Tax return season

For all Americans this is tax season.  However, most Americans will have over withheld their federal income taxes.  We won’t dive into why overpaying is not a smart financial plan today but we will talk about what your plans are with this return.  If you are like a third of those who are getting a tax return you will be paying down your high interest credit card debt. This is good right? Wrong.

Emergency Fund  Before you spend or invest a dime of your tax return do something different and create a $1000 emergency fund. This fund will allow you to stop using your credit card so that you can actually pay it off.

Budget  Make sure you have a plan aka. budget before you pay down anything.  The idea of a budget is that by having one you will not have debt next year and your return (if you have one) will be used for a more productive opportunity.

Debt Reduction Plan  Let’s keep it simple Check out this video Debt Snowball

What to look for when searching for a professional

There is a lot to be said about working with a professional.  Most of us think that we can save money by doing our own taxes or painting the house our self.  The truth is that a professional is just what we need.  Hiring a person does have a price but if you hire a professional they will be well worth their price and the good ones will provide value that far out exceeds any cost.  So the question that we need to ask is what do we look for when hiring a true professional?

Here are 2 suggested criteria to look for….

Experience/qualifications

                I list this one first not because it is the most important.  Of the 5, experience and qualifications should be treated simply as a quick question and answer. Understand that the person has the right license or has permission to practice in the state that you live.

Referred by a person you trust

                Go ahead and ask people that you know about professionals that they have used in the past.  Referrals are what any good professional seek.  In order to be referred they must have provided value that exceeds the client’s expectations.  How much more comfortable are you in purchasing car insurance if you know just how helpful the agent has been to your friend?

Remember these are suggestions; you may be considering a person with limited experience and that’s ok...as long as they have and do the following three.

Heart of a teacher

                Having the heart of a teacher means that the professional will take his or her time in educating you on the services or goods to be provided.   They will not speak over your head, rather they bring the info to you and will not proceed through the selling process without your understanding.  They will be easy to ask questions to and excited about finding or giving you the answers that you need.

Passionate         

                Extremely important and easy to spot.  Important because with passion comes knowledge.  Think of that passionate sports fan and how they know everything about their team.  What if you accountant had that enthusiasm about doing your taxes? Can that sports fan hide is passion? Not a chance. The same can be said about a person that is passionate about what they do. One meeting with them and you will see that they love what they do and would love to use their talents to help you.

Servant

                I saved the best for last.  Yes, any person that is a professional in the sales industry must serve you, but too often sales people will sell you rather than serve you.  A serving sells professional will ask you many questions.   You will be able to see that his or her interest is tied to your satisfaction, not in the sale.  The “Sale” is a result, not an objective to a servant.  It is a great feeling knowing that you have bought a good or service for someone that was looking at you as a person rather than an objective.

5 Principles For Negotiating

If you want to save money then negotiating is a must. Here are some simple principles to remember as you negotiate your way to a successful budget:

Everything is negotiable

Yes, everything. Some items may be more difficult to reach an agreement on, but searching for the products or services that can be easily negotiated may be a talent of its own.  Some helpful tips would be looking for display items, open boxes, out of season, surplus, used, end of month, or private seller or business.

Silence

                We could all use a little more of this, but in negotiating, oftentimes the party opposite you will hint at a preferred price or will talk themselves into a price that will work for both of you. Keeping quiet can be intimidating for the sales person and productive for you.

It must be a win-win

                If you are only out to get a “steal” then you may be insulting every sales person you encounter.  Remember a sales person is human and has a family to feed just like you. He or she wants to sell you their product or service and should be compensated fairly for it. There is a difference between challenging a sales representative and bullying them.

Be able to walk away

                One of the hardest things to do is to say “NO”, especially if you are emotionally tied to the item or service. Having the walking power will keep your price relevant. If the sales person knows that you will not walk away you can forget about the price coming down.

Knowledge

                It is not always easy to have more knowledge than the sales person that is helping you, but understanding what it is that you want will make for a smooth transaction. Do your research before you buy! It will also help you recognize if you are working a professional during your buying process.

Now you are armed with some info. Remember these and you will find negotiating to be FUN!