It’s Time to Get Rid of Your Debt. Here’s How…

Another year has passed and it is a time for reflection and planning for a new year. If you are like me, one of your New Year’s resolutions may revolve around improving your finances and more specifically around debt. If your goal for 2008 is have less debt or no debt at all, then you are reading this at the right time? Why? Because this year you can actually achieve this resolution if you put a firm plan into action.

Lawrence Goldberg, the Credit Card Magician, recently shared his insights at one of JASI’s events during which time he shared some valuable tips and answered callers’ questions on debt reduction and elimination. If you missed the teleseminar, here is a quick recap of Lawrence’s valuable advice.

Q: I want to eliminate all of my debt. How do I get started?

A: To get started, first you must have the right mindset. First be thankful for your debt and what it has provided. What did you debt buy you? Did it pay for your children’s tuition? Did it provide you with a dream vacation with your spouse? Chances are you incurred debt to acquire or achieve something. The idea here is to focus on what your debt did for you that was positive. Once you have figured out what you debts provided, it is time to become bigger than your debt. Look at both your debt AND your assets. Know what you owe and what you have. If you have a lot of debt chances are you have a lot of stuff. By taking a look at the larger picture you can become bigger than you debt and put yourself in more powerful place.

 

Q: How can I pay off my debt when I am living paycheck to paycheck?

A: Know every detail about your debt and take a look at your assets. It’s not a zero sum game. Here are a few tips to try out.

• Try going frugal for a month to figure out lifestyle changes that affect spending. For example, instead of spending money on a gym membership, exercise outside.
• Try lowering the interest rates of your credit cards. Your minimum payments will put more money towards your principal and less towards interest.
• Figure out how you can increase your cash flow to pay down your debt. Search for a higher paying or second job or take another look at your assets. You may have assets that you can sell.

Quick Tip: Read the chapter on going frugal for a month in the Maxed Out Credit Card Game for more tips.

Q: Is debt consolidation a waste of time and money?

A: If bankruptcy is your only option, then debt consolidation may be for you. However, be wary of bad operators particularly on the internet. There are a few consolidators that work with credit card companies, but it will devastate your credit. Consolidation rates are usually around 8-10% so treat it as a last resort. Instead transfer your balances. You can get your interest rate down to 4% or less.

Quick Tip: Read Balance Transfer Magic to learn more.

Q: How can you win with credit card companies?

A: Credit card companies are masters at screwing around with you. Before committing to the great 0% limited time offer, read the fine print and work out exactly what you are getting yourself into. There are many ways to take advantage of their opportunities. You just have to know how to play the game.

Quick Tip: Spring is usually the best time for good offers. Even if they are not great, it may be better than where you are now.

Read more about Lawrence Goldberg purchase one of his books at www.thecreditcardmagician.com. Use the promotional code “transform” and get 25% off now through December 31^st! And tell him JASI sent you!

 

Have You Looked At Your Business Plan Lately?

By Karen McFarlane

The holidays are coming so Get Jazzed Up! It’s a great time to catch up with family members, call old friends, and plan for the New Year! This is an especially good time for you to analyze 2007 and make a list of what you need to shape up by the time midnight hits on December 31^st. While I am not a big fan of New Year’s resolutions, I do like the fact that everyone focuses their attention on making personal improvements to their lives. But have you also focused your attention to making improvements to your business by updating your business plan.

Every entrepreneur should have written a business plan before they opened the doors on their business. If you haven’t then you are a serious risk taker. How many people would you invest in without some sort of written account of how that money would be spent and later returned? However, for the savvy business owners that have invested their time and energy into crafting a viable written plan, it’s time to take a moment before the year is up to revisit it and analyze how your company is living up to your original promises.

Remember that your business plan is your roadmap to success. It forced you to think through every aspect of your enterprise from product development to finance. You wrote down how you would achieve these goals and provided a detailed account of your tactics and milestones. That was great work. So why did you abandon it?

Committing your thoughts to paper was the first step in making a commitment to yourself and the viability of the business. However, your plan is organic and is meant to continuously stimulate your thinking. So let’s do a checkup and honestly assess where you are. Here are a few areas to focus on:

• About Us. Are you living up to your original description? Are you falling short or have you become more that what you initially envisioned for yourself. Perhaps your original vision was too ambitious or there were changes in the market that affected your competitive advantage. Or maybe, you are right where you need to be! Take a hard look at who you are and make sure your goals are aligned with where you want to be.
• Mission Statement. Are you putting your purpose into practice? Perform an honest analysis and ask yourself if your activities, tactics, goals and employees supporting this mission. If not, adjust.
• Competitive Analysis. Are your competitors the same as they were a year ago or have new ones popped up? Now that you are hands-on you may have discovered other challenges that were not originally considered in the plan. Remember, to expand your competitive focus too. If you sell DVDs, your direct competitors could also be video game retailers. While your product may be different, you are competing for the same attention from similar audiences.
• Products/Services: Are you still selling the same thing? Have you added to your inventory or have you decided to package your products differently? Update this section along with price points. These changes may inform changes in your marketing plan throughout the year or impact your budget.
• Marketing Strategy: Are your marketing plans effective? Changes in the competitive landscape may have required adjustments or opportunities arose that you were able to capitalize on. Marketing is a process of discovery which is part art and part science. Whichever tactics you decide to execute, measure their effectiveness and adjust accordingly. It might take you a while before you find the right marketing mix for your audience. Also, make sure you got your audience right! Are you messaging to your target or is your audience skewing in a different direction?
• Budget: Reassess your finances. Are you spending more or less than anticipated? What is your return on investment? Depending on the results, you may need to adjust your allocations. For instance, if a particular marketing tactic is yielding positive results, you may want to consider committing additional funds to the effort. If sales are up then you may need to staff up to support the growth. And if you find that you aren’t making the money you projected, it’s time to take a hard look at your entire business plan again. Perhaps there was flaw in your thinking that can be corrected for 2008 or perhaps the idea was a good try, but just not financially viable.

I applaud all those that had the discipline to work through all of the possibilities and plan for their success in advance. In fact, that is the purpose of the plan – to force you to think and plan for success. Continue to use it to regularly inform your thinking and share it with your colleagues. Sometimes a fresh pair of ideas and an objective point of view can open your mind up to things you never considered before After all, you put so much effort into crafting it – you might as well make the most out of it by using it everyday!

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