Need Liquor Store Business Financing?A Business Cash Advance May Work For You

Liquor store business financing is a necessity in today’s economy. Banks have imposed strict lending standards and are making it difficult for liquor store owners to get the cash they need to get by. Fortunately, there’s a business loan alternative. A business cash advance can provide the liquor store business financing you need to keep your doors open, pay bills, refresh your inventory, expand your business, remodel or make needed repairs.

A business cash advance from Rapid Capital Funding is available to businesses that accept Visa or MasterCard and generate at least $2,500 in credit and debit sales each month. With a business cash advance, there are no long applications to fill out, no waiting to find out if you can get the cash you need, no collateral and no personal guarantees. Most applications for a business cash advance are approved. The liquor store business financing you need is yours in a matter of hours or days. You won’t get that from a bank!

As a business loan alternative, it’s hard to beat a business cash advance. You can get the cash you need up front without the delays and hassles you’ll get from a bank. You don’t need to tell us what the funds will be used for, and there’s no fixed monthly repayment or late fees! Repayment of your cash advance occurs each time you process a credit or debit transaction. A small percentage of your sale goes to repay the business cash advance and the rest comes back to you.

What’s even better is that a business cash advance is available whether your credit is good or bad. Contact Rapid Capital Funding today and let us show you how a business cash advance can provide the liquor store business financing you need when you need it!

Photo Credit: kosala

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by admin in Loans

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Apr

Should you call your prospect’s cell phone?

There is a lively debate underway in one of my LinkedIn groups about whether or not you should call your prospect’s cell phone if they’ve included the number in their outbound voice mail message – or on their email signature or business card for that matter – versus leaving a message.

To me, it’s a no-brainer. Call the cell phone.

They’ve provided you with a valid alternate contact number and an invitation to use it. Why would you even think twice? Top sales professionals know that it’s critical to get in front of their prospects by whatever appropriate means they can. These days, that often means calling their cell phone.

The reality is that voice mail – even messages left on cell phones – is quickly falling out of favor. Data from uReach Technologies (their operations include voice messaging systems for several major cell phone carriers) shows that more than 30 percent of voice mail messages go unheard for three or more days. More than 20 percent of people with messages in their mailboxes rarely, if ever, check them.

There are a number of reasons behind the decline of the voice mail message. Accessing messages is often a multi-step process that takes too long in today’s fast-paced business environment. It also takes longer to listen to a voice message than it does to read an email or text.

Voice mail is also one-way communication. You can’t forward or respond to a message directly, but rather must physically return the call and risk getting caught up in a game of phone tag.

Plus, many people are just plain bad at leaving voice mail messages. They tend to be long rambling affairs that are rushed to the point that it’s difficult to determine the actual purpose of the call or capture the call-back number.

I will add one caveat to my stance. If the prospect’s voice mail message makes it clear that calls to the cell phone number should be reserved for urgent matters, respect that or risk losing the sale. Instead, leave a short, clear and concise message and follow up again later on. - by ksnaviga

by admin in Finance

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Apr

Basics of the Fair Tax

Now that Tax Day has come and gone again, and anger is subsiding, let’s spend some time thinking about what a better system might look like.

Have you heard of the “Fair Tax” proposal? I may be late to the knowledge party (Flexo mentioned it briefly in December 2007 when comparing presiential candidates’ ideas), and it’s likely I had disregarded it because I was confusing it with various Flat Tax ideas, which failed miserably in the 1990s. But it’s different; here are the basics:

It’s a Tax on Spending and Nothing Else

Let’s start with the greatest part first: Federal income taxes get repealed. This includes personal, estate, gift, capital gains, alternative minimum, Social Security, Medicare, self-employment, and corporate taxes. That’s just about all the big boxes on your 1040. Instead, the Federal government collect revenue from sales of new goods and services (unlike Europe’s VAT idea, used goods are not taxed again).

According to the people who’ve calculated what would be a “fair” tax, a national sales tax of 23% would completely replace the need for all those kinds of income taxes. We’d be collecting the same amount of revenue. In short: because you take home your whole paycheck, the amount you spend or save is entirely up to you. Things in the store would appear to cost more than you’re currently used to, but a $77 item would still cost you $77 (read the complex bit contrasting tax-inclusive and tax-exclusive).

Wealth isn’t Penalized

Under our current progressive income tax system, you’re taxed more when you earn more. Subsequently, wealthy people (for whom I admit I do not yet feel sorry) are likely to complain that they are being “taxed to death”. The most common understandable complaint sounds like this: I don’t benefit x% more from common Government services more than anybody else, why should I pay x% more? And the unsatisfactory answer is always: because nobody else can afford it. (Then the argument goes off onto various tangents, some of which make sense.)

In the Fair Tax proposal, you choose how much you get taxed by choosing how much to spend. One of the assumptions behind the proposal is that if a) you already have plenty of extra money after your budgetary needs are met and b) you’re taking home your whole paycheck, that you’ll buy things that you want. I know I would, and I’m not exactly wealthy.

It’s Meant to be Revenue-Neutral

Replacing Federal income taxes with a 23% Fair Tax is supposed to mean that almost* all common services being paid for will continue as usual.

I ran our household finances through the Fair Tax Calculator and came up with these results:

2.40% more spendable income
$1,984 more purchasing power
$3,114 less federal taxes

These are fairly modest differences, which makes me feel better, and helps convince me that the idea really is “revenue neutral” and not a scheme to shut down Government services without considering the consequences.

^* Taxes would be much, much simpler, and so the IRS would probably have to lay off some people. CPAs, likewise, would probably need to find other work.

Essential Goods and Services are Not Taxed

Well, sort of. Just like many groceries don’t have sales tax applied now, there are essential staples that none of us can live without that under the Fair Tax plan, you would get reimbursed for. The novel thing is that you’d get a “prebate”: a rebate before it happens. This is different depending on the size of your household, see the full table.

Conclusion

I’m not ready yet to conclude whether this is a better idea. It’s certainly simpler, and on its face it’s very tempting and does indeed seem more fair. I’m going to keep reading all the Pros and Cons I can find (from only reputable news sources, naturally). In the meantime, I’d love to get your opinion.

Start by comparing Fair Tax to Barack Obama’s tax plan and browse the FAQ, where proponents have answered nearly every question I had.

Finally, this isn’t just an idea floating around in the ether. There is a bill proposed in the U.S. House that is up for consideration. If you like the idea, I encourage you to call your congresspeople.

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Basics of the Fair Tax

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by admin in Finance

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Apr

Taxi Or Limousine Business Financing Business Loan Alternative

If you run a taxi or limousine business, financing is of the utmost importance. Your vehicles need to run sometimes 24 hours a day. You need special licenses, non-standard registration, expensive insurance, a steady supply of gasoline, and regular maintenance on your vehicles to keep your taxi or limousine business running smoothly. Banks aren’t likely to provide you with the taxi or limousine business financing you need, but a business loan alternative called a merchant cash advance may be your source of “just-in-time” cash.

A merchant cash advance isn’t a loan; it’s a business loan alternative that makes a lot of sense for businesses that accept Visa or MasterCard and generate at least $2,500 each month in credit or debit card receipts. Rapid Capital Funding will purchase a portion of your future credit card sales. As the transactions come in, a small percentage is diverted to repay the merchant cash advance, and the rest comes back to you. You get the taxi or limousine business financing you need to keep your cars on the road, and easy repayment terms.

Because the merchant cash advance isn’t a loan, no collateral and no personal guarantees are required. You also won’t get a fixed monthly payment. Your repayment schedule is flexible and follows your business cycle. When your transaction volume is high, your loan is repaid more quickly. When your business slows down, so does the rate of repayment. A merchant cash advance is a business loan alternative that makes sense for your taxi or limousine business financing needs in these uncertain economic times.

Contact Rapid Capital Funding today and let us show you how to put your future credit card transactions to work today!

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by admin in Loans

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Apr

Dry Cleaners Business Financing May Just Be A Merchant Cash Advance

Dry cleaners business financing is something of a trick for banks during a recession. Dry cleaners, it turns out, are highly susceptible to changes in consumer spending. A survey conducted in March 2008 of dry cleaner operators showed that three of four operators said that the US was already in recession at that time, months before the official pronouncment of recession was issued. So what do small business owners know that economists don’t?

Dry cleaners deal with working professionals every day, and have good insight into changes in employment, and people’s overall willingness to spend money. Dry cleaning is considered a luxury, so when a recession starts, dry cleaners’ business financing reflects the change right away. Operators are also finding that a better way to get the dry cleaner business financing they need is to get a merchant cash advance from Rapid Capital Funding.

A merchant cash advance puts money in your account up-front. You sell a portion of your future credit card sales to Rapid Capital Funding. In exchange, you get the money you need to improve your small business, pay bills, buy or lease new equipment, or make your small business more cost-effective to operate.

As each new credit card transaction is processed, a small percentage of the sale is returned to Rapid Capital Funding to repay the merchant cash advance. The rest of the sale comes back to you. Three out of four small businesses that take a merchant cash advance take a second one after the first advance has been repaid. That says a lot about how a merchant cash advance can help a small business like a dry cleaner get the cash they need when they need it, without having to wait and without having to provide mountains of documentation.

Contact Rapid Capital Funding today and let us show you how a merchant cash advance can provide the dry cleaners business financing you need to ride out the recession.

Photo Credit: Lotus Head

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by admin in Loans

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Apr

Resume Dos and Don’ts (Plus Resume Makeovers)

This is a guest article by Ginger from Girls Just Wanna Have Funds. Ginger teaches women how to break financial ceilings one stiletto at a time! Join the social network, Girls Just Wanna Have Funds on Ning to connect with other financially savvy women.

This week I’ve been helping out my company’s HR department by reviewing resumes and conducting interviews. The experience levels range from those who are new graduates to people with years of experience. Sadly, I was disappointed with how many people didn’t have the basics down when it came to writing their cover letters and resumes.

Now isn’t the time to slack in this area if you’re looking for a job, you’re competing with literally hundreds to maybe thousands for one position. If you’re looking for work, take a second look at your resume and make sure your resume and cover letter at least falls within the following guidelines:

Do not:

… ask how much the position pays within the cover letter until you’re on the interview and/or sure that you will be offered the position. I personally don’t have a problem with someone asking but I think it rude to ask in an informally written cover letter without a resume, then telling me that you’ll send the resume after I tell you how much the job is paying. Seriously? HR managers and recruiters don’t have time for that, it’s rude and unprofessional. Needless to say I didn’t respond to said applicant.

… use an email user name that isn’t related to your government name. I can’t tell you how many times I saw email addresses like starzaligned@yourdomain.com, bustitbaby@yourdomain.com etc. I moved on to the next person because I’m a firm believer that if you don’t know these basic principles of resume writing then it will be questionable on whether or not you’ll conduct yourself professionally. Your email address should be some combination of your first and/or last name.

… use different fonts throughout your resume. Using different fonts makes your resume hard to read and it shows that you’re not as detail oriented as you need to be. Set the view on your resume to 70% and make sure everything is uniform and in line, especially bullets and indentation.

… extend your resume beyond one page. Unless you have 5-10+ years of relevant experience, you don’t need a 2-3-4-5 page resume, especially if some of your experience has nothing to do with the position. Try to keep the positions listed relevant to the job.

Do:

List your achievements throughout your resume. Time and time again applicants literally copy and paste their job description without any consideration to how their actual work contributed to the organization’s goals. You need to ask yourself: how does this description convey my worth to the organization? Does “putting files away at the end of the day” really convey my value? How about: “Systematically reorganized files to increase organizational productivity and efficiency.” Sounds highfalutin but it works!

Apply for jobs that are best suited for your skills and experience. Skip the long shot positions where your experience can’t possibly match with the requirements. Look at your resume and scan the job post, how can you honestly and ethically marry up what they are looking for and what you have to offer.

Maintain a consistent theme. If you’re a jack of all trades then it’s now time to settle down on one career area. Here’s a comment from a friend who works at Homeland Security: “When you have too many degrees and you’re not working in your field of study then most likely you are a risk to hire. Why? We are looking for people that are career driven and not job driven. Just some insight from looking over countless resumes.” How’s that for sage advice? Pick an area and stick with it or create different resumes for each area. Employers want to know that once hired, you’ll be committed to the job and organization, not planning for your the next jump 3 months in.

Have a friend, preferably someone in a managerial position, review your resume for errors. Sometimes having another set of eyes review your resume helps because they might see things you won’t after looking at it day in day out. Everything starts to look the same after a while.

Make your resume skimmable. Recruiters and HR Managers spend 3-5 seconds tops skimming resumes. If your resume is hard to read or the important information is lost in the layout then you put yourself at a disadvantage. Here’s an example of a resume makeover which resulted in the resume being easier to skim:

Take a second look at your resume and make a few edits if needed or revamp it for a bold and fresh look. Focus on your strengths and make them apparent throughout your resume. Recruiters are bogged down with countless resumes, make sure yours makes the first cut.

If you enjoyed this article, please visit Ginger’s blog Girls Just Wanna Have Funds and subscribe to the blog’s RSS feed. We would appreciate your comments and reactions, so if you would like to contribute to the discussion, add your comment below.

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Resume Dos and Don’ts (Plus Resume Makeovers)

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by admin in Finance

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Apr

The Greatest Loss of This Recession

About the author: This is a guest article by The Weakonomist, an anonymous blogger responsible for everything at Weakonomics.com. As a banking insider he’s witnessed the economic implosion from inside the bubble. You can usually find him at the corner of Wall Street and Main Street throwing rocks at traffic.

My retirement accounts have dropped as hard as any index, I’ve watched friends and loved ones lose jobs (and fear for my own), you can’t go through 30 minutes of news without a sad story about someone losing their home. You can’t trust your government, you can’t trust Wall Street, some can’t even trust their own families with money anymore. We have no money, no way to make more money, and no end in sight to this vicious cycle. All of this is a result of the worst recession since the Great Depression, but none of the above is the worst thing we’ve lost.

As much as I pretend to be an amateur economist, I’m just as much an amateur psychologist. I’m a student of behavioral economics. And our economy has taken its worst blow in the form of self-esteem. More powerful than the loss of trillions in wealth and more devastating than losing your home is the long term effect these events have on your state of mind. It’s important not to get caught in this trap as it can hinder you from getting back on your feet. Let’s look at three examples of how you might get damaged:

The Terrified - Knowing the rules for retirement saving, our friend here diligently saved 15% of his income for retirement. After 10 years of saving he is basically no better off than before because the markets are so down. Distraught, he loses faith in the market’s ability to fund his retirement. He won’t put any more money into stocks and mutual funds because he’s afraid of losing it.

The Failure - This guy has worked hard his entire life. He never made a ton of money but was able to finally buy a house in 2004. He lost his job and then lost his house. Saddled with the guilt of letting his entire family down, he has lost the will to pursue the American Dream.

The Worthless - School never came easy to this guy, but he worked hard and got all the way through college. Having been told all his life that a college degree will help in his career, he graduated only to find there are no jobs to be had. He feels there is something wrong with him. Despite his desire to contribute positively to society, he instead sees a world that doesn’t want him.

These three guys have the same thing in common, they followed the rules, they played the game, and they lost. Due to factors they couldn’t control their self-esteem and faith in the system is tarnished. If you’ve seen the effects of depression first-hand you know exactly how bad this can be.

But all hope is not lost for these folks. They need to get back on their feet and find ways to get over this slump. It will do no good for them to try and convince themselves it’s not their fault and they couldn’t have stopped it, the human mind is too stubborn to accept that. Instead they must trick their own consciousness into feeling good again.

Our Terrified friend must forget about the past. Rule number one of the investment rules he learned was that past performance is no indicator of the future. That goes for the good years and the bad years. Don’t pull out of the market, because if the month of March has taught us anything it’s that the best returns come right after the worst ones.

The Failure has forgotten what the American Dream is all about. Half of the dream of success is failure. You can’t completely win at something until you’ve lost. It’s true some people hit a stroke of luck and it makes it look easier, but if you give up on a dream because of a setback then you aren’t working hard enough for it. The only way not to feel like a failure after a loss is to turn that loss into a lesson and then create success.

Finally, Worthless can look into new methods of adding value to this world. If you’re out of work or hate your job, volunteer. Making your resources available to a cause without an expectation of being compensated is perhaps the greatest value offered to the world. It fills whitespace on a resume, makes you a few friends, and most importantly makes you feel needed.

Just as a recession can be a vicious cycle of layoffs, deflation, and negative market returns, your mental health in this environment can be a downward spiral of pessimism, depression, and fear. However identifying these feelings is the first step towards recovery, just like an economist identifies the weakest points in the world of commerce. Be proactive; help yourself and help others stem these emotions and we’ll all work faster towards recovery.

If you enjoyed this article, please visit Weakonomics and subscribe to the blog’s RSS feed. We would appreciate your comments and reactions, so if you would like to contribute to the discussion, add your comment below.

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The Greatest Loss of This Recession

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by admin in Finance

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Apr

Daniel Rendon Herrera (Done Mario) Arrested

daniel-rendon-herrera

Colombian police found and arrested Columbia’s most wanted drug lord yesterday, ex right-wing paramilitary Daniel Herrera who offered to pay his henchmen $1,000 for each policeman they murdered.

Daniel Rendon Herrera, 43, known as “Don Mario,” was discovered hiding under a tree in the jungle eating rice out of his hands, defence Minster Juan Manuel Santos said.

300 police officers were involved in his capture, it is difficult to believe he has made millions of dollars from drugs and lived a life of luxury, he was living like an animal when the police surrounded and arrested him.

He has been accused of shipping more than 100 tonnes of cocaine from Colombia to the United States of America. He is responsible for more than 3,000 murders.

When he was taken from the plane in Bogota he was not how you would expect one of the most powerful and important drug lords the world has ever seen to appear, he was looking tired, untidy and very humble but certainly not under weight.

He was taken from the plane with his hands tied together in front of him, bundled in to an armoured car and taken to jail.

Informants have played a major part in aiding the authorities to locate Herrera, with a $2,000,000 reward for information leading to his capture it would appear there were no shortage of old friends willing to cash in he is also wanted in the United States although at the moment it is not known if they will ask for his extradition.

The operation to locate Herrera began nine months ago, as he began to feel the net closing in he offered his soldiers $1,000 reward for each policeman they could kill.

Rendon Herrera has followed in the footsteps of Pablo Escobar who started out as a car thief in Medellin and became Columbia’s most notorious drug baron killing anyone who got in his way, his life ended when he was shot by the security forces in a rooftop shootout in 1993.

It is unlikely to disrupt the running of their drug business he has created for very long, someone will merely move up from the ranks as he did when his brother was jailed for running their drugs empire and it will soon be business as usual.

“Don Mario was the most important drug trafficker out there, but someone will take his place very quickly and it will be business as usual,” said security analyst Pablo Casas

by admin in News

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Apr

Helping Your Parents With Their Finances

About the author: Jeff Rose is a Certified Financial Planner™ and co-founder of Alliance Investment Planning Group. He is a veteran of Operation Iraqi Freedom, having served in the National Guard. His blog, Good Financial Cents, covers financial planning and investment related topics.

As a kid, there’s no greater comfort in having your parents there to pick you up when you fall. But what happens when the role reverses, and now you become the care taker of your elderly parents. Most parents will never admit to you that they need help keeping track of their finances. Admitting help is a sign of giving in and succumbing to their elder age and for many seniors is a hard pill to swallow. Down the road it may be a necessity to assist them in their finances, but it’s not too early to start the money discussions today.

Usually it will take some sort of medical emergency before both parent and child realize that they both need to be on the same page with the financial situation. I’ve seen client instances where suddenly deceased parents left their children to sort through the financial mess that’s left behind. It’s the equivalent of setting out on a long hiking trip without compass and map, having no clue where to begin or where you are going. If you think a parent is in need of help, start looking for signs. If they start complaining about misplaced bills, bouncing checks and unpaid electricity bills, it might just be time to step in.

Get the picture

You need to sit down with your parents to find out their whole situation. They should have in place several essential documents, including a will, living will and separate durable power of attorney for health care and financial decision making. If they have setup a trust, you should know where the trust documents are and who has been appointed trustee. If they have a safe or safety deposit box, you need to know where and what’s located in there. I’ve seen instances where clients parents had Cd’s and other investments spread over dozens of different banks and brokerage firms. Getting on the same page will save countless hours of frustration once your parents are gone.

Find out what the monthly income and expenditures are and make sure a usable budget is in place. By knowing what they spend their money on each month, you’ll be able to better assist them going forward.

Make things simple

If your parent has a plethora of plastic in their wallet, it’s time to start cutting the cards up and consolidating. Find the one with the lowest interest rate, and transfer all the cards to them. If they have department store cards, do your best to pay them off if the funds are available.

It might also be time to introduce some technology in their life with online banking. If you’re comfortable with this option, you’ll be able to streamline this so you can set up direct deposits, automatic bill pay and even have outside investment pay their dividends and interest into their checking/or savings accounts. I once had a elderly senior client who didn’t need his social security checks, so he just let them accumulate. Last time I checked he had almost 9 months of accumulated checks still not cashed. I could only imagine if something had happened to him and how hard it would be for his family to sort through his finances.

If your parents are computer savvy, develop a bill paying calendar and remind your parents to write checks. If it’s pass that point, you might have to write the checks yourself.

Find a money manager

Choosing the right person to manage the money might be tough. Handling your own finances is tough enough, by taking on somebody else’s can be overwhelming. Somebody that lives close might be the logical answer, but you also want to make sure that person has a handle on their own finances first. If you are the only child, it maybe your burden to bare, but don’t forget about close family friends or even a friendly close neighbor that might be there for support. There are even money management services that will take on the task of paying the bills on time. Before hiring one, be sure to thoroughly inspect the actually costs and fees of their program.

If a bill payer is required, check out the American Association of Daily Money Managers. Depending on your parents’ situation, you may also need to hire an elder care attorney to help with estate planning and to help assist them. The National Academy of Elder Law Attorneys can point you to qualified experts to help out. I’ve worked with elder care attorney that was able to greatly assist some clients whose father was in assisted living. When all else fails, there are even Certified Financial Planners that will assist in these sort of situations.

Have you had to help an elderly parent with their finances? If so, share your story on what you did to help out.

If you enjoyed this article, please visit Jeff Rose’s blog, Good Financial Cents. You can also subscribe to the blog’s RSS feed. We would appreciate your comments and reactions, so if you would like to contribute to the discussion, add your comment below.

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Helping Your Parents With Their Finances

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by admin in Finance

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Apr

A Home of My Own: Why We Buy

About the author: This is a guest article by Matt Wallaert, a behavioral psychologist and the Lead Scientist at Thrive, a free financial advisory website that helps people organize their finances and plan for the future with personalized feedback from its behavioral advisory engine.

I’m an owner. While I rent an apartment in New York City (the average apartment in Manhattan is worth $1.5 million; I won’t be buying soon), I’ve never leased a car or rented my furnishings because, generally speaking, I simply prefer to own than to buy.

But with the mortgage meltdown and the recent issues surrounding overconsumption, home ownership is becoming an active question, rather than the default standard. Rebecca Tuhus-Dubrow wrote a piece for The Boston Globe recently summarizing the debate and the angle was clear: homeownership needs rethinking, and is probably dramatically less good than we think it is.

I liked the article and a number of interesting academics weighed in to contribute, but the focus was on the social impacts of owning, rather than the personal ones, and I think that misses a key part of the equation. How we feel about owning versus renting, and how it changes our behavior, is worth exploring, particularly as owning wins in some unusual ways.

I should be clear that I’m not trying to argue that owning a home is intrinsically better than renting an apartment. As Tuhus-Dubrow points out, many of the disadvantages of a home rental are due to inadequate legal protections, rather than the actual rental procedure itself. Instead, my concern is with the psychological consequences of owning versus renting in general, whether it is an apartment, or a car, or a computer. I’m going to talk about apartments, just because they make a handy example, but feel free to insert “leased car” if it makes you happy.

Consider the typical renting New Yorker in their mid-20s. Few would argue that looking for an apartment is pleasant, and most would label it down around the 5th or 6th circle of hell. You have to find a place you can afford, that you like, that accommodates your lifestyle, that is in the right location, and is decently hard to do, given the actual raw number of rentals available in any given area.

Assuming you manage to actually find a place you like, you then have to actually get it, which can be harder than it sounds when people are going on and off the market at lightning speed. Renters live in a constant state of indecision: should I put a deposit down on this place now? If I take two minutes to talk myself into believing that it is the perfect place for me, will it be snatched away, leaving me with only the certainty that it was the best of all worlds and now I can never have it? Few people enjoy the process and fewer still come out feeling “happy,” and it is no wonder: a home is supposed to make you feel permanent, not dissatisfied.

And yet renters go through the process again and again, year after year. For many, it isn’t a choice: as Tuhus-Dubrow points out, renters don’t enjoy all that many legal protections and many of them get priced out or forced out of their housing, throwing them back onto the market. But even for those that could stay, many of them don’t because of the torture of knowing that you could have something different. Because you can move, you want to - knowing that other options are out there, it is part of our personal psyche and our national culture to want to explore them.

The problem is that psychologists have shown fairly conclusively that this type of comparison is almost certain to make you unhappy. The more options there are to consider, the more time you spend thinking about them, the more difficult the decision, and the more regret you feel when you actually pick one. And renting means always having options: there is always another apartment you could easily take, another car you could easily drive.

Owning alleviates this problem. While you can still compare your home to others (and many people do move several times over the course of their lives), increasing your attachment an object makes it harder to let go of and increases its value in your mind. Psychologists call it the endowment effect and it breaks down simply: there is value to feeling like something is “yours.” And while we can certainly think of our apartments as part of our domain in a psychological way, there are plenty of reminders in daily life that we don’t own them and never will.

And it isn’t just mental. The psychological value of owning translates to real value in your interactions, as almost anyone that has ever rented something intrinsically knows. You scratch the floor and don’t feel particularly bad or try to get it fixed (unless motivated by worry about your damage deposit). You beat the hell out of a computer until the lease runs out and you get a new one. No one puts premium gas in a rental car.

A home is a decision you don’t have to make again, or at least not for awhile. And there is value, sometimes, in less: less comparison, fewer decisions, less movement. Even as renting and leasing allow us to maintain our flexibility, they demand that we give up any number of psychological benefits. Sometimes it is a good trade, but more often than not, our instinct towards ownership is probably a decent one. Especially when it lets us save our time and energy for the decisions that matter; less “where will I live tomorrow?” and more “what will I do today?”.

If you enjoyed this article, please visit Thrive and Thrive’s blog, Good to Grow. You can also subscribe to the blog’s RSS feed. We would appreciate your comments and reactions, so if you would like to contribute to the discussion, add your comment below.

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A Home of My Own: Why We Buy

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