In today’s US market, convenience and cheap prices are the primary goal for many companies. The majority of corporations were able to accomplish these goals, but sacrificed the quality of their products or services. Labor is inexpensive overseas, so many companies outsourced their factories, leaving plenty of American citizens unemployed, mostly factory workers and call center representatives.

Some economists would say that there is nothing wrong with the financial stability of today’s market; others would say that we need to bring the jobs back into our country. Regardless, change wasn’t being made quick enough, so the American people took things into their own hands.

Craig’s list and Angie’s list were made to bring products and services back into America. On Craig’s list, you can find products that your neighbors are selling. You can also find job postings in your area. Rather than going to the local supermarket for an item, many people are checking Craig’s list to see if anyone is selling that same item cheaper than retail value.

On Angie’s list, people are finding services that are backed by quality reviews. Therefore, they know the company they hire would do a good job. This not only helps the local business owners become more profitable, it helps the consumer feel safe knowing they are hiring a company that other people trust.

What are the true benefits of these two services?

Craig’s list allows consumer to consumer selling. It also helps local business owners market their business when they may have a strict budget that won’t allow premium advertising. Craig’s list helps keep money circulating through America, rather than pay for the outsourced companies to produce more products.

Angie’s list, much like Craig’s list, helps local service members market their company, be it electricians, landscaping, plumbing or any other type of service imaginable. Moreover, the website encourages previous clients to share their experiences about various companies, allowing potential clients to make an informed decision on whether they should hire that company or not.

Together, both of these sites are doing a great job at helping the local business owner grow their business. As more people realize that the key to economic growth is helping the local business owners, sites like Craig’s list and Angie’s list will be even more important.

In today’s fast-paced digital world, people rarely refer to the Yellow Pages and White Pages when they need to find a company. Instead, they go to Google to find local businesses, and then they may refer to Angie’s list to see what other people think. If they are searching for something very specific, they may visit Craig’s list to see if they can find what they are looking for. Craig’s list allows people to advertise services and products that may be hard to find with a Google search.

photo by merfam

Energy is one of, if not the biggest overhead of many companies, irrespective of size or industry. As this is the case with a lot of businesses large and small, they often pay close attention to how much they spend on gas and electricity to see if their bills are too big. If they feel that they are spending too much on energy, then they’ll feel the need that something should be done to ensure it never happens again. Switching energy suppliers with the help of make it cheaper is one course of action that some businesses take.

It might not seem as obvious as cutting down on energy wastage, but changing energy supplier could mean the difference between your company’s finances being in the black and in the red. Research conducted by Make it Cheaper showed that, on average, businesses would save around 4p per kWh of electricity used, as well as 1.6p per kWh of gas, proving that it pays to switch. However, if you want to make the leap from one supplier to another, you have to time it right.

Every business signs a contract with an energy supplier, many of them on a reasonable-sounding fixed price tariff. Typically, these contracts last between a year and three years, and the only way in which they can be left is when a â˜renewal window’ is activated. It opens during the last few months of your contract, and lasts for 30 days. During the window, you can either choose to renew your contract or leave for another supplier.

While the renewal window provides a great opportunity for businesses to change energy suppliers, many companies aren’t aware that, in order to switch, they have to wait until the window opens. Of 750 companies surveyed by Make it Cheaper, only half said that they knew about the renewal window, whereas just one-fifth of those questioned said that they even remember receiving a letter from their existing energy supplier about the window being open.

If you’re dissatisfied with your current energy deal and are looking for a great way to save money on your gas and electricity bills, your best option is to wait until the renewal window opens. Once it’s open, you should make your move as quickly as possible. With the help of experts like Make it Cheaper, who saved their clients a whopping $88m over the course of 2011, lower energy bills could be within easy reach.

There’s a line of thinking that you should begin investing as early in your life as possible, that way you can take full advantage of the compounding of investment income. But should you do that if you only have a few thousand dollars?

You’ll get different answers from different people, but I think the answer is a resounding maybe!

When we invest, we don’t do it in a vacuum. It’s actually part of our larger financial situations, and that’s what has to be closely examined before investing with relatively little money.

Creating a financial safety net before investing

Before tying up money in investments, you first need to have an emergency fund. That will not only provide ready cash in the event of a crisis, but it will also keep you from liquidating your investments to deal with the emergency. And it’s a not so funny thing with emergency investment liquidationsâ”they always seem to come up when your investments are down in price, forcing you to sell at a loss.

How much should you have in an emergency fund? Some say $1,000, some say an amount equal to six months living expensesâ”it really varies depending on your own needs and temperament. My personal thought is that you should have an amount equal to 30 days living expenses, that way you’ll at least have enough money to cover the first month of a job loss. That will generally also be enough to cover an unexpected major car repair, or the deductible on a health insurance claim.

Once you have your emergency fund in place, you can begin looking at investing what you have left over.

What else is going on in your life?

Investing isn’t all about how much money you have to play the market. You also should look closely at what else you have happening in your life that may either enhance or restrict your investing activity. Here are some things to consider:

Job stability. If you’re in a stable job situation, investing is much easier. If however your job is uncertain, you might be better off keeping your cash handy rather than tying it up in investments that will require years to fully payoff.

Income level. Investing is a less risky affair if you have a high income. High incomes mean fresh money is available to cover losses and diversify into more investments. At the opposite end of the spectrum, if your income barely covers your living expenses, investing may be playing with money you can’t afford to lose.

Debt. If you have more credit card debt than you have money to invest, you don’t need to be investing. Credit card debt carries interest rates that are not only high, but also subject to change. Interest on credit cards offsets investment returns, much like a very high margin loan account. Get rid of your credit card debt before investing.

Self-employment opportunities. Think of this as an opportunity costâ”what else could you invest your money in that might provide a higher return than the stock market? For many, that’s having your own business. If you plan to head in that direction, you might be better off keeping your money in savings so that you can start the business any time you’re ready. There’s no better investment than investing in yourself.

Diversification options

If you have less then $5,000 to invest, you probably should stay out of individual stocks. $5,000 just can’t achieve any reasonable level of diversification, and the transaction costs would eat up your capital if you tried.

Better to go with a mutual fund, and use either an index fund or some other fund that invests in the broad market. Though mutual funds work well for small investment amounts, you probably will want to avoid sector funds at least until you have a large enough portfolio that you can hold them along with broader market funds too. Sector funds may provide higher returns, but they can just as easily create larger losses.

Playing risk factors to your advantage

The conventional wisdom is that younger investors can afford to take on more risk because they have a longer time horizon to recover from losses. That may be true if you have a large amount of money to invest, but not if you only have a few thousand dollars.

Yes, you may have a need to grow your money as quickly as possible, but at the same time taking large losses to a small amount of money may leave you with insufficient capital to recover with.

It may be better to seek steady returns on lower risk stocks (through mutual funds) than to take chances on high return/high risk investments. Slow and steady wins the race, and when you’re young you have plenty of time to get that working in your favor.

Compounding of investment returns works so much better when you don’t take big losses early in the game.
As I said at the beginning, investing isn’t something we do in a vacuum. We have to consider what our resources are, what else we have going on in life, and maybe even what it is we want to do in life.

Have you been thinking about investing in the market, but only have a few thousand dollars to do it with?

photo by 44313045@N08

As I have said in previous posts, you need to open a Roth-IRA stat! Outside of your 401k plan, a Roth-IRA is by far the best way to save for your retirement. It’s the “golden egg” our government gives us. Since you’re investing your post-tax dollars, your money grows tax free for the life of the account. How sweet is that? The tax shelter benefits is just one great aspect though. With a Roth-IRA, you have unlimited options for investing. You can choose everything from individual stocks to index funds, so the sky is the limit.

I won’t go into too much more as to why a Roth-IRA is a great way to invest. What I want to do with this article is tell you a little about some things you should consider when opening a Roth-IRA. There are a host of tools that can be coupled with a new Roth-IRA account. I want to make sure that you are aware of these things before jumping in!

Is your financial house in order?

Before you set out on the quest to opening a new Roth-IRA, you need to ensure that your financial house is in order. What I’m referring to are things like debts and high interest credit cards. These are examples where you should use your money to pay down debt instead of investing in a Roth-IRA. If it’s a low interest loan, then that’s another story. However, all high interest debt should take precedent.

What about your emergency fund?

Another item besides paying down debt that you need to take care of before opening a Roth-IRA is making sure you have an ample emergency fund. I’ve been guilty of not having a big enough emergency fund but it’s wise to focus your energy here rather than investing in a Roth-IRA. Yes, investing is great but what’s going to happen if you lose your job or have some unexpected medical bills come up? You want to avoid this type of situation. Worst case scenario is you taking money out of your Roth-IRA. By doing so, you are foregoing future gains on your investment, which you want to avoid at all costs. It’s almost like throwing money down the drain!

How to invest your Roth-IRA money?

There are tons of ways you can invest your money within a Roth-IRA. It’s critical that you go into a new Roth-IRA with confidence and choose investment options that have the lowest costs. You can buy stocks, a variety of mutual funds, or even index funds. I personally recommend index funds as they are the lowest cost to own and will get you consistent gains over the next few years. Another option would be to go with a local bank. These are more like money market funds, so your investment options will be severely limited if you do this. At the end of the day, you need to make the best decision for YOU and only YOU.

Where to open a Roth-IRA?

So, now that you have a Roth-IRA account open, what’s next on the agenda? Well, where you actually open your account is! you will have to research various account entry minimums across various brokers like Zecco or Betterment. While both are great companies, both have positives and negatives you need to take into account.

You may also elect to use a stard bank like Ally or Discover to invest your money in a Roth-IRA. While the investment options will be limited, this is a great way to invest your money if your’re a beginner.

Now you’re set!

Now that you know the various items to be aware of, you’re all set and ready to open your first Roth-IRA! Don’t be scared, now you can go into a new Roth-IRA account with confidence.

photo by PT