Should You Start A Business During The Recession?

Due to some pressing issues here on the homefront, I will be running a few guest posts this week. The following is a post by DebtKid, who writes about his journey to get out of debt, and achieve financial stability. He runs a small software development company in Seattle and just launched a new coupon section on his blog.

There are so many terms floating around out there it is hard to pick one to describe “the current economic crisis”. Everyone is wondering how long their savings will last, how badly their portfolio has been effected or how long the recession will last. The stress for many people comes from the feeling of not having control over critical aspects of their personal and financial matters.

If you have decided that you are tired of waiting to see how things play out you can take back control over your life and start your own business. Before you do, you should know some of the pro’s and con’s of starting a business during a recession.

Reasons You Should Start Your Business During A Recession

Small Businesses Are Closing Their Doors– You may wonder why this is a positive when considering starting a new business venture. After all if those businesses are failing, how can you possibly thrive? The reason many small businesses are failing is due to the product or service they provide. When the economy takes a turn for the worse everyone becomes more aware of their spending; if you are able to provide a service or product that people actually need you will likely attract consumers looking to simplify their life at a relatively low price.

New Opportunities– The Internet provides many new opportunities that weren’t available to entrepreneurs in the past. While many facets of today’s business being conducted online there are some businesses that don’t even require a physical location. This can greatly reduce the need for funding as your start up costs will be much lower than businesses with a brick and mortar building. Freelance employees in several areas are currently seeing a spike in business as other companies begin outsourcing their projects.

You Are In Control– There is no such thing as job security anymore. Each person in a company is dispensable, that is unless you have your own company. There are no guarantees in life and less when it comes to a start up business in a down economy. That being said, if you have a well thought out plan and you offer a service that people need you may find the rewards of being your own boss outweigh the risk.

Reasons You Should Not Start Your Business In A Recession

Funding Is Limited– If you do not have money tucked away to get your venture off the ground and need funding to start your business you may be out of luck. Finding a lending institution that is willing to take the risk on a new business will be difficult if not impossible in the current economy. See alternative funding sources for your business.

Consumers Are Not Spending Money– Businesses that are doing well in this economy are for some intents and purposes recession “proof”. This is not the case with all business and your dream company offers a service or product that won’t be well received in a down economy you are better off waiting until things turn around before trying to launch your business.

You Are In Control– Yes, you are correct. This was listed as a positive however it is a catch 22. While being in control of your own destiny offers you the opportunity to make decisions and reap the rewards for all your hard work, you have no where to turn if you fail. You need to seriously consider if you have what it takes to start and run your own company before starting down that path.

Have you started a business recently? Are you thinking of starting one? Why or why not?


Frugal Tip: Stop Wasting Money Buying Ice Packs For Your Cooler.

You can make them yourself for free – which not only saves you money but also reduces the amount of potentially toxic chemicals you have in your house. Years ago I discovered that plastic soda bottles work just as well as those hard ice packs do! I just take empty 20oz bottles and fill them 3/4 of the way up with water and put them in the freezer. (You cannot fill them all the way, as the water expands as it freezes) Voila – free ice packs. You can use different sizes depending on what you need to keep cold and how big your cooler is, but it really makes no sense to pay for something that you can make for free at home. Keep that in mind next time you are headed to the park or going camping!


Ask The Readers: What’s Your Favorite Coupon Site?

While I have never really been much of a coupon clipper, I do like to save money! So one of the ways I am going to try to start saving a little cash is looking for coupons I can use on the things I buy. I have either checked out or used Coupon Mom, Cool Savings, Coupons.com, and Coupon Cabin. But I need your help! I am a newbie compared to some of you, and I know some readers are pros at this and can really make some great suggestions of sites to use and/or sign up for. However, I have a ground rule for what I would ever consider using…

I refuse to pay for coupons.

While I understand some services are probably worth the monthly charge, I just don’t want to pay to use coupons. Other than that, I am excited to check out whatever it is you guys use. And I am sure there are other readers of My Two Dollars who are looking for coupon advice as well, so come on now – readers who “do” coupons – I, scratch that, WE, need your help finding the best coupons available to us. Do your magic in the comments!


The Hardest Part of Any Job Interview: Don’t Trash The Old Boss.

This is a guest post from Ron Haynes who writes for The Wisdom Journal, a blog about Wise Choices, Improved Finances, and a Better Life. A partner in a regional lumber and building materials company, he has a bachelor’s in Human Resources Management and an MBA with a marketing concentration.

Putting a positive spin on what (at the time) felt like the worst day of your life is the easy part. Volumes have been written about how to spin your layoff, or handle a termination, or explain away that annoying gap in your employment history. No, those are easy. What’s far more difficult is resisting the urge to trash your former boss when deep down you know he or she really deserves it. Yes, it’s the hardest part of your interview, but it’s also the most critical.

All bosses hate to see an interviewee criticize their former employer. Even if you work for an ogre who deserves to be fed to radiated vampire cockroaches, the thoughts of hiring someone who is willing to unload a truck of bitterness — even if it’s warranted — on a former manager is unsettling at the least and an immediate interview killer at its worst.

When asked about a situation where “things just didn’t work out,” always seek the balanced approach. Try saying, “I learned a great deal at XYZ Company but I felt that I needed a change.” If the interviewer presses you, continue with something like, “There were a lot of really great people at my level and the prospect of any professional growth was slim.” Or “I was growing professionally, but not in the direction I really wanted.”

Sometimes those will work, but if they don’t and the interviewer seems to be goading you for more information, lay it out there: “My boss and I didn’t see eye to eye on some matters. It was really no one’s fault but I like to be happy in my job and I want my boss to be happy, too.” Once you say that, don’t keep talking about it. Turn the interview into one that’s focused on the position and the company’s needs in the future by asking, “So, how does my experience and education stack up for this position?”

Remember that not all interviewers are very experienced in drawing information out and some will actually want to test you to see if you’ll take the bait to trash your boss. Don’t take that bait. There’s a better than average chance the interviewer knows something or knows someone in your former organization who has spilled the beans about your situation. By keeping cool, you’ll communicate that you’re not there to play that game.

And one more thing, make sure you find someone with a title at your former job who will be a good reference for you. He or she doesn’t have to be a former superior, just the fact that someone is willing to vouch for you will help you land on your feet and nail the interview.


Money Quote Friday – Help Humanity Forward Edition.

I am absolutely convinced that no wealth in the world can help humanity forward, even in the hands of the most devoted worker in this cause. The example of great and pure characters is the only thing that can produce fine ideas and noble deeds. Money only appeals to selfishness and always tempts its owners irresistibly to abuse it.
– Albert Einstein

Have a nice weekend everyone…