The Personal Owner also believes that one should manage one’s personal financial affairs as if they were a separate and independent business entity – in hand, the Me Myself & Inc. Series works to help the entrepreneur make that happen, thus preparing the entrepreneur for success as a business owner by encouraging them to begin by practicing on themselves.

According to the United States Census Bureau, as of 2007 - the average US citizen with a bachelor’s degree will earn a total of $2,859,050.00 over the course of their 50 year professional career if they were to keep the same job and same salary all throughout it; let’s take both this statistic and the overall assumption that an individual can estimate the total return on investment in a college degree (based on the average expected return of everyone else who has that equivalent degree) and let them serve as the basis for our Me, Myself, & Inc. Series. We will let this two million dollar figure serve as the primary revenue stream estimation. 

Take a look at the following balance sheet and be sure to take note of how we’ve implemented our expected lifetime earnings figure of $2,859,050.00 as an intangible asset.

This first installment of the series will introduce the Personal Owner’s very own Personal Launchpad Statement. The Personal Launchpad is a converted balance sheet financial statement from a typical corporation. The Balance sheet has been adjusted to account for the financial affairs of an individual human being instead of a traditional business entity. Before we continue, let’s be informed on the fact that the Personal Launchpad statement still adheres to the basic principle of a financial balance sheet and that is to only recognize items that can be quantified and reasonably estimated both now (date of the statement) and into the future; because of this election to adhere to the standard principle, both life insurance and health insurance have been omitted.

Let’s start this first post off with the procurement of our first asset.

The Personal Launchpad – How it works:

Current assets retain the same meaning – cash still represents the bank account balance. Investments still represent any equity an individual may hold in any particular venture. Supplies represent anything we have procured to help us maintain our day to day operations – supplies don’t have a secondary market.

Property plant and equipment also retain their same meanings. We will depreciate our real estate assets, automobiles, and computers the same way a corporation does.

The intangible asset field is where things get fun. Normally, a corporation will count goodwill and intellectual property as an intangible asset. However, in the personal launchpad we’ve decided to account for our expected return on investment from a Bachelor’s degree. The launchpad will depreciate this asset with the same figure we used to compute it – $57,181.00 will be deducted from this asset and sent to accumulated depreciation on an annual basis. Meanwhile, our unearned revenues will be adjusted as our wages come and the adjustments will be sent to the earned wages account. Future posts will explain how the yearly profit and loss will be accounted for.

Current Liabilities will consist of one year’s worth of the total consumer related loans e.g. mortgages, student loans, care notes etc. Long term liabilities will consist of the rest of the amounts due on those short term notes (the aforementioned debt that is due any number greater than 365 days). Our unearned revenue account will reflect the expected return on investment in education figure minus the cost of the investment which is being accounted for in the student loan calculation. We’ll credit cash as we pay off the student loans; meanwhile, we’ll credit fee income (profit and loss account) as we debit out the unearned revenue figure.

The part two installment to this Entrepreneurial Launchpad series will analyze the next step toward success for our model aspiring entrepreneur!

To personal ownership and beyond!!

Minimize the cost of your personal communication by knowing your options; being informed on all your options while dealing with your cell phone carrier should save you a lot of money. The first step to decreasing your cost during the contract negotiation process is to make sure that you’re talking to the right person; in turn, the identification of the right person usually depends on what you’re trying to accomplish.

Here are set of guidelines and tidbits to utilize during your cell phone negotiation process; the list is organized according to various goals a typical consumer might be pursuing.

Breaking contracts

1. Talking to someone who can buy your contract. Yes, a consumer looking to drop their current contract can actually sell it to another consumer; this option is rarely advertised by carriers but your carrier can actually help you execute this process. Websites like www.trademycellular.com, www.cellswapper.com, and www.celltradeusa.com all have the potential to connect you with individuals that are willing to purchase your current contract. Contract swapping websites are great ways to avoid absorbing those hefty contract cancellation fees (usually ranging from $150 to $200 for individual plans). Cell phone carriers will usually charge no more than $20 dollars to execute the swap, add that to the cost of actually finding someone to purchase your contract and you might just chop a $200 dollar cancellation fee into nothing more than $30 dollars. **Word to the wise reader, this can also be done in reverse, you can save a lot of money by purchasing a contract through these websites instead of using the traditional method of purchasing a contract through a carrier.** If you’re a seller dealing with these websites you’re going to want to offer incentives on top of your contract (e.g. phone accessories) The good thing is that these websites don’t restrict your negotiation power while searching for a buyer, all they do is connect you – after that, everything is up to you, the buyer, and the cell phone carrier.

Buying a new phone/contract traditionally

1. Talking face-to-face with a sales rep. When talking to a sales representative, you’re going to want to scope out the phone packages of the companies’ competitors before stepping in the store. Once you’ve done your due diligence, here’s a nifty little trick to use with the reps: Strike a friendly conversation with the rep to make sure you’re liked, during the conversation, voice the fact that you really want the phone but you’re a bit reluctant due to the price. If the sales rep doesn’t automatically cut the price down with an offer that was not previously mentioned, then get on the phone with a competitor that’s offering a cheaper price for a comparable package, do this while you’re still in a conversation with the rep. Remember, sales representatives are usually paid with commission; thus, it’s in their best interest to get you to buy the phone. Remember, be liked, be excited by the product, but be reluctant – root your reluctance to the competitor’s pricing.

2. Talking to a customer service rep over the phone. The following tidbit works best with existing customers who are approaching the end of their contracts. Telephone tricks don’t necessary work when you’re already on the phone, being liked is also a bit tougher when you’re on the phone and not in person but it can still be done. The first step is to politely work your way up through the decision making pipeline within the customer service center; there are a number of ways to do this but “demanding to speak with a manager” is the worst. I like the strategy of voicing a few contractual perks that you’re friends are getting all the while stating various reasons why you’re not happy with your current options. Once such tasks are complete, simply ask if there’s an available manager in the center who can take on other technical issues that have yet to be introduced. Your goal should be to present a competitor’s better option while asking the decision maker if they can do anything to get you to stay.

Other problems

1. When talking to sales representatives at the point of sale. Don’t waste your money by keeping a phone that you cannot use due to lack of service in specific areas. Many consumers take their phone home and to work after a purchase only to find out that they spend the majority of their day in a signal “dead zone.” Ask your sales rep about the length of the phone’s trial period after purchasing a new phone. Carriers will typically offer a 14 to 30 day trial period so that you may test the phone’s signal before keeping it. If you bring the phone back you will only have to pay for the usage within that period; you will not need to worry about any contract termination fees.

Tips in passing

 - Do you have a group of friends that are all impressed with the fact that your just started your car with your cell phone? Depending on your carrier, you can actually gain credits on your monthly bill by convincing your friends to buy a phone with your carrier. Ask your carrier about this little known incentive.

- Understand that you’re likely to save a lot of money purchasing a phone online instead of purchasing it at a traditional physical store. Online store’s have less overhead and are thus able to charge you less for the product. Combine such a fact, with the strategy of purchasing someone else’s contract and you’re bound to save HUNDREDS of dollars in cell phone costs.

TO PERSONAL OWNERSHIP AND BEYOND!!

A lot of us are blessed with good health and have no dependents making it easier for one to say “I’ll take a risk and skip for now.” Meanwhile, we go outdoors and make the most of our youthful energy and hearts by engaging in risky activities such as basketball, football, jogging, weightlifting, dancing, speeding, etc.; all the while risking that ONE big accident that sidelines us and buries us in debt for the rest of our lives. Medical expenses from a broken bone (or any other sport related injury including injuries resulting from car accidents) can cost an uninsured individual anywhere from five to ten thousand bucks. Setting up a budget is a tough challenge without a solid cash flow, those of us who are uninsured risk not having one for the rest of our lives as medical debt could destroy both our credit and our prospects for a solid wage for the rest of our lives. Solid wages are increasingly becoming the result of a good credit score.

Here are some health insurance tips for the young adult looking to fit healthcare into their budget:

1. Take advantage of Healthcare Reform.

Whether you are or are not currently insured, if you have a parent who is receiving medical benefits from their employer – on September 23, 2010 – you can be added onto their family coverage as a dependent until your 26th birthday. Yes we can save a lot of money through this option. Check out the new website established by the Obama administration at HHS.gov or skip directly to the link regarding relief for adults under the age of 26. This new website is GREAT! It has to be the most user-friendly health insurance related website I’ve ever seen. Within a couple clicks you’ll be able to compare all the health insurance options available to you in your currently state both geographically and financially; starting in October we’ll be able to compare all these plans based on dollar figure alone. EXCEPTIONAL.

2. Take advantage of FSA’s and HSA’s.

If your parent does not have employer provided health coverage here are some more options. FSA’s and HSA’s Flexible Spending Accounts and Health Savings Accounts respectively are options that a young professional with a high deductible should pursue. HSA’s and FSA’s can be provided by both employers and private insurance companies, you typically provide a certain amount of your pay that is matched, tax free and can only be used for medical expenses learn more about HSA’s and FSA’s at this  helpful article. These programs go well with high-deductible plans as they help to reduce the expenses that fall underneath your annual deductible.  High deductible plans are a bit of a catch-22 though; you usually end up paying around a hundred dollars a month for an annual deductible around two to five thousand dollars, which means if you get a minor injury that doesn’t go over your deductible you will have to pay the money out of your own pocket after a discount from your insurer. The discounts on the expenses are good and in-network discount could save you around 40% of the ultimate medical expense, but you’re still going to have to pay these costly expenses on top of your monthly premium of around $100. These plans are best for the individual who is of good health as these plans protect you from the financially catastrophic BIG accident that you can’t afford and that will damage your credit for life

3. Plan for an injury, map out potential expenses.

If you have a high deductible plan you’re going to want to map out all of your expenses before you get injured that way you can have a cost saving action plan. Your health insurance provider should provide with the online resources needed to map out the costs of MRI’s, X-rays, and emergency room anesthetics; visit your provider’s website or call them for specific directions on how to get to their cost mapping feature.  Find out who the in-service providers are in your current town and make sure you know how to give directions to their locations. If you want the cheapest medical service capable of helping you fix up a broken leg then you’re going to want to do this; my concluding tip is to learn how to give directions to your handpicked hospital. If you’re at the park playing basketball and you get hurt it’s a lot easier on your pocket to find a stranger to take you to the hospital in exchange for $100 bucks at a later date then it is to get a ride via the ambulance. The ambulance will cost you no less than $600 on a high deductible plan.

To personal ownership and beyond!!

SETTING A BUDGET DOESN’T MEAN YOU ARE BROKE! Forget everything anyone ever told you about budgeting in regard to it being something that “broke” people do. Smart people set budgets.

Budgets should be used to manage income against expenses, prepare for unpredictable “life shots,” and plan for future big money purchases (e.g. car, house, girlfriend, education, Jordans, those heels you always wanted) without going into unforseen debt thus damaging your credit score. 

Setting a budget doesn’t mean subjecting yourself to pain in order accomplish a goal, it doesn’t necessarily involve sacrificing today so that you  may gain tomorrow. I like to think of it as a way of accounting for every dollar that goes in and out of your personal cash register. Setup your personal finances so that when you purchase that next hot dress, you’ll know exactly how it will affect your bank account two months from now. Don’t fall victim to the embarrassing “DECLINED in the grocery line” cliche. Grab hold of the reigns.

Some Budgeting tips:

1. Budgeting Software: grab free budgeting software at CNET’s Download.com, if you don’t want to go through all that, then open up an excel file and create one in there. All you have to do is enter your income then enter your expenses and obtain the difference. Such a process can be extended months and years into the future. You can then upload your budget onto a keyring usb drive and take it with you everywhere, just incase you need to stop and check before a big purchase.

2. Budget Allocations: A basic guideline that can be followed when deciding how to allocate your income can be as follows:

Food – 15%

Housing – 40%

Apparel – 5%

Transportation – 20%

Health – 10%

Entertainment – 10%

Keep in mind that, that is a mere guideline that is presented to serve as an example of how one might set up her monthly budget. Departing from that skeleton is natural – you’ll find that different stages of your life will require adjustments to your expense allocation. Take me for example, after graduation I had to dip into my excel file and shift my entertainment allocation down in order to prepare for the oncoming financial aid obligations. Not only did I reduce entertainment, but I also changed my  GMAT (business school entrance exam) study habits from driving to a distant library to driving to a local panera bread, by doing that I was able to save a lot in gas money each month. Milk the budget allocation process for everything it’s worth, and believe me when I say it’s worth a whole lot. Using a series of excel tables, one can type a number in for the month of November and see how that dollar figure will affect his April balance. Don’t just pay bills as they come and don’t just bunch your expenses into one expense category. Compartmentalize, doing so will reduce the amount of stress in your life. Pick up more budgeting tips here.

3. You won’t get it right the first time: It took me many months to finally get a grip on my financial well being. Understand that it will take a while before you know exactly where every dollar is going. Remain stedfast – keep your eye on the prize!

To personal ownership and beyond!!