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The Secret Method for Establishing Your Child’s Financial Future

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The innate drive I have as a parent to teach, influence, and leave a legacy for my children was unexpected. It was sparked at the hospital when they were born and hasn’t stopped since then.

While I was growing up, I wasn’t taught much about money, investing, business, and entrepreneurship. I had to learn a lot of painful lessons. I have been fortunate to establish a financial system from which my kids are already benefiting.

My system runs contrary to the traditional financial system parents and grandparents used to save for their kids’ future in many ways.

But the only way to get uncommon results is through uncommon means. This is my system for establishing for your child’s future.

The Unnecessary Burden of a 529 Plan

The 529 plan, also called a qualified tuition plan, is a tax-advantaged savings plan designed to encourage saving for future college costs. These plans are very popular and have become a sacred cow, even though they have only been around since 1996.

When my two girls were born, my dad was insistent on contributing to a 529 plan for college. At the time, I was barely into my first job out of college and hadn’t learned what I teach now, so I decided to open one up.

Today, millions of people have them, and your kids and grandkids are attached to them. In my experience, saying no to a 529 plan is like telling a mother her baby is ugly.

I don’t want to say what you’re doing is bad. You’re planning for your child or grandchild’s financial well-being, which is commendable. But if you look at the nature of a 529 plan, it’s not set up for your best interests or the best interests of the child or grandchild.

It’s pitched to you as a benefit, but it’s just another way for Wall Street to sell you mutual funds and make money off your desire to do well by your kids.

The objective of the 529 plan is to put money away and pay for future college expenses while getting a tax benefit for doing so. The catch is, if the money is not used for college or some other qualified higher education expense, you have to pay penalties for withdrawing it. What if you don’t need the account anymore—your kid decides to skip college, for instance—and you want to use that money for something else? Is the penalty you pay on the 529 plan worth it from the beginning?

Additionally, the burden on families to completely fund college has an opportunity cost that is difficult to quantify. Because of that, the financial future of the family may be put in jeopardy. I have seen it bankrupt a few.

The 529 in Practice

Here’s an example of what I mean. Assume your child is five years old and you have committed to taking care of their educational costs for a four-year degree.

Right now, the average annual cost to attend a public university is $25,000, rising by 5 percent a year. That means that by the time a five-year-old today is 18 and ready to go to college, tuition would be almost $50,000. Over four years, factoring in tuition rises, that comes to a total cost of $213,344.

For a 529 account to pay out that much when it’s needed, it has to start with $100,000 and earn a net 5 percent every year through graduation.

Or, you could just save $8,147 a year for 18 years.

To really drive this point home, the opportunity cost for the family during their later years is really where the price is paid.

If you saved $8,147 a year for 18 years and then let it grow past that point until your future retirement, your balance at the end of 35 years would be $551,602.

If you spent that down through a 20-year retirement, the cash flow would be $42,154.24 per year, for a total lost opportunity cost of: $843,084.80.

A More Certain Future

The opportunity cost that comes with following the typical college path doesn’t simply disappear if funded through a WMA—it only gives you more options.

You’re trying to prepare for something in the future that may not happen the way you think or may not happen at all. Consider the opportunity cost of that money—what that money could do between now and the time your child goes to college.

When I learned about what I do today, I cancelled the 529 plans I had and opened Wealth Maximization Accounts on each of my kids. Today, I have multiple policies for each of them.

However, the idea isn’t simply to treat these as 529 comparisons. The money inside a WMA can be used now, without any restrictions. In my experience, that has been a most powerful tool to teach kids, including my own, about money.

Instead of saying no to things they want, I can say yes. The money is borrowed against their policies, however, so it becomes their responsibility to pay it back. We call it our family bank.

For example, my daughter Meghan has used her policies to buy numerous types of electronics and a $400 gymnastics mat, amounting to thousands of dollars cumulatively. She had to create a payback plan before she was given the money. She felt she could earn enough for the payments by increasing the amount of babysitting she did in the neighborhood.

She also researched ways to earn bigger tips by giving better service, such as making little videos of the kids, making sure the house was cleaner than when the parents left, and leaving a handwritten note. This experience has given Meghan an appreciation for where money comes from, what a loan is, and what interest is—both the interest you pay and the interest you earn. I know that will benefit her in the future.

Wealth Maximization Accounts for your kids are the ideal way to teach them about money and also to prepare for their future purchases, such as a car, college, and beyond. Properly structured plans are a superior alternative to a 529 college savings plan. For more resources take a look at Paradigm Life.

Patrick Donohoe is the President and CEO of Paradigm Life, a company he founded to help clients build wealth, create income for life, and leave a legacy of service to those who will inherit their assets. Patrick is a popular speaker at wealth management seminars and hosts The Wealth Standard Radio, a popular financial podcast on the TuneIn network. Patrick grew up in West Hartford, Connecticut, and attended the University of Utah, where he received his BA degree in economics. He lives in Salt Lake City with his wife and three children.

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Business

How to Simplify Your Marketing Strategy 

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The term ‘marketing’ encompasses a huge range of different techniques, and it can be overwhelming to consider the number of options you have as a new business owner when it comes to creating your marketing strategy. Bearing in mind that you will have limited time, staff, and capital in the early days of your business, it’s best to concentrate on simplifying your approach as much as possible. The best was to do this is by focusing on digital automatic marketing, and here’s why. 

Syncing

Luckily there is a lot of software designed to help people carry out digital marketing activities. It helps you to keep on track when it comes to following your marketing plan, and centralises all the information you could need to carry out the various aspects of it. Furthermore, thanks to services like Piesync, you can now sync your marketing app to your email account, for example creating a HubSpot Outlook connection

When it comes to marketing, your contact list is a crucial source of potential income, so you need to make the most of it. Syncing these apps helps you to save a lot of time as you will no longer need to manually input your contacts, you can even filter the kind of contacts you sync. Updates you make to contact details will be updated on all apps too, and it’s a great tool when it comes to automatic marketing.

Automatic Marketing

Automatic marketing is the key to spending less time drumming up business and more time running it. It uses intelligent technology to source potentially lucrative information from the communications you have with your contacts, and uses it to create marketing materials, which it then sends out to the relevant audience in bulk. 

This means that you can have a constant, steady stream of marketing activities being actioned while you focus on the other aspects of your business.

Remote Access

You can now download marketing apps to your phone and other remote devices, which allows you to access the software you need in order to carry out various marketing activities such as outreach and engagement response, wherever you are. This helps you to be more flexible when it comes to your working schedule. 

If you’re just starting out as a business owner, you will no doubt be pulled in lots of different directions while you still have minimal staff numbers, so being able to set up automatic marketing, respond to engagement, and take action on the go is a life saver. 

Marketing is an essential part of any business; it creates customers and helps you to build up a reputation, but it is also expensive and time consuming. Simplifying your marketing routine helps you to save time and money, which is especially important if you’re just starting out, or if you have a large company with a significantly large marketing plan. Using marketing apps, and syncing them with your contacts in order to enable automatic marketing is a great method of streamlining your marketing operations. For more business advice such as how to start a business from scratch, check out chaosandkiddos.com.

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Business

Email Marketing Laws

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With the rise of social media, instant messaging and texting, many pundits are declaring the death of email. However, rumors of the demise of the medium are greatly exaggerated. Email continues to deliver the best return on investment of any advertising strategy.

In fact, for every dollar you spend on email marketing, you can expect to earn an average of $32 in business. However, there are some rules by which you must abide to avoid harassing potential customers, as well as ensuring you stay on the right side of the law.

The CAN-SPAM Act

Also known as the Controlling the Assault of Non-Solicited Pornography and Marketing Act, this 2003 regulation laid down the rules with which commercial email messages must comply to this day.

The act defines any electronic mail message advertising or promoting a commercial product or service—including email messaging promoting content on commercial websites—as a commercial message. Penalties for violations of the act are imposed by the Federal Trade Commission and include fines of up to $16,000 for each instance of a violation. In other words, if 100 emails sent on your behalf are determined to be in violation of some aspect of the regulation, you’ll pay up to $16,000 per message.

The Basic Rules

The primary purpose of the act is to minimize the amount of Spam emails floating around the ‘Net. Another goal is to ensure email users have as much choice as possible when it comes to receiving advertising messages. Whatever your endeavor, whether it’s selling cosmetics from home, marketing furniture or you’re learning how to sell an ebook online with a platform like Shopify, you must:

  1. Identify Yourself: TheFrom”, “To” and “Reply To” fields must contain accurate information so recipients know from whom the message originates and to where their response to it will go. Said simply, you must identify your business.
  2. Provide an Accurate Subject Line: The “Subject” field must contain information describing the nature of the email and it must be pertinent to the message. You can’t promise dancing kittens if the message is really about snaking clogged drains.
  3. Label the Message an Advertisement: The body of the message must tell recipients they are reading an advertisement. No pretending to be a long lost friend looking to hook them up with an amazing discovery you just found. There is an exception to this rule however. There is no need to make this disclosure if everyone on your mailing list has agreed in writing to accept advertisements from you.
  4. Stipulate a Physical Address: Even though you’re messaging over the ‘Net, you’re required to provide a standard postal address at which you can receive traditional mail. The address must be valid and it must be a mailbox you check on a regular basis.
  5. Allow Recipients to Opt-out: Every message must include an unsubscribe link to afford those who receive your messages an easy way to stop your transmissions. This typically takes the form of an “Unsubscribe” link at the bottom of the message. It must be readily discernable and you cannot make users jump through hoops to stop your messages.
  6. Fulfill Opt-out Requests in a Timely Fashion: Unsubscribe requests must be honored within 10 business days of receipt. This courtesy is to be provided free of charge. You are not allowed to ask for any personal information during this process, nor are you permitted to sell their email address to another company.
  7. Know What’s Being Done in your Name: In most cases, third party email marketing services are engaged to handle campaigns of this nature. This means you’ll leave compliance with these rules to an outside resource. However, you’re still held responsible for whatever actions they take. Before you turn your campaign over to a contractor, make sure they have a reputation for always operating within the law.

The Bottom Line

The best way to ensure success with an email campaign is to build your mailing list organically. That way, people on the receiving end have already agreed to hear from you and are more likely to respond to your entreaties. Yes, it takes longer to get your marketing effort up and running with this method, but the results are better and you’ll be less likely to irritate people.

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Business

Starting a Family Business? Here’s Why Business Cards are Important

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Starting a family business is no mean feat. It is all the more pressing when you are building everything from scratch. Not only do you have to balance your family and work life in a manner that gives you peace, but you also need to tend to your new business like it’s another baby that you brought into this world.

Remember your business needs ample attention from you right from the get go if it is to reach the level of success that you aspire for it to achieve.

For that, you need to turn to branding.

Only with the proper image and branding can you ensure that your family business isn’t going to run into the ground – especially mere weeks after it spreads its small wings.

And one of the best ways to establish this branding for a budding family business is through utilizing business stationery such as business cards.

Why Use Business Cards for Your New Venture?

Everyone is aware that conventional tools such as business cards are quite easy to obtain, yet just as profound in their positive effects. That is one of the reasons why they are so widespread in their adoption and usage.

With vendors such as Basic Invite, you can order your business cards with an ease that was never available before.

Through Basic Invite’s online design tool, you can ensure to develop your business cards through a variety of designs. In fact, the vendor allows you to have a choice of over 180 different colors for each element of your card.

Needless to say, this gives you virtually unlimited options to design your family business’ branding image. This is what sets Basic Invite apart from other online business card providers.

And that’s not all, since you could enhance those designs with prime accents such as foil cards. As a design element that adds a touch of elegance to any card, these rose gold, gold and silver accents could elevate your branding to a whole new level.

Basic Invite also allows you to order custom samples, so you could order the designs in one sample card to see how it would actually turn out. This way, you can judge your card by holding it in your hands, and change any design elements that do not work for you.

This also saves you a large amount in costs. You do not have to order a bunch of cards on blind faith only to find out that you could have improved on that one element… and have to go through the whole procedure again.

If you don’t like how the sample has turned out, you can simply discard it and change it again. You could then repeat the sample process until you have reached the perfect card design.

But you are not limited to only create business cards through Basic Invite. You could also have additional business stationery options such as envelopes in over 40 different colors. This way, you could complete your professional image while being right at home.

Another feature that sets Basic Invite apart from other vendors is how it allows you to save your recipients’ mailing addresses through its address capturing service. By sharing one simple link through social media, you could have your potential customers sign up to your mailing lists. From there, you could print their addresses onto the envelopes exactly as they are provided.

If you want to order online business cards with all of these features, then don’t hesitate from reaching out to Basic Invite today.

Since the company is running a 15% off promotion with coupon code: 15FF51, this would be the perfect time to obtain your new business cards. Make sure to get them today!

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