The Simple Dollar: “Questions about Baby Exhaustion, Data Plans, Goodwill, Costco, and More!” plus 1 more

Questions about Baby Exhaustion, Data Plans, Goodwill, Costco, and More!

Posted: 20 Oct 2014 07:00 AM PDT

What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to five word summaries. Click on the number to jump straight down to the question.
1. Money discipline with baby exhaustion
2. Never enough
3. Piles of old paperbacks
4. Books for high earners
5. Investing small amounts
6. The $2,000 iPad
7. Buy it for life: Goodwill
8. Comparing quality of life
9. “Costco-sized portions”
10. Are data plans worth it?
11. Trick or treat expense
12. Headphones advice
13. Debt repayment or savings
14. Selling hair
15. NaNoWriMo

Recently, I was asked by a personal friend how I still manage to come up with post ideas after so many years and how I avoid repeating things.

First of all, I have no problems with ideas. I have long lists of ideas. The trick is filtering those ideas into ones that will work well as articles.

As for repeating ideas, I don’t worry about it too much. I’ll do a Google search and see if I’ve written anything exactly the same, but if it’s similar to something I wrote three or four years ago, I don’t worry about it. I figure that I’ll have a new angle and new insights and new specific tips that I’ll have based on those three or four years of life change.

Let’s get to the questions!

Q1: Money discipline with baby exhaustion

I made some great progress with my personal finances (paid back debt, built savings etc.) a few years back when I was single. I am glad I did so when I was single because now it's a very different situation.

Now I am 29, married, mother of a 8-month old baby girl.

I recently went back to work. My husband works in shifts. My mother-in-law takes care of the baby while I'm at work.

In theory I know what we should do with our money – spend wisely, save, invest. But ever since the baby came it seems like we can't hold it together! We don't save much. We could save more, but there are many occasions when we eat out instead of cook at home because we are just too exhausted. I buy baby food instead of preparing it at home for the same reason. (I made apple puree once and that was it.)

With all the housework, cooking, cleaning, grocery shopping, it's just crazy. My husband works in shifts so I often end up alone with the baby and it's really hard to get anything done that way. My husband sleeps during different times (works in shifts) and often comes home at 1am or other times gets up for work at 4am, so that is not helping with my sleep at all. On top of that the baby wakes up pretty much every hour at night and doesn't go back to sleep until I cuddle her.

I'm exhausted, my husband is exhausted, and everything is a mess. We use our willpower to get us through the day and get stuff done, and it we have no willpower left to be smart with our spending.

We don't earn too much but still I know we could be wiser with our money.

So my question is, do you think we could do something? Or do we need to just wait this out until the baby is older or until we start earning more?
– Jean

This sounds like virtually every new parent since the dawn of time.

During the first six months of our first son’s life, our home life was a lot like you describe. We were constantly exhausted. There was never enough time to do all of the things we thought we should be doing.

The problem is that you’re still wanting to do things according to priorities that existed before the baby and you’re seeing how that prioritization doesn’t match your life after the baby. There is a huge period of priority adjustment that just happens to coincide with a new person in your home that will not allow anyone to sleep for more than three hours at a time.

What will happen over time is that you’ll figure out patterns that work well for your family. Some things that used to be priorities will drop and vanish. You’ll figure out new ways to multitask.

I would not get too frustrated about being perfect with your money during this transition. Just keep your head above water. It will get easier.

Q2: Never enough

I’ve been enjoying The Simple Dollar for more than a year and I really value your comments. I also read several other money blogs as well.

The challenge I’m facing is that I never feel like I’m doing enough. For example, you’ve said that you and Sarah basically live off of one salary and save the other one. As hard as we try I don’t know how we would ever do that and it makes me feel like I’m never going to be able to do “enough” to get ahead.

I’m sure you’ve read about other examples, like how Pastor Rick Warren gives away 90% of his family’s income. Do you ever feel like you can possibly match that?

How can someone ever feel happy when it seems like so many people are able to do more than them?
– Karen

I honestly don’t worry at all about what other people are doing. I only draw on that experience for more ideas for what I can do better. How can I spend less? How can I earn more? How can your experiences help me with that?

This is because no one else’s experiences match my experiences. Every single person has a unique life journey that puts them in a place that makes their life situation very difficult to compare to others.

The only person you have to compare yourself with is yourself. In other words, you should be striving to do better than you did yesterday or last year or five years ago. How are you improving compared to where you used to be?

The only thing you should use in terms of comparing yourself to others is in the form of tactics. What things are they doing that might be useful to me so that I can do better than I used to do? That’s all.

Q3: Piles of old paperbacks

I’m in the process of cleaning out my dad’s house as he has moved into a retirement home. He has thousands of old paperbacks in boxes out in the garage. Most of them are just old cheap paperbacks that are yellow with age. I can’t imagine anyone wants them but the idea of throwing them away or burning them seems really wrong to me. What should I do with them?
– Charlie

If you’re thinking about throwing them away, think about giving them away instead.

Take the whole collection down to a retirement home or to an American Legion office or to a VFW post or to a hospital and see if they’re wanted. Call ahead so you’re not hauling books everywhere.

If you find that truly no one wants these books, consider recycling them. Recycling centers will accept them and then they’ll be turned into other paper products rather than just visiting a dump.

Q4: Books for high earners

Do you know of any books that focus on money management for high income earners with no debt? We are trying to figure out how to invest our money intelligently but make sure we are being mindful of the short-term and long-term tax burden we may face.
– Timothy

Hands down, the best book on investments I’ve ever read is The Bogleheads’ Guide to Investing by Larimore, Lindauer, and LeBoeuf. The name “Bogleheads” comes from John Bogle, the founder of The Vanguard Group, and the book follows Bogle’s stated investment philosophy and carries it all the way through the various dimensions of a person’s financial life.

In general, the book’s philosophy is that casual investors can’t compete with the professionals, so they should instead focus on matching the overall stock market as cheaply as possible, minimizing investment fees and expense ratios. This is mostly done by using tax-advantaged accounts (like 401(k)s, Roth IRAs, 529s, and so on) and investing in highly diverse index funds to spread out your risk at a low cost.

I swear by this book. I turn to it as my first answer almost every time I have an investment question. It has a permanent place on the bookshelf over my desk.

Q5: Investing small amounts

I want to start investing in the stock market each month – say $100 at a time. How would I go about doing this with minimal expenses?
– Tim

With that small amount and without a healthy amount to start with, fees are going to eat you alive. There’s just no way around it.

Most brokerages make money via transaction fees. Whenever you buy stocks, they charge you. It doesn’t matter how much you buy (for the most part), so a $10,000 buy often has the same fee as a $100 buy. If your fee is $10, then the fee is only 0.1% of your investment with the $10K buy, but it’s 10% of your investment if you do the $100 buy. Ouch.

You’re better off putting money into a savings account for a while and then buying in after a long period. For example, if you put $100 in your savings account each month for a year, you could buy at the end of the year and buy $1,200 in stocks with only $10 in fees – an $1,190 investment, in other words. If you bought in each month, you’d buy only $1,080 in stocks – $1,200 minus $120 in fees. Unless you’re extremely lucky, you won’t make up for that loss in the stock market – the market would have to have a 20% positive year for you to break even on the lost fees.

Of course, if you’re saving up and buying in with a big lump sum, you’re better off just buying an index fund directly from an investment house like Vanguard. If you can save up to the $3,000 mark (which is their investment minimum for most of their funds), you can buy into almost all of their index funds, then set up an automatic investment plan where you put in $100 a month without any fees at all.

That’s honestly what I’d do for now. Put that $100 a month into a savings account. Drop in more when you can. When you get to a few thousand in there, start re-evaluating your options. I recommend seriously looking at Vanguard’s offerings. Even if you don’t choose there, you’ll save a bundle on brokerage fees just by being patient.

Q6: The $2,000 iPad

So, here’s the situation. My older brother buys a bunch of stuff from a rent to own store in our area. He’ll sign up to make a ton of weekly installments there and eventually he’ll own the item. The problem is that if you add up the payments they add up to like four times as much as the item owes. I show this to him but he just says I’m jealous because he can get an iPad for like $19 a week. Yeah, but he’s making 104 payments (one a week for two years) so it’s $2,000.

How do I get through to him that this is a scam?
– Steve

Some people simply have a very short term view of things, and that sounds like your brother. I know quite a few people that seem to be unable to consider elements of their life that exist more than a week or two in the future. They buy last minute presents, sign up for ludicrously bad contracts, and so on.

The simultaneous challenge you’re seeing is that people often don’t like being shown that their choices are poor. They’ll often respond by retreating into a spiny shell of pride, viewing any comment as a personal assault that must be protected against.

That kind of viewpoint is not something you can shake up from the outside. The honest truth is that you’re just going to have to be patient with him and let him figure it out on his own.

You can lead a horse to water but you can’t make him drink.

Q7: Buy it for life: Goodwill

Well built furniture like sofas and desks can be found at goodwill and similar for very little money. I purchased a 10 ft long sofa for $35 and had it completely reupholstered for less than $500. It’s been in heavy use for over 30 yrs and is easily outlasting the sofa i purchased (the 2 recliner type) seven years ago. Desks for kids’ rooms are durable and will last for generations. End tables, picture frames, cookware, glass ware like pyrex and corningware, and seasonal ornaments are also examples of very inexpensive ‘buy it for life’ purchases we’ve made at thrift stores over the past 39 years of marriage.
– John

I am a huge advocate of shopping for almost everything non-electronic first at thrift stores.

Yes, most of the stuff you’ll find there is stuff you won’t want to buy because it’s of poor quality or because it doesn’t meet your needs. Guess what? The same is true of most stores – you wouldn’t want most of the stuff there, either.

With Goodwill and other thrift stores, though, you’ll sometimes walk in and find a stupendous bargain – something well-made and incredibly useful that’s being sold at a pittance. It has happened to me many times.

You’ve just got to be patient and be willing to stop there sometimes and leave empty-handed.

Q8: Comparing quality of life

I understand how you can compare cost of living from place to place. You can use a calculator. But how do you compare “quality of life” from place to place? Where do you even start with that?
– Danielle

The problem is that you can’t come up with a standard definition of “quality of life” that works for everyone.

For me personally, the upper Midwest has the highest quality of life of anywhere I’ve ever been. That’s because of the factors I attribute to quality of life – strong public education, a wide variance in weather between the seasons, constant access to open spaces and fresh air, incredible access to farm-fresh foods, a relatively low crime rate, and so on. That’s what I want in an area where I live because that’s what I value in life. I want a high level of quality in those areas that I value.

If you want to compare areas in terms of “quality of life,” you need to figure out what “quality of life” means for you. What exactly are you looking for? What factors mean the most to you?

If you accept someone else’s idea of what “quality of life” means, they’re going to be spitting out a score based on factors that you might not care about in the least.

So, your first step in answering this question is figuring out what factors contribute most to your quality of life. What are the things that are most important to you? Schools? Public transportation? Crime rate? Cultural opportunities? Something else? Then, compare areas based on those factors.

Q9: “Costco-sized portions”

Do you have any thoughts on this article from The Atlantic on warehouse clubs – http://www.theatlantic.com/business/archive/2014/10/why-people-love-costco-sized-portions/381562/

Seems to imply that people waste money by buying in bulk too much. Thoughts?
– Amy

Bulk buying is a good strategy if you’re actually using everything you buy before it goes bad and it’s not increasing your usage of the item. For example, if you’re buying giant bags of potato chips and that’s causing you to eat more of them, it’s not really helping.

In other words, I think bulk buying is a supplement to a good grocery shopping and food management strategy (and household good strategy), not a full solution. You should buy items in bulk if they make sense based on your already-existing meal plans that are led by fruits and vegetables and meats that are bought on discount.

I think most of the people in this article – at least the ones that are directly discussed – aren’t following that policy and, because of that, they’re not getting the best value out of bulk buying.

To really answer this, I need to write a full-length article on how to incorporate bulk buying into meal planning. Expect it soon.

Q10: Are data plans worth it?

I had an old flip phone for my cell phone which worked out very well for 6 years. The battery died and I was unable to recharge it or replace it. i bought another cell phone for $ 20.00 but have been unhappy with it as I am missing texts (they come the next day), and don’t receive all calls. A friend has given me their iphone 4. Are there quality phones out there that are not required to have data? If I have an iphone is it worth it to have data? We have a family plan with 5 phones ( no contract) and presently we do not have any data plans.
– Sara

An iPhone works just fine without a data plan. You can use all of the other features of it whenever you are near a wi-fi signal. The only thing extra that a data plan provides is access to data – websites, map data, and apps – when you’re outside of a wi-fi area.

Having said that, it will become tempting to get a data plan if you use the non-phone features very much.

As for the late texts, that sounds like more of a provider issue than anything else. If your phone isn’t receiving texts until the next day, I would immediately talk to my provider about it. There may be a phone setting issue or something on their end.

Q11: Trick or treat expense

I live on a block that receives a lot of traffic on trick or treat night – on the order of 400 kids. I don’t have kids of my own. I used to just leave a bowl out front, but then kids would clean out the bowl by taking lots of candy. I don’t really want to sit on the front step and hand out candy either.

I don’t want to buy thousands of pieces of candy – $$$ – but I also don’t want to just shut off my lights and hide downstairs either. Ideas on how to keep trick or treat less expensive?
– Sam

Here’s an idea. How about finding a neighbor kid who is just a bit too old for trick-or-treating and give that kid $5 or $10 to hand out candy on your front step?

This accomplishes a bunch of things at once. One, you’ll be spending less on 400 pieces of candy than 1,000. Two, you’ll be keeping that kid out of trouble on trick-or-treat night and letting them earn a few dollars. Three, you don’t have to deal with trick-or-treat night.

I’m actually in a similar situation. We have about 300 kids on trick-or-treat night at our house, but our own kids want to go out on the town (understandably). Our solution has been to invite our parents up that weekend. They usually hand out treats (my father, in fact, likes to dress up a bit, usually involving a ludicrous wig) while Sarah and I handle the trick-or-treat responsibilities for our own kids.

Q12: Headphones advice

I listen to headphones quite often – probably 2-3 hours a day. This enables me to listen to podcasts while I’m at the library or when I’m at work and want to listen to things without interrupting others.

In this situation, you might think that I want to “buy headphones for life” but my problem is that I beat up headphones. They rarely last me even a single year. I carry them everywhere and something inevitably goes wrong with them.

But then the ultracheap headphones sound like garbage. So I guess what I’m looking for are the cheapest headphones that still sound decent. Or some other solution I haven’t thought of.
– Arthur

The problem here is that you’re using words that are very specific to your personal perceptions. What does “ultracheap” mean in terms of headphones for you? Do you mean $5 earbuds? Do you mean $20 headphones? What does “sound like garbage” mean? Honestly, I’m deaf in one ear, so I listen to everything in mono anyway, so sound quality to me almost assuredly means something different than what it means to you.

So, I asked this exact question of a friend of mine who is a bit of an audiophile. His suggestion was to balance the two and get headphones with a “good but not high-end” sound quality from a brand with a reputation for ruggedness. His pick was the Shure SE112, which has a two year warranty and can be found below $50.

Personally, I can’t tell the difference between “sounds like garbage” and “sounds decent” (which is part of the reason I’ve always had trouble with podcasting – I can’t tell whether I sound good), so I just use cheap over-the-ear headphones and a “mono” setting on my listening device.

Q13: Debt repayment or savings

I carry a large amount of credit card debt. It is currently on a 0% interest promotional rate for another year. I have enough savings to pay it off and still have a good cushion.

A financial advisor recommended that I keep my savings earning interest and hold off on paying off the credit card debt. But I really want to be rid of this debt that has been haunting me for many years. I’m afraid if I don’t pay it off now, there will always be some reason not to.

Another factor in the equation is that I am 51 and am not putting the maximum amount in my company 401k. I feel if I paid off the debt I could immediately start putting more towards retirement.
– Cindy

How about this?

Open up a checking account that earns interest that also lets you schedule online bill payments. Let’s use Ally Bank as an example, which offers a 0.10% interest rate on balances below $15,000 and a 0.60% rate on balances above $15,000. I don’t know how much your credit card debt actually is.

Now, move the amount equal to your credit card balance into that account and out of your savings, then schedule a bill payment for a few weeks prior to when the promotional rate ends. Then just forget about it entirely until that time frame rolls around (add it to your calendar) and check in at that time.

You’ll earn some interest on your money while it sits there, then the payment goes off without a hitch, leaving behind some interest that you can pocket. Plus, the money is out of sight and out of mind.

That’s probably the approach I would take in your situation. If your balance is $15,000, for instance, and it’s a year off, you’ll earn about $100 by doing this.

Q14: Selling hair

So my friend knows a wig maker who will buy long hair for wigs. Basically, if you go to her and your hair is a certain length (I think 14 inches cut, so you’d need hair of 15 or 16 inches so that she doesn’t shave you bald!), she’ll give you a short haircut and pay you $50 for going there. I don’t really mind a short haircut or long hair (I’ve had both many times) so I’m trying to judge whether this is worth it. Seems to me like it’s a great way to just get a “fresh look” every three years or so and make $50 each time.
– Sandy

The additional cost that comes to mind is for hair styling products needed for longer hair. My hair is nice and short, so I need virtually nothing to care for it – a drop of shampoo, or even a drop of body wash if the shampoo is out. It never really matters – my hair is just always soft and kind of fuzzy.

My wife has longer hair and thus uses more specialized stuff. It costs more per wash than my own hair, period. There’s no way around it. Since she’s responsible for buying the stuff (she either buys it herself or tacks it onto a grocery list), I can’t easily estimate the difference in costs. It’s just rolled into our household supplies budget. My estimate is that she spends $15-20 more a year on hair care than I do.

So, if that’s your rate in terms of extra spending on longer hair versus very short hair, you’re going to roughly break even on this plan. It’s certainly a way to maintain different hair stylings over time essentially for free, though. I don’t see a thing wrong with it.

Q15: NaNoWriMo

Have you participated in NaNoWriMo in the past? Are you going to do it this year?
– Keith

Yes, I have participated in National Novel Writing Month in the past. (For those unaware, NaNoWriMo is a month-long event, usually held in November, where people are encouraged to write an entire novel in a month.) Some years, I have managed to complete a novel draft; other years, I’ve tried and failed; in still other years, I’ve not even tried.

I’m planning on doing it this year. In fact, I’ve done more pre-novel prep work this year than I have in any previous year. I have a pile of notes and a good outline in my head of what I want to write.

I’m pretty hesitant to share it as I go along, though, because sometimes life intervenes with things like this. For me, it’s just an encouragement to get things down on paper, but when others are watching, it can sometimes add more pressure than I would like.

Still, I do participate, and I do feel optimistic this year.

Got any questions? The best way to ask is to email me – trent at thesimpledollar dot com. I’ll attempt to answer them in a future mailbag (which, by way of full disclosure, may also get re-posted on other websites that pick up my blog). However, I do receive many, many questions per week, so I may not necessarily be able to answer yours.

The post Questions about Baby Exhaustion, Data Plans, Goodwill, Costco, and More! appeared first on The Simple Dollar.

Saving Money in Your Startup

Posted: 20 Oct 2014 05:00 AM PDT

So you're thinking about starting a business. Congrats! Now what? Odds are good that if you're starting a business, you’re a “solopreneur” — meaning it's just you, and you’ve got some questions about what to do next.

Whether it’s your first startup or you’ve been down this path before, identifying and accessing key resources — both online and offline — will save you money when you launch your business. Today's post will explore money-saving tools, software, and practices to help you launch your startup in a cost-efficient manner. Ultimately you will have to assess your own business and financial resources to decide what is best for your situation.

So how do you set up a business correctly and get the wheels turning with limited capital and resources?

Outline Your Business Idea

First things first: You need to get a handle on what your business is, and how it will make money. There are a couple of ways to get started.

Business Plan

Traditional business ideology suggests the first step to starting a business is writing a business plan. The old advice was: Write a business plan, find investors, hire a team, go to market, and SELL, SELL, SELL.

Your business plan should include:

Executive Summary
Description of Business and Problem Solved
Marketing Strategy
Competitive Analysis
Financials
Operations
Management Team

Many entrepreneurs write business plans to present to investors in hopes of attracting funding. Business plans also help you get a comprehensive look at the business, market, competition, financial projections, and outline the leadership team that will execute the plan.

“Everyone has a plan ’til they get punched in the mouth.” — Mike Tyson

Business plans are great, but if you’re looking for ways to save money without risking the future success of your business, there are other ways to proceed without investing time or money into a business plan.

Most people struggle with writing a good business plan and consider hiring outside consultants to assist with the process. Do not waste your time paying consultants thousands of dollars to help you with a business plan. If anything, utilize small business resources available through the Small Business Association (SBA) or local colleges.

Lean Startup

Because planning for an uncertain future is very difficult, there is a new school of thought emerging in the startup world that’s making its way into the mainstream and being taught in college classrooms across the country: the lean startup.

The lean startup, explains Stanford professor Steve Blank, “favors experimentation over elaborate planning, customer feedback over intuition, and iterative design over traditional ‘big design up front’ development.” The idea comes down to a fast and smart cycle of trial and error: Develop something new, get customer feedback, learn from its failure, and make small, quick improvements as you scale upward.

Research by Harvard Business School shows that 75 percent or more of all venture-backed startups fail. And these businesses fail because they run out of money.

The Lean Startup method can actually make your new business more likely to succeed by keeping expenses low — giving you a longer period of time to increase revenue enough to begin turning a profit.

If you're still trying to figure out what your business looks like, check out a resource like Blank’s “Startup Owner’s Manual” — or “The Lean Startup,” by Blank’s former student, Eric Ries — or an online version of the business model canvas. This can help you get an initial framework for the impact areas of your business and help you save money by focusing on priorities.

Setting up Your Entity

While running out to set up a new business entity isn't the first thing to do on your startup checklist, it shouldn’t be too far down the line. Once you have an understanding of your business idea, costs, revenue streams, customer segments, key activities and partnerships, and path to execution, setting up your business and making it official is the logical next step.

Below are two options for setting up your business.

Option 1: LegalZoom

With so many services moving online these days, it’s no surprise that there are now legal services available, too. The most reputable and trusted online resource for lawyers and legal documents is LegalZoom. LegalZoom bills itself as the nation’s leading provider of personalized, online legal solutions for small business owners and families. They were founded in 2001 and boast having helped start over one million businesses.

LegalZoom provides online legal documents and allows you to set up an LLC or incorporate and set up an S-Corp or C-Corp for $149 + state filing fees. That’s less than most lawyers charge for just an hour of services.

When setting up your business, LegalZoom is a better fit if you already know what type of entity you want to set up for your business. In the event you are not sure what type of entity makes the most sense for your business, LegalZoom takes you through a step-by-step process with questionnaires to be sure you are setting up the right type of entity to meet your needs. They also guarantee your satisfaction with their services.

Advantages of LegalZoom

Ability to browse and review costs of documents ahead of time
$149 + state fees to set up your business
Lots of free online resources available as well as FAQs
Step-by-step guides and questionnaires to assist in decision making
Will check availability of the business name for you with your state
Quick turnaround
24/7 access to information

Disadvantages of Legalzoom

Risk of filing the wrong paperwork or setting up the wrong type of entity (i.e., bad business decisions)
LegalZoom’s guarantee only covers satisfaction issues caused by LegalZoom — not changes to your situation or your state of mind
Inability to seamlessly ask a lawyer questions as they come up
You don’t get to tell your story in person, which could uncover other legal needs or strategies
No hands-on professional there by your side

Option 2: Traditional Law Firm

Knowing a good lawyer is like knowing a good mechanic. They are worth their weight in gold, but most people hope to rarely need their services.

Growing up in a family of attorneys, I took for granted having access to lawyers. But because the nuances of the law are very foreign to most people, using a law firm, while more costly, might be the right option for setting up your business. That said, I’ve opened bills from law firms and had my jaw drop at the billable hours I was charged for.

Advantages of a Law Firm

Peace of mind knowing you are working with a local, trusted professional
The ability to have a lawyer answer all of your questions
A lawyer may recommend other ideas that you hadn’t thought of
You can find a lawyer that specializes in unique circumstances or situations
Years of experience

Disadvantages a Law Firm

COST: Most lawyers charge $150/hr+ and will bill by the hour
Billable hours: Lawyers charge for email, phone calls, and face-to-face meetings
Scheduling: Making appointments and getting on the lawyer’s calendar can be tough

LegalZoom can provide instant access to documents, helping you get the set-up process started right away. Understanding what type of entity you want to set up is important. LegalZoom has lots of online resources and guides to follow, but if you are still unclear or uncertain, it’s a smart idea to schedule a meeting with a lawyer. If you feel LegalZoom will suffice, you can save yourself a thousand dollars or more in setting up your business.

Another option is to use LegalZoom and then set up a one-hour meeting with a lawyer to review your documents to be sure everything is set up correctly as you intended it to be. This can cost you a couple hundred dollars for an hour or two of the lawyer’s time, versus a thousand dollars or more to have the lawyer create the documents for you.

Once your business structure is set up, you will want to look at building out the business’s infrastructure in a cost-efficient but effective manner.

Manage Your Business with Google Apps

Google Apps is the only service I’ve used that I would recommend for managing your business email, file sharing, calendars, video meetings, and internal chat. It saves all your information in the cloud, across devices, and makes files and folders easy to share across teams from anywhere.

And it can be set up in just minutes, so you’ll be up and running in no time.

Your Google Apps account will allow you to get custom email addresses for you and your team. This is a very simple and affordable branding and credibility move you should make early on.

Remember when some businesses didn’t have a website and you started to wonder if they were legit or not? The same can be said for a yourname@yourbusiness.com email address.

If you have a Yahoo or Gmail email address, make the simple move to get a custom Google Apps email address for your business, even if you’re the only one working there. You can forward all of your emails to one account, but the ability to switch between email accounts within Google is pretty seamless (once logged in, Google Apps lets you select from a drop-down menu to switch between accounts).

Google Apps was free for a while, then started to charge $5 per user per month, and now offers a $10 per user per month plan for additional storage and features. While I generally shy away from monthly subscriptions, especially unnecessary ones, Google Apps is a good investment and the return on time, convenience, ease of use, and money invested is second to none in this space. I personally have not tried the $10/month option yet, and get all the business services and storage space we need from the $5/month package.

The calendar and Google Drive allow you to share where you’ll be and what you’re working on with your team. Google Drive offers you a suite of word processing documents, spreadsheets, and folders that you can seamlessly use, store in the cloud, and share with your team.

Website Services

Whatever industry you’re in, your business is going to need a website. If you’re looking for an affordable way to get a professional-looking website, there are a few different services for the do-it-yourselfer. Learning to build a basic website may be a good investment of your time.

If you don’t want to learn to build your own site, you can look to sites like Odesk and Elance, where you can outsource the work for a reasonable price, or find a friend or family member who is willing to do it. Odds are good that someone you know can build you version 1.0 of your website for an affordable price.

Assuming you want to DIY, below are some code-free options for building your website.

WordPress

There are two different WordPress sites, WordPress.com and WordPress.org. Beginners should stick with WordPress.com, which allows you to host your site on WordPress's servers (one less thing for you to worry about). Sticking with the dot-com version, you will want to upgrade to a custom domain name — otherwise you will have dot-wordpress in your URL (e.g., www.yourwebsite.wordpress.com). Note that you must initially start with a dot-wordpress URL, and then you can upgrade.

You can register a domain name with WordPress.com for $18, or map a domain you already own for $13. WordPress is easy to use and is the site I primarily use for building websites.

Here are some advantages and disadvantages I’ve found with WordPress.com (note that these are not the same for the more powerful wordpress.org, which is what I have shifted my sites over to):

Advantages of WordPress.com

Quick setup: You can have a site up and running in less than 30 minutes
Free hosting thru WordPress
Cost effective
No monthly hosting or website expenses
Ability to build and customize a site without coding
Lots of easy-to-use, free templates
Plug-ins to add additional features
Easy click-and-drag integration with Facebook, Twitter, and other social media sites

Disadvantages of WordPress.com

Lack of ability to customize and move things on the screen
Less unique and visually compelling than using a graphic designer
Requires additional set up for an e-commerce site
I’ve found that the best templates usually charge a one-time fee

Squarespace

One of the most hyped new website builder services is Squarespace. One look at their site and you can see how good looking these websites are. Squarespace powers nearly 2 million websites and has gotten rave reviews for its visually appealing and e-commerce enabled sites.

Advantages of Squarespace

Lots of style and design options
Fully integrated e-commerce – allows you to sell things online
Quick and easy setup (again, no coding!)
Responsive templates that optimize viewing on mobile devices

Disadvantages of Squarespace

Cost: $8-$24/month (beware of locking your business into ongoing subscriptions)

Technology is a place where you can sink a lot of your business’s money. There were times in the past when spending thousands of dollars on a website might have made sense. With WordPress.com and Squarespace there is no reason for you to spend that kind of cash to set up your website. Spend a couple of minutes on each site and choose the one that works for you and your business.

The cost of a WordPress site is going to be cheaper annually, but if you need a turn-key e-commerce business website, Squarespace might be a better fit.

Conclusion

It’s important to assess ongoing costs to your business and to keep overhead when low getting started. Most businesses fail because they run out of revenue, so try to keep expenses low while you start to ramp up revenue (we will cover this in another post).

There are always new technologies, innovations, and services coming out, so having someone on your team who can identify value and opportunities in these areas is important. We will get to hiring in a later post, but for now, these suggestions should help get you up and running or shed light on valuable services for your small business.

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