Finance Book

Are your personal finances in order? Are you saving money and allowing your investments to grow or are you paying heavy interest the wrong way on credit card debt? It matters, and even if you are in your twenties or thirties it still matters. Why? Because the sooner you start planning for your non-working years the more worry-free your retirement years will treat you.

It is for this reason perhaps that I’d like to recommend a very good book to you. It is two decades old now, but it is one of the books I read that helped me retire early (age 39). If you will follow this book and perhaps do a little reading of similar current books, as some of the laws have changed, then together this learning experience will allow you to retire early and carefree too. The book is: “Retire Worry Free – Financial Strategies for Tomorrow’s Independence” by Michael E. Leonetti; Longman Financial Services Publishing; division of Longman Financial Services Institute, Inc, 1989.

Mr. Leonetti, has a financial services and financial planning background and his common sense approach is a breath of fresh air compared to the hype that so many personal financial “How to” books present their information. This book is broken into 2-parts; Part I asks the reader simple questions and then allows them to compare notes as to where they are now and where they need to be. Questions such as:

Do you have a retirement plan? Do you know why you had better?

As well as; How to pick goals, and chart your direction towards retirement and which choices are prudent and why? Thus allowing the reader to create a lifestyle for your later years.

In Part II, Leonetti, associated the reader with key points of contention such as; Understanding risks and How to take financial inventory; how to do Estate Planning and the very basics of Investing. Also are tips on how to live on a budget, within your means, and the art of stretching your money. Please consider this book and the wisdom within.

By: Lance Winslow

OK, so we’re in a recession, and a really bad one at that. Ask the experts how long it will last and you’ll hear everything from 5 or 6 more months to 5 or 6 more years. One thing is certain, though – everyone agrees that it won’t last forever.

So what do you do with this not-so-helpful bit of information? Here are a few ideas for ways to avoid some of the common mistakes of past downturns-and get a head start on your competition at the same time.

It Starts With Cost Control

Financial strategies for any company in these uncertain times should consider the company’s fundamental strength in designing a cost control program. Across-the-board cost reductions, so common during times like this, are fairly easy to initiate, but can be damaging to a company’s foundation over the long term. Instead, consider these guidelines for creating a more effective cost reduction program:

First, focus your staffing reductions on marginal performers throughout your workforce. This is an excellent opportunity to relieve your payroll of under-performers with minimal risk of backlash or legal exposure. If you have delayed having a confrontation with these employees or their managers, do it now. (Your potential legal exposure, of course, is based on your individual situation, and you should always consult a labor attorney in questionable cases.)

Second, cut costs in areas that will not impede your recovery or affect critical current programs. You can cut these costs sharply or eliminate them entirely. Examples include planned enhancements to employee benefit programs (even if announced) and replacement of inefficient equipment that still keeps up with demand. Then initiate efforts that will reduce costs without cutting into capability. A good example might be refinancing of corporate borrowings at lower current interest rates.

Third, cut activities that must be retained long term but can be delayed or reduced to an inactive state for six to nine months. For example, you could shelve an accounting system conversion for now, even if the software has been bought and paid for, thus saving thousands of dollars in implementation and training costs. This assumes the prior system isn’t crippled and unworkable in the interim.

Fourth, consider investing money in programs that can benefit your cost control program or add power to your readiness for the recovery. For example, finish the partially completed development of a new product that will be the market leader in a high-demand environment when it ships. Or hire a few outstanding people in critical departments that were not previously impacted by layoffs. In other words, feed your winners.

Protection and Preparation

In a nutshell, you want to protect yourself during the downturn while preparing yourself for the recovery. When that time arrives, you want to be in a position to move out aggressively, take advantage of your weakened competitors, and add market share and profit margin. It is important to think strategically during these times-because when the recession is finally over, it’s going to be a very good year. 

By: Gene Siciliano