Tag Archives: Money

November 21, 2011

Why You Need To Celebrate Progress

By Chris LoCurto
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“People are afraid to celebrate winning the battle, because the war hasn’t been won yet.” – Kent Singletary

I was having a conversation with Kent, our Momentum Coach, and we were talking about completing the Financial Peace University (FPU) Baby Steps. That’s when he shared with me the above quote. (Yes, I could have written it into this paragraph, but it’s much better as a stand-alone quote.) He said people (especially men) are hesitant to celebrate accomplishing Baby Step 1 of FPU, which is getting $1,000 in an emergency fund, because something might happen and they would have to use that money.

He pointed out that people don’t celebrate what can be taken away. Think about the kinds of cards you can buy at Hallmark – birthday, anniversary, etc. But you don’t see a “Great job losing 10 pounds!” card. The same thing is true for emergency funds. Something might happen, and they will be forced to pull money out of their emergency fund for…wait for it…an emergency!

But that’s what it’s there for. The sad thing is, people feel like they’ve failed if they have an emergency and they have to use the emergency fund. How is that possible? Well, to be honest, it’s because of the financial roller coaster we’ve all been on with our money since we started our lives as adults. We started using debt. We didn’t watch where we spent our money. We’re a culture that celebrates permanence; therefore, we don’t place as much value on the things that might last only a short time.

According to The Wall Street Journal, 70% of Americans are living paycheck to paycheck. That means that all the money coming in is going right back out again. With life being this tight, any unexpected event is going to be a financial crisis. And what do we do when we have a financial crisis? Well, considering we don’t have cash to handle it, we go into debt. Thus, the pensive feelings when we finally have an emergency fund. These crises leave such deep mental scars that we’re still just waiting for the next bad thing to happen.

We get confused thinking that unless the fund stays at $1,000, we weren’t successful. The truth is, most people have never had that much money in their account on purpose! We also worry that if we have to use the money, and someone finds out, they will look at us as failures. It’s just not true! And if someone does, get that dork out of your life. Look for people who enjoy celebrating milestones.

So what do we do? Here are some suggestions:

  • Celebrate – Make it a point to get excited that you have that money! (Especially you men!) Get up and dance a jig. Or the Hokie Pokie. Or the Macarena. I don’t care, just get happy!
  • Celebrate with others – Again, as humans we are naturally concerned with what others think of us. If you see somebody doing something right, go crazy telling them how well they’ve done. They’ll soon begin to feel it as well. Then it will be okay for them to experience the fun! And don’t be afraid to celebrate the same win again if you have to go backward temporarily.
  • Plan for emergencies – Planning for an emergency doesn’t mean one will happen. It just means you are prepared. What if there is an emergency? What then? Well, since you’ve been working like crazy to protect yourself against emergencies, then it’s okay if you need to use that protection. By the way, stop calling this failure!

Always remember that we don’t get into financial trouble overnight. Therefore, it will take some time to get out. Celebrating the Baby Steps is just a way of saying along the way that you have no intentions of going backward for good. If we do for a time, it’s only for a time.

Question: Have you ever felt this way before, or noticed someone who has? Is there someone you need to celebrate with today?

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28 comments   |  tags: , , , , , , | posted in Financial

July 21, 2011

Can You Agree With Your Spouse?

By Chris LoCurto
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The number one issue for fights inside of a marriage is money problems. Some studies show that 57% of the fights inside of a marriage are over money.

So if it’s that bad at home, what happens when a couple works together with the business finances? Well, here’s a very common question from one of our fans:

My husband and his father are running a small real estate management company. My husband hired me to start managing the finances/keeping the books for them beginning in September 2010. After working with their finances for several months now, I see that there is a substantial amount of credit card debt.

I have tried to explain to my husband that I need to apply the principle of the “debt-snowball” to this debt instead of continuing to make several minimum monthly payments that are several hundreds of dollars each. My husband argues with me about this stating that this will destroy the company’s credit rating, etc.

This is the same argument he made with me when I started FPU and told him we needed to start the debt-snowball on our personal credit card debt. In that case, he finally stopped arguing with me and let me go ahead. In terms of the small business, he is being a bit more difficult. I need to be able to show him the specific answer that the debt-snowball is applied in the same manner in a small company like theirs, as it is in personal finance. Please help!

The debt question is one that I get A LOT in EntreLeadership. So many leaders think that people can’t run a business without debt. So inevitably, during my event I will ask how many people are running their business debt free. It’s usually about 30% of the attendees. If people can’t run a business without debt, then how are so many doing it?

There are a few things to consider:

  • What does God say? – The Bible is very clear on the issue of debt. DON’T DO IT! In fact, Proverbs says that if you have gone into debt, get out as quickly as you possibly can. Nowhere in the Bible will you find God blessing someone with debt. Nor do you see Him separating out personal and business. He doesn’t differentiate.
  • It gives me options – Actually, I am a firm believer that debt robs you of your options. When your money is tied up paying off debt, you’re not able to take advantage of situations when they come up. On top of that, you are potentially holding God back from doing some of the things He want to do in His business. (It is His, right?) I have seen plenty of God situations that people weren’t able to capitalize on because they were bound by debt. Going into debt is saying that you know better than God on the speed of growth you should have.
  • But my credit score! – There is only one thing that you need a credit score/rating for – to go into debt. That’s it. It’s there to help you get into more trouble. If you have cash, you don’t need a rating. Besides, you get MUCH better deals when you pay companies with cash. Especially in a time when so many companies are no getting their receivables collected for months on end. Go ahead and destroy the credit rating, it’s not helping you.
  • Proverbs 31 – Who can find a virtuous wife? Her worth is far above rubies. Her husbands heart trusts safely in her; so he will have no lack of gain. Dude, listen to your wife! She’s onto something. Women have a sense of discernment that us guys just don’t have. And like fools, so many guys don’t listen to them when it comes to business. This is a mistake. God has wired them differently than us. Drop the pride and ask for her opinion. You’ll be surprised at how much money, time, and nose bleeds it will save you.

Question: What ways have you experienced this in your life?

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14 comments   |  tags: , , , , , , , , , | posted in EntreLeadership, Leadership, Small Business

July 11, 2011

Interview with Melissa Fuller [Video]

By Chris LoCurto
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Melissa Fuller is one of the most talented singer/song writers I have ever heard. I may be a little biased though, because she was also one of the most talented members of my team. And if you know both of us, it’s no secret that we both love to cook. So naturally, while we were cooking together, we set aside a few minutes to talk about life, music, and chasing your dreams. Here’s our conversation about never giving up:

Now check out Melissa’s brand new video, “Money Money Money.” Be sure to comment on both the video and the interview. We want to know what you think.

Melissa also just launched her new website MelissaFuller.com. You can also follow her on Twitter and Facebook.

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March 8, 2011

Come Here Kid!

By Chris LoCurto
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The Washington Post reported on a new way that banks are taking advantage of people – in this case, college students.

Shortly after students show up on campus, they receive a welcome letter that contains a MasterCard from a company called Higher One. But this isn’t your run-of-the-mill credit card. It’s a card that accesses student loans. That’s right, students can use the cards to add debt to their student loans that they already can’t afford. Not only that, but the cards also come with high fees.

So this company is essentially targeting kids who are in debt and have no money of their own (Right? Or they wouldn’t have a loan.), is encouraging them to spend more money they don’t have, and then topping it all off with high fees.

This is genius! Why hasn’t someone thought of this before? Let’s get all of our graduating students in horribly desperate situations and send them out into the workforce. That ought to make for some open-minded, creative, happy workers.

According to the report, college officials contend that the loan cards make it easier for administrators and can provide income for cash-strapped schools. So… let’s get students further in debt so the school can make more money? This is ridiculous!

The article goes on to quote Anne Gross, legislative affairs director for the National Association of College and University Business Officers, as saying, “Sometimes people are looking for evil intent where there is none.” Riiiiiiiiight, because this plan is angelic!

If you’re a parent of a college student or a soon-to-be college student, there are three things you can do to avoid the college debt trap:

  • Edumacate ‘em – It is your duty to make sure your kids leave your house as responsible adults. Please tell me you’re not expecting the school to do that. Make sure that they understand how to handle money by budgeting and living on less than they make.
  • Scare ‘em – Do everything you can to teach them the dangers of debt. Show them how they are going to be tempted, and basically attacked, by offers that sound really good but will make them slaves to debt.
  • Hit ‘em – On their cell phone, that is. Make a point to stay in touch with your kids and hold them accountable. You want to know what they’re doing in their relationships and if they’re staying out of trouble. It’s the same with money. Ask them how they’re doing financially and find out if they’ve been approached about debt. It will train them to always be on the lookout.

On top of all of this, pray! I promise, you can’t do too much of that. Think about the pitfalls you constantly had to navigate at their age – and then multiply them by 10!

What great advice do you have for students starting out?

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March 4, 2011

You Can’t Have That!

By Chris LoCurto
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Today we are in Kansas City for the EntreLeadership 1-Day event teaching business owners and leaders how to grow and build their business. And I just want to say that I am a capitalist! I have no problem with someone leaving the cave, killing something, dragging it home, and keeping it!

My New iPhone 4 Arrived today! - June 29, 2010

The Bible specifically says the diligent will prosper. If I decide to put my energy into creating a product that changes or enhances lives, and I make money for that, what’s the problem?

There is this crazy idea that you shouldn’t be able to make a lot of money for your hard work. If you do, you should give it all away. Who came up with this idea?

I don’t know who came up with the idea, but I do know who brings it up all the time. It’s always someone who doesn’t have anything. Someone who isn’t willing to work their tail off to obtain a better standard of living.

Someone who thinks that life and money should be handed to them. This is the same person who wants to partake in luxuries but doesn’t want the company who makes those luxuries to have any money.

Question for ya: How would Apple research, develop, and get the iPhone out to market if it didn’t have any cash? “Didn’t a lot of this stuff start in a garage somewhere?” Yes! And do you remember how long it took to get to market? Be reasonable.

Does this mean that I don’t think businesses should give? Not at all. In fact, David Green, CEO of Hobby Lobby, recently gave $70 million to a university. $70 MILLION! Now ya can’t do that if you don’t have any money, can you?

On the way back from lunch today, I saw two people standing in a median, each with a stop sign on a stick that read, “STOP CORPORATE TAKEOVER.” That’s right. Two healthy-looking people, in the middle of a workday, denouncing corporate “greed” to everyone who drove by.

I didn’t see that they were getting much support. After all, most of us were on our way to earn our living by working for those “greedy” corporations who pay us.

I believe most people are not upset about what other people have. They’re upset about what they don’t have. Again, the diligent prosper. If you want more, instead of being jealous of someone else, try working harder. Or come up with other ways to make money.

Don’t be a hater! (That’s street lingo.) I once heard that the difference between jealousy and envy is with envy, you want what someone has. With jealousy, you want what they have, and you don’t want them to have it.

Let’s just work on getting what we want and not worry about what others have, mmmkay? Please share some situations that you’ve experienced.

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March 1, 2011

Celebrating Progress

By Chris LoCurto
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“People are afraid to celebrate winning the battle, because the war hasn’t been won yet.” – Kent Singletary

A few weeks ago, I was having a conversation with Kent, our Momentum Coach, and we were talking about completing the Financial Peace University (FPU) Baby Steps. That’s when he shared with me the above quote. (Yes, I could have written it into this paragraph, but it’s much better as a stand-alone quote.) He said people (especially men) are hesitant to celebrate accomplishing Baby Step 1 of FPU, which is getting $1,000 in an emergency fund, because something might happen and they would have to use that money.

He pointed out that people don’t celebrate what can be taken away. Think about the kinds of cards you can buy at Hallmark – birthday, anniversary, etc. But you don’t see a “Great job losing 10 pounds!” card. The same thing is true for emergency funds. Something might happen, and they will be forced to pull money out of their emergency fund for…wait for it…an emergency!

But that’s what it’s there for. The sad thing is, people feel like they’ve failed if they have an emergency and they have to use the emergency fund. How is that possible? Well, to be honest, it’s because of the financial roller coaster we’ve all been on with our money since we started our lives as adults. We started using debt. We didn’t watch where we spent our money. We’re a culture that celebrates permanence; therefore, we don’t place as much value on the things that might last only a short time.

According to The Wall Street Journal, 70% of Americans are living paycheck to paycheck. That means that all the money coming in is going right back out again. With life being this tight, any unexpected event is going to be a financial crisis. And what do we do when we have a financial crisis? Well, considering we don’t have cash to handle it, we go into debt. Thus, the pensive feelings when we finally have an emergency fund. These crises leave such deep mental scars that we’re still just waiting for the next bad thing to happen.

We get confused thinking that unless the fund stays at $1,000, we weren’t successful. The truth is, most people have never had that much money in their account on purpose! We also worry that if we have to use the money, and someone finds out, they will look at us as failures. It’s just not true! And if someone does, get that dork out of your life. Look for people who enjoy celebrating milestones.

So what do we do? Here are some suggestions:

  • Celebrate – Make it a point to get excited that you have that money! (Especially you men!) Get up and dance a jig. Or the Hokie Pokie. Or the Macarena. I don’t care, just get happy!
  • Celebrate with others – Again, as humans we are naturally concerned with what others think of us. If you see somebody doing something right, go crazy telling them how well they’ve done. They’ll soon begin to feel it as well. Then it will be okay for them to experience the fun! And don’t be afraid to celebrate the same win again if you have to go backward temporarily.
  • Plan for emergencies – Planning for an emergency doesn’t mean one will happen. It just means you are prepared. What if there is an emergency? What then? Well, since you’ve been working like crazy to protect yourself against emergencies, then it’s okay if you need to use that protection. By the way, stop calling this failure!

Always remember that we don’t get into financial trouble overnight. Therefore, it will take some time to get out. Celebrating the Baby Steps is just a way of saying along the way that you have no intentions of going backward for good. If we do for a time, it’s only for a time.

Have you ever felt this way before or noticed someone who has? Is there someone you need to celebrate with today?

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4 comments   |  tags: , , , , , , | posted in Financial

January 20, 2011

Aren’t I Your Favorite?

By Chris LoCurto
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If there’s one thing I’ve learned from being on a missions trip…it’s how to negotiate! Okay, I’ve learned a ton of spiritual stuff as well, but inevitably, on each missions trip comes the free day where you go to the local market. Ohhhhhh yeaaaaaaah, shopping at its finest. This is where you can find just about anything carved out of a coconut…or a stump. You can get your hair braided so tight that your grandchildren will have a headache. You can pick up a cross made out of….stuff that you don’t recognize. It’s the day we ‘set free’ the kids that have traveled with us, and tell them to go buy something to bless their parents and supporters.

It’s not uncommon for you to be walking by the huts, which are outside in eleven thousand degree weather, for the seller to wave a fan handmade out of banana leaves at you and tell you that they have air conditioning. It’s quite funny, but you have to realize that these are people trying to put food on their table just like the rest of us. At these markets we would always tell the youth on the trip with us to not just take the first price offered. These folks are used to negotiating. In fact, in most countries other than ours, they are used to negotiating at markets. Therefore, you always figure out what you are willing to pay for the item, go lower than that, and try and negotiate to your price. What’s really funny is watching one of our youth lock onto something that they really want, and they try to negotiate. Once they see you’re sold, they don’t back down. But if you act like it’s no big deal, they will drop the price with every step you take walking away from their merchandise.

“That’s great Chris, I’m sure that’ll help me on my next missions trip. But what can I do with that here?” Well, the truth is, I negotiate stuff here all the time just by asking. The Bible says you have not ’cause you ask not. So ask! Many times at car rental places I have been the sweetest and most charming guy, and then asked for a free upgrade by saying, “Can you upgrade me for free since I’m your favorite?!” The crazy thing is, it has worked more than not. The same thing at hotels when asking for a better room. During Christmas, when a store is packed, is a great time to ask for a discount. Just about anyone is able to give a ten percent discount.

The point is, it’s not that difficult to negotiate a better rate on the things you are buying. Just be realistic,and expect someone to do the same to you. :-)

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January 12, 2011

Oh, I Wasn’t Supposed To Do That?

By Chris LoCurto
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no credit

Image by TheTruthAbout via Flickr

A fantastic comment came in from the great Misty Gilbert:

“Chris, I do have a scenario recently experienced and am curious what you all would advise. I have a client (doctor) that has purchased a practice that has been in business 24 years. He is not out of debt and is not following The Baby Step principles. In fact, he has a very poor situation with bankruptcy 6 years ago.

I am setting up his practice from the ground up. I know none of this follows the “Dave Plan” but wondered how you would advise a business owner in regards to credit. How do you help someone when you have run into issues getting him a bank loan, credit card machine, vendor agreements, utilities when he has poor credit?

I know Dave would say he shouldn’t buy the business if he can’t pay cash for it, and he can’t. I know Dave would say operate the business without credit cards, and he won’t. Do you feel credit is a good thing in the business world? How would he establish these things with no credit? Maybe this can be a blog post?

For those of you who’ve been through our stuff, and have never run your own business, you’re probably thinking this is a silly question. But the truth is, this is a very common question that we get from business owners. When you step into the business world, you have a hard time finding people who are running a business debt free. They’re out there, you just don’t notice them until you start running your business debt free. Therefore, it seems reasonable to use debt to start and grow your venture. This, however, is a really bad idea.

All throughout the Bible it says that debt is either a curse or it’s something that a fool does. Nowhere does it differentiate between personal and business. Therefore, if you can’t run your business debt free, you shouldn’t be in it. “But how can anyone start a business then?!?!” Save for it. Yes, save money. Sixty percent of all new businesses start on less than $5,000. You need to work like crazy at what you’re doing until you save enough money to move into what you love. Plain and simple. “That’s great, how does it help this guy?”

Well, he’s already bought the practice, so he’s in. But from here on out he needs to run it like they did in the old days. Obviously he shouldn’t be getting any loans at all. He should have proven to himself that with the bankruptcy, debt isn’t the way to go. Instead of a credit card machine, he goes to an old carbon slider. If the issue with getting a machine is lack of credit, he doesn’t take cards right now; checks and cash. Or, get PayPal hooked up to a debit card. Vendors may have to be paid up front for a while until he earns their trust. It’s the same with utilities. You can do a turn on fee and first month’s payment. Is it tough? YES! But I can promise that the sweat equity will be way less stressful than the bankruptcy was!

The biggest issue, (by the way, this was a softball pitch by Misty, she actually knows the answer) is to actually plan for the future. Manage cash flow so you can actually have something to build a business with. Jumping in with nothing and expecting everything to work and make lots of money is an immature way of running a business. Adults plan and prepare. Seventy-four percent of the Forbes Four Hundred say that getting out of debt and staying out of debt is how they became successful.

Last year I started a real estate company with cash. No debt, and I only make moves that I can fund with cash. Plain and simple. There’s no business deal that could make me want to go back into debt. I trust God WAY more than I trust me.

Give me your thoughts on this topic. Leave a comment on this post for others to get involved.


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6 comments   |  tags: , , , , , , , , | posted in Financial, Small Business

December 31, 2010

Is That Your Wallet Vibrating…

By Chris LoCurto
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Tomorrow is a brand spankin’ new year! And with each new year, comes resolutions. In our business, we have two New Year’s: one at the beginning of each year, and one when the kids go back to school. Both times of year people decide that they are going to get their finances in order. It’s a funny phenomena. It’s like people wake up one day and think, “Oh crud! My finances are whack!” Or something like that. Then they seek out any possible way to try and get back on track, as if they were on the tracks to start with. There’s a lot of midnight cable watching, brother-in-law asking, get rich scheme talkin’ goin’ on. But for a select percentage of the population, they actually get on a plan that changes how they handle their finances for life: our plan! (Insert guy with pearly white teeth and a single “DING” sound.)

But let’s go back to the other FANTASTIC ideas that will help people stop their horrid spending habits and get focused on the things that will truly make them rich. Like the three wallets that fine folks at M.I.T. came up with. As Michael Koretzky reported, they developed some wallets to combat “our consumer impulses.”

  • The Bumblebee – which vibrates whenever your bank registers a transaction.
  • The Mother Bear – which has a hinge that gets tougher to open as your account gets smaller.
  • The Peacock – which inflates or deflates as your account gets cash flush or cash poor.

As I read this I couldn’t help but think, “These are some great novelty items.” That’s right, novelty. “But Chris, wouldn’t that stop my over-spending? Wouldn’t that keep my bank account full? Wouldn’t that get me on the path to financial freedom?” Uhhhhhh, no. It really wouldn’t. Disciplining yourself to be on a budget that allows you to spend for what you need AND (here it comes) want, will get you on the path. Yes you can actually budget the things that you want as well as need. Actually having a plan of how to live on less than you make will get you on that path. A trick wallet that tells you how dumb you’ve been lately isn’t the thing that’ll do it. Pretty soon you’ll just get tired of the wallet telling you what you can and cannot do, and you’ll toss it for the one that was more spender friendly.

Please…pleeeeeeease start your year off right and get on a plan. It’s really not that hard to do, and you’ll be amazed at the difference it makes.

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December 22, 2010

That’s Just Silly

By Chris LoCurto
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We’ve known Dave Ramsey for a long time. A really long time. And while I would charge the gates of hell with him, side by side with nothing but water pistols, I do have to say that I have had…oooooh…moments of doubt. I know, I know, it’s crazy, but you have to realize that until ten years ago, we….dare I say it…weren’t following the plan. We were friends with Dave and Sharon, but didn’t realize how stupid we were being. So when we started the plan, a little tool popped up for us to use: the Envelope System. To which I said, “That’s just silly. I’m not carrying that around.”

In case you don’t know, the purpose of the envelope system is to take the budget that you should have done, spending money on paper before the month begins, and filling  the envelope with cash for the budget categories that you don’t just write checks for, like bills. Examples would be groceries, eating out, entertainment, clothing, etc. (In one guys case he had a pot envelope. Yes, pot. When he realized how much he was spending a month on pot, he quit smoking.) So if you budget $100 for entertainment, that’s all you end up spending. When the envelope is empty, you go home and count the number of ketchup packets you have in the fridge for entertainment instead.

And me in all of my brilliance, thought that I had a better way. But we did something that I thought was pretty smart. We collected receipts on things that we bought for a couple of weeks. It was just something that I wanted to see out of curiosity. When I saw how much money was being spent at the BP on just sodas and junk food, I became a huge proponent of the envelope system. It was ridiculous! We quickly decided that Dave was right….’cause Dave was right, and we began making giant steps towards getting control of our finances, and getting out of debt.

We hit it hard for a year and got completely out of debt except for the house. We went on a work trip, where we tagged a couple of vacation days on, and I forgot to get the budget done and the money for the envelope system. But I thought, “It’s no big deal, I’ll just use my debit card and keep track in my head what we’ve spent. I won’t go over.” Well, I’m sure you know what happened next.

So next time you see something that seems a little silly, maybe spend a few minutes actually learning what its purpose really is. It just might save you some trouble.

Now I know those of you reading this have had a similar experience. Comment about it.If you are enjoying these posts, be sure to click the follow button.

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