Archives For July 2012

July 30, 2012

Recently, I met with a group of Freshman at Tulane University in New Orleans to talk about money and careers. My main question was this:

How long will it be before you’re earning a million dollars a year?

Their majors ranged from business to engineering with some liberal arts degrees thrown in as well. Even more interesting, they were part of a group from inner city Los Angeles who were given special scholarships to attend Tulane. How do you think they answered that question?

Before I tell you, let’s talk about the two emotions that consistently make us broke – desperation and optimism. When we are optimistic, we are willing to take on the world and the large amounts of debt that can come with it. Optimism is why I amassed over $50,000 of consumer debt only one year out of college. I knew I would succeed in the real world; only later did I learn I wouldn’t make money as fast as I was spending it!

Garrett Hardin put in perfectly in Living Within Limits when he said, “Since man, an optimistic animal, usually presumes that ‘we’ will be rich later, conservatism was refined as living on credit cards.” We all hope to be doing better in a couple of years, and we often plan our financial future based on that! This is what keeps us from saving now and spending later.

Optimism can be seen in all sorts of debt – houses, cars, student loans, credit cards, etc…. Basically anything we think we can spend money on now and pay for later. It took quite a bit of optimism for us to take out a mortgage on our house and be confident we can make the payments every month.

Optimism is a powerful thing, and I don’t advocate living a life of pessimism. However, when it comes to managing your money, sometimes a little pessimism can pay off big time. What would happen if you lost your job tomorrow? What would happen to your family if you died in an accident? The more you think about and plan for these negative events, the better financial shape you’ll be in.

What happens when those negative unforeseen events happen? You become desperate. Desperation is second emotion that makes us broke.

It’s easy to see how desperation can make us broke. It usually doesn’t happen all at once, but is a confluence of items that continually pile up and make us feel we can’t keep our heads above water. It might start with a broken down car, continue with health issues or a house repair, and get even worse with a job loss. What the heck are we supposed to do now?

Many people turn to the only things that keep them going until the next month – credit cards and pay day loans. Neither of these are good things, but sometimes we have no other choice.

What’s the best way to avoid going into debt because of desperation? The quick answer is to save up a starter emergency fund of $1,000 so you have something to turn to instead of the vultures mentioned above. From there, follow the steps in the OWN IT plan to take control of your money.  This is what I used to finally pay off my $50,000 of debt and start saving money.

Back to the Tulane students. Out of the ten students who I asked at what age they’ll be making their first million, all of them but one said they’d be between the ages of 23 and 27. They didn’t have any specific plans or strategies, they just thought they’d be the best in their fields and the money would come. We do a great job of teaching confidence and optimism, but we don’t do a great job of teaching financial reality.

If you’ve been doing your homework, you know how long it takes to save one million dollars. If not, time to study up!

 

Here are 12 things my wife and I do pretty consistently to take control of our money – you know, the tree that doesn’t live on water or soil, but the tree that lives off of your hard work!

1.  My wife cuts my hair

Kid with a mullet

This is my favorite way to stay frugal because I get some quality time with my wife!  Also, I never planned ahead when I got my hair cut before so I had to wait in line, and I hated to have an awkward conversation with someone while they’re cutting my hair!

Let’s be honest though, there is some added “risk” with doing this… especially in the beginning when your spouse may not be a “pro” yet!  My side burns have paid the price a few times…

Total savings:  $200/year + 12 hours of my life

2.  Drink water

Sure, I’ m spending money because I’m already out to eat, but I prevent myself from spending more by drinking water.  In fact, you might be able to save $1,000/year if you transition to drinking water at restaurants!  I’ll stick with a more conservative estimate for myself because we don’t go out to eat a ton.

Total savings: $300/yr

3.  Search for coupons before I buy

Most of my bad purchases are made when I’m rushed because I don’t have the time to research the best option.  This usually happens when I need to buy something right away and can’t wait for it to be shipped (cough, cough, presents maybe..).

However, I’ve saved good money by performing a Google search before buying it.  I’ll usually Google “Company Name” + “Product” + “Coupon” and see what comes up.

Just yesterday I did this with our local pizza joint (Reginelli’s) and found a $2 off coupon.  Woo hoo!  I also do this with success when buying flowers online.

Total savings: $150/yr

4.  Call annually to reduce my cable bill

There’s no secret here, but the hard part is remembering to do it.  Sometimes you don’t even have to threaten to leave, you can just ask the call center rep if there are any existing promotions lower your bill.

My wife really wanted to see the new series “Newsroom” on HBO, but we didn’t have HBO because I’m too cheap.  We have Cox Communications in New Orleans so I called them, and it turns out they’re currently offering free premium movie stations for three months!

Just make sure you make a mental or physical note to remind yourself when the free period is over so you don’t get charged.  I put a meeting reminder on my Outlook email because I definitely don’t want to pay the $45/month when the free period ends!

Total savings: $180/yr

5.  Cook at homeFood market in Peru

Earth shattering money-saving information, I know, but we’ve learned to enjoy cooking in the last couple of years.  We used to see it as hassle with all of the preparation and clean-up afterwards, but we have a nice system now where one of us cooks and the other cleans!  We also cook in bulk in the beginning of the week so we can have some good ‘warm-up’ meals the rest of the week.

Total savings: $1,200/yr

6.  Exercise outside

I use nature for a gym…  well, before I was injured anyway!  I’m a Blackbelt in Tae Kwon Do and trained for ten years under my dad, so I know how to exercise without needing to go to the gym.

My favorite source for outdoor workout inspiration is Steve Kamb over at Nerd Fitness.  In fact, he just published a post on how to make a mobile gym using a sandbag.

Total savings: $500/yr

7.  Live without car payments

Ever since my breaking point and when I finally paid off my debt, we’ve managed to stay away from car payments.  Our incomes have increased substantially in the last 8 years, but my wife drives the same car she had in college, and I drive the car I bought with cash in 2007.  We currently have combined mileage of 270,000 miles on our two cars, but we haven’t had car payments in 5 years!

Let’s assume the average car payment is $300/month.  This is much lower than I paid when I bought a new car, but it’s a decent average.  If we both had that payment, we would’ve paid $36,000 in car payments in the last five years!  That’s why I hate new cars (unless you buy them with cash).  When we do finally need to purchase a newer car, we’ll certainly use the 20% rule.

Total savings: $7,200/yr

8.  Monitor credit/debit cards

It’s amazing how many times incorrect charges have shown up on my credit or debit cards.  Sometimes they happen on accident, but other times it just seems to weird to be accidental.  When this happens, get on the phone and get it straightened out!

Also, when I’m charged an annual fee on a credit card, I usually try to call them and talk my way out of it.  This won’t work all of the time, but when it does it’s a good $50 or so savings.

Some credit card companies are catching on to this, and they transfer you to a separate department to negotiate the fee!  This happened on our Frontier MasterCard – a persistent man in India debated back and forth with me for over 15 minutes on what combination of annual fee vs mileage earned we would pay.  In the end I cut it in half and received the same mileage, but they successfully made it very painful!

Total savings: $100/yr

9.  Cash Budget

I’ve talked about this a few times before, but the best way to get your spending under control is to use a cash budget because it makes you realize where you money is actually going.  It’s also much harder to give up a Benjamin ($100 bill) at the bar than it is to simply swipe a credit card for the same amount.  You’ll feel the pain with cash!!

Total savings: too hard to estimate, but a lot!

10.  Keep your long term goals in mind

If you don’t know what you’re saving for, it will be hard to stay inspired.  What are you long term goals?  Do you want to take a dream vacation next year, pay off the house early, or retire by the age of 50?  Once you get that goal, make saving for it a priority.

Total savings: once again, too hard to estimate

11.  Saving on travel

I traveled with my job for seven years, and we travel quite a bit for fun too so I have some experience in this area.  However, I’ve been really lucky because we’ve amassed an incredible amount of hotel points to make our travel much cheaper.

Whenever I pay for my own travel and can’t use points, I get creative to find the best prices.  My favorite booking agency is Hotwire where you can book your hotel rooms and rental cars.  This is by far the cheapest way to rent a car.  Other ideas to decrease expenses is to try places like VRBO where you can rent out houses and condos – this really works well for a family.  As I’ve alluded to in the past, I’ll spent more time on travel discussions soon.

Total savings: $150/yr

12.  DIY home repair (yard, house, etc)

When I was in high school, I worked part-time as a maintenance man (and janitor) at my school.  I can’t even begin to estimate how much money this has saved me over the last three years of home ownership.  From minor repairs, yard work, making our own headboard, and painting walls, it’s all pretty easy and if I don’t know how to do it I’ll look it up on Youtube!

Total savings: $400/yr

I don’t like when they have the articles online that say “How to save $10,000 a year”, etc because we all have different spending habits.  Obviously, if you aren’t a gym member now, you’re not going to save $600/yr!  However, I do see most of these as sacrifices that my wife and I choose to do.

What are your go to methods for staying frugal?

July 16, 2012

This weekend my wife and I stayed home to watch a movie starring Justin Timberlake – which is not something I like to admit.  However, “In Time” turned out to be quite thought-provoking and inspired me to write about it today.  To get a better idea of what I’m focusing on.. here is the trailer:

Just in case you can’t watch the video, here’s a quick summary and review from Movie Quotes and More:

The idea of the story is unique and innovative, it’s based in the future when the commodity of value is not cash but time and everyone only gets to live to the age of 25 and after that you have one year to live depending on the time credits you’ve earned.  However, the way the story is told is not as good as it should have been given the rich narrative and the movie lacks momentum with the characters not well developed enough to get a sense of who these people are…

That’s why we usually work, right?  So we can earn money to pay our bills and hopefully do some things we love.  In this movie, they took out the medium (currency) and charged you actual minutes of your life to do everything from buying your lunch to paying your rent.  They added minutes by doing anything you’d do today to make money.

Our time is limited so it makes sense it would act as a natural currency.  However, we don’t have the ability to buy additional time, so we have to use it wisely… and boy does time go by so fast!

The movie also factors in “classes” of society and shows how the rich can live forever because they can buy as much life as they want, but they can still die by everyday accidents, so they stop living adventurous lives and start living in a bubble so they won’t die prematurely.  They’re also surrounded by paranoia and bodyguards to prevent others from stealing their time.

In “Golden Handcuffs: Why Can’t I Leave My Job?“, I talk about the fear we have with leaving a well-paying job.  We sometimes sacrifice adventure, sense of purpose, and happiness because we don’t want to risk losing what we already have.  It reminded me of the problems the rich people had in the movie.

At one point in the movie, one of the rich people talks about how the need for time (the clock) is `good for no one.  She says:

Sylvia Weis: Oh, no? The clock is good for no one. The poor die and the rich don’t live. We can all live forever so long as we don’t do anything foolish. Doesn’t that scare you? That maybe you’ll never do anything foolish or courageous or anything worth a damn?

Is it the same for us? Do we risk living an adventurous life because we feel playing it safe will best preserve the time we have remaining?

 

July 12, 2012

We like debt like a fat kid likes cupcakes. I’ve been in love with both at one point or another (debt and cupcakes)… but luckily I kicked my love of debt habit! However, the same can’t be said for the majority of people in the US and our beloved US government. I already wrote a post on consumer’s love of debt, but now I want to review the total US government debt.

Government debt has been a popular topic the last couple of months as we head towards the Presidential elections, as it should be. We’re continually increasing our debt ceiling because we can’t even stabilize our spending.

Don’t get me wrong, I think this is a big deal… but I don’t think it’s the end of the world. It definitely affects us with the potential for increased taxes, decreased government services, and decreased spending power due to inflation. But… and a big but… our government debt hasn’t affected Apple and their ability to make a lot of money. Why? Because we can have a strong private sector even with a screwed up government.

Our government debt is bad, but it’s not as bad as its been in the past on a % of GDP basis. The GDP is our “gross domestic product”, or basically the value of all goods and services that are produced and sold in and from the United States. According to the stats from April 2012, our debt to GDP is 101% – so we have more debt than our GDP. That sucks.

However, we were up to 120% of our GDP during World War II -which was built on top of a lot of government debt added during the Great Depression. This Wikipedia chart is a little outdated, but you get the point:

US Debt as Percentage of GDP

How does our debt compare to other countries?

We have the highest total debt, but we also have the highest total GDP. Our government debt per capita (per person) and our debt as a % of GDP aren’t nearly as high as many other countries. Sure, we don’t want to compare ourselves to European countries too much, but most of the European countries have a debt as a % of GDP of 140% – 200%! The worst country is Luxembourg (I had to look it up on a map) which weighs in at 3,443%… Impressive.

If we look at debt per capita, we’re pretty low on this measure as well. Most of the European countries average between $50k and $75k per capita and we are just under $48k. Here’s a look at the full chart from Wikipedia:

Total Government Debt by Country

What does this all mean?

We have a lot of debt, but it’s been a little worse for us and for other countries. However, that doesn’t mean we should continue this out of control spending, because at some point it will start impacting us majorly.

We need to get our acts together. My hope is our government leaders start getting serious about our debt, but they won’t until we force them to. Just like individuals, the government won’t fix the problem until it becomes such a big deal that there’s no other option.

We’ve also been through a really tough 4-5 years, and we’ve had to turn to the government and printing presses to maintain stability. As our economy continues to improve long term, revenue from taxes will increase and the money spent on subsidizing individuals, companies, and other countries should decrease. I know it doesn’t look pretty right now, but I think we’ll be ok in the long run, and I’ll continue investing by dollar cost averaging into the stock market.

If you really want to scare yourself, take a look at the US Debt Clock which provides a running total of our total government and consumer debt. Is it just a coincidence that consumers have racked up just as much total debt as the government??

 

Should you purchase rental car insurance?

My head is spinning right now because I’ve spent the last few days researching if I should purchase rental car insurance.  Before I completed all of the research, my standard answer was to never purchase the extra coverage the rental car agency offers.  I mostly did this because I had heard this advice before, and because I’m too cheap to buy extra coverage!  However, after reading many coverage facts and articles, my answer has changed somewhat.

I still won’t buy extra coverage from the rental company unless I’m renting a car internationally or maybe a very short term rental.  Let me explain why.

For most auto insurers, the coverage you pay on your personal vehicle will automatically transfer over to your rental car.  In addition, many credit cards will provide the “gap” coverage for the amounts that aren’t covered by your auto insurance due to deductibles (I carry a $1,000 deductible on collision and comprehensive).

I read through Visa’s rental car coverage, but it’s hard to decipher what exactly they cover.  The combination of both of these offers still may not be enough and you may want to purchase additional coverage.

The reason your combined existing personal auto insurance and the extra credit card coverage may not be enough is because there are additional charges that accrue such as “loss of use” while the rental car is getting repaired and “administrative fees” that are sometimes as much as 6-10% of the cost of the total repair of your rental car.  In addition, many credit card companies only cover certain types of cars (not luxury vehicles, SUVs, etc) or only partial repair costs.  and some of the stories I’ve read don’t make their coverage seem real dependable.

Another reason to get some additional rental insurance is that even if you do use your personal auto insurance to cover the rental car and your credit card covers the deductibles, your accident will go on your record and your insurance company might increase your rates because of it.  If you have coverage through another source, your insurance company won’t know about it and your rates won’t rise.

Where can you purchase additional coverage?

The first option is to purchase it from the rental car company which is typically $10-$30 per day – and is a complete rip-off most of the time.  However, if you’re only renting 1-2 days or if you’re renting a car internationally, you may have no better option.

The best option I found for extra coverage while renting a car is through American Express – it definitely helped this guy .  They offer Premium Car Rental Protection for a flat rate of $24.95 (or $17.95 for California residents).  This covers most everything you need including the extras the rental car agencies like to add on in the event of an accident, but you will need to own an American Express card to use this program.

As mentioned before, you should get extra coverage when renting a car internationally.  The main reason is because most auto insurance providers don’t cover cars outside of the United States.  In addition, some countries are pretty crazy about wrecks and will make you pay up right then.   The first option is American Express which covers all countries except around 5, or you’ll have to buy the insurance from the rental car agency in that country.

What type of coverage is offered by the rental car company?

Rental car companies offer five main types of coverage.  As mentioned earlier, most of these are covered by your existing auto insurance.

Collision Damage Waiver (CDW) – mostly covered by auto insurance / credit card

Personal Accident Insurance (PAI) – mostly covered by health insurance

Loss Damage Waiver (LDW) – mostly covered by auto insurance / credit card

Supplemental Liability Insurance (SLI) – extra insurance, usually not worth it

Personal Effects Coverage – covers personal items stolen from the car

Out of all of these, the one you may consider most is the “Personal Effects Coverage”, but I also read it’s  pretty painful to go through the process of trying to submit a claim.

I’ve rented quite a few cars in my life without paying for extra coverage, and so far I haven’t had to pay for damage.  However, I’ve had damage to at least three rental cars.  Two of the accidents occurred while I was traveling for business so they were covered by Corporate American Express and my company.  They were minor instances.

The third occurred while I was renting a car for my brother’s wedding.  Long story short, I was driving the car “like a rental” and when I had to turn around while driving through the Ozark Mountains, I backed into a rock and punched a hole in the bumper of the car!!  I won’t mention the name of the rental car company because they might still come after me… but when we got home, my dad was able to fix the hole in the bumper well enough so they didn’t see it!  This involved using some bondo, matching the maroon color with spray paint, and then driving around in dust to try and mask it.  I was stressed the next few months hoping I wouldn’t get charged and luckily I didn’t.

To avoid something like that again, I now want to make sure I’m covered.  This is a new revelation to me since I researched this article – I even rented a car this past weekend and didn’t get the extra coverage!  I wasn’t really aware of what I was liable for, and I thought the rental car agents always used scare tactics to make it sound worse than it is.  However, if you do get in a wreck or even receive a ding on the door, you’ll wish you had some extra protection.

Here are 6 steps to take when renting a car to ensure you are covered:

1.  Contact your auto insurance company to see what coverage is provided for the rental car

2.  Contact your credit card company and ask what their automatic plans offer

3.  Reserve your rental car

4.  Depending on what your car insurance company or credit card company said, you may need to call them again to ensure they cover the type of car you rent (some don’t cover SUVs, luxury cars, etc)

5.  Check in to purchasing additional coverage from a service such as American Express or through the rental car agencies if you have a short rental

6.  Upon receiving the car, inspect it to ensure there isn’t any damage before you rent it

State Farm also has a helpful guide to help you walkthrough when you might need to purchase insurance:

Situation What coverage to look for When to consider add’l coverage
You have a personal auto policy Read your policies carefully or call your insurance agent to ask for details of coverage. Many auto policies cover rentals with the same type and amount of coverage on your personal vehicle. Also ask about coverage for any administrative fees you may be responsible for, such as loss of use (rental income not earned on a car while it is in the repair shop). If your policy does not cover rentals, has a high deductible, or does not include collision coverage or sufficient comprehensive coverage, you may wish to purchase additional coverage from the rental company. Also, insurance is invaluable in foreign countries where you may be responsible for paying for the damage in full before you leave the country.
Your credit card offers rental insurance Carefully read the documentation that came with your specific credit card and understand the extent of the coverage it provides. Depending on the level of coverage your credit card provides, you might consider adding coverage from the renting agency.
You are traveling on business Your employer may provide corporate insurance for rented vehicles. Be sure to know the applicable corporate policies and procedures before you rent a car for business.
You do not own a car If you do not own a car and therefore do not carry auto insurance, you will need to purchase insurance from the rental agency. Take your time at the rental counter to consider the coverage packages being offered. You may not need the most expensive plan being offered.
You are renting a car in a foregin country Check your auto insurance policy for possible exclusions or limitations on renting a car abroad. Also check for coverage that may be offered by your credit card company or auto club. If you are not sufficiently covered, you may wish to purchase third-party travel insurance to cover your foreign rental, or the Loss Damage Waiver from the agency. You will still be liable for any costs resulting from vehicle damage that are not covered by the waiver.

 

One final note, if you rent a moving truck such as Uhaul, most insurances don’t cover that at all.  I have a friend who rented a Uhaul, damaged the upper portion above the cab (Mom’s Attic), and had to pay out of pocket to cover it.  The only insurance I’ve found for that is through the Uhaul company.  I’ve rented a few without the coverage, but I’m sure my friend will get the coverage next time!

In the end, purchasing rental car insurance sucks, but after thoroughly researching it, I now recommend some sort of extra coverage.  In the future, I’ll write about how to save money on your rental car – one great way is to use services such as Hotwire and Priceline.  Do you purchase insurance for your rental car?

p.s.  – I’m not liable if you take any of this advice and it doesn’t work out for you!

how to make a queen headboard

Our finished headboard

DIY:  How to make a queen size headboard

My wife and I love to do DIY projects around the house.  We bought an old house in New Orleans and have fixed it up over the last three years… and it’s been a ton of work.  However, our interior renovations are complete and now we’re moving on to more fun projects!  I’ll talk about all of the home renovations (and if they were worth it) later.

For now, let’s talk headboards.

We have a queen size bed, so I’ll give specifics for it. My wife is the awesome designer, and I’m the doer.

List of materials for a queen size bed headboard:
– 1 sheet of plywood
– 12 – 15 feet of 1X4 board
– 2 yards of fabric ($35)
– 1 layer of foam ($38)
– Screws, staples, wood glue, sand paper

Tools needed to make a headboard:
– Jig saw or skill saw
– Drill
– Staple gun

We only spent around $73 making the headboard because we already had the wood, tools, and various supplies.  If you start from scratch but still have the tools, you could probably do it for around $100.  It took around 3 hours to complete.

1. Cut plywood to size of headboard

You can use almost any type of plywood, but you should get something at least 1/2 inch thick so it’s sturdy enough and can take staples.  The rumor is you can have the people at Lowe’s or Home Depot cut the plywood to size, but I’ve never tried it.

A queen size bed is 60 inches wide, so we decided to cut the plywood to 63 inches so we’d have some overhang on each side.  We also wanted our headboard to have a more custom look, so we decided to give it a rounded top.  To do this, I simply put a screw towards the bottom of the plywood, tied a string to it, and traced the circle based on the circumference we were looking for.  I then cut out the design with a jig saw.

I recommend playing around with some ideas and draw them out on paper first.  It’s really not that hard to make some cool shapes if you have the right saw (jig saw).  The final step is to sand down the edges of the plywood so it doesn’t snag your fabric.

2. Add legs and frame to headboard

We have our bed on risers so our dog Lucy can get under it (it’s her ‘safe cave’).  Because of this, our headboard sits a little higher than most.  I used a 10′ piece of 1X4 board and cut it in half to make the two legs.  I used another 58″ piece to go across the top.

To secure the legs and top piece to the plywood, I used wood glue in addition to screws to keep the headboard frame from squeaking (get your mind out of the gutter).  I placed the legs about 3 inches in from the edges so we’d have plenty of room to staple the foam and fabric.  Now we’re ready to attach the foam to the headboard.

3. Attach foam to headboard

Everybody likes a nice and soft headboard, so it’s important to get some sturdy foam.  You can buy it from craft stores for $60/sheet, or you can make it out of the egg crates you put over your mattress to soften it up.

We ended up using two egg crates and put them face to face so the outside surfaces were flat.  We then glued the first piece to the plywood and glued the second piece face down on the first piece.  Then came the hardest part.

To give the headboard nice soft edges, we folded the foam around the back of the plywood and stapled it.  This was a tedious task that took both of us because we the foam took some pressure to hold in place while we stapled.  We placed staples every two inches around the entire plywood frame.  After we had it stapled, we cut off the excess foam with a knife.

We actually purchased batting to put over the foam, but we decided not to use it because the foam gave us enough cushion.  Now, the final piece!

4. Cover foam and headboard with fabric

My wife found some great fabric on sale at a local crafts store.  She said we could have gone to Joann’s or any other fabric place to get it.  We also happened to go during a 40% off sale which I was excited about.

To install the fabric over the foam, simply place it on top and straighten as necessary.  We then folded the fabric around the back of the plywood and stapled it just as we stapled the foam.  We gently pulled it tight as we stapled it down to ensure no wrinkles.

5. Install!

To install the headboard, we simply leaned it against the wall and pushed the bed frame against it.  We used some pretty heavy plywood so it stays in place pretty well.

All in all, it was a pretty easy job!  Do you have any tips for making a queen headboard?

Ah yes, I can see it now… I’m sitting in my office in the middle of Silicon Valley laughing at the small sums that Mark Zuckerburg is worth when compared to me. The (insert business idea here) finally took off when I discovered my true passion and transformed it into gold.

It’s as easy at that, right?

It seems pretty easy these days to find a story of someone who went out on their own to start their own business, and who is now swimming in millions while living the high life.

Since I graduated college in 2004, I’ve wanted to start my own business but haven’t. I get frustrated when I look back on the time that has passed with little results in that arena!

I think I’ve had some pretty good ideas and have even written up some business plans to get them started… but that is usually where it ends. Some ideas start with my own needs and wants and others are attempted answers to today’s challenges and trends. Let’s review some of the ideas:

1. The Green Box ( a green retail store)

2. Golden Years Job Placement (for retired people)

3. product – six pack of milk (quasi joke)

4. product – designer shampoo bottles

5. product – interactive retail store map (could do on smartphone easy now)

6. Wizepoll – smartphone survey app

7. Flower subscription service

I still like my idea of the six pack of milk! It would be so much easier to store (you open each one as you need them) and grab on the go. Yes, they sell them individually in smaller bottles, but that’s not the point, I want a full six pack! This is just a few of the ideas on my longer list.

So, the question is, why have I never made any serious moves on any of these? Am I afraid of failure? Am I too lazy? Am I trapped in golden handcuffs?

One thing is certain… ideas are a dime a dozen but finding someone to actually follow through with an idea is the hard part. If you look at my friend Chris Fagan, CEO of Mobestream Media, who has his own mobile app business with millions of users, you’d probably think that he just got lucky with a good idea. Oh no, it was much more than that. Chris has worked hard on developing his business for 2-3 years and has sacrificed and incredible amount of money and energy to try and make it work. He’s still battling.

It hasn’t been easy. He spent two years living off of meager savings, spending every waking minute trying to bring this idea into fruition. He would call me in tears while I was living a cushy life at my corporate job (where he used to work). He said he longed for the days with minimal risk and guaranteed return.

He was battling the ever-changing market of smartphone application development while dealing with everyday issues like rent, patent and legal issues, managing a partnership, and trying to prove out his business. He has now received funding and has almost 10 people working for him. However, the hard work and angst hasn’t stopped. If he makes it big, he deserves it.

Man, that sounds just as rough now as it did when I was on the phone with him. Starting your own business isn’t easy, but I’ve had some pretty specific reasons holding me back.

Why haven’t I started a business?

1. I was too focused on the potential profit and cut the idea if the business case didn’t seemingly prove out to make me rich

2. I’ve only wanted to pursue ideas that I’m fully passionate for – rather than letting my passion transcend the idea and be “my own business”

3. I’m too comfortable where I’m at now (wearing my golden handcuffs)

For now, I’ll continue to use my job as a tool while I explore things on the side and prepare financially to start my own business. If I would’ve quit everything and tried to start my own business a few years ago, I probably now be broke because I didn’t have any money and didn’t have an idea worth pursuing.

The important part is to continue searching to find what you love to do. You may have found it already, and it’s perfectly fine if it is a corporate job or some other job where you’ll never get rich. Just make sure it’s something that’s worth your time.

Even if you do start a business, realize it might take a long time before your idea even starts to turn a profit. For an idea for how long, check out the timeline of an entrepreneur.