General

How Much Should You Borrow to Pay for College?

July 22, 2012 by Guest Contributor

Borrowing for College

With stagnant wage levels and increasing costs of living, higher education has become a fact of life for anyone wanting to get ahead. Rising costs of that education are making it harder for parents and students to meet the costs. The past two years, for instance, have seen tuition inflation averaging eight percent, and tuition is virtually guaranteed to increase by three percent every year, if the last two decades are any indication.

Students have some resources available, and a couple of tricks to minimize costs. Private and university scholarships are still a possibility to reduce the costs. The Pell grant can help with undergraduate expenses, but it has not been increased to meet inflation in recent years. Tax credits are a great resource for parents who want to help their children pay for school. Students are increasingly working part-time while attending full-time classes, and they are completing the first two years of core classes at community colleges or on-line.

Even with these options, most students face borrowing to pay for school and living expenses, or putting off their degree programs in favor of full-time employment. How much debt should students feel comfortable with? How much is too much? Are some loans better than others? Finance provider Sallie Mae offers help for those considering student loans.

Borrowing for College — College—401 K 2012 (Flickr.com)

Remember Why You Borrowed

Students often have difficulty making the transition from high school to college. The latter half of senior year for students planning to attend public universities adds to the confusion with frequent parties and road trips. Student loans can easily become a way of maintaining a particular lifestyle, whether it is eating out regularly, living in classy apartments or buying designer clothes. Every dollar of student loans should be directed to the costs of education. When used to cover housing and food, such as during the more hectic final two years, these costs should be minimized as much as possible.

Make Long-term Goals

A way to help control your use of loans is future orientation. What are your plans after school? Do they include buying a new car or house? Maybe you want to start a family or take a vacation to celebrate? Student loan debt will make all these things more difficult, so minimize the debt. [Read more…] about How Much Should You Borrow to Pay for College?

Payroll Systems for Small Businesses

July 21, 2012 by Guest Contributor

Why do You need a Payroll System?

One of the challenges that comes with starting a new business is figuring out all the systems that you need have in place to run things. If you have any employees, one of the necessary items that you’ll need is a good payroll system. If you have never chosen a payroll system before, it can be a little bit intimidating. Payroll costs are one of your largest business expenses so it pays to choose a payroll system carefully. Here are a few things that you should look for when choosing a payroll system.

Ability to Integrate With Accounting Software

When you are using a payroll system, it needs to be able to integrate into your current accounting system. If you don’t have an accounting system yet, you have a little bit of flexibility when it comes to choosing both of them. Your payroll system needs to be able to download the entries from your accounting system. This will make things a lot easier on you, instead of having to manually enter all the information twice.

Scalable System

You may also want to choose a payroll system that is considered scalable. If you have a payroll system that is highly scalable, it can grow with your business. This makes it possible for you to avoid switching payroll software once your company starts to grow. If your company is highly successful in gross quickly, you don’t want to have to completely redo the payroll system at that point. [Read more…] about Payroll Systems for Small Businesses

4 Ways Outsourcing Payroll Could Benefit Your Business

July 20, 2012 by John Hughes

Outsourcing Payroll

If people are the heart of every business then it could be said that payroll is the blood. Everyone likes getting paid and in this economic climate, it is more important than ever that payroll is carried out on time and with the utmost accuracy.

It’s natural for business owners to want to be in control of their payroll but as an operational task, it can be extremely time-consuming. Nevertheless hiring a payroll manager can also be a costly affair as you will want to ensure that the person you take on is fully qualified for the role. Here are 4 reasons your business could benefit from outsourcing your payroll to the experts:

1. Outsourcing Payroll could help your business save money.

Payroll software systems can be costly and you will need to factor in the cost of employing someone to take care of payroll responsibilities. Labour costs of in-house payroll are not the only factor to consider; the price of postage, office space, stationery, printing and other costs may not seem like great expenses but can add up rapidly.

Running a cost/benefit analysis to estimate the overall costs incurred by your payroll each period compared to the fees charged by an outsourced payroll firm for a full payroll management service will help determine whether this is cost effective for your business. [Read more…] about 4 Ways Outsourcing Payroll Could Benefit Your Business

Going Back To School? Here Are The Top 5 Online Programs To Pursue

July 12, 2012 by Guest Contributor

Top 5 Online Programs

Today’s job market is tough. If you are thinking about going back to school but don’t want to waste your money on degrees that won’t help you find a career that is in demand, take a look at some online programs that will pay for themselves. One major benefit of taking classes online is that anyone from almost anywhere can have access to a computer these days. Case in point, in the picture below, a young Brazilian man checks out the new computer center in the city of Cabrália, Brazil. The center provides broadband access, 3G mobile Internet, and custom applications for managing fishing businesses, equipment, and training. Once trained and properly equipped, local fishermen, including those from the Pataxó indigenous ethnic group, will be able to broker deals with buyers, access weather information, and manage economic activities, all in real-time.

1. Business Administration

Online programs in business administration start at the associate degree level and go all the way up to the MBA, or Masters of Business Administration. If you have never attended college or didn’t earn a degree when you did, the two-year degree is a great place to start. You can always continue working toward a more advanced degree one step at a time. Expect to take classes in all areas of business for these degrees, including management, economics, and accounting to develop a broad knowledge base. According the the Bureau of Labor Statistics Occupational Outlook Catalog a wide variety of jobs require an MBA, including everything from Financial Analysts, to Top Corporate Executives, Atmospheric Scientists and museum curators.

2. Education

If you love children, a teaching career could be a great fit for you in a growing field. It’s no secret that the world population is growing at an exponential rate, leading to an increase in demand for educators to teach the growing number of children. Bachelors degrees in education can be earned online, but many states require that you also spend a certain amount of time in a classroom to earn your teaching certificate. According to the Bureau of Labor Statistics (BLS) the number of jobs for teachers is expected to increase faster than the average for all occupations through 2018.

3. Computer Science

Computer science degrees are perfectly formatted for online learning because you are learning in the environment you will need to know inside and out to complete your degree. Whether you are interested in web development, computer programming or software engineering, you can find a specialized degree that you can complete 100 percent online. According to the BLS positions like software developers is projected to grow 30 percent from 2010 to 2020, much faster than the average for all occupations.

Payday Loans: The Responsible Way to Go?

June 28, 2012 by Guest Contributor

Payday Loans

Even for people who are careful, life’s unexpected events happen. People who have their lives carefully ordered and their finances sorted can still have a temporary setback in which they will need just a little bit of immediate cash to keep the train on the tracks. Cars do break down and trees do fall on roofs. These things are a part of everyday life that cannot be exactly predicted.

What can be predicted is that when they happen they are expensive even with insurance coverage. Payday loan providers try to make the process as user friendly as possible for anyone who has regular employment. All you need is a bank account and an old pay stub and you can get the money needed on a short-term basis. Just go to the local payday loan office, fill in the paperwork and get the money you need. But once you are on the hook to them your problems just seem to get bigger. Even though the government has mandated maximum interest charges, payday lenders get around this by charging “fees” instead of interest. And the only thing worse than being in debt to a Payday lender is being in debt to a loan shark.

Editor’s Note:

Because “emergencies” can happen at any time you should be prepared for them. Proper budgeting involves a fund set aside to handle these intermittent but totally expected events. If a tire blows out you should be prepared knowing that tires don’t last forever. The same with washing machines, refrigerators, and roofs. Hopefully, they won’t all blow up at the same time. But if you don’t have an emergency fund that you are putting money into every paycheck in preparation then you are actually living beyond your means, even though during “normal” times it may not seem like it.

But eventually, something will happen and then you will have to resort to a payday loan and life will get much worse because you will not only need to pay for the repair but the high-interest rates that go with it. Plan for emergencies and they won’t be an “emergency” they will be a minor bump in the road of life. But if your credit cards are maxed out and you are living on the edge… a blown tire will force you to seek ever-higher cost forms of debt.

According to the Consumer’s Union: “Payday” loans are small, short-term loans made by check cashers or similar businesses at extremely high-interest rates. Typically, a borrower writes a personal check for $100-$300, plus a fee, payable to the lender. The lender agrees to hold onto the check until the borrower’s next payday, usually one week to one month later, only then will the check be deposited. In return, the borrower gets cash immediately. The fees for payday loans are extremely high: up to $17.50 for every $100 borrowed, up to a maximum of $300. The [annual] interest rates for such transactions are staggering: 911% for a one-week loan; 456% for a two-week loan, 212% for a one-month loan.

$17.50 may not sound like much but if you are working a near minimum wage job making $7.50 an hour you will need to work an extra 2 hours and 20 minutes just to pay the “fee”. $17.50 is 17.5% of $100 but since it is a “fee” and not “interest” it isn’t regulated in the same way. High-interest credit cards may charge 18% to 24% a Year compared to 17.5% a week for a payday loan. Thus you would still be better off with an Instant Approval Credit Card or a card for people with Bad Credit… even though the terms aren’t great… they are still infinitely better than the fees on a payday loan.

Post a comment and tell us what you think about Payday Loans.

Accounting Trends Creating Jobs

June 27, 2012 by Tim McMahon

Accounting Jobs

A recent article in Financial Trend Forecaster talks about a new trend in the world of accounting. Increasingly more companies are hiring accountants to work on staff as full-time employees to manage corporate budgets, accounts payable and receivable, to present financial reports to investors and to negotiate corporate tax laws. Companies are also looking for accounting professionals to protect investors’ money and company assets. At the same time, more businesses are looking to hire accountants, the jobs are becoming harder to fill. In addition, companies are becoming more global in nature and adopting the global standards called International Financial Reporting Standards (IFRS).

More Accounting Jobs Available

This is creating a demand for more accountants, the U.S. Bureau of Labor Statistics (BLS) is projecting a 16% growth rate in the need for accountants between 2010 and 2020 which they consider to be “average growth rate”. According to the most recent Occupational Employment data published by the BLS (May 2011) for Accountants and Auditors, the mean annual wage is $70,130. While those in Accounting, Tax Preparation, Bookkeeping, and Payroll Services have an annual mean wage of $75,060. A recent U.S. News survey ranked Accounting among their 25 Best Jobs of 2012.

What Accountants and Auditors Do

According to the BLS: “Accountants and auditors prepare and examine financial records. They ensure that financial records are accurate and that taxes are paid properly and on time. Accountants and auditors assess financial operations and work to help ensure that organizations run efficiently.”

The Importance of Building Credit as a Young Adult

June 26, 2012 by Tim McMahon

Building Credit

If you are currently in college, or have recently graduated from college, you know how difficult it is to get a credit card due to a lack of credit history. For those of us who are a little older, this may seem unbelievable, because when we were in school, credit card offers would literally pour out of our mailboxes.

In the past, credit companies would practically beg college students to sign up for low-balance student cards, but thanks to the credit collapse of 2008, that story has drastically changed. It is now nearly impossible to get accepted for a credit card if you have no previous credit history, and this is really hurting a lot of young adults who are trying to get on their feet.

Why You Need to Build Credit

It is a giant “Catch 22” You need a Credit History in order to Build a Credit History

Building Credit History—natloans (Flickr.com)You have to have credit history in order to buy or lease a car… buy a home…be considered for a loan…

And when do people usually first need loans? Two to three years after graduating from college. Without a credit card, college students can’t build the credit they need to do these things, and this is why it is important for parents to start helping their kids build their credit starting their freshman year.

How Parents Can Help Build Your Credit

Parents can help their children build credit by opening a joint account with them; with parents as the owners and the child as the authorized user. Have one card designated as the “credit-builder card.” Only use it to buy things like school textbooks or supplies, and pay it off as soon as you make purchases. This will teach your children good credit spending habits and slowly build their responsibility. It will require parents to constantly monitor the card’s use and stay on the child about making payments, but if the student is mindful, there shouldn’t be any problems.

If a parent is concerned that [Read more…] about The Importance of Building Credit as a Young Adult

May Unemployment Statistics by State

June 25, 2012 by Tim McMahon

U.S. Unemployment Rate by State

The U.S. Bureau of Labor Statistics has released their Unemployment rates by State. So we can see how the various states compare. From the chart below we can see that California, Nevada, North Carolina, New Jersey, Washington D.C., and Rhode Island are all doing worse than the national average. New York, Connecticut, Michigan, Indiana, Illinois, Kentucky, South Carolina, Georgia, Florida, Alabama, Mississippi, Louisiana, Colorado, Idaho, New Mexico, Washington and Oregon are all average in their unemployment rates while the remainder are above average.

How the Unemployment Rates of Various States Compare

Nevada continued to record the highest unemployment rate among the states at 11.6 percent in May. Rhode Island and California posted the next highest rates, 11.0 and 10.8 percent, respectively. North Dakota again registered the lowest jobless rate, 3.0 percent, followed by Nebraska, 3.9 percent.

South Dakota, 4.3%, Vermont 4.6%, and Oklahoma at 4.8% were all below 5%. While New Hampshire, [Read more…] about May Unemployment Statistics by State

Why Your Small Business Needs an Accountant

June 21, 2012 by Tim McMahon

Small Business Accountant

Many people who start their own small businesses do so as a means of determining their own destiny. They are their own boss, operating the business their own way and planning for the future with their own ideas. There are, however, certain laws and regulations legislating aspects of any business. For this reason, and more, it is a good idea for any small business to have an accountant.

Small Business Accountants Can Handle Payroll

Small business owners often wear many hats: boss, lease negotiator, inventory specialist, decision-maker, payroll, shipping and receiving, IT, HR, and occasionally even custodian. In the midst of all of that, they also manage employees, even if those employees are contracted. State and national law dictate what forms those employees need to fill out, how much of their paycheck is deducted for taxes, benefits, and Social Security. Business owners are forced to either learn the tax laws (and the changes to said laws each year) or hire an accountant to help. Just managing payroll can be time-consuming, as an owner your time is valuable and should be spent growing your business.

Small Business Accountants Can Handle Taxes

Even contract labor requires certain documentation. If a company pays a contractor more than $600 over the course of the year, a 1099 must be filed. Keeping track of the various tax amounts for various employees as well as which contracted employees earned how much can easily become a full-time job. Small business owners have plenty of other details to manage without adding that to their plates. If only for personnel purposes, an accountant will save time as well as headaches.

In addition to managing tax issues for employees, a small business accountant will help navigate tax concerns for the business itself. Capital improvements, profits, loss, depreciation, and potential write-offs may exist. Some small businesses pay taxes quarterly rather than annually, requiring an ability to understand and follow additional tax laws. An accountant can save you money by avoiding government penalties and late fees but also by pointing out deductions, monitoring for “slippage” or missing funds, and other ways to save money. [Read more…] about Why Your Small Business Needs an Accountant

Private Sector Job Creation Slightly Down in May

June 6, 2012 by Tim McMahon

Job Creation in May

According to the most recent Gallup survey results U.S. job creation is at a 19 in May down from 20 in April but up from 18 in March. Gallup interviewed 16,913 workers in May and asked them whether they felt their employer was increasing, decreasing or maintaining the same size workforce. This is not the same as asking employers about actual jobs they have created but gives an indication of the perception of the people. Gallup believes that this is a strong predictor of the direction of Unemployment and U.S. Jobless claims.

According to Gallup, the +19 for May is comprised of 35% of the nationwide workers surveyed saying that they thought that their company was increasing their workforce (hiring) while 16% of those surveyed said they felt their employer was decreasing their workforce (laying-off). Thus 35-16=19. The remaining 49% of the workers surveyed said that their company was holding steady neither hiring or firing.

According to the U.S. Bureau of Labor Statistics (Seasonally adjusted ) the Non-Farm payrolls in May increased by 69,000 jobs. Unfortunately, the U.S. adds about 167,000 new men,women and children every month. Of course not all of them are workers but 69,000 new jobs will just about provide for 167,000 new people so the net effect is that the Unemployment rate would stay about the same.

The one ray of hope according to Gallup is that Government job creation which has been negative since 2009 has ticked up from -7 in April to -3 in May even though private sector hiring fell from 25 to 23. Gallup believes that overall the level is relatively flat for the month of May and that we will have to look at next month’s data to see if a trend is developing.

See the full article U.S. Job Creation Largely Steady in May on Gallup.com

Sources:

Poplulation

Labor Statistics- Employment Situation — MAY 2012

Gallup US Job Creation