The Magnifying Glass and the Sun

Creating Business Focus by Delegating to Experts

When I was a young boy, my grandfather passed on the age-old wisdom of the power of “The Magnifying Glass and the Sun”. That day I spent an hour trying to harness the sun and start a fire on a small piece of newspaper-and did not succeed.

What I have learned since then is that it takes both a steady hand and quite a bit of preserving to sit and wait until something catches fire (5-10 minutes actually). The interesting part was not that I spent an hour “working” on the fire, but that I did not spend 5-10 minutes working on the single task of not moving the magnifying glass. Read the rest of this entry »

Filed under: General

No Minimum Distributions in 2009!

It’s official.  The Worker, Retiree and Employer Recovery Act of 2008 was signed by President Bush.  The new law, which was designed to help alleviate the financial burden facing investors in this economic downturn, suspends the current requirement for mandatory withdrawals from retirement accounts at age 70 ½ and allows the money to remain invested on a tax-deferred basis.  The new law will apply to all defined-contribution plans, including 401(k), 403(b), 457(b), and IRA accounts.  Please note this waiver applies only to 2009.

Filed under: General

Effective Marketing Begins at the End

If you are like many marketers, your decisions are based on what you’ve done in the past, what your competition is doing, or worse yet – you advertise because you feel like you “…just have to advertise.” There is a better way.

Dr. Stephen R. Covey writes that the ability to “Begin with the End in Mind” is one of 7 Habits of Highly Effective People. Where his concepts can be applied to many aspects of our personal and business life, I think this is an important one to embrace when marketing our businesses. Try using this simple 3-step approach to a goal-centered marketing campaign.

Read the rest of this entry »

Filed under: General

Should You Delay Receiving Social Security?

You worked for decades and contributed a lot of your hard-earned money into the social security  system.  And now you may be wondering when is the time to start drawing on those benefits?  The question seems simple enough.  The answer, however, hinges on several factors.

The Basics:
You can start collecting social security benefits anytime between the ages of 62 to 70.  If you wait until full retirement age, which is now 66 for those born between 1943-1954, you will receive larger monthly checks.  However, if you need money before then or are, for example, in poor health, you can start receiving a reduced benefit at age 62; this amount is currently 75% of your full retirement benefit.   You can continue to work and receive social security.  If you are receiving benefits prior to full retirement age, you will have some restrictions on the amount of income you can earn.  In 2008, you lose $1 in social security benefits for every $2 dollars in gross earnings over $13,560.

For example, let’s assume your social security benefits at age 62 are $18,000 a year.  In 2008, you had earned income from your job of $49,560.  Since this is $36,000 over the penalty threshold ($49,560-$13,560) you would lose all your social security benefits ($18,000) for the year ($36,000 x 50%).  Therefore, there is no economic benefit in receiving social security prior to full retirement age.

Full retirement age or later:
If you wait until full retirement age, currently 66, you will receive 100% of your benefit and you can earn  any amount of money without having your benefits reduced.  However, even after you reach full retirement age you can choose to postpone benefits and get additional retirement credits for waiting.  For those born after 1942, your benefit goes up by two-thirds of 1% for every month you wait.  That’s 8% a year!  Once you reach age 70, there is no additional advantage to waiting.

Conclusion:
If longevity runs in your family and you don’t need the money now, it may make sense to delay taking social security at least until full retirement age.  The Social Security Administration can calculate the “breakeven” age for you.  On average, if you live longer than 78 to 83 years of age, you’re better off waiting.

Filed under: General

Reduce Anxiety to Increase Sales

I came across a great article recently titled Reducing Customer Anxiety About Products on Product Pages that described how to increase conversions on your e-commerce site. Though this article focused on reducing anxiety with e-commerce sites, it was a great piece of advice for many different types of web sites.

Successful businesses need to have a professional, attractive, and functional web site. This is fairly accepted by most people. However, how much time do we spend on crafting that site so that our potential customers feel safe and comfortable when interacting with our businesses and organizations on the web? I often see sites that spend lots of time on Flash or beautiful imagery but have very little content to tell a story or teach me how their products will benefit me. Non-profits and associations are also guilty of this – if I join an association, what can I expect as a member? What are the guidelines? What’s benefit for me?

Here are some ways to reduce visitor anxiety when he/she is exploring your web site:

• Create a Thorough FAQ. The FAQ seems to be a lost art and many sites either don’t have one or post a useless one that doesn’t really answer anything. A good FAQ should get inside the head of your constituents and address the common concerns that most people have about your product, service, or organization. This helps reduce anxiety and increases the level of familiarity that sites visitors have with your organization.
• Utilize Case Studies. Case studies are a powerful tool that can dramatically increase the level of trust you have with your audience. Tell stories about how you solved a problem or eased the pain for your customers and how they benefited from working with you. Stories about other customers are much more effective than self-promotion.

• Explain How You Are Different. Your competitors are all saying the same thing. They are probably using vague marketing messages centered about “customer service” or “quality”. Be different: tell your customer how you provide customer service. Explain why your quality is superior. Then, go a step further and explain how it will benefit your customer. These are the things your customers are asking as they explore your web site.

Your customers and constituents need to feel safe before they work with you. Don’t keep your stories in a black box. Ease their fears and anxiety by anticipating and addressing these concerns up front. People want to work with companies and organizations that are transparent and honest, not mysterious unknowns. Reduce anxiety and increase your sales.

Author: Michael Reynolds
Michael Reynolds is President and CEO of SpinWeb. His background includes information technology, design and branding, organizational productivity, and web marketing. In his spare time, Michael enjoys tennis, sushi, and his iPhone. Contact Michael at michael@spinweb.net or 866.SPINWEB x1200.

Filed under: General

New Year Resolutions

With the coming of the New Year, we all tend to look for New Year’s Resolutions.  Things we want to accomplish in the New Year, or things we did not do in the old year.  One thing you should consider is your insurance coverage.  Most people buy a policy and assume they are covered for all their needs, and basically forget about it until their premium comes due.  However, needs change – you improve your home or you get additional goodies that need to be covered.  Also times change – the market price of your home may have gone down this year, but the price of replacement has probably gone up.  Maybe money is tighter this year, and you want to reduce the cost of your insurance.   Therefore, you need to make some New Year’s Resolutions regarding your insurance.

First, I would suggest you review your personal lines policy for all your valuables. Make sure you have included any Christmas gifts that need to be added – i.e. jewelry, computer equipment, valuable art, etc.

Have you finished any remodeling jobs on your home? Added a deck or swimming pool?  All these things could change the way you are covered.  Talk to me about the savings you might get if you replaced your furnace, air conditioner, electrical system, or roof.  One company I use gives a discount if you have replaced these things.

I have had several people call to reduce costs of their insurance, but they should be very cautious about dropping coverage to get a lower price.  One customer got a quote from one of the TV advertisers.  He called an 800 number for a quote.  They lowered the policy limits, so the price WAS lower.  However, the customer lost his multi-policy discount because that company does not sell homeowners insurance.  Across the board, insurance companies are currently losing money on homeowners insurance, so some 800 number companies do not sell this insurance.  Although that person got a lower rate on their auto insurance, their home owners insurance went up.  Know what you are getting and what you are not getting.  Call me to make sure you are covered correctly.

Another problem in 2009 will be replacement cost versus market value. Most people think of market value when considering what their home is worth.  Insurance companies use replacement cost when there is a claim.  Evaluate replacement cost of your home and/or business.  Compare this to your current policy to see if you are underinsured.  I would suspect market values have gone down, and replacement costs have gone up.   Having trouble coming up with the replacement cost, let me give you a free replacement cost analysis.

A big resolution for the New Year is to complete a home inventory and/or business inventory. In case of a major claim, insurance companies have you submit a list of all items that you own, when they were purchased, cost of the purchase and id numbers, if possible.  Most of you can tell me how many TV’s you own or what appliances are in your kitchen, but do you know how many pairs of jeans you own, what is in your bathroom cabinet, or the number of DVD’s you have?  To be sure all items will be replaced, it is important to have everything inventoried.   It should be stored not only in your home or business, but completely off the property in a lock box or accessible storage.

Last but not least, do you have enough life insurance to protect your family if something should happen to you?

The tendency right now is to shop for a lower rate and switch companies.  It’s been my experience that the worst thing you can do is switch insurance companies when we are heading into a market where prices are increasing and underwriting guidelines are changing.  If you want loyalty from your insurance company when a claim happens, now is the time to show loyalty to your insurance company.

Steve has 25+ years of experience as an insurance agent and he founded his company Priority Risk Management with the guiding principle of educating his clients as to the risks they face and the commitment to protect their most valuable assets. He has written numerous consumer reports advising his clients on the intricacies of their insurance policies and the best way to protect themselves. Additionally, he has authored, “Safe Teen Driver Guide: 16 Steps Every Parent Should Take to Prepare Their Teen to Drive!” To view these consumer reports and others visit his website: www.PriorityRisk.com. You can reach Steve by phone at 317-713-2959.

Filed under: General

The Staggering Cost of Insuring Teen Drivers

Ask any parent who has just added a kid to the family’s insurance  policy and they’ll tell you how expensive it is to have a teen behind the wheel. But the overall cost of teen driving is as tragic as it is staggering.

According to a recent report from AAA, car accidents involving drivers 15 to 17 cost society more than $34 billion in medical expenses, property damage and related costs in 2006. AAA also reports, in 2006 drivers ages 15 to 17 were involved in approximately 974,000 crashes that injured 406,427 people and killed 2,541.

Parents can reduce the high cost of insuring their teen drivers. There  are special discounts that can really make a big difference in how much you will have to pay for your teen to drive. Some of these discounts include:

• Good Student- If your teen driver has a “B” average or better, you can save up to 10%.
• Multi-policy- If you insure your home and cars with the same company, you can save up to 15% on both policies
• GPS Teen Driver Monitoring System- There is one company that offers a 15% discount for installing this unit in the teen driver’s car
• Safe Driver- If your family has a clean driving and claims record, you can save up to 15%
• Good credit- Some companies reward responsible customers based on their credit. This can be very significant and can save you as much as 35%.

The bottom line is that the most responsible families will pay the lowest premium. Stress to your teen that avoiding tickets and accidents is most critical to not only keeping your insurance rates down, but of course, assure the safety of your teen driver and others.

Filed under: General

Higher Insurance Premiums in 2009?

I have been forecasting a hardening of the market due to underwriting losses.  The sudden down turn of the financial markets will serve to only hasten the arrival of the hard market.

On Oct 20, Progressive announced net realized pre-tax losses in the investment portfolio of 1.36 billion dollars for the months of Aug. and Sept.  By comparison, the total value of their investment portfolio is approximately 12.7 billion dollars.  No doubt, they will experience similar losses for the month of Oct.

Progressive was quick to point out that while they have less operating capital, they continue to have all they need today to meet the regulatory requirements.  Shortly after their Aug. release, Fitch Ratings affirmed Progressive’s AA+ Insurer Financial Strength rating with a stable rating outlook.

What does all this mean?  While Progressive is still very financially sound, they will need to raise additional capital to replace the recent losses.  This can only be done one of three ways: write more business, increase premiums or lower expenses.  I will leave it to you to decide which course of action you think they will take.

While Progressive was quick to announce the results, surely there are more companies to follow with a similar story.

In addition to watching your 401K plan shrink while gas prices shoot through the roof, you should be anticipating increases in your insurance premiums in 2009.

Steve Shoultz, Priority Risk Management

Filed under: General

Choosing the right bank can save you time and money

When the economy is struggling, it’s important to look for ways to save money wherever you can. One way to do that is to reevaluate your current banking relationship.

While everyone’s needs vary slightly when it comes to the products and services they require from a financial institution, there are several considerations everyone needs to keep in mind.

• Consider banks that are convenient to your everyday activities. Look for banks that are easily accessible as you drive to and from work, or while you run errands.
• Check out different banks’ web sites. They will give you an idea of the types of accounts, rates, and services available without having to set foot in an office.
• Consider what’s most important to you when it comes to a banking relationship. If you want to develop a personal, long-term relationship with a bank, a smaller one might be a better fit. Or, if you travel frequently, you might want to consider a larger regional or national bank.
• Consider how you will do your banking. Do you need access to several branch offices, or will you be doing most of your banking on-line or through ATMs.
• Make a visit to a local branch and get to know the staff. Are the tellers knowledgeable and friendly, are the managers accessible? Are they going to be open when you need them?
• Compare rates and fees among banks to make sure you’re getting the best deal. And don’t ignore the fine print; oftentimes banks will advertise accounts with no fees only to charge for the additional services you use most.

Chris Cannaley is a Banking Office Manager with Huntington National Bank, and manages the office at 10585 N Meridian St. in Indianapolis. During his 10 years in the banking industry, Chris has helped both small business and consumer customers make and save money, while providing them with additional access and convenience. Chris can be contacted at 317-843-0101 or at christopher.cannaley@huntington.com. You can also visit Huntington Bank on the web at www.huntington.com.

Filed under: General

Pool and Trampoline Dangers

Protect Yourself from Pool and Trampoline Dangers
Did you know that many home insurers won’t cover customers with trampolines and have restrictions for those with a pool?  Check with your insurance agent before buying a trampoline or pool — and let your agent know if you’ve already purchased one. If you file an insurance claim involving a trampoline or pool (especially one your insurance company didn’t know about), you not only risk higher insurance bills in the future;  you could have trouble finding an insurance company willing to underwrite your future coverage.
Here are some tips on how to protect yourself and your loved ones from these common warm-weather hazards.

Read the rest of this entry »

Filed under: General