completely anticipate each person's situation. You could call a dozen different IRS agents with the same question and get as many different answers. A proactive planner will research any unusual circumstances you may have and help you plan a course of action.
4. Doing Your Taxes Yourself?
I firmly believe in getting professional tax assistance. However, I realize that many people prefer to do their own taxes perhaps to save money, or perhaps you have cleaned up the mess a 'store front' preparer made of your taxes and vow to do your own. It has been my experience that often the professional tax preparer has saved us the amount of their fee in our taxes. The peace of mind that the taxes are done right has a value all its own.
However, people who have prepared their own taxes at least once with paper and pencil or software usually understand taxes much better. If you self-prepare your taxes, consider having a qualified accountant review them before you send them in. They may find things you or the software might have missed.
If you made less than $54,000 in 2007, you can file your taxes electronically for free through the irs.gov website www.irs.gov/efile/. If you use tax software and wish to e-file be aware of the fees so that you can budget and compare prices properly. For example, a download of Turbo Tax Home and Business Federal and State for 2006 cost just under $100 and the filing fees cost around $30. Some States allow you to 'phone in' your State return for free.
If you choose to mail your return, go to your local post office and send it 'Certified Return Receipt' mail to insure that you have a record that the IRS received your paperwork. This will cost around $10 or less and will be worth every penny should the IRS contest the receipt of your return.
5. Keep great records
If you are already very organized you may read this section just to feel great about your organization skills or skip to the next section. If, however you have heard 'get organized' many times before and if you are the type of person who balks at the idea of organizing that mess of receipts just remember how you felt last year as tax time approached. You could become organized in only one evening of television viewing with the right tools. Arm yourself with an accordion file with at least 16 sections. Label them according to your situation or use the following sections: Auto, Bank, Business, Credit Cards, Dental, Medical, General Receipts, Grocery, Income, Insurance, Mortgage, Utilities, School, and Taxes. Now sort your receipts into these sections. Organizing your receipts will help you "Take the mystery out of..." your financial situation. Use a new accordion file every year. Not only will this help you find needed information, it will also help you find a receipt in case you need to return an item you purchased. . Your tax professional will be sending you a tax organizer the end of December or the first of January. In this organizer will be a list of information that you will need to gather. Becoming organized will help you easily gather the information you need to fill out your tax organizer.
6. Start early
Do not procrastinate on your taxes. Tax professionals are unbelievably busy January through April. Firms who prepare business returns also have a crazy March 15 business deadline. We are providing this information because we want you to get the most attention from your preparer during their craziest season. As soon as you get your organizer, begin gathering the needed papers. If you are only missing one or two pieces of information return the organizer to your accountant with a note that says what is missing. They will begin entering the information in their software. Try to get a January or February meeting with your accountant. These months are the best to meet because they will have more time to spend with you and they will be able to think proactively. If you are looking for a professional, start looking now.
Another reason to start early is allowing yourself time to look for records, ask financial institutions for copies of lost information, or calling investment companies for statements.
7. Judicious Paycheck Tax Withholding
Many people like to overpay their taxes, so that they get a nice refund in time for vacations or other wants and needs - Kind of like a forced savings. Overpaying taxes is like a giving the government an interest free loan of your money.
Good financial management involves developing savings habits so that you set aside money in an interest bearing account from each paycheck for future needs, wants and emergencies. This helps you to avoid using credit cards for those things and not having to wait until refund time. Secondly it then allows you to manage how much you can afford or are able to put into 401(k) plans at work. This accomplishes two things, first you are managing your money better and you are saving for retirement. Saving for retirement in tax deductible retirement plans like 401(k)s will also lower your taxes, enabling you to save more for retirement and everyday needs and wants.
If you want to lower the taxes that are being withheld from your paycheck, file a new W-4 form with your employer to claim an additional withholding. Make adjustment for getting married, divorced, having children and for increasing contributions to tax deductible retirement plans. Your accountant will help you estimate this.
8. Tax planning is not the tail that wags the dog
Taxes consume a large if not the largest single percentage of your income, therefore good financial planning should strive to lessen them, by whatever means possible as allowed by law.
However, tax planning is not the only core issue of good financial planning. Tax planning works in concert with your overall goals and your individual situation.
A very important part of personal financial planning is tax planning. This article will help you take the mystery out of personal tax Planning by providing a financial planning perspective for your overall tax situation.
1. Be aware of the different types of taxes
Many people are not aware of the different types of tax systems that we have. Income: Federal, State and Local. Real estate tax. Tax on Investments: Dividends, interest, capital gain, and passive income on stocks, bonds, mutual funds, and investment real estate. Estate or Inheritance Tax: Federal and state tax due on the estate or the inheritor. Gift tax: tax on giver of large gifts. Entitlement Tax: Social Security and Medicare (FICA), Federal Unemployment (FUTA). Sales, self employment, and corporate taxation.
2. Consider working with a Qualified Tax Professional
Tax planning can be complex for many people, therefore it may be wide to work with a trusted professional tax advisor.
Tax advisors not only prepare your taxes but can help make decisions that will affect your future. They can serve as advisors for a whole host of matters and they can represent you if you face the dreaded audit. Consider the following when selecting a tax professional:
- Local: Someone that you can easily meet with face to face
- Personable: Someone that you can interact with and who cares about you
- Proactive: Some tax preparers simply look at your previous year's return and plug your current numbers into last year's format. This of course assumes that last year's preparer knew what he/she was doing. Try to find a preparer who knows your situation. A proactive professional will ask questions that will help you anticipate changes in your tax situation to help you properly plan in advance
- Reputable: Find a professional with a good reputation. Ask people you admire for a referral.
- Skilled: Look for an accountant that is very competent. You have to be smart to obtain a degree in accounting or law.
Fees: Find out up front what they estimate their fees to be, what they charge to file electronically and whether they will represent you in an IRS audit. Avoid any 'early refund' ploys. Some well known tax preparation companies 'provide' this service which charges a hefty fee (with a lot of small print) and a lot of advertised hype for you to get your refund 'early'. It is basically a high-interest loan. Just waiting for your actual refund will save you a lot of money.
3. Remember, tax preparation entails both art and science
The science involves the mathematical calculations that in most instances can be figured using calculators and software, and the infinite number of complex tax laws.
The art of tax planning comes into play with interpretation of any special circumstances. There are some areas of tax law that leave the government's intentions unclear. No law can completely anticipate each person's situation. You could call a dozen different IRS agents with the same question and get as many different answers. A proactive planner will research any unusual circumstances you may have and help you plan a course of action.
4. Doing Your Taxes Yourself?
I firmly believe in getting professional tax assistance. However, I realize that many people prefer to do their own taxes perhaps to save money, or perhaps you have cleaned up the mess a 'store front' preparer made of your taxes and vow to do your own. It has been my experience that often the professional tax preparer has saved us the amount of their fee in our taxes. The peace of mind that the taxes are done right has a value all its own.
However, people who have prepared their own taxes at least once with paper and pencil or software usually understand taxes much better. If you self-prepare your taxes, consider having a qualified accountant review them before you send them in. They may find things you or the software might have missed.
If you made less than $54,000 in 2007, you can file your taxes electronically for free through the irs.gov website www.irs.gov/efile/. If you use tax software and wish to e-file be aware of the fees so that you can budget and compare prices properly. For example, a download of Turbo Tax Home and Business Federal and State for 2006 cost just under $100 and the filing fees cost around $30. Some States allow you to 'phone in' your State return for free.
If you choose to mail your return, go to your local post office and send it 'Certified Return Receipt' mail to insure that you have a record that the IRS received your paperwork. This will cost around $10 or less and will be worth every penny should the IRS contest the receipt of your return.
5. Keep great records
If you are already very organized you may read this section just to feel great about your organization skills or skip to the next section. If, however you have heard 'get organized' many times before and if you are the type of person who balks at the idea of organizing that mess of receipts just remember how you felt last year as tax time approached. You could become organized in only one evening of television viewing with the right tools. Arm yourself with an accordion file with at least 16 sections. Label them according to your situation or use the following sections: Auto, Bank, Business, Credit Cards, Dental, Medical, General Receipts, Grocery, Income, Insurance, Mortgage, Utilities, School, and Taxes. Now sort your receipts into these sections. Organizing your receipts will help you "Take the mystery out of..." your financial situation. Use a new accordion file every year. Not only will this help you find needed information, it will also help you find a receipt in case you need to return an item you purchased. . Your tax professional will be sending you a tax organizer the end of December or the first of January. In this organizer will be a list of information that you will need to gather. Becoming organized will help you easily gather the information you need to fill out your tax organizer.
6. Start early
Do not procrastinate on your taxes. Tax professionals are unbelievably busy January through April. Firms who prepare business returns also have a crazy March 15 business deadline. We are providing this information because we want you to get the most attention from your preparer during their craziest season. As soon as you get your organizer, begin gathering the needed papers. If you are only missing one or two pieces of information return the organizer to your accountant with a note that says what is missing. They will begin entering the information in their software. Try to get a January or February meeting with your accountant. These months are the best to meet because they will have more time to spend with you and they will be able to think proactively. If you are looking for a professional, start looking now.
Another reason to start early is allowing yourself time to look for records, ask financial institutions for copies of lost information, or calling investment companies for statements.
7. Judicious Paycheck Tax Withholding
Many people like to overpay their taxes, so that they get a nice refund in time for vacations or other wants and needs - Kind of like a forced savings. Overpaying taxes is like a giving the government an interest free loan of your money.
Good financial management involves developing savings habits so that you set aside money in an interest bearing account from each paycheck for future needs, wants and emergencies. This helps you to avoid using credit cards for those things and not having to wait until refund time. Secondly it then allows you to manage how much you can afford or are able to put into 401(k) plans at work. This accomplishes two things, first you are managing your money better and you are saving for retirement. Saving for retirement in tax deductible retirement plans like 401(k)s will also lower your taxes, enabling you to save more for retirement and everyday needs and wants.
If you want to lower the taxes that are being withheld from your paycheck, file a new W-4 form with your employer to claim an additional withholding. Make adjustment for getting married, divorced, having children and for increasing contributions to tax deductible retirement plans. Your accountant will help you estimate this.
8. Tax planning is not the tail that wags the dog
Taxes consume a large if not the largest single percentage of your income, therefore good financial planning should strive to lessen them, by whatever means possible as allowed by law.
However, tax planning is not the only core issue of good financial planning. Tax planning works in concert with your overall goals and your individual situation.
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