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Entrepreneuring Your Personal Finances

personal_financeBigg success is life on your own terms. You are the entrepreneur of your life. Entrepreneurs look at the world through a different lens than do large company CEOs.

For example, large companies and small companies use different financial models. Large companies generally have the ability to raise large amounts of money when they need it.

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For small companies, it’s much more difficult. So it’s more critical for small business owners to watch their cash flow. For us as individuals, our financial model is much closer to the entrepreneur’s.

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Image of a credit score with the blog post title: The 5 Components of Your Credit Rating

The 5 Components of Your Credit Rating

Image of a credit score with the blog post title: The 5 Components of Your Credit Rating

BIGG success is life on your own terms. Our focus today is on money, one of the five elements of BIGG success.

Specifically, we want to talk about an asset that is particularly valuable now. Yet it doesn’t show up on your Balance Sheet. It’s your credit rating, or credit score.

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Is it Time to Buy a House?

home_sales The national news is full of bad news about our economy – rising unemployment, stocks hitting ten-year lows, and the value of our homes falling. We wanted to get an inside perspective so we turned to the experts – the National Association of Realtors. We were fortunate to be joined by Jed Smith, their Senior Economist, on The Bigg Success Show today. Here’s a recap of our conversation:

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marylynnWe’re hoping for some rainbows and butterflies from you, Jed. Are there markets where home prices are actually rising?

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jedThere are a few. Right now, the market is in a process of stabilizing, which means that prices are down but sales activity is up in quite a few markets. Just to give you a few examples, prices are actually rising a little in Minneapolis, Minnesota; Mobile, Alabama, Stamford, Connecticut; and Amarillo, Texas. It varies around the country depending on a lot of local conditions. However, right now, we’re particularly interested in the level of sales. Obviously, a good level of sales can lead to an overall price rise in the future and, as your listeners probably know, both sales and prices have been declining for awhile. We’d sure like to see those level out and there’s some reason to believe that we’re getting to the bottom of the market.

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george
Real estate is still a local game, right?

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jedYes. Every market is local. To give you an example, prices are way down in Prince William County, Virginia. That’s a suburb of Washington. Just across the way, up the street in Washington, D.C., prices are stable; and in Arlington, Virginia, prices are actually starting to rise a bit. So it varies from region to region.

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georgeSo, while we may be hearing doom-and-gloom about national real estate prices, it’s possible – depending on your local market – that the dream house you want to buy is getting more expensive.

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jedWell, prices right now are down. As I said, they are starting to turn a little bit in a few markets. Most markets are either declining a little or holding steady while they’re getting ready to turn. But I think if you’re thinking about a house right now, I don’t think you want to think about a short-term flip. There was a lot of flipping a few years ago during the rapid run-up in prices in 2006 and 2007. Right now, as measured in terms of affordability, taking into account interest rates which are at an all-time low coupled with reasonable prices, housing is actually a very good buy. If you’re not buying it to flip it, but rather to hold it for five or six years, I think you’ll be very pleased with the ultimate result.

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georgeOn average, Jed, how much have house prices fallen back nationally from their peak?

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jedWell, that will vary from area to area. I think we want to talk in terms of the last year. They’re down about 15 percent in the last year, probably down about another 10 percent above that from the peak. That’s not true everywhere. That’s just a national average, like my head’s in the furnace and my feet are in the Artic, so I’m comfortable on average.

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george
I like the way you explained that!

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jedWe think that with the forthcoming recovery – there’s a lot of spending going on, a lot of economic stimulus, and a lot of effort to stop foreclosures – we project that prices will start to level out, certainly, by the fourth quarter of this year. That’s why, when prices are in good shape and you can get that $8,000 tax credit, right now is a good time to consider buying a house if you don’t own one.

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marylynnWe’ve been hearing that prices in areas like Detroit are just astoundingly low. Is it wise to go into an area that has been beaten up and buy some property there?

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jedThat depends on the long-term outlook for the area. Let’s put this into a little broader perspective than Detroit. Much of California, Arizona and Nevada have had prices that have been beaten up pretty thoroughly. Yet we all know that those areas are going to have vibrant job growth over the next four or five years and, right now, we see buyers flocking out to purchase property in that area. The prices are low, but the number of buyers showing up is substantial. I think for the longer term, these folks are getting a good buy.

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marylynnFor people who are thinking about buying in some of those areas, do you have any recommendations for finding an area that is beat up but has long-term growth potential? How do people get that information?

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jedThis is the type of information – specific market characteristics – that a Realtor would know. A Realtor could give you an idea of the outlook for jobs, income, population in a specific area, and how prices compare to the overall market for that area. That’s why we would recommend working with an expert – a Realtor – to understand the market because there are some good buys out there.

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george
And you probably know a Realtor or two, don’t you Jed?

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jed

I probably do.

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georgeI think you’re absolutely right. I have found in my life that it pays to turn to the professionals and let them help guide you through the process. With a Realtor, you know it’s win – win all the way through.

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jedWe think that Realtors bring a real value-added to the market because they live in the community, they know the community, and they’re part of the community. They’ve been there for a long time and they’ve done a lot of transactions. They can guide you – just like a doctor or a lawyer does with their professional services – in making your largest purchase.

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Thanks Jed so much for sharing your time and wisdom with all of us! And a special thanks to Hilary Marsh and Sara Weis, Jed’s co-workers at the National Association of Realtors, for helping us arrange our conversation with him.

If you’re in the market to buy or sell your house, the National Association of Realtors is a great resource. Check out their tips for home buyers and sellers.

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Thanks so much for reading our post today. Join us next time as look squarely at the four-leaf clover on St. Paddy’s Day! Until then, here’s to your bigg success!

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Direct link to The Bigg Success Show audio file:
http://media.libsyn.com/media/biggsuccess/00351-031609.mp3

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(Image in today's post by svilen001)

The Hero Behind the Hero

eagle Today we continue our series on heroes. Last time we talked about what makes a hero a hero.

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Captain Chesley Sullenberger (Sully as we’ve come to know him) inspired this series. He is, of course, the pilot who landed his plane in the Hudson River to ultimately save over 150 lives.

But we haven’t heard much about the co-pilot on that fateful flight – Jeffrey Skiles. He, much like Sully, was a veteran of the industry as well. And let’s not forget the flight crew and also the passengers who stepped up to the challenge. The news coverage has largely ignored them too.

Heroes aren’t alone

We love our heroes. They are usually a single person. But a person usually doesn’t become a hero by themselves.

Which got us thinking about the Wind Beneath My Wings. Doesn’t that song seem particularly appropriate when thinking about heroes and airplanes? Pun fully intended!

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marylynn
On the show, I had to try hard not to cry as we talked about the lyrics of this song.

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georgeI tried not to admit that I’m a huge Bette Midler fan! But so was Johnny Carson … so I guess I’m in good company.

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Unsung heroes

The song starts …

“It must have been cold there in my shadow, to never have sunlight on your face.
You were content to let me shine, that's your way. You always walked a step behind.”

This is the case with many heroes. There are the heroes we see. And for every hero that we see, there are many unsung heroes, working behind the scenes, that we never see.

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marylynnWhen I was in radio, I did a segment called “Superstar Employee of the Month,” where people could nominate their co-workers. The nominations were always so heartfelt and touching. People often recognized those co-workers who seldom got any credit.

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Plenty of work, very little credit

The song continues …

“So I was the one with all the glory, while you were the one with all the strain.”

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georgeThis reminds me of something I heard my dad say a number of times about the employees of his business. “They do all the work and I get all the credit.” This is so true for many leaders. At least he recognized it!

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We all have people behind us that help us succeed. And they often don’t get the credit they deserve. Just like the co-pilot and crew of US Airways Flight 1549.

Lifting us up

These unsung heroes, who do so much work for so little credit do much more than just support us.

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marylynnMy favorite line of this song is in the chorus, “I can fly higher than an eagle, for you are the wind beneath my wings.” It shows how important some people are to us. They lift us up to heights we can’t achieve on our own, to levels we can hardly imagine.

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A hero’s response

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georgeWhen my dad passed away unexpectedly, I kept a journal for awhile. The chorus to this song was the feature of the very first entry. There wasn’t much left unsaid between the two of us. We had a great relationship, but I’m not sure that I ever told him that he was a hero to me. I think he knew, but I sure wish I had said it explicitly.

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The song closes with the appropriate response of a hero …

“Thank you, thank you, thank God for you, the wind beneath my wings”.

Whether we feel like a hero or not, it’s important to understand that any success we achieve isn’t reached alone. There are people lifting us up every step of the way.

Don’t just think about how much you appreciate them. Tell them. To go back to the song one more time, it says it explicitly …

“It might have appeared to go unnoticed, but I've got it all here in my heart.
I want you to know I know the truth, of course I know it.
I would be nothing without you.”

We should do the same!

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Get the tips and tools you need to be a BIGG success.
Subscribe to the Bigg Success Weekly – it’s FREE!

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Do you have any idea how much we appreciate that you are part of our community? Well, let us just say, it means more to us than words can say. But we’ll try anyway:

You lift us up! Thank you, thank you … 

Join us next time as we wrap up this series by discussing the hero within the hero. Until then, here’s to your bigg success!

Subscribe to The Bigg Success Show in iTunes. 

Subscribe to the Bigg Success feed.

Direct link to The Bigg Success Show audio file:
http://media.libsyn.com/media/biggsuccess/00314-012209.mp3

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Don’t Show Me the Money

wallet The List Universe recently published their list of ten lost rules of etiquette. The one that really got our attention was their #1 reason – talking about money and possessions.

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When it comes to money, the author says that a gentleman would never:

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