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How to Align Your Paycheck

Here’s a fact – paychecks can be confusing, and often depressing.  Why? Because when you work for someone else, the government slices off a huge chunk of your total pay — as much as 40% — or more.   

We pay federal, state, social security, Medicare, and county taxes, and sometimes even commuter taxes.  And then medical insurance and retirement savings take a final bite out of what eventually becomes our net pay – or take home pay. 

In the last few posts I highlighted the benefits of using credit cards, planning your financial life quarterly instead of monthly, and gaining a better understanding of your spending habits. 

Now I’ll show you how to bring home as much of your hard-earned pay as possible, and how to see if your expenses (in relation to your take-home pay) are reasonable, and how to think about your 401k differently.   

Simple Advice on Taxes

The biggest tax everyone pays – regardless of who’s in the White House – is federal income tax.  And back when I was in debt, and financially inept, I looked forward to my federal tax return each Spring.  I would usually receive a few thousand dollars and it would bail me out of my latest financial quandary.

But in reality, I was letting the government take more of my money than they required.  Even worse I was letting them hold it for months without paying interest.  The government wouldn’t loan me money interest free, nor would a bank.  So why should I?

This is why a business hires accountants and bookkeepers.  They want to minimize the amount of money they pay each year in taxes.  Their goal is not to have a big tax return, their goal is to actually owe a little bit of tax.      

Why? Because those extra dollars over the course of a year — in my case thousands of dollars — could have been invested, saved or used to pay off interest bearing debt.  Getting a large tax return is a sign that you didn’t maximize your cashflow, it’s a sign you don’t have self-mastery over your own finances.  And it’s something easy to fix.   

The W-4

So, where do we start?  Well, start by adjusting the exemptions on a W-4.  This is an official IRS form telling your employer how much tax to withhold from your paycheck.  These exemptions are based on your marital status, number of dependents, and other factors.  Your human resource department can easily provide this document, or you can download one from the IRS website.

The question on your mind may be how many exemptions should I take?  The answer is, it depends. Everyone’s situation is different, but you don’t have to guess.  Check out this easy withholding calculator from the IRS, all you need is a recent paystub:

Here is one of my actual pay stubs from 2019. 

I’m claiming 4 federal exemptions, and 2 state exemptions.  And I’ll admit, this is aggressive.  It’s more than the IRS website indicates I should take.  But my situation is unique because I have deductions outside of work further reducing my taxable income.  My number of exemptions allows me to maximize my take home pay without exposing myself to a huge tax bill each Spring.  If you have any doubt about how many exemptions you should take, invest a few dollars and seek professional advice from an accountant. 

Paycheck Alignment

One day while looking over my latest paycheck, I wanted to measure the impact of each deduction and expense in relation to my income – and once again – I couldn’t find a resource like this anywhere.  So, I created another spreadsheet, I call it my Paycheck Alignment Tool.

Here I go again, more spreadsheets!  Hang in there with me.  The point of this chart is to see what percentage of my income was going to various categories; savings, taxes, insurance and all expenses.  My goal was to maximize savings, especially pre-tax savings like my 401k, and to make sure I wasn’t spending too much of my income in any particular area. 

The far-left hand column lists the standard deductions anyone who works for someone else sees on their paycheck.  The rest are my personal expense categories pulled from the Quarterly Cashflow Planner. 

The deductions in green are my pre-tax savings and are the most important.  The best use of this tool is to see how big of a benefit pre-tax savings are on my entire financial universe. 

The column in the middle, Monthly Gross Pay, is where I combine both my paychecks into one, and the spreadsheet automatically deducts the expenses from the left column while indicating their percentage impact in the column on the right.

What drove me into debt was when my fixed expenses like rent, utilities, food and transportation exceeded 50% of my take home pay.  There is a lot of bad information (from biased sources) about how much of your income should go to the major expense categories. 

Ask a mortgage company or real estate salesperson or bank and they’ll say 28-36% of your GROSS income is a comfortable range. 

But in reality, none of your budgeting should be based on GROSS pay, only take home pay.  And the wisest advice on rent or mortgage (as a percentage of your income) I learned from Dave Ramsey, the famous personal finance author and radio host – he advises your mortgage or rent – including taxes and insurance – shouldn’t exceed 25% of your take-home pay. 

As I write this in November of 2019, my gross income per month is $9,690.  I contribute 20% to my 401k and 2% to my Health Savings Account (HSA) which also gets the pre-tax benefit.  This reduces my taxable income by $2,135 – so in addition to saving over two thousand dollars per month I lower my taxable income by the same amount.  Further down the chart you see after all the deductions my take home pay is $5,290 per month.  And of my take home pay, 26% of it goes towards my rent payment.

The Greatest Tax Loophole for Employees

The greatest advantage of plotting your income and expenses on this spreadsheet is to realize the power of pre-tax savings.  The most beneficial way for an employee to reduce their taxes is by contributing as much of their paycheck to whatever tax advantaged savings plan their employer offers – most commonly a 401k savings plan. 

This is the single most important piece of financial advice for anyone who works for someone else.  The biggest obstacle to wealth isn’t just self-mastery over our personal finances, the biggest challenge to becoming wealthy are taxes. 

Business owners have a huge advantage over their employees.  They get to pay for many of their expenses before they get taxed, thereby reducing their taxable income.  Employees have to use after-tax money – you know – the 50 or 60% we take home after the government takes their share.

When a business owner earns $100k she doesn’t have to pay taxes on the full $100k.  She gets to pay her business expenses before establishing her taxable income.  And many of those expenses cross over into her personal financial life – like her transportation, some food and travel expenses, and insurance.    

After she’s paid those expenses – let’s say they added up to $25k – then she declares her income of $75k and THEN she pays her taxes in April.  Let’s say taxes and insurance equal 40% so she’ll take home 60% of the $75k – or $45k – and pay $30k in taxes.

Employees do the opposite.  If they earn $100k (assuming again taxes and insurance equal 40%) their taxable income is the full $100k.  Meaning they’ll pay $10k more in taxes than the business owner who earned the same income, and if expenses are the same in the earlier example, the employee will take home $10k less in income.   

  This is why the 401k is the most powerful tax benefit for employees. 

 Why?  Because the government allows you to automatically deduct up to $19,000 (in 2019) — prior to being taxed — to be invested in a retirement savings program (like a 401k).  

But most people under-save and fail to take advantage of this tax break because it reduces their take home pay.  

But over the course of a year, the reduction in take home pay is very minimal.   While the upside to the tax benefits is exponential.  Here are two scenarios I hope illustrate this point:

Option 1: Don’t Contribute

Let’s say you earn $100k per year and for simplicity we assume again taxes and insurance eat up 40%. 

So, under this scenario you take home $60k, and pay $40k to the government — and save nothing.  And after taxes you bring home (or net) $5k per month ($60k/12 months = $5k)

Option 2: Contribute just 10%

Now, let’s say you contributed just 10% ($10k) of your gross income ($100k) to your 401k pre-tax savings. This reduces your taxable income by $10,000 — from $100,000 to $90k, and with taxes and insurance at 40% — instead of paying $40k in taxes — you instead pay $36k in taxes ($4k less). 

You might assume your take-home pay will drop by $10k — but it doesn’t — your take home pay only drops by $6k, from $60k annually to $54k annually, because you paid less income tax.  

Your take home pay does go down from $5k per month to $4,500 per month ($54k/12 = $4,500).  Granted, that’s $500 out of your pocket each month.  But the government isn’t getting the difference!  You are!  Whenever you can save $10k by only investing $6k of your take-home pay — you should do it.  

Let’s review the benefits of setting aside just 10% of your pay in this scenario:  

  • Paid $4k less in taxes
  • Saved $10k by reducing your take home pay by only $6k
  • A gross benefit of $14k by contributing 10% to your 401k

The other significant benefit of the 401k is the automatic deduction from your paycheck, meaning you don’t have to touch it, and you can’t touch it, or you will face significant tax penalties.  Don’t underestimate the power of automatic deductions.  We’ve all heard the axioms about paying ourselves first, but in reality, the 401k is the only tool that enforces this philosophy with teeth.  If left up to our own devices, we often don’t save as much of our take home pay as we should.  Life is just too tempting. 

If you raid your 401k before you’re 59.5 years old the IRS will tax you at your regular tax rate plus an additional 10% as a penalty.  The net result is almost half of your hard-earned savings will go back to the government.  I should know because I made this mistake in my twenties.  The money I withdrew would have grown into six figures by the time I am writing this in 2019.  It was a stupid, stupid thing to do. 

In my next post I’m going to touch on one of the biggest barriers to accumulating wealth, something that catapults millions of people into financial slavery, an industry supported by more disinformation and marketing than any other but the automobile industry, and that is the mortgage industry.    

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How to See into Your Financial Future

            Positive cashflow, in business terms, is the net amount of money being transferred in and out of a business. A company’s ability to create value for shareholders is determined by its ability to generate positive cash flows, meaning after they pay all of their bills each month, they have money left over to save or reinvest.  Your ability to build wealth is determined by the same principle.

            When I found myself deeply in debt, I felt limited by traditional budgeting practices. Monthly budgeting didn’t give me the vision I needed to manage my irregular income and future expenses.  I wasn’t able to grasp the bigger picture of how money was flowing in and out of my life. 

            Cash was vacating my account from a variety of sources; debit card spending, checks, electronic banking transactions, and ATM withdrawals.  There were larger infrequent expenses like car insurance, car maintenance, and taxes.  Also adding to the chaos were my credit card purchases.    

            After a few years of tracking my finances in notebooks, I kept yearning for a way to visualize my cashflow further into the future.  If  a business has software, and support from bookkeepers and accountants to optimize their cashflow, why don’t individuals – like me – have similar resources? 

            Sadly, I couldn’t find anything in the personal financial universe beyond variations of the traditional monthly budget.  Not even the most popular personal finance website in the world ( – with over 20 million users – had an answer.  Their budgeting focused on individual months (see example below).

            Then one day it hit me, and the inspiration came from something simple.  Have you ever used one of those calendars, the ones that allow you to see three or more months at a time?  Like this one:

            This multi-month calendar inspired me to develop my own way of projecting income and expenses into the future, a simple spreadsheet I call my quarterly cashflow planner.   

            It allows me to capture and visualize my entire financial universe beyond a single month. It captures every paycheck and source of income, breaks expenses into categories, identifies what will be paid for in cash or credit, and tracks how my balance fluctuates based on my income and expenses.  In essence, it’s a live look of my finances. 

            Let me guess, you are intimidated by spread sheets.  Don’t be.  And don’t get caught up into thinking you have to use a spreadsheet at all.  I’m terrible at excel, yet I came up with this crude but effective tool for my own use.  The point here is to introduce the concept of quarterly budgeting into your own life and find a system that works for you.    

            If you’d like a copy of my spreadsheet, I’ll send you one for a small fee just email me:

            With the power of foresight in my arsenal I embarked on vastly simplifying my life.  I began using credit cards to pay for as many expenses as possible.  Turns out I was able to pay for everything but my mortgage and a few utilities.  All of my food, shopping, auto, insurance and entertainment expenses could be bought on credit. 

            Below is a typical month where my credit spending is projected in white, and whatever I have to pay in cash is projected in yellow.  The total amount I anticipate spending on credit is tallied below in the red cell.

            The far-right column – the most important feature of this tool – tracks my checking account balance relative to my earnings and spending.

How to Utilize Credit and Avoid Debt

            Notice how the credit projections in white have no impact on my checking balance while the cash transactions in yellow do.  Whatever I spend on credit gets paid the following month under the credit card category in cash (via an online banking transaction). 

            This is a key point, while monthly credit spending doesn’t immediately impact my cash balance, it is accounted for – and on my radar – the following month.  This is how I remind myself of the pain of overspending on credit.  Because if I spend too much, I immediately see how it negatively impacts my cash balance in future months.  The point of all of this is to avoid fees and interest and maximize my savings potential, so paying off my entire credit balance each month is the top priority.  

            I began using just two credit cards, one with a due date on the first of every month, the other on the fifteenth (or middle) of every month.  Since credit cards now captured most of my spending, and because they were due around my pay days, cash only left my checking account twice per month.  This simplified my life and allowed me (in essence) to pay all of my vendors around the time I got paid.      

            For most people, including me, the mortgage (or rent) is typically the largest expense.  And it’s usually paid for in cash because most banks (and landlords) don’t accept credit cards for payment – if they do there are usually fees involved – and I never pay fees.           

            Also, mortgage (and rent) payments are usually due on (or around) the first of the month, so for almost all other expenses I use the credit card with the due date on the fifteenth.  This ensures my cash balance at the beginning of the month is enough to pay the mortgage (my largest expense).  This is a perfect example of controlling and optimizing my cashflow. 

Tracking What You Spend

            I only use 10 categories to track all of my spending.  This is a personal preference; I’ve been doing it so long I know where everything fits.  You may want to track more categories, do whatever is comfortable, the most important thing is to see where you spend your take-home pay.  For example, maybe you want to track how often you eat at restaurants or go to Starbucks.  I just like the simplicity of lumping all dining, grocery shopping and beverages into the Food category. 

            It’s essential to learn how much of your income is going towards the major categories like transportation, food, housing and entertainment.  This allows for accurate projecting, and even more important, you’ll begin to understand where your spending may be out of whack. 

            When I dug deeper into my own spending, I immediately noticed how much I wasted on gambling, drinking, and golf (entertainment category).  This single category swallowed over  40% of my take home pay each month.  I go much deeper on how to track your financial transactions in this post:

            The best part about a cashflow planner is it allows me to spend less time figuring out my finances.  I update it when I get paid (which triggers me to pay bills) or if there’s a big unexpected expense.  That’s it.

Positive Cashflow vs. Negative Cashflow

            The most valuable benefit to a cashflow planner is the column on the far-right, where I can see how my income influences my cash balance relative to when bills are due.  Notice how my checking balance dips dangerously low in the first half of November.  But I  can see this happening almost 3 months in advance, giving me plenty of time to solve the issue. 

            Given this much notice, there are plenty of solutions available to me.  I can transfer money from my savings into my checking, spend less in other categories, reduce my savings, or if circumstances are really dire; I could borrow money (interest free from a family member!) to bridge the gap.  And in each case, I can immediately see how it impacts my cashflow in the future.  This is the vision and insight everyone should have to maximize their personal financial lives.

            The ultimate goals are to avoid interest, penalties, and fees of any kind.  Since I began quarterly planning, I haven’t incurred any of the like.  Prior to tracking my financial life with my planner – I paid thousands. 

            Another benefit – let’s say I encounter a large unexpected expense – like a car repair .  No sweat,  I simply add it to my auto category and adjust accordingly.  Since I used credit to pay – depending on when the transaction occurred in my billing cycle – I may not have to pay for another two months.  In this post find out how to use credit card for almost two months without incurring any interest or fees:

            The beauty of quarterly cashflow budgeting is it allows me to see into the future, to see when I might enter into negative territory, it allows me to adjust and maneuver to avoid fees and interest.  On the flip side, if I notice a consistent surplus of cash in my checking account, I can allocate more cash to savings or other investments.    

Cash Discounts

            Savvy business owners never turn down an opportunity to reduce costs (or reap rewards) by paying bills early, or, by paying up-front or via lump sum.  Why?  Because it’s free money. It’s known as a cash discount, or sales discount.       

            Credit cards combined with quarterly cashflow management empowered me to maximize cash discounts for my own personal benefit.  For example, my auto insurance; Geico and most insurers incentivize customers to pay their policies up-front (or biannually) by offering discounts on their rates.  In the example below I was given 5 options to pay my car insurance.  Paid in full up-front costs me $517.  If paid over two installments the total rises to $527, if paid in five  installments it rises to $542.  Not a huge difference, but it’s still free money in the bank just for being able to optimize my cashflow.       

            Why does Geico charge less if I pay up-front?  Because the earlier they get my money, the earlier they can invest and earn interest and pay their own bills. It’s a win-win. 

            I used to work for an ad agency who managed large volumes of printing for clients.  Our print vendors were saddled with fixed expenses like paper, ink, labor, and maintenance on their gigantic presses.  Most printers would offer discounts of 3-5% on their invoices if we paid within a few days of receipt.  A few percent may not seem like a lot, but it adds up, especially when the invoices were for hundreds of thousands of dollars.  

            And it can add up for you as well.  In personal finance, cash discounts are:

  • The annual savings from never paying ATM or bank fees
  • Earning interest on your checking and savings accounts
  • The annual savings from not paying any interest on debt
  • Earnings and rewards from credit cards
  • Discounts earned by paying expenses up-front, like the insurance example I shared earlier. 

            In 2019 I earned over $5,000 from these forms of cash discounts.  Most of it through credit card rewards.   

            I was never able to optimize my cashflow until I combined the benefits of credit cards with my quarterly cashflow management tool. 

            It helped me climb out of over $250,000 in debt, maximize my retirement savings, avoid thousands of dollars in interest and fees, capture thousands of dollars in cash discounts, and massively simplify my life. 

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How to Be An Effective Seller #5: Invest in Training and Education

Learn to work harder on yourself than on your job

Tony Robbins

All you have to do to earn more money in the same amount of time is to become more valuable

Jim Rohn

What separates amateurs from professionals, losers from winners, average from exceptional, is training.  And coaching. 

Consider the impact coach Bill Belichick has had on the New England Patriots. Before his arrival, no Super Bowl wins.  Since his arrival, six Super Bowl wins.   

As I transitioned from radio into TV advertising sales, I realized there was a great opportunity to make money ahead of me.

I was being paid 100% commission to sell a monopolistic product, and our clients spent an average of $50,000 per year – more than double what my average radio advertisers were spending. 

Before this my only training was from my newspaper advertising days.  Occasionally management would bring in consultants to go out on sales calls and teach us the basics of selling.    

Most of what I learned came from trial and error, and helpful mentors, and by emulating other successful salespeople.

But I knew this wasn’t enough, I knew that to separate myself from the pack and maximize my earnings I needed professional guidance.   

I decided to step up my selling game and invest in training with my own money. 

It’s different investing your own money in adult education, much different than paying for college or grad school.  There are no loans, it’s 100% cash, and it means you actually pay attention, attend class, study, and learn. 

There were two sales training programs I focused on – I’m sure there are others – but I would still recommend these two.

Dale Carnegie Training:  Foundational Sales Training

Dale Carnegie was a public speaker, lecturer and aspiring actor.  While broke and living in New York in the early 1900’s he began teaching public speaking to adults at the local YMCA.   

His courses became a hit across the country, and he went on to write several books.  Published in 1936, How to Win Friends and Influence People sold millions of copies and continues to sell today.  It was broken down into 4 parts:

  1. Fundamental Techniques in Handling People
  2. Six Ways to Make People Like You
  3. How to Win People to Your Way of Thinking
  4. Be a Leader – How to Change People Without Giving Offense or Arousing Resentment

Dale Carnegie training is more entry level, more foundational.  In a nutshell, it’s a reminder you can catch more bees with honey than vinegar.

Warren Buffett famously credits his Dale Carnegie training with helping him overcome his fear of public speaking.

Everyone can benefit from going through their programs.  Crew Car Wash, an Indianapolis based car wash chain used to send all front-line employees through Dale Carnegie training.  I think it’s one of the main reasons for their success.

To this day, you encounter clerks who greet you with a smile, are dressed neatly, are unfailingly polite, consistent in their scripts, always asking for an up sell, and thanking you for your visit. 

Their car wash is impeccably clean – devoid of litter and oil spots – landscaped beautifully, and features stuffed animals dangling around to surprise and delight youngsters.

Dale Carnegie teaches the fundamentals of salesmanship.  They teach you how to present yourself and communicate in the business world, and this basic etiquette is as important to selling as blocking and tackling is to football. 

Sandler Sales Training:  Graduate Level Sales Training

Dale Carnegie taught me the fundamentals, but Sandler Sales Training was my graduate degree in sales.

The biggest distinction between Sandler training and, well, pretty much all other sales training is – they teach you to not act like every other salesperson. How do they do this? 

Sandler fosters your killer instinct.  Most salespeople want to be liked by their prospects.  Psychologically they’re more concerned about seeking approval than closing the sale.  And this is why they’ll give up on a sale rather than lean in and fight.  

They teach that prospects are not your friends.  Rather, prospects steal your time and information, and they lie, and they are constantly manipulating you.  And you should manipulate right back or you’ll never win.

Selling is one of the few professions where manipulation is expected from both the seller and the prospect. 

There are few professions where manipulation is considered an acceptable practice.  All sports for example, employ manipulation tactics to gain an edge on their opponents. 

In football they manipulate through deceptive play calling, strategy and signals.   Can you imagine a quarterback telling the other team what play he’s calling in a football game?  

Lawyers manipulate through rigorous cross examination, finding loopholes in the law, and by presenting your version of the story.  Do you really want your lawyer telling a jury your whole truth?

Chances are, most of the time when you buy something, you’ve been manipulated in some indirect way. 

When you buy groceries, you’re manipulated into believing the store you chose (and the products you purchased) may be cheaper, healthier or more delicious than at competing grocers.  They manipulate through store aesthetics, visual merchandising, advertisements, and by training their employees to up-sell. 

In a corporate setting manipulation is done through leverage – like a family relationship, or a referral, or some inside knowledge that gives you the upper hand.

This manipulation isn’t illegal, or unethical, it’s part of the game in the exchange of goods and services in our economy. 

David Sandler’s hallmark tactic is the up-front contract.  Before you spend time presenting any solutions, you come to a series of mutual agreements with prospects about the decision-making process.

How much pain does the prospect have?  And is she really motivated enough financially to solve that pain?  Are you even a good fit from a budget and solution standpoint?  And are you 100% clear on what the decision-making process looks like?   

No presentation is made until those issues are understood, so you can be assured a decision will be made, wasting much less time.  This leads to more no’s, but you end up finding more yes’s by quickly moving on from the unqualified prospects.

Most salespeople present to everyone, and often too early, then have to wait and hope for an answer that may never come.  Leaving them dangling in the wind like a bed sheet on a clothesline. 

Sandler is also different from other programs because they understand nobody learns much in a seminar.  People get charged up and motivated in seminars, but the effect usually wears off.

Sandler training meets weekly, and you become a lifetime member meaning you can attend training classes anytime and anywhere.  It’s a similar model to joining a gym with locations across the country, like Lifetime Fitness.

It was the most transformational training I’ve ever been exposed to and it cost me over $10,000.  And I didn’t have the money, in fact, I was deeply in debt.  I put it on my credit card, and they billed me in installments.  But it was 100% worth it. 

You Should Read and/or Listen

Another transformational habit I developed was instead of watching or looking at any kind of news in the morning, I now read a book.  I don’t read much more than one or two chapters per morning with my coffee.  But I learn so much, and it starts my day off on a much more positive and productive note.

I read mostly self-help books on sales, marketing, investing, business, history, and more.  And I have learned so much by just reallocating a few minutes of my morning to ingesting positive content.

When  driving I prefer to listen to music or sports talk, I just want to zone out.  But as often as possible I force myself to listen to some type of inspirational audio programs.  Podcasts, audio books, training materials.  Just something positive and uplifting about goal setting or sales. 

Here is a list of 10 books that influenced how I sell:

Discover Dan Kennedy, and start with these four books

  • Magnetic Marketing
  • No B.S. Sales Success in the New Economy
  • The Ultimate Sales Letter
  • No B.S. Direct Marketing

Tony Robbins, I like to listen to Tony while I’m driving and this is the one I revisit the most:

  • Awaken the Giant Within

Zig Zigler is classic, very inspirational and folksy:

  • Goals: How to Set Then, How to Achieve Them
  • Secrets of Closing the Sale

Sandler Sales Training has published some great books, this is my favorite:

  • Prospect the Sandler Way by John Rosso

Dale Carnegie

  • How to Win Friends and Influence People

Vash Young was an insurance salesman who inspired Dale Carnegie

  • The Go-Giver

The great thing about reading books is you’ll find out about other books that inspired the author. With every book I read I probably buy at least one more book based on those recommendations.

The price of the information in books pales in comparison to their value.  You can buy life changing information for $20 or less in a paperback book on Amazon, and have it delivered the very next day.

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How to be an Effective Seller #4: Qualifying

Time is money, and you’ll never understand how true this is until you make your living from selling.

Identifying and qualifying your best prospects is one of the most important factors in becoming a successful salesperson.


Because it determines where you spend your precious time.

Every product or service has characteristics that determine who your most qualified prospects will be.   

Early in my career I sold newspaper advertising, waaaaay back when most people read a newspaper every day.  This was before the internet changed the game.   

In addition to being popular, newspapers offered a variety of advertising options affordable for any sized business. 

There were inexpensive classified ads, or big display ads running in the news or sports sections. Ads could run in sections targeted to particular areas of the city, and there were printed inserts that could be targeted by zip code.    

Newspaper Characteristics:

  1.  Mass audience  
  2.  Broad or targeted geographic reach
  3. Affordable advertising options for every type of business
  4. Affordable or free production (production means creation) of ads

These characteristics determined it was efficient for me to call on just about any retail business. 

If a business wanted the general public to buy their goods or services, then it was justifiable for me to call on them.

I would go to any commercial building or strip mall and call on every business.  And it worked great, I won awards and routinely led the sales department in opening new accounts.     

Greener Pastures

In the newspaper business, the pay was OK, but regardless of how many millions of dollars of advertising I sold, my earnings were capped.

This drove me nuts, proper incentives are the heartbeat of any successful selling organization, and if you cap good salespeople they will leave for greener pastures.

I was ready to test my selling skills in a higher stakes game, one that paid me only when I sold, and placed no limits on what I could earn.    

This for me was radio advertising.  It paid 100% commission.

And even though I had great experience from my newspaper days, I was a rookie in the radio business, and I had to start from scratch.  This meant no salary, no existing accounts, and very little guidance. 

In order to eat, I had to sell.  

My first year was extremely tough, I took a $40,000 pay cut and almost had to declare personal bankruptcy. 

But I still loved it, because I was learning about radio and helping business owners with their marketing.  And now I was in show business!  Well, kind of.    

Newspaper Prospects are not Radio Prospects 

Newspapers (most of them) are about journalism, ethics and news. 

Radio stations (most of them) are about entertainment.  The ones I worked for had shock jocks, Rock n’ Roll, and sports. 

But enjoying my work and getting paid were two very different things.  I quickly discovered it wasn’t efficient for me to call on every business like I did at the newspaper. 

My radio stations had their own set of characteristics that determined who was a qualified prospect.

Radio Characteristics:

  1. The 3 stations I represented appealed to men ages 25-54
  2. To be on the radio, you have to produce a radio commercial, and it’s a barrier because it costs money and takes time
  3. Listeners are very loyal to their stations, programs and favorite DJ 
  4. Radio can be affordable because it’s a targeted media

I discovered the best way to find qualified prospects was to listen to other radio stations.  This may seem obvious, but you would be surprised how many salespeople in this business spin their wheels elsewhere. 

Existing radio advertisers are already sold on radio, and they already have commercials produced.

Another qualified target were business owners who were fans of our stations, because they love to hear their own ads and support their favorite programs.  

Radio Advertisers are not TV Advertisers

After selling radio for a few years I noticed how much money was being spent on TV advertising.  TV stations also paid their salespeople on straight commission, and the earnings potential was much greater.

In Indianapolis where I worked, the 4 major broadcast stations (ABC/CBS/FOX/NBC) took in more advertising revenue than all of the radio stations combined.  Fewer salespeople, more money, straight commission, you do the math!

Based on my selling success in newspaper and radio I landed a job with the local CBS station.  And I quickly realized my former radio clients were not good prospects for television advertising. 

Why?  Primarily due to cost.    

It costs more time and money to create a television commercial than it does a radio commercial. Also broadcast TV airtime is more expensive for a variety of reasons.   

And most business owners, especially those who advertise on the radio, have an underlying assumption that the cost of TV is prohibitive.  Blame the Super Bowl and the hype surrounding how much those commercials sell for.

I had to qualify a new set of potential prospects for television advertising. 

Local Broadcast Television Characteristics:

  1. Like big newspapers, broadcast networks like CBS reach a large audience over a wide geographic area
  2. TV costs more than newspapers because there is the no way to geographically target ads 
  3. The cost of producing a commercial on TV is more expensive than radio because you are dealing with video in addition to audio
  4. The cost of broadcast TV airtime is generally more expensive than individual radio stations because the audience is larger

Like radio, it was more efficient to target other TV advertisers because they already had commercials produced.  

Also, broadcast TV was often purchased on behalf of clients by advertising agencies, so advertising agencies would become targets as well. 

I determined I would only call on businesses who could serve a large geographic area like auto dealers, HVAC companies, grocery stores, and department stores.

Also, I determined it would take $10,000 per month minimum to run an effective schedule on our station.  Doing the math, that equates to $120k per year.  A business would need to gross $5M or more per year to afford an advertising spend of that size. 

Why?  We knew that most retail businesses spend between 3 – 5% of their gross sales on advertising.  In a $5M business, that equates to about $150,000 allocated to advertising.    

You might ask, how did you determine sales volume and find these types of businesses? 

Reference USA

There are many tools out there to find your prospects and gather intelligence.  LinkedIn, Zoom Info, Google, company websites, trade journals, and more.  I won’t go into all of them here because it’s already been done.

But there is one source of information I find many salespeople have never heard of, and that’s too bad because it might be a better resource than anything else. 

Reference USA is operated by Infogroup, the leading source of business and residential data in the United States. 

And Infogroup sells access to their vast database to Libraries, who use it as a tool to recruit members.  And if you are a member of a library and have a library card, this amazing resource is available to you for free. 

You can find information on:

  • 24 million U.S. businesses
  • 1.5 million Canadian businesses
  • 675,000 doctors and 180,000 dentists
  • 50,000 new U.S. businesses (added weekly)
  • 89 million residents (U.S. Standard White Pages)
  • 12 million households (Canadian White Pages)
  • 235 million consumers
  • 300,000 U.S. new movers and 100,000 new homeowners (added weekly)

Business Information Includes:

  • Company name 
  • Phone number 
  • Complete address 
  • Key executive name 
  • SIC Codes 
  • Employee size 
  • Sales volume 
  • Business expenditures 
  • Geo-codes for mapping 
  • Fax and toll-free numbers 
  • Website addresses 
  • Franchise and brand information 
  • Headline news
  • Email addresses 
  • Business credit rating scores 

Residential Information Includes:

  • Median household income
  • Median home value
  • Latitude/longitude
  • Percentage of owner-occupied housing

No matter what you sell, it’s worth taking the time to identify the characteristics of your product or service that will lead you to complete a profile of your ideal customers. 

The profile will usually be a combination of the following:

  • Type of industry or business sector using your product or service
  • Gross Sales volume
  • # of employees
  • Geographic
  • Who’s making the economic decision to buy your product or service.  Is the CEO? Or is it a VP or director?  Or do they hire professional buyers like advertising agencies or consultants?  It could be multiple people. 

Without this you are flying blind, and wasting time, and therefore wasting your own money.   

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How to Be an Effective Seller #3: Play Dumb

Don’t Act Like a Salesperson

Have you ever been in charge of buying anything for a company? 

Ever been in a situation where salespeople call you every day?  I have.  And I can assure you, very quickly, you build up a shield of armor. 

I can also say, from personal experience, the salespeople who break through this armor are those who persist, and are thoughtful, and show vulnerability.

If clients don’t view you as threatening, they’ll feel more comfortable and be inclined to meet with you.

When a client is comfortable, guess what, they are more willing to share their problems, problems you can hopefully solve. 

Vulnerability Builds Credibility

You have a huge advantage early in your sales career by not being an expert, or having any product knowledge, something you may think is a disadvantage. 

But it’s not.  

It’s why I place this rule of “being dumb” so early on my list of effective selling tips.

Before you become an expert in what you sell, before you learn the industry jargon, and technical specifications, and the features and benefits, you’ll do something much more important with your clients:  You’ll listen.   

Even more important, you’ll disarm them by not acting like you know everything.  This vulnerability triggers a natural instinct in people, and they will try to help you. 

Avoid Confusing Language  

In just about every industry or profession there are terms and language unknown to the outside world.    

I worked in the media industry most of my life.  Have you ever heard of a CPM (cost per thousand), or CPP (cost per point), or HUT (households using television), or AQH (average quarter hour)? 

Probably not, yet salespeople in my industry commonly use these terms to sound smart in front of clients.

And clients may nod their heads acting like they understand, but they don’t, they just don’t want to look stupid. 

The use of industry jargon and technical words creates discomfort and confusion. 

And the net result of confusing anyone in the selling process is no sale.  

Learning and Listening

I will never forget a story from my sales training many years ago.

A department store hires a young salesclerk and assigns him to the section of the store selling portable heaters and other hardware. 

It happened to be a frigid winter and there were a lot of customers trying to keep their homes warm. 

This kid was far from an expert in portable heaters.  So, instead he listened intently to his customers, seeking to learn from them. 

He worked patiently with each person to figure out the best heating option for their home.

Eventually, they would figure out the right solution together and the customer would make a purchase, no closing necessary. 

As a result of his disarming nature, patience, and willingness to listen, his sales skyrocketed.

His numbers were so good the store manager enrolled him into their management trainee program.  There he learned all of the latest sales techniques and product knowledge.   

And next winter, another cold snap, and our new management trainee was ready to sell.  No one had more technical know-how on portable heaters than this kid.

But a funny thing happened, instead of listening to his customers, he spent more time trying use the techniques and share the knowledge he learned in training.

Instead of making customers feel more comfortable, their guard went up, because now it felt like they were being sold to.

His sales cratered, even in a record cold winter.  Because nobody  likes to be sold to – people only like to buy. 

Be Like Detective Columbo

You might remember a popular television series starring Peter Falk as Detective Columbo, a homicide detective with the Los Angeles Police Department. 

If you haven’t watched it, and are serious about a career in sales, I strongly encourage you to check it out. 

Detective Columbo had a unique approach to solving crimes. He wanted suspects to believe they were smarter than him. And instead of treating them with disrespect, he established rapport with them. 

He was chatty, often sprinkling in details about his personal life.  He was unfailingly polite and would address everyone as “sir”, “ma’am”, or “miss” .

He wasn’t socially polished, and his demeanor was unassuming. He presented himself as a simple man easily impressed by the West Coast movers, shakers and celebrities who were his suspects. 

He wore a wrinkled beige raincoat over his rumpled suit and tie.  Instead of a police issue sedan, he drove a beat-up convertible. 

He didn’t even carry a gun. 

His suspects were dismissive of Detective Columbo after their first meeting, because he didn’t look or act like someone capable of catching them – they saw him as inept.

Suspects became comfortable around him, and his relentless curiosity allowed him to tease out incriminating evidence.

Often, they were so exasperated by the end of his investigation they would end up confessing. 

You should act like Detective Columbo when selling.

You don’t have to wear messy clothes or drive a beat-up car.  But you should recognize the psychological advantage of disarming your clients by not acting like the typical salesperson. 

You should swallow your ego and allow the client to be the big shot in your conversation. 

This is how you truly uncover pain and learn what solutions are needed to close a sale.

Nobody was threatened by Detective Columbo, and when their guard was down, suspects would willingly share information, secretly thinking there’s no way this dumb detective will ever figure it out, and then he’d arrest them.   

Clients don’t have to believe you are dumb, just that you’re there to learn, and when they feel you are there to learn, they’ll teach you how they like to buy.    

If you’re a new salesperson just starting out, you should feel empowered by your lack of experience and knowledge and just go out and learn from as many clients as possible.

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How to Be an Effective Seller #2: Embrace the Power of the Hustle

If you sell for a living, making calls on qualified strangers is a must. And a lack of doing it effectively (and frequently) is typically the reason for failure. 

When I was selling advertising in my college newspaper, it was easy as long I made enough sales calls.

There was intrinsic demand for newspaper advertising, because they held a monopolistic advantage.

That’s why I stayed in the ad selling business and joined The Indianapolis Star, the largest daily newspaper in Indiana. 

The hustle ethic I developed in college served me well because nobody at The Star worked very hard.  It was like unionized labor for salespeople. 

I once overheard the Director of Sales proclaim just by answering the telephone the paper would take in over $100 million dollars per year. 

I was not deterred, and spent each day calling as many prospects as possible.  By sheer volume I was guaranteed to outsell everyone else. 

And it became a reality when I won salesperson of the year twice in just four years on the job.

Business Owners are Busy

Embracing the hustle means optimizing your time and making that extra effort to get a potential client’s attention.

Most salespeople give up after just a few attempts, and put little thought into their outreach.

But here’s a fact, people who have the power to buy products and services – the decision makers, or economic buyers, or owners of businesses etc. – they are inundated by bad salespeople every day. 

And the only way to get their attention is through repetitive yet thoughtful outreach.

What I mean by repetitive is it may take a dozen or more different attempts per client.

What I mean by thoughtful is doing some research and providing rationale for why anyone should meet with you.

Over the years I developed a strategy for how much activity I needed each day to be successful; I call it The Power of Ten, and it gave me a benchmark to achieve selling success. 

Why the Power of Ten Works

Because 10 is a good number for just about any type of sales position, unless you’re a telemarketer.     

Your 10 daily touches can be a combination of meetings with new or existing clients, and cold outreach efforts like phone calls, emails, letters, and canvassing (stopping into a business). 

There are 3 primary reasons why you should have a set number in mind for your daily activity. 

First, one day, you will feel like you’ve run out of people to call on.  And when this happens, you look back and find new ways to creatively reach out to the people you’ve already called on

Very rarely will you land an appointment with a highly qualified prospect in just one attempt.  It should take multiple attempts to get their attention. If it’s too easy, then you should be worried.   

Remember, you are 1 of 30 or more salespeople trying to get a client’s attention on any given day.    

Secondly, any more than 10 calls per day turns you into a telemarketer.

The Power of Ten is not for telemarketers. It’s for outside salespeople who should embrace their creative freedom to use multiple media to influence prospective clients.

For instance, sending a cold email – with no research or rationale, to someone who’s never heard of you – doesn’t count. 

However, if that email contains rationale, based on research you’ve conducted on that business, on why they should consider meeting with you, then its worthy.  

Below is an example of an email I sent to a high-ranking executive who gets hundreds of emails a day from salespeople, he’s never met me or heard of me, and he responded the same day:

Hello Rick,

I’m the new XXXXX @XXXX.  XXX just took over XXX – we are now part of the same team who helps you @ XX and XXX.  Jerry XXX suggested I reach out to you. 

XXX has zero partners in the XXX category.  There is a real opportunity here to establish a foothold and possibly even own the category for a relatively small investment.

From what I can see you have 6 maybe 7 offices where XXX has influence, here is a link to a recent study on the Economic Impact of XXX and surrounding counties:  www.examplelink

We would love to develop some ideas for this upcoming XXXX – but If budgets are long allocated would you mind visiting with me in January? 

Thanks for your consideration XXX – and have a great weekend.

Shane, thank you for your email and it good to hear that you have partnered with XXX. 

We would absolutely entertain an opportunity to work together!  Let me reach out to my Advertising team and have them reach out to you. Hopefully, we can get something set up in the near future to talk through 2019 and what opportunities might be available for both of us.
Thanks for your email and we will be in touch.

Since you’re only doing 10 touches per day, spend time making each one thoughtful and creative. 

Some days you’ll run out of time developing your creative approaches – it’s OK – quality over quantity is the point. 

After a while you can use the same language in all of your outreach. And start developing scripts and automating your processes increasing your efficiency.

At the end of this post I’ll share with you an opportunity to download proven materials, scripts, and tactics that help me increase my response to emails and phone calls. 

And Thirdly, there is a psychological benefit to limiting your efforts to 10 calls per day.

At some point you need a break.  And If you spent the time to do 10 meaningful outreaches – regardless of the results – you’ve done a good days’ work.

To summarize the Power of Ten:

  1. Make 10 outreaches per day, every day, Monday – Friday.
  2. These outreaches are a combination of appointments, calls, emails, canvassing and are either related new business development, up selling and/or retention. 
  3. The primary goal of outreaches is to secure appointments to present solutions and close sales.

If you would like to learn more about the scripts, language, systems and tactics I use to get response to my emails and phone calls, you can purchase my guide “How to Land More Appointments with Prospects” by emailing

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How to Be an Effective Seller #1: Sell Something you Believe in

About My Selling Credentials

I’ve been in sales and business development my entire professional life. 

I never had the desire, academic chops, or patience to become anything else.  I took the LSAT and my score was so miserable I’m embarrassed to even share it. 

Truth is, I am an introverted person. I shouldn’t be attracted to the selling profession.  But according to my parents and grandparents, I have a good personality – and good manners – which are helpful in selling.

There were other factors that led me into sales: I had bad grades, I was the class clown, I have the attention span of a gnat, I’m not unpleasant to look at, I have some hair, I’m a snappy dresser, I like to golf, and I’m competitive. 

And most importantly, without a graduate degree, professional aspirations, or entrepreneurial ambitions, selling was the best path for me to earn good money.

Here are the sales positions I’ve worked in:

  1. Account Executive for The Ball State Daily News (newspaper advertising sales)
  2. Account Executive for The Indianapolis Star and News (newspaper advertising sales)
  3. Account Executive for Time Inc. (magazine advertising sales)
  4. Account Executive for 3 radio stations (radio advertising)
  5. Account Executive for a CBS Local TV station (TV advertising sales)
  6. Account Executive for Ivie & Associates (selling marketing services to businesses)
  7. VP of Accounts for Ivie & Associates (same as above)
  8. Account Executive for an NBC Local TV station (TV advertising sales)
  9. General Manager for Ball State Sports Properties (corporate sponsorship sales for collegiate sports)

So, I’ve been around the block, and learned a few things over the years.  Not to brag – but everywhere I’ve sold I’ve been successful.  In some cases, I’ve been the top seller among many, and even won some awards.   

In the coming weeks, I will share what I believe to be the 10 most important ingredients in becoming a successful salesperson.

#1:  Sell Something You Love or Believe In

In college, needing to make beer money, my interest in advertising and newspapers led me to a student job selling ads for our school newspaper – The Ball State Daily News.  And it may have been the worst way to start my sales career.

Why?  Because newspapers (this was the late 1990’s) were still the dominant advertising media for local business.  Before Google, Craigslist, Facebook, Snap Chat, and other digital media companies devastated print advertising.

It was so easy. 

Selling ads in a college newspaper – to a business in a college town – wasn’t rocket science.  We had a monopoly on the campus audience.  And I exploited our dominance.

The key here, I also loved the product

The key here, I also loved the product.  I devoured newspapers every morning since I was a kid eating bowls of Captain Crunch cereal.  There were no smart phones, laptops, or tablets. 

Secretly, I wanted to be a journalist.  But there were too many smart people vying for those positions, and I knew a job as a reporter didn’t pay much. 

So, I sold ads, and discovered it was the highest paying student job on campus.  I not only loved the money, I loved that I was supporting journalism, and I was also supporting students learning how to be journalists!

This made selling more of a mission, and it didn’t feel like a job, it felt like service.   

It’s About Service

First, I was serving advertisers by introducing them to new customers. Second, I was serving our journalists because the advertising revenue paid for their expenses. And third, I was serving our readers by funding the gathering of the news they wanted to read. 

Contrast this with selling something I wasn’t interested in, like pharmaceuticals, or industrial widgets, or medical devices – selling something I didn’t have a passion for would have made it more difficult to overcome my shyness and call on strangers.

In order to be successful in sales, you have to call on strangers

The Pursuit of Happyness starring Will Smith:

In order to be successful in sales, you have to call on strangers.  Strangers who don’t necessarily want to talk to you. 

And you may have to repeatedly call until these strangers are convinced you won’t go away.  And if they agree to talk to you, finally recognizing your dogged persistence, they’ll often discover you have a solution to their pain and buy something.

This is so much easier to do when you believe in what you are selling.  Not just a fake belief, but a true interest and passion for the product or service you represent.  

I have always had a passion for journalism, advertising, and marketing, so I have stayed where my passion was fueling my sales efforts. 

In my next post on becoming an effective seller, I’ll dive into “Embracing The Art of The Hustle”.

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Why Selling Is Important

Some people believe selling is a god given skill.

It’s not, you can develop this skill quite easily.  Anyone can get better at selling by changing how they look at the concept of selling.

You may never achieve rainmaker status, the highest level of selling, but you can develop sales skills that will help you immensely in life, and in business, and in finding a mate.  And I hope my story helps you. 

The greatest benefit to having the ability to sell is it distinguishes you from the majority of the workforce.

It’s an extra arrow in your quiver of arrows making you a more marketable employee.  And if you ever dream of owning your own business, selling others on your idea will be helpful.

I find many people are afraid of selling for or one or more of the following reasons:

  1. Their personal appearance is less than flattering; overweight, bad teeth, out of shape, bald or balding etc.
  2. Introverted personality, shyness
  3. Lack of knowledge and/or respect about the importance of the sales process in any business
  4. Feel their advanced degree and education (doctors and lawyers for example) make them exempt from selling

Here’s some truth.  If you send two women, one stunningly beautiful and the other of average beauty (both with equal selling skills) to sell the same product to a man, the beautiful woman will win that sales contest 100% of the time.

Here’s more truth, good looking men can more easily sell to women than other women. 

Beautiful people have advantages over everyone else in this world.  But looks are a very small part of effective selling.  Looks may get you in the door faster, but skill is what closes a sale.  Skills that you can develop.

Why? Because ultimately – decision makers value solutions to their problems.  And if you can get their attention, listen, uncover their pain, and provide a solution, it won’t matter what you look like. 

How an Introvert Can Sell

I personally struggle with being an introvert. I’d rather stay in the comfort of my own home or enjoy the solitude of a golf course than do any anything social. 

But social shyness and business shyness are two very different animals.

It’s OK to be socially shy, but when it comes to business, it’s about your survival. 

And if eating and supporting a family isn’t motivation enough to break out of your shell – then nobody can help you. 

You have to help yourself in this instance.  The motivation to survive – and thrive – should trump all shyness in the business jungle.   

How do you do it?  By assuming a different identity for your social life and business life. 

Christopher Reeves as Clark Kent in Superman

Being shy and awkward at home like Clark Kent is fine, but when you dress for work you must turn into Superman – or Wonder Woman – a fearless version of yourself ready to do battle in a fierce capitalistic world of business. 

Chistopher Reeves as Superman in Superman

I find that many professionals like lawyers, doctors, and accountants dismiss the idea they need to sell.  Why else did they spend all those years in school studying? 

But the most successful and wealthy professionals develop a healthy respect for the selling process. 

They must win clients before they can attain partnership status or build their own practice. And they do thy by skillfully selling.  

Why Selling is HARD

There are three foundational marketing principles underlying any successful business:

  1. Continued customer acquisition
  2. Conversion and Sales Optimization
  3. Customer Retention and Referrals

The most important, difficult and expensive of the three is customer acquisition.


Because … until someone, somehow, in some way – convinces a business, government, non-profit organization or person to part with their money – absolutely nothing would transpire in the world of business.    

And because the selling process takes time, and customers are finicky, there’s endless competition, habits and trends change, leadership changes, governments and laws change. 

It takes patience to develop a relationship, to win trust, and deliver a solution.  It takes persistence, drive, skill and psychology. 

The Indians tried to create rain through rituals and prayer.  Man tried to create rain through science. In the business world, rain is made through methodical and strategic sales and marketing efforts. 

And for those who can consistently sell at the highest levels, they are the true rainmakers. 

The Rainmakers and The Fulfillers

Very generally, there are two kinds of people in this world, rainmakers and fulfillers.  Those who can sell, and those who can’t – or don’t want to, for a variety of reasons, I call them the fulfillers. 

The vast majority of our planet is on the fulfillment side. They are the specialists, or subject matter experts, or number crunchers, and managers.  Their jobs are to fulfill and manage the obligations of the sale. 

Fulfillment of a sale is vitally important because it’s what retains and grows clients.  But the selling part is much more difficult.   

In his book Million Dollar Consulting, author Alan Weiss calls fulfillers – “delivery people”, and makes this point:  “If anyone tries to tell you … that delivery is the key to client success, I’d remind them that delivery people are more common than garden weeds, and rainmakers are rarer than Sasquatch.”

The process by which you are compelled to buy a McDonald’s cheeseburger and Coke has evolved from a sophisticated team of sales, marketing and merchandise folks – fulfillers trying to drive traffic into McDonald’s retail locations. 

The delivery of the meal is also fulfilled by the franchisor, who pays handsomely for the brand and system that delivers a Coke and cheeseburger to her customers.

The one who developed the idea, licensed it, financed it, and sold it to the masses was Ray Kroc, the rainmaker in this scenario.    

Ray Croc, Founder of McDonald’s

The car salesperson – or realtor – who start with nothing – and go on to build successful careers must develop rainmaking skills to succeed.

The finance person at the dealership, or the title agent at the title company, are the fulfillers of their sales.  The realtor and car salesperson generated the rain.  

While working at a Division One collegiate athletics program I witnessed true rainmaking from their athletics director – Beth.  You’d think an A.D. would be consumed with wins and losses, not so much.  Her mission was fundraising. 

Her focus was on raising money (making rain) to fund scholarships and build state-of-the-art athletics facilities designed to attract recruits and coaching talent. Which in the long term will lead to more wins for the program.

In my next series of posts, I am going to focus on the sales profession and what I believe to be the 10 most important ingredients into becoming an effective salesperson.

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Credit Card Rewards Arbitrage

Did you know you can use your credit card for two months and not pay a single dime in interest?

I call it Credit Card Arbitrage.

Here’s how it works

When you receive a credit card bill, there are three options for you to pay: the minimum payment, the statement balance, or the full balance.

If my statement balance is low, or at zero, I can then charge whatever I want and not pay until the next billing cycle — meaning I have a 58 day float.

Here is my recent Citi Double Cash Card statement. The due date is on the 17th of the month, and they close my billing on the 21st of each month.

So whatever I charge on the 21st (or after) won’t be due for 58 days.

And If I pay the statement balance, I won’t be charged any interest.

My goal is to always avoid interest.  And if I pay my statement balance in full, even if I owe more than the statement balance, I won’t be charged any interest.

So as of May 21st, (my statement closing date) I have until June 17th (my next due date) to use this card and despite how much I spend, only $135 will be due on June 17th.  

And that is the key.  The statement balance is all the credit card companies require you to pay to avoid interest and fees.  

Let’s say I go crazy and buy a jet ski (or something impulsive) and spend $10,000 one day between 5/21 and 6/17.

On my due date of June 17th my account balance will be $10,135.  My minimum payment will be something like $50, and my statement balance will still be $135. 

And as long as I pay my statement balance, I won’t owe interest on the $10k.  

In fact, I won’t have to pay that $10k until July 17th — a full 30 days later! But then I must pay in full or will incur interest on the entire sum.   

So, what happened here is I was able to use $10,000 of the credit card float for my own benefit, interest free, from May 21st — July 17th.  

That’s 58 days, or 2 months of an interest free cash flow.

It Pays to Have Multiple Cards

Over time, as I’ve tried to run my personal finances more like a successful business, I have found value in expanding my access to credit.

I have credit cards from all of the major banks, and some smaller banks and credit unions. All told, I have over $200,000 in accessible credit.

Every successful business from a donut shop to a Fortune 500 multinational corporation has access to credit, and uses it to their advantage.

Also, having a larger pool of credit helps with my credit score because one of the high impact factors is total credit usage. The more credit I have, the less I actually use as a percentage of my total available credit.

And all of my credit earns rewards, my favorite is cash-back. Below is a snapshot of how I track my credit card usage.

And I link this chart with my Quarterly Cashflow Planner

The Intelligent Advertiser Credit Card Tracker

I used to spend a lot of time figuring out which cards to use based on their rewards potential. Now I rotate cards who have a low or zero statement balance. Meaning I’m perpetually using a two month float.

Is it Worth the Time and Effort?

Yes, because it maximizes my cash flow by allowing me to use the credit card’s money for the next 2 months — interest free.  

As I’ve climbed out of debt and optimized my finances, I take pleasure in finding new ways to improve my cash flow.

Do the credit card companies mind?  No, they make money on our transaction fees and hope in the long term we become interest paying financial slaves.  

The main benefit of Credit Card Arbitrage is it helps me take advantage of lump sum or cash discounts.  

For example, if I pay my entire car insurance bill with a (zero statement balance) credit card, I’ve given myself two more months to generate the cash flow needed to pay off this bill. Instead of an alternative like tapping into my savings.

This only works for me because I have consistently positive cash flow, and I’m only using it to stabilize any irregular spending. 

More than anything, I do this because it gives me more time.  And time equals options. And options give me choices.

More time for me to make money, invest in educational opportunities, more time to figure things out in general.  

It comforts me to know what I’m buying today won’t be due for another two months. I can always pay off my balance now instead of waiting — which is usually the case because I hate debt.   

In closing, I should point out this really isn’t arbitrage because I’m not buying and selling anything, I’m just taking advantage of a loophole in how credit card companies ask to be paid back.  

But the name just sounds so cool — so I ‘m sticking with it.

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Spotting Trends and Reducing Overhead

            Do you know – I mean – really know, where you spend your money each month?

            What you spend on gas, insurance, repairs and maintenance.  On food from the grocery, or restaurants, or at coffee shops.  What you spend on your home; the utilities, taxes, insurance, maintenance and repairs.  On travel like airfare, Uber, hotels, tolls and taxis. What about shopping for clothes, or on Amazon, or how much you spend on your phone, or on music, or on video services like Netflix and Hulu? 

            I’ll bet you don’t.  You may think you do, but you really don’t know.  Don’t worry, I didn’t either.

            In personal finance we are at a disadvantage when it comes to tracking our finances.  We lack tools and resources.  Business owners have specialized software, they employ bookkeepers and accountants to help analyze their expenditures.  But we are on our own, and without knowing the reality of our spending there’s no way in heck we’re maximizing our cashflow.      

Get Down to Business

            After a business analyzes its historical spending, they may find they’re spending too much on office supplies compared to the previous year. This discovery, or data, can lead to action.  Without it, nothing happens.  And there might be many solutions, like negotiating better terms with their current vendor, or seeking new suppliers who charge less.

            A business might discover their payroll has swelled to an all-time high, prompting a deeper look at the entire organizational structure.  This may lead to a realization that outsourcing janitorial services is less expensive than employing a full-time janitor. 

            Without having the data there is no ability to spot trends, and therefore nothing would have changed. 

            In business, the goal is profit, and analyzing historical data is a proven method of boosting profitability.  Why would we, as CEO’s of our personal financial enterprise, not follow this proven model of success?         

Spotting Trends

            When I was deeply in debt, not only did I lack control over my personal finances, I lacked vision into how I spent my money. 

            For example, every month I would timidly declare $500 as my monthly budget for automotive expenses, but I didn’t really know.  I only knew my car payment was $350, and I also bought gas and paid for oil changes.  It was a best guess. 

            I didn’t have the time or a good way of tracking all my auto-related expenses.  I wasn’t able to fully comprehend my spending habits until I started using the online personal finance website, 

Mint Dot Com

For those who don’t know, is a personal financial website used by over 20 million people.  It’s owned by INTUIT, a finance-focused software company who also owns Turbo Tax and QuickBooks.

            Mint was able to collect data from all of my financial accounts; my checking, savings, credit cards, utilities, insurance, investments, loans – and more.  And then organize all of it so I could discover trends and patterns in my spending habits. 

            For me, using Mint was a game changer, because it captured and organized all of my financial data automatically.  No effort on my part.  Once I submitted my login information, they did the rest -for free.

            The only thing Mint lacked was a way to forecast my cashflow beyond one month, hence the reason I came up with my quarterly cashflow planner.

            And after just a few months on Mint I quickly noticed a difference in what I thought I spent – and what I actually spent.

            Let’s revisit my auto-related expenses.  I thought they were about $500 per month, but in reality, they were more like $950 a month.  A BIG difference, how could this be? 

            Well, I wasn’t factoring in my entire universe of repair and maintenance expenses like oil changes, tires, windshield wipers, brakes, and more. I also vastly underestimated how much gas I bought, and – oh yeah! – car insurance.  Without insurance or maintenance my spending WAS around $500 per month.

            After much consideration, I decided $950 was high, but it was a justifiable expense.  And again, it was an average.  I didn’t spend $950 every month – most months WERE around $500.  There were two or three events each year that tipped the average higher, like when I paid my entire insurance bill, or when I replaced the tires.

            My job in sales required I drive a lot, and I had a checkered driving history with a few accidents and infractions, so I paid higher than average insurance.  I came to peace with this expense, and knowing it was verified allowed me to project the rest of my expenses more accurately. 

            The advantage of knowing my true spending helped me plan and optimize my cashflow.  Really knowing created a benchmark for future projections and improvement. 

            Greater visibility into my trends shed light on other areas where I could improve – like what I spent on entertainment.

How to be an Idiot

            I used to be a complete idiot.  I spent a heap of time, money and energy at bars, drinking and smoking like I was Keith Richards.

            I was able to afford some of this debauchery, being young and enjoying my ability to tolerate hangovers.  But I spent money like a professional athlete, the one who just cashed their first big check, then proceeds to pick up every bar tab and buys his mom a house.  Only I wasn’t earning that kind of jack. 

            I also gambled, a lot, mostly losing.  Pretending to be a big shot I would bet $100 or more on football and basketball games. I’d go to Vegas twice a year and blow at least $5-10k per trip.  And at least once a week a I’d join a group of guys to play poker, potentially winning but usually losing hundreds more.

            Oh, and don’t let me forget about golf.  I started playing with some real sharks, hundreds of dollars at stake sometimes on each hole.  It was nerve racking, but it made me feel cool, and poor. 

            Almost 40% of my take home pay was going to entertainment activities, more than my rent, more than my auto expense.  It was ridiculous.  And I didn’t fully realize the impact it was having on my entire financial world until I saw the trend in Mint.

            Just like any business would do to maintain profits, once I had visibility into my entertainment excess, I took steps to drastically reduce my idiocy.    

Variable vs. Fixed Expenses

            What’s important to consider about our expenses is most of them are variable-meaning they fluctuate from month to month – AND we’re not legally bound to them like an auto loan, or a mortgage.

            I spend way too much on wine each month, but, if and when I need to cut back – I can.  I think.  But I didn’t sign any legal document requiring me to buy wine each month.

            I spend about $100 each month at Starbucks, I’m addicted to their green iced tea.  I’ve come to peace with my addiction, but if I have to, I can stop. 

            The opposite of variable expenses are fixed expenses, and they are what lead people into financial slavery.

            In the business world expenses are referred to as overhead, and usually the biggest fixed expense for any business is payroll.  When companies are forced to reduce overhead, they usually start by laying off employees.   

            In personal finance the largest fixed expense is typically the rent or mortgage, then food, followed by auto or credit card debt.  Increasingly, it’s also college debt.    

            What dug me into $250,000 of debt was a combination of poor cashflow management and fixed expenses that were too high in relation to my income.

            I quickly got out of debt when I reduced my fixed expenses to about half of my take home pay.  For example, I paid off my car, I sold my house and moved into a more affordable one.  And I got rid of all my revolving credit card debt.  This reduction in fixed overhead improved my personal profitability.   

            Below is a simple chart I update occasionally; it reminds me of how much flexibility and freedom I have with low fixed expenses.  And how important it is to maintain the priority of saving. I’ve simply outlined my fixed vs. variable expenses, what I pay for in cash vs. credit, and the percentages of each compared to the total spending. 

            No business thrives without simple data, and regardless of how much money I earned, I never realized my true cashflow potential until I took advantage of resources like and began tracking my income and expenses. 

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How I Got out of Debt By Running My Personal Finances Like a Business

What if I told you there was better way to manage your personal financial life?  A way to help prepare for the future, save more money, avoid bank fees … and rather than pay interest … actually earn interest and rewards?

If that’s appealing to you, then you should consider running your personal finances more like a successful business, and instead of old-school budgeting, start managing and optimizing your cashflow. 

What is Cashflow?

Well, in business terms, it’s the net amount of money being transferred in and out of a business. A company’s ability to create value for shareholders is determined by its ability to generate positive cash flows, meaning after they pay all of their bills each month, they have money left over to save or reinvest.  Your ability to build savings and wealth is determined by the same principle. 

Business owners manage their cash to optimize profit.  They exert much more control over how (and when) they pay their bills, all while earning interest on their un-deployed cash.

Fees are avoided at all costs, because fees reduce profit. And a smart business never turns down an opportunity for discounts or rewards, for example, a discount earned from paying bills early.    

Just like any successful commercial enterprise, most of us earn income on a fairly regular basis. Some monthly, some bi-weekly.  The keys to maximizing your personal cashflow are:

  1. Simplify your finances by reducing the number of merchants or vendors (utilities, landlord, banks etc.) you pay each month from your bank account. 
  2. Eliminate bank fees and interest.
  3. Take control over when and how you pay your bills.
  4. Recognize — then reduce — unnecessary overhead and expenses through better tracking and awareness. 
  5. Maximize credit card rewards and your ability to earn interest on your cash. 

How I Became A King of Cashflow

This all started for me when I was 32 years old. I was deeply in debt, to the tune of about $250,000, and I was inspired to climb out after listening to Dave Ramsey’s wonderful book; The Total Money Makeover

But I was lousy at budgeting, and it was before a lot of banking could be done on the internet.  My personal budgeting system was more about feel.

When I felt like I had money in the bank (like on payday) I’d pay bills and pull some cash out of an ATM – usually paying a $3 in fee for the privilege.

Friends would tease me about withdrawing only $40 at a time, they would say “why don’t you just pull $100 out and visit the cash machine less?” 

Well, there’s nothing more embarrassing than having a car full of friends, with a line of cars waiting impatiently behind you, and being denied at a public ATM machine.  $40 seemed like better odds because I never had a complete picture of where I stood financially. 

There were outstanding checks, credit and debit card purchases, cash withdrawals, and merchants like the gas company automatically withdrawing money from my checking account –My feel system contributed to my growing debt and produced a ton of bank fees. 

Income vs. Management

The thing is, I didn’t have an income problem, I had a cash management problem.  I made enough money, but lacked vision, time and the tools to get the most out of my income. 

So, I began keeping a financial journal in a spiral bound notebook, the kind you use in high school or college, and started tracking all my expenses. A few times a week I would have a financial reckoning and try to sort everything out in my financial life.

As you can see, I had dozens of expenses and I was writing a lot of checks. When checks cleared, I would highlight them. 

This worked better for me than just balancing a checkbook, at least I had better vision into my entire financial universe, but it was still complicated and time consuming. 

Another wrinkle, I was a commissioned salesperson, and my pay was irregular.  I’d receive a small draw check (against future commissions) in the first week of each month, and my larger (hopefully) commission check in the 3rd week of the month.  The draw checks were always the same, but the commission checks would vary by thousands of dollars each month.  There were many peaks and valleys making traditional monthly budgeting useless for me.

I needed to find a way to exert more control over who I paid and when.  The bank or power company didn’t care when I got paid, only that they get paid on their due date.  So, I had to figure out a way to stabilize my irregular income while paying the same bills each month. 

The more I thought about it, the idea of writing dozens of checks each month really bothered me.  I realized each time I wrote a check I would temporarily lose control of my money because checks are in limbo for 3 – 5 business days.  This was a bad thing because as I stated before, I had no clue what was going on in my financial life. 

This loss of control added stress, and I was never at ease until all checks were clear.  Even to this day I avoid writing checks at all costs.  It’s slow, inefficient, and boring.  There are numerous ways to pay electronically, leave checks for your beloved grandparents.   

It became clear to me it was more efficient to write one or two checks — to a credit card company— rather than dozens of checks to a variety of merchants.  So, I began paying for whatever I could on a credit card.  Not a debit card, which I’ll go into a bit later. 

This was a key revelation, because it gave me greater control over the cash flow of money leaving my checking account. 

The simplicity of writing fewer checks alone was life changing. While businesses have accountants and bookkeepers, I was on my own, so reducing complexity paid huge dividends.   The less activity and more stability I created in my checking account, the more quickly I eliminated all fees. 

My checking account activity today is no more than 6 or 7 electronic transactions covering all of my personal financial obligations every month. I rarely, if ever use cash, because 99% of businesses accept credit cards. Compare that to the 30+ transactions that used to flow in and out of my checking account each month.  

And my bank (Charles Schwab) pays me interest (not much) AND they refund all ATM fees. If you pay a fee to keep a checking account and/or use an ATM, you need to find a new bank or credit union. Because if you’re willing to bank electronically, meaning you don’t need to visit a branch, there are tons of great options out there. 

Ask yourself, do you really need to go inside a bank branch to do your banking anymore? You have a phone, a computer, and if you need cash, you can go to any ATM. 

Keep Your Paws OFF My Money

Another thing I eliminated was allowing anybody access to my checking account. Utilities, car payments, mortgage payments — they all encourage you to sign up for automatic billing.        

Sure, it’s convenient — for them — but never do it. I’ll permit merchants to auto-bill me on my credit cards, but only if there are no fees.  AT&T, HULU, my gas utility, and my high-speed internet carrier all bill me on a credit card and do so without a fee.  

Never, ever, let someone else decide when they can take money out of your checking account.  This is the antithesis of good cashflow management.  No business would allow it.  

Why?  Because one day, somebody might take your money when you need it for a more important purpose, like a medical emergency.  Or even worse, the money goes out of your account when you don’t have it, and then you get charged a bunch of fees.  Like a shrewd business operator, only you decide when bills get paid, and if money is tight, who gets paid — and when.  Smart businesses pay themselves first. 

Today, of course, most payments can be made online without the use of checks, and debit cards are wonderful alternative as well.  But credit cards, when the balance is paid in full each month, give you most power to maximize your cashflow. 

Why Credit Cards are the Key to Cashflow Optimization

The biggest advantage to using credit cards is control.  I was able to focus all of my cash outflow (bill paying) to two days per month – around my paydays – and eliminate 80% of my checking account transactions.  Most credit card companies will allow you to pick a due date either at the beginning or end of a month, it’s best to have two cards with one corresponding to each date.        

Think about that for a minute – because it was a complete game changer for me.  Instead of having a dozen due dates scattered throughout the month (determined by my vendors) and dozens of transactions occurring in my checking account, I was able to turn the tables on when cash flowed out of my checking account to two days per month.             

The more of my monthly expenses I could direct through credit cards meant the more control I had over my cash.  And the more interest I would earn on my checking account balance. 

Below you can see how my budgeting evolved around paying bills when I got paid, by using credit cards to quickly take care of any bill.  In the meantime, cash idly sits in my checking account and collects interest. 

Fraud Protection

Another advantage of using credit cards — fraud protection. If someone steals your debit card (or checkbook) precious cash will vacate your account until the bank decides to reimburse you.  If the same happens with your credit card, your precious cash stays untouched AND credit card companies (who have fraud down to a science) will credit your account within days. 

Forgotten Subscriptions

Another advantage of credit cards — managing subscriptions and automatic renewals.  Ever get dinged for a subscription you forgot about?  Sometimes I’ll sign up for 1 month of HBO or Showtime then forget, and then I get keep getting charged.  And over time these types of subscriptions pile up. 

A lot of merchants today sell subscriptions — from Apple Music to Hulu to Bumble to the New York Times.  It usually starts with a free trial, and before you realize it the trial is over (like merchant ninjas) they silently auto-renew your subscription.  I hate that.

They call this continuity and it’s a great business model because most of us don’t immediately cancel — even if we’re unhappy with the service.  

Some companies make it very difficult to cancel (DirecTV, any cable company).  Even worse, some companies require you to talk to an actual person before you’re allowed to cancel.  

There is one simple and foolproof way of getting rid of unwanted and forgotten subscriptions.  Never use anything but a credit card for any type of continuity or subscription service.  And when you want to cancel, if it’s the least bit difficult to do, or you feel overwhelmed by the sheer volume of your commitments, call your credit card company and ask for a new card with a new number.    

Job done, cancelled, no more unplanned charges.  And your credit card company will send you a new card, with a new account number within days. 

If you cut off their source of payment, they can’t keep billing you, and you won’t owe any money.  And it won’t impact your credit score one bit.

Actually, DirectTV will keep billing you because they make you sign a contract, but with most others, especially e-commerce type businesses, this works without consequence.

Maximizing Interest and Rewards

Another advantage of credit cards – earning points and rewards. By using credit cards I’m able to accumulate a few thousand dollars in rewards each year.  As a practice, regardless of rewards or incentives, I no longer use any cards that charge annual fees.  I just won’t pay fees regardless of the benefits.  In a later chapter I go deeper into this topic. 

To the Nay Sayers

I know, I know, I know.  Credit cards can lead to credit card debt, and financial slavery.  And it’s proven (and hard to dispute) that when you use a credit card, there is no pain, you’ll likely spend more money, and risk not paying off the entire balance and incur interest charges.  The opposite of what I’m trying to accomplish here. 

First, let me stress the paramount importance of eliminating fees and paying interest.  They are termites quietly munching away at your financial foundation.  During my twenties I estimate to have wasted more than $25,000 in fees and interest.  Money I might as well have flushed down the toilet or burned in the fireplace.  They are silent killers, nipping away at your personal profit, and regardless of how small the amount is, no successful business pays fees when they can avoid them, and neither should you.    

As a savvy businessperson in charge of your own finances, to ignore the advantages of credit cards is to ignore one of the most versatile methods of conducting business.  What keeps successful businesses from overspending on credit is budgeting, but they don’t budget monthly like we’ve been taught, they budget quarterly.  A business forecasts their income and expenses at least 3 months at a time, and often a year at a time, and so should you. 

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How Financial Cowardice Lead Me To Financial Slavery

I was 16 years old when I got my first real job.

I grew up in the small factory town of Marion, IN., about an hour north of Indianapolis.  Like most kids I worked for neighbors pulling weeds, mowing lawns, and washing cars.

Eventually, my parents grew weary of my irregular employment (or lack of) and got me a job as a busboy at their favorite restaurant, The Icehouse.

The Icehouse was the most popular restaurant in town, and its motto was: Food, Fun, and Firewater (firewater is alcohol). 

Part of the appeal was its owner, Steve, who drove a Crimson-red Jeep Cherokee Limited with gold spoke wheels, and a vanity license plate bearing his nickname: The Iceman.

And at every lunch and dinner service, 7 days a week, The Iceman would greet every single customer, ensuring their meals were satisfactory, and refilling their drinks as needed.

He would stroll through the restaurant humming the phrase, “Only in America” a nod to the fact anyone, even a factory worker like him, could achieve their dream in America.   

“The Iceman”

The Icehouse was a precursor to what we know today as Applebee’s, or Chili’s, or Friday’s. Normal dishes were bedazzled with tastier ingredients and catchy entree names, and there were fun appetizers like jalapeño poppers and mozzarella sticks. And the atmosphere was warm and inviting with nostalgic signs and TV’s everywhere.  

Everybody wanted to eat at the The Icehouse.  Politicians, judges, business owners, bankers, lawyers, doctors, visiting celebrities, dignitaries, shady characters, gamblers, athletes, coaches, drunks, shift workers, the elderly, prom dates, and people having affairs. 

My Aunt Melanie met her second husband, Gary, at The Icehouse.  He was a traveling salesman.

I didn’t really enjoy busing tables or washing dishes or cleaning ashtrays.  And I wasn’t making much money, I actually made more money washing cars for my parents’ friends.  

But it was a cool place to be, and the Iceman was a charismatic leader who inspired me to work hard and hustle.  And I enjoyed the cast of characters I worked with, the waitresses, cooks, bartenders — all of us commiserating over cigarettes in the break room.

Every Friday night, around 10pm when dinner service ended, a DJ would start the weekend with a cheesy 80’s dance tune, and then The Icehouse would morph into the hottest dance club in town. And I would go home.

I tried working at a few other restaurants in college, but I never experienced the same pride or camaraderie I felt at The Icehouse.  The other restaurants were more like manual labor, and drudgery, led by disgruntled people. There was no “cool” factor.  

So, I decided then I would never work in a job that didn’t interest me.  I would never sell anonymous industrial widgets, or become some boring lawyer, or grind away at a repetitive factory job. No offense to anyone in these jobs, they just weren’t for me.

By college I developed an interest in journalism, and I started looking into writing for my college newspaper, The Ball State Daily News.  If I had a knack for anything academic, it was reading and writing.  I don’t claim to be some great writer, but I can spell and put a few sentences together. Things like grammar and English always came easier to me than math and science.

And I loved newspapers.  To me they were institutions of truth and service to their communities.  As a kid I would start each day with a bowl of sugary cereal and a crisp copy of the Chronicle Tribune, a beacon of local news, information, and entertainment for our sleepy town.

Landing a job for the school newspaper was not easy.  Ball State had a robust journalism program and competition was fierce for student jobs.  Truth was, I never summoned up enough courage to apply.  While I was convincing myself I would never get hired — at the same moment — I found out they were also hiring students to sell advertising in the paper.

I stumbled upon the highest paying student job on campus, paying 100% commission to sell ad space to local businesses. 

To me, selling ads in the lone school paper seemed easy. And that may be the secret to sales success — sell for a monopoly.

Ball State is based in Muncie, IN., and it is by far the largest economic force in an economically depressed region of the state. And if you ran a business in Muncie, it was smart to advertise in the only school newspaper. This was back in the early ’90’s before internet and social media.  Everybody read the campus newspaper.

Selling advertising was fun, it was mindless, and certainly more lucrative than being a journalist.  I reasoned, if I don’t write for a newspaper, I can still support journalism by selling ads — which pays for the journalism.  But even more pressing was graduation; the business side of newspapers was a more lucrative and stable career path.

This is the moment in my life when I sold out, where I chose the commercial path in life, opting for what paid more money and offered the most security instead of pursuing a passion.  I wasn’t a financial slave yet, because I wasn’t in debt. But I was a financial coward.  

More than anything, I was compelled by security. Something I lacked psychologically throughout my childhood, because my parents lived beyond their means. I was a sophomore, and it was about this time my parents got divorced, largely due to their financial problems. 

Rather than pursuing my interest, I became programmed to pursue money. The possibility of being poor terrified me.

My parents instilled this terror in me when I was young, because they were also terrified of being poor.  And the root of their terror was not in actually being poor, but what their friends would think of them if they were poor.  Which is dumb, because their lawyer and doctor friends wouldn’t be “friends” with a poor version of my parents.  

I remember between the ages of 10 and 15, I was a horrible student. To say I goofed off in high school would be an understatement.  I spent most of my time inventing new ways to cheat. Once, when my elderly Spanish teacher left the classroom for a moment, I strode up to her grade-book and changed my test score from 68 to 88.  It didn’t work.

And when I brought home successively bad report cards, my dad would take me for long scenic rides through the poorest neighborhoods in town, reminding me where I was heading.

Selling ads for my college newspaper led to a sales job at the largest newspaper in Indiana, The Indianapolis Star

Being the new guy, I was assigned the worst territory full of industrial warehousing and strip bars.  But I hustled and developed a lot of new accounts.  Most of the salespeople I worked with sat at their desks and waited for the phone to ring.

Newspapers had virtual monopolies on local news at this time, they were at their peak of influence, and staggeringly profitable.  The Star alone took in over $150M in annual revenues in the early ’90’s. More than all of the local radio and TV Stations combined.     

I kept on hustling, earning two Salesperson of the Year awards, and eventually graduated to more lucrative territories.  By my mid-twenties I was earning more money than most of my friends, Problem was, I had no clue what to do with it.  And this is where my dismal personal financial skills started putting me on a path towards financial slavery.  

With more success and security at work, I started buying things I couldn’t afford, and adopting habits — like gambling — pushing me beyond my financial means.  I would justify this behavior by reassuring myself I’ll keep making more and more money.  

I was rebelling, in a way, for choosing a career that wasn’t all that fulfilling. If I didn’t have the courage to become a journalist, at least I can spend some money and have fun!

And from there I never looked back.  My career path became a continual pursuit of security and money in the evolving landscape of advertising and media.  When newspapers began to show signs of strain in the early 2000’s, I transitioned to selling radio, and then to local TV.

Over the next 5 years, I would make every mistake possible in personal finance. I borrowed money from banks, credit unions, friends and family.  I used credit cards like they were free money, leased cars I couldn’t afford, and spent excessively on food and booze.    

I never saved money, never budgeted, cashed out my 401k, bought a house when I was cash poor, and paid massive amounts of interest and bank fees. Oh, and I gambled, a lot.  

By age 32, I was a quarter million dollars in debt with no savings to show for it.  

I had become a full-on financial slave. Owing money … paying interest … and continually living beyond my means.  Oh, and I had a career in Advertising Sales that I didn’t really like.  Which meant I was a financial coward, too.  But now I was trapped.  

So, on a cold snowy Christmas morning in 2005, driving to Detroit to see family, I listened to an audio book by Dave Ramsey called The Total Money Makeover, and it would change my life forever.  

How to Get Rich, Working for Someone Else

I’ve got some bad news. Most of you won’t get rich while you’re young. And, even worse, many of you will submit to financial slavery for the better part of your lives.

Let me define wealthy as having a net worth (assets minus debts) of at least $1 million. And a quarter of it ($250,000) in non-retirement investments — meaning you can spend it however you want with zero penalty or restriction.  Meaning it’s liquid.  

And I define young as by the time you are 45 years old.  Sure, $1 million isn’t what it used to be, especially if you live in a large coastal city, but for many of us, having that type of net worth by the age of 45 would be a terrific accomplishment.

The Federal Reserve reported the average net worth for families in the US between the ages of 35 and 44 in 2016 was $288,700. And, the average net worth for families under the age of 35 was $76,200 in 2016. 

And you may wonder, what is the point of this wealth?  Well, It’s freedom.  It’s freedom from, well, everything you don’t like to do, like a job that makes you miserable. It’s the freedom to work not for the money, but for the work itself, for the people you interact with, for the purpose it brings into your life.  

Wealth is discretionary time; money is simply the means to obtain wealth.

Alan Weiss, Million Dollar Consulting (5th Edition)

If you can save a pile of cash, you are also free from unexpected financial surprises in life, like a job loss, or medical emergency. 

And most importantly, having this kind of cash empowers you to make investments in things like real estate, stocks, or even your own business – the path to true wealth.  

Having $750,000 in retirement savings (401k, IRA etc.) by age 45 pretty much assures you a comfortable life in retirement.  By the time you’re 67, when you can maximize your social security benefits, the powerful tsunami of dividends, capital gains and compound interest, combined with even modest stock market performance, could double or even triple this balance in those 20+ years. 

And this type of wealth is attainable to the vast majority of us who make even a modest living – but piss it away on stuff we don’t need or enjoy.  

The opposite of this freedom is what most of us submit to, and that is financial slavery, which is living beyond our means, owing money, and paying interest. Like rats in a rat race, or hamsters on a wheel.

Why You Won’t Get Rich While You’re Young

Because most of us won’t participate in any of the following:

  1. Start or build a successful business
  2. Inherit a successful business
  3. Inherit a fortune
  4. Win the lottery
  5. Or marry someone rich

If you think about it, those are really the primary pathways to wealth.     

Most of us will work for someone else to earn a paycheck. According to the 2016 Annual Survey of Entrepreneurs by the U.S. Census, there were about 5.6 million businesses employing about 151 million Americans (2016 Bureau of Labor Statistics).

The vast majority of us (for a variety of reasons) work for other people, which is perfectly fine, working for other people has its benefits.  

It’s less stressful and it’s less risky. You don’t have to deal with the #1 worry for most business owners, how to stay in business.  You get to clock in, work hard, clock out, and take home a paycheck.

But to get rich while you’re young (and working for someone else) means you’ll need to earn an equity stake in that business (stock, or stock options) and have the value of your shares rise in value.

The ONLY other way to get rich while you’re young (and working for someone else) is to live below your means, and regularly save a large chunk of your take home pay. Which is extremely hard for the majority of us to do, especially me.

Why? Because it’s so DAMN BORING, that’s why.  We want to live life while we’re young, eat great food, experience travel, wear cool clothes, live in a nice place, have the latest iPhone, and drive a sweet ride. 

We also want our friends, family, and even strangers to know we are succeeding in life. Social peer pressure is the primary contributor to financial slavery.  I’m won’t cite boring research to back this up, it’s just human nature.  We are competitive creatures and have a desire to keep up with the lifestyles of those closest to us, and even strangers like our neighbors, even if it requires going into debt.  

It’s kind of like driving on the interstate and you notice another car about to pass you, your instinct is to speed up, to not be overtaken.  Same goes for when you pass someone, if you pay attention, you’ll notice most of the time people speed up when you try to pass them, even if they don’t realize it. It’s just in our nature.     

The key to overcoming the social and psychological contributors to financial slavery is to start feeling pain when you live beyond your means.    

Not just the pain of stress – the stress of not being able to pay your debts — stress alone is not enough.  You need to realize when you live beyond your means, you are limiting your own freedom. Understand that when you go into debt and pay interest, you are choosing to become a financial slave.    

Accumulating debt and paying interest are the chains that bind you to jobs you don’t like. They’re a protective moat keeping you from wealth, and the constraints keeping you from pursuing a healthier and happier lifestyle.

When you work for someone else — your take home pay IS YOUR FREEDOM.  Meaning your paycheck is your most significant tool for building wealth.  And when you commit to financing things and paying interest you are infringing on your freedom to create wealth. 

Let’s look at something as simple as a new car, because I have struggled with this instrument of financial slavery all my life.  

I love cars.  Can you guess how much I have spent on car payments over the past 25 years? 

Over $200,000.

That’s right.  Since I’ve been on this earth, I have invested $200k in car related stupidity. And I don’t even drive fancy cars. If you’ve been driving for 20+ years, it’s likely you’ve spent well into the six figures on car payments.   

Would you like to know what I have to show for this investment of $200,000?

About $10,000.  

That’s what my current car, a 2010 Infiniti G37X Sedan, is worth. So, I have lost around $190,000 on my investment in cars.  

If you want to create wealth (while you’re young and working for someone else) you need to start thinking about cars very differently.  They are among the worst investments and biggest contributors to our financial slavery. 

Because when you buy a car and you don’t have the money to do so, you are financing a car. Leasing is even worse, because you never end up owning anything — it’s perpetual renting.       

Financing (or leasing) a car means you are choosing to allocate a large chunk of your paycheck to something that depreciates in value.  Maybe you won’t lose money on a classic Ferrari or a ’60’s muscle car, but your new car is guaranteed to lose money, and in addition to losing money, you’ll pay interest too. Feeling any pain yet?   

Start thinking about transportation as overhead.  Successful businesses try to maximize the amount of cash they have in their business by keeping overhead low. A smart business owner might seek a better solution like buying a slightly used car, one that gets good gas mileage, and doesn’t cost an arm and a leg to maintain.    

The more of your take home pay tied up into monthly finance payments — especially on stuff that depreciates (like cars) — the less you can save and invest.

The more and more stuff you finance means the less and less freedom you have.  And it’s not just your freedom to create wealth, it’s the freedom from having to do things you don’t like to do.    

Big Hat, No Cattle  

Are you trapped in your life and career?  Ensconced in a cocoon of comfort and measuring up with your neighbors and friends in all the major consumer categories?  You have the big house in the trendy suburb, a new hybrid sedan and SUV, designer clothes, hip furniture, private schools for the kids, plenty of vacations, and you go out to dinner a few times a week at the popular new organic restaurant.  

You can buy (finance) just about anything you need because you have a great credit score.  But, by the time you get your paycheck, it’s pretty much spent.  There are several credit cards, private school tuition, and car payments due.  Also, the mortgage, utilities, country club memberships, hot yoga, cable TV, Netflix, Apple Music and many others. Leaving zero room to make a deposit into your freedom account – or create wealth.  

In Texas they call this “Big Hat, No Cattle.” 

Your entire ecosystem of overhead is dependent on a single source of income, your paycheck from one employer.  Maybe two paychecks if you’re married. That begs another question, are you and your spouse both working, and paying for someone to watch your children, just so you can maintain this lifestyle?

Does your job make you happy?  Or is it more about the pursuit of money?  Is your favorite night Thursday, because the next day is Friday?  And your least favorite day Sunday, because the next day is Monday?

Do you dread waking up on another cold, dark, snowy, winter Monday, to join the rest of the zombies on a rush hour commute to a job you don’t enjoy, all to support a lifestyle that really doesn’t make you happy?

Does the career you chose in college, the path that paid the most money, create the kind of stress triggering you to smoke, drink excessively, or abuse drugs?  Do the politics of this job lead you to behave in unethical ways? Are the 60-hour work weeks steering you to eat poorly, gain weight, and avoid exercise?  

These constraints on our freedom are the most common, and subtle, but just as destructive because they turn our purpose of life into a pursuit of money, for stuff we buy, trying to impress our friends.  And we end up fat, out of shape, and unhappy.  With garages and basements full of crap.

Think back to when you were a kid and worked summer jobs.  This is possibly the last time you were truly free.  Before you took on the college loan, before you were introduced to credit cards, and before you were exposed to the powerful social and marketing forces that drive our consumption.  

This was the last time many of us truly lived below our means because our parents paid for our overhead.  It should have been an incredible opportunity to save money because every cent earned wasn’t earmarked for some type of bill. 

Many first-generation wealthy people today, meaning they didn’t inherit any money, built the foundation of this wealth on money they saved from summer jobs as kids.  

Not me, I didn’t save a penny.  

The Secret To Wealth

I had a terrific role model when I was growing up in my Aunt Ven and Uncle Bob.  They lived in the small town of Huntington, Indiana.  They never had children, and both had successful careers.  

In the 1970’s my Aunt became a Vice President for her local bank.  No small feat in those days.  She was an incredibly smart and driven person, and I believe a pioneer for women in the work place.  She broke free from the rat race at the age of 46 and fully retired from the bank.  Age 46, can you imagine?  As I write this today, I am 45 years old and nowhere close to retiring.  I’m betting this goes for the vast majority of us. 

My Uncle Bob started out as a tailor, and then bought a title insurance company that my father runs to this day. He worked until his early 60’s but not because he needed the money, he worked because he enjoyed his job and the daily interaction with people.  

Oddly, as a banker, my aunt never let my uncle borrow money for his business.  Not for anything.  She would insist they use cash to buy things.  Now isn’t that strange?  A person who made money for her bank by making loans to businesses wouldn’t allow her own husband to borrow money.  

It turns out that my Aunt Ven was very opposed to borrowing money, for anything.  

And that’s how they lived their lives.  In a sea of people borrowing money to build houses and buy cars.  They always paid cash.  And they always saved a portion of their income.  

Because their paychecks were not tied up in monthly payments for home, cars and credit cards, they were able to save a lot of money and take advantage of investment opportunities throughout their lives. 

They mostly invested in startup banks, stocks and real estate.  Because of these investments they were able to retire early and live off of dividends and rental income. 

They never made huge paychecks.  Their creation of wealth stemmed primarily from appreciation of investments.  Investments made early in life because they had the cash to do it.  

When I was young, I always looked forward to visiting their lake cottage in northern Indiana. I will never forget when Aunt Vennie discovered her neighbors were selling the vacant lot in between their two cottages.  She wrote a check on the spot for $60,000. 

Now who can come up with $60,000 in one afternoon without having to borrow it?  People who live below their means, that’s who. By the way, that property today is worth 20x the amount she paid.  

Aunt Ven and Uncle Bob gave me valuable advice while I was young.  But I never followed it. 

My parents were quite the opposite.  

Although I couldn’t have asked for a better childhood, or nicer parents who did their very best, they were terrible with their money. I don’t blame them one bit, like so many of us they wanted to have fun while they were young. And they had a bunch of wealthy friends: Doctors, Lawyers, business owners, so they were compelled to keep up appearances.

My parents financed just about everything.  Cars, houses, vacations, home remodeling, carpet, a pool, a deck, household appliances, cabinets, bikes, clothes, TV’s, furniture, exercise equipment, landscaping, garden tools.  

At first, my mother stayed home to raise me and my sister, and Dad’s income was our only source of revenue.  Eventually, as we grew older, the need for money was so persistent Mom began selling real estate.   

Still, all of their take home pay was tied up into payments of some sort.  And as kids, my sister and I benefited socially.  I remember how proud I was when my Dad brought home a new 1992 convertible Corvette.  It was White, with a navy-blue cloth top with matching leather interior.  It was beautiful, and my friends were in awe of it. The new Corvette was a symbol that we were doing alright.       

But living paycheck to paycheck is stressful, and I could feel the stress on my parents as a kid.  One day we’d be on top of the world with a new car.  The next day we’d be stressing out over lunch money.  

I believe this stress played a big role in their eventual divorce.  I’m certain it’s why my father had to file for bankruptcy soon after. 

I don’t blame them, because I acted the same way when I earned my own money.  I had every opportunity to learn from good examples like Aunt Ven and Uncle Bob – who by the way paid for my college, and my sister’s college.  And have funded my niece and nephew’s college funds.      

I just never associated enough pain with living beyond my means, I never considered, until now, what kind of freedom I was sacrificing. If I knew what I know now, and started when I was 25, I could have easily attained the wealth and freedom I described earlier by age 45.   

Consider this, if you work for someone else, eventually, you will become too old in the eyes of any employer.  

Recently, on a local personal finance radio show, the hosts pondered the following scenario:  A 58-year-old woman worked her entire career for a local family owned company.  She accumulated over $600K in retirement savings.  She owned her house, and she had some decent cash savings, around $20K.

The owners of the company – who valued her contribution and employment – were now old and wanted to retire from the business, leaving their 30 something year old daughter to take over.  

Naturally, the daughter wanted to change things.  Right or wrong, changes were coming, youth was moving in, and it worried the dickens out of this poor woman and other veteran employees. 

While this woman had done a good job of saving money, and living below her means, she still would benefit greatly by keeping this job, and her nice salary, until her mid-60’s.

The radio hosts pondered several scenarios for her, she could stay and run the risk of getting laid off by the younger generation.  She could retire, and look for other employment, or she could go back to school and seek other skills. 

These are the type of frightening scenarios you need to be prepared for as you age. Because when you devote your life to working for someone else, and you don’t live below your means and save a pile of money, someday your skills and contributions won’t be valued by a new generation of employers.        

The tools of financial slavery are debt and interest, brought on my living beyond your means, and if you think about how these forces restrict your freedom and dictate your life, it shouldn’t be hard to start feeling their true pain. So, get busy saving and investing, or even better, get busy creating your own business.     

How to Find Value in Sports Sponsorship

What’s true about the evolution of marketing tactics, just like in publicly traded stocks, is their value (or impact) changes over time.

Just 50 years ago the most valuable companies were department stores like Sears, industrial businesses like US Steel, and low-tech pioneers like Polaroid and Kodak.  

In the marketing world, the daily newspaper used to be the dominant source of information, and the most popular solution for advertisers.  

Today the most valuable companies are in technology, they make software like Oracle and Salesforce, or run digital platforms like Amazon and Uber — connecting people with information, products, and services.  

In the marketing world, the value (and popularity) of digital and social marketing has exploded, while the value of print marketing has plummeted.

But there is one marketing tactic that is seemingly timeless, because its value has never diminished, and today may be at its pinnacle — and that is — sports sponsorship.  

Why?  Because there has never been more demand for content — and there have never been more ways to consume content.  

What I mean by content is the entertainment you watch, and listen to, or read in various kinds of media like TV shows, movies, sporting events, concerts, viral videos, music from the radio or from streaming services like Spotify, articles from websites, blogs, apps, and other news providers.

All of it consumed on a growing number of devices and platform like our smart phones, TV’s, desktop computers, laptops, tablets, and even watches.

Therefore, the amount of money invested in content has never been greater, Netflix alone spent over $6 billion on entertainment for their subscribers in 2017.

ESPN, a part of Disney, spent about $6 billion on just the rights to air live sporting events — the most valuable of all content.

The Value of Live

Live sports are the most valuable of all content because it’s rare now for people to share the same entertainment experience at the same time.

Most of us are plugged into our personal (on-demand) feed of entertainment, delivered by our favorite device.

Intelligent marketers covet reaching folks sharing experiences at the same time because it’s a more efficient and effective way of engaging customers. 

Think about the Super Bowl in 2018, advertisers paid over $5 million PER thirty-second commercial (in part) because over 100 million people were tuned in at the same time.  

Live sports, especially Football, Basketball and Baseball, translate well to every media — they are safe for anyone to watch —and they elicit an emotional connection unlike any other type of content.

Sports work well in TV, Radio, social media platforms like Facebook, Instagram, Twitter, and are ideal for streaming.  Also, they provide compelling content and analysis for printed publications like magazines, newspapers, and programs.  

This means flexibility in creating effective and affordable campaigns for sponsors.

Sports are also safe — meaning when a business invests in sports sponsorship, they don’t have to worry about being associated with anything obscene or politically offensive — a growing concern especially in the digital marketing space.

A Shortcut to Making Your Business Unique and Compelling

One of the biggest challenges facing business owners today is figuring out how to differentiate themselves from their competitors.

How can your law firm, furniture store, HVAC company, or auto dealership stand out from your competition?

Most businesses say the same things in their advertising: How long they’ve been in business, how well they serve their clients, and that they’re locally owned and operated. 

Rarely are these features unique, and rarely are they compelling enough (on their own) to attract customers.

Sponsoring a pro or college sports team is a shortcut to the hard work it takes to develop a unique selling point.  

You gain access to a team’s most valuable asset — their intellectual property.  This means you can proclaim your business an official partner and incorporate their logos into your own advertising.  

This creates instant credibility and a connection to their fan base, the community, alumni, university leadership, faculty and students.  

Nobody understands this better than the beverage industry.  

Pepsi may not taste like Coke, and Miller may not taste like Coors, but they are similar. 

That’s why these savvy marketers engage with college programs and professional franchises in just about every city — because it makes them stand out AND it instantly connects them with a large pool of customers.

How to Market Your Business to Other Businesses

If you’re a business selling products or services to other businesses (a B2B), sponsorship is an especially good idea. 

B2B’s have a smaller target audience — other businesses. And there are fewer ways for them to advertise — which is why they often employ salespeople.

Ads in business journals and trade publications can only be as effective as the message or offer in the ad.

So, if you’re an official partner of a respected athletic program, and cleverly weave this into your marketing, suddenly you have a more compelling message.    

Ice Miller is a law firm based in Indianapolis, IN. And they work with many colleges in the state of Indiana.  

The ad below ran in a local business journal — but I modified it slightly — I inserted the logos of four prominent universities above their headline “build partnerships.” 

Which version of this ad do you believe would have more impact? The one with or without the implied partnership and logos?    

If you sell services or products to a college or university, you’d be wise to invest in an athletic sponsorship.  

Why?  Guess who attends games and pays close attention to their athletic programs?  

University leadership, administration, trustees, influential alumni, and decision makers within each school or department.  Also, students, their parents, visiting teams, visiting administrators, fans who are business decision makers, and the community.  

If you want to do business with the college or university, you’d be wise to invest in an athletic sponsorship.

Why? A sponsorship with a college athletic program is the single most impactful and efficient way of engaging these decision makers.  Period.  

Furthermore, you can invest in hospitality opportunities where can meet and interact with these leaders and decision makers. 

Universities also have ENORMOUS economic impact on their communities.

If you operate a business in a college town, you’d be wise to invest in some kind of sponsorship — or risk having a direct competitor gain this advantage — and risk losing out on a large source of existing and potential clients.

How to Get a Return on your Sponsorship Investment

All it takes is a little effort, and some common sense.

If you buy a sign and put your logo on it — and that’s all you do — it will be tough to measure the response.  

I’m not saying it won’t work, people will see your logo. Some will buy your product or service just because of that sign — but it’s still tough to measure.

Now, what if you add a clever little offer just below your logo?

What if a customer could download a coupon or some helpful research from your website? Now we have something more measurable!

Here are some other ideas (and there are many more) you can use to help develop a sponsorship likely to generate a measurable return on your investment:

Create a branded product, for example, Toyota has an Indianapolis Colts branded truck.  Ford has a Texas Edition truck.  

The Indianapolis Colts Toyota Tacoma Truck

You can brand anything with an athletic team. A furniture dealer could develop a branded recliner with logos and beverage holders.  Fans love to buy stuff with their team’s logo on them.

Have a coach or current or former player endorse your product or service.  Before Peyton Manning ever threw a touchdown pass, Indianapolis auto dealer Bill Estes signed him to an endorsement contract, and reaped the rewards of that partnership as Manning’s career took off.

Not everyone can afford a celebrity spokesperson, but you can probably afford a former or current player or coach, and this instantly distinguishes you from all your competitors. 

Offer a discount on your product or service with a win  or a loss — or some specific score.  The more you gamble the more interesting this becomes to fans. In many cities where Papa John’s operates, when the local colleges or pro team wins, fans win 50% off their next pizza!

Put your name on it!  Let’s say you own a lawn services company — name the football field — call it LAWN PRIDE FIELD! 

Lawn Pride Field @ Ball State University’s Scheumann Stadium

If you own a professional services firm and want to entertain clients and rub elbows with business leaders — put your name on the suite level or premium seats, or even create a special section for VIP’s.

Share Content — as I explained earlier, sports content is valuable, so become a sponsor of replays, or the play of the game, or a special video feature. Then SHARE IT on your own social media feeds.  

Ball State Sports Link is a student run program that produces video series and reports on Ball State’s athletic programs

Watch your audience organically grow by being the source of great content from a respected athletic program or franchise.  

One of the Best Ideas Ever

Many years ago, an NFL executive named Jim Steeg was inspired by a Wilson tennis racket.  He noticed a giant “W” on the strings signifying the Wilson brand.  

Steeg took that idea and emblazoned the NFL shield on the nets behind the goal posts at the 2003 Super Bowl and in Pro Bowls from 2002 to 2004.  A few years later Allstate picked up the idea and now sponsors over 100 colleges and football events each year.  

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This an example of an awesome idea we know is influential but may be difficult to measure.

How to Recruit the Best Talent

Historically low unemployment is a great thing for our country, but the number one complaint I hear from business owners is finding and keeping good people to work for them.

This is not just a white collar problem; it spans the entire spectrum of employment. From local retailers and restaurants, to shift workers and truck drivers, all the way up to professional service firms.

And the greatest untapped resource of talent is at colleges across our country.  From students who need part-time work to fund their college education, or find work because college is not working out, or the future salespeople, doctors, lawyers, bankers and accountants.  

An intelligent and efficient way of introducing your company to these potential recruits is by engaging with them through their collegiate athletic teams.

Sure, there will always be career fairs and on-campus interviews. And just like a needle in a haystack — you won’t be memorableespecially to the graduates who truly do have choices.  But what if these recruits knew about your company BEFORE they met you? And they thought of you in a different way, as someone who supports their beloved basketball or football team and might be cool to work for?

Chances are, most of these student have never heard about your insurance firm, or bank, or software company, or whatever … unless you’re with a big national brand with lots of name recognition. 

Something as simple a sign in an arena will put you on the radar of more potential qualified candidates than just about any other form of recruitment marketing.  And it will be less expensive. 

This is pro-active recruitment marketing.  It’s about the long game. Because by the time you’re forced to spend money to fill your talent pipeline, it’s already too late.

A sports sponsorship won’t flood your HR department with a pile of resumes. But in the long term, it will align your business with something near and dear to the hearts of thousands of future adults who will need jobs.

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How to Be an Intelligent Investor – And Advertiser

Featured on Inside Indiana Business

I believe the core principles of value investing in the stock market also apply to the world of advertising.  Whether you’re buying stocks, or advertising, the goal is the same: create a profitable return on your investment.  And in each activity, there’s a speculative factor with no guarantee for success.  Anyone can buy stocks, or bonds, or advertising; it is the intelligent buyers who find value where nobody else is looking.    

Value Investing

In 1949, legendary investor, Benjamin Graham, published one of the most popular books ever written about investing in the stock market, The Intelligent Investor – The Definitive Book on Value Investing.  You may know one of his most loyal followers – Warren Buffett. 

Graham’s searched for gaps in the intrinsic value of businesses and the prices of those businesses, then took advantage of those gaps by purchasing stocks or bonds in these companies at a discount.  These deviations in value often occurred because the prevailing herd on Wall Street (and the media) didn’t favor a specific industry or category of business.  When these enterprises were out of favor, or boring – yet still profitable and dependable businesses – their stock could often be bought below the fundamental value of the business. In plain terms, the companies were undervalued by Wall Street.  

For example, remember the dot-com bubble in the late 1990’s?  This is when the herd on Wall Street speculated excessively on dot-com businesses while profitable but untrendy businesses saw their values stagnate and stock prices sink.  

Become an Intelligent Advertiser 

I find most business owners today are quick to dismiss traditional or offline media as a viable option to market their business.  When I refer to offline or traditional media, I’m talking about everything but the internet.  Generally speaking – print (Direct Mail, Newspapers, Magazines) and broadcast (Radio and Television).

How can I blame them? For years they were restricted to boring newspaper ads, dreary direct mail, and seemingly ancient radio and television.  A lot of business owners think traditional media tactics are too expensive, wasteful, and difficult to execute profitably.  

Many businesses are handing over their marketing duties to younger adults who have very little exposure or interest in traditional media.  Or, they hire digitally-focused advertising agencies with zero experience – or interest – in anything offline or traditional.   

The marketing universe is consumed by propaganda in trade publications, newspapers, white papers, research studies, books, commentary and interviews with industry leaders – all focused entirely on social and digital media trends.  

Good news, this creates opportunity for the intelligent advertiser.  Offline media is very much out of favor.  Not because they don’t work, but because they had their bubble, and it burst many years ago.  While digital and social media attract the spotlight, I urge you to consider the significant underlying value in traditional media.  

If we were to compare advertising tactics to the stock market – you might classify offline media as an old blue-chip stock cranking out reliable profits and dividends for its investors.  Kind of like IBM, or Chevron.  Far from sexy, but profitable, and a classic value investment because the price of traditional media has never been lower.  

There have never been more ways to spend money on advertising than there are today.  And many “experts” give digital and social media far more credit than they deserve for their true influence on consumer behaviors.  Many digital solutions are wonderful, but just as many are faddish, unproven, wasteful, and fueled by hype.  

In case you hadn’t noticed, every major digital or social media company – from Facebook to Google to Amazon to Apple – all invest a considerable sum into traditional media.  

So much marketing advice these days comes from people who are rebelling against traditional media. They have a vigor and desire to disrupt (and I applaud and support their efforts), but this clouds their judgment when they won’t consider all the available options. Professional marketers and service providers who ignore how to execute successful marketing in traditional media are basically shunning the lowest-hanging fruit of potential success.

The Bottom Line

I’m not saying you shouldn’t invest in digital marketing or online infrastructure.  The point is: don’t get caught up in the hype, and don’t dilute your already small advertising budget (in comparison your national competitors) with a bunch of unproven digital and social media tactics – unless those tactics truly are the right solution.  In the pursuit of value, Intelligent investors and advertisers don’t have a bias toward any advertising tactic, the only metric that matters is return on investment.  

Shane Nichols is the General Manager of Ball State Sports Properties for Learfield Communications and the author of The Intelligent Advertiser, The Definitive Guide to Finding Value in Local Broadcast Media.

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How to Win Business and Influence People Part 1: Use Better Bait

Featured on Inside Indiana Business

Read Parts 2 & 3 of this series by following these links:

If your goal is to show a positive return on your invested marketing dollars, there are three key components of your marketing strategy that must work in harmony:  The math, or the media buy – the merchandising, or how you maximize transactions – and the messaging, or your creative.  

I believe the most important element is the messaging — what are you saying in your paid media to get a response from prospective customers? Anybody can buy media, the intelligent advertiser takes the time to develop a unique selling point, which may ultimately influence the media they use. And with the growing number of advertising options, this is now more important than ever.  

Here is a very common scenario, you spend a lot of time and effort on where to invest your marketing budget, spend even more time negotiating rates, and now it’s time to submit your ad.  Problem is — you’re busy running the business — so you decide to repeat last year’s ad.  

This is probably the most common mistake in all of advertising, a failure to take the time and effort to develop a unique selling point or actionable offer that will resonate with your target audience.  Because once you have the foundation of a truly unique selling point, it can be used forever.  

If your ad wastes precious airtime or space on any of the following features, then you probably won’t get a measurable response to your ad: 

  1. How long you’ve been in business 
  2. Having a family-owned business 
  3. Being locally owned and operated 

Notice that your national competitors can’t use any of these features in their advertising, and it doesn’t seem to hurt them one bit! 

Try spending one day paying attention to as much TV, radio and print advertising as you can stomach, and you’ll be stunned at how many businesses claim one or all three of these clichéd features. 

Bottom line: Spending money on ad space or air time and not utilizing it with some type of offer or unique selling point renders your investment unmeasurable.  

Your message should be 100% about getting a direct, immediate response from the small number of customers who are ready and able to buy at that moment.  And then, getting contact information from those who will buy – but aren’t ready yet.

Branding is for manufacturers with deep pockets like General Motors and their Chevrolet brand of cars and trucks. Response driven advertising is for the local Chevy dealer who sells the cars and trucks. 

For example, instead of just advertising a low monthly payment, Hare Chevrolet in Noblesville, IN features the “Sisters of Savings” who help you save money in their catchy radio commercials. 

The Sisters of Savings:  Courtney Cole and Monica Peck  

Testimonials from customers describing how you helped solve their problem or impressed them with your service are among the most effective forms of messaging. 

Indianapolis hair restoration clinic, PAI Medical, developed an effective and unique campaign when they started recruiting popular local DJs to endorse their service and products.

They find DJs who have thinning hair, restore their hair, then feature the successful transformation through testimonials on radio, television, and billboards. It’s a potent combination, especially when you hear your friendly DJ describe on-air how it improved their life.  

Celebrated author and master direct-response marketer Dan S. Kennedy offers great advice in his book, The Ultimate Marketing Plan. He advises taking a stack of 3×5 index cards and writing down every fact, feature, benefit, promise, offer component, and idea on each card—until you have exhausted everything you know about your business and direct competitors. Then try to prioritize these items by what is going to be most compelling to your customers—and by what makes you stand out from your competition. 

This doesn’t mean you have to become an experimenter or innovator – instead, be an adapter – and implementer.  Pay attention to unique approaches that are working from entrepreneurs in your industry in other markets and make them your own. 

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How to Win Business and Influence People Part 2: Be A Better Merchandiser

Featured on Inside Indiana Business

Read Parts 1 & 3 of this series by following these links:

If your goal is to show a positive return on your invested marketing dollars, there are three key elements of your strategy that must work in harmony — the math, the merchandising, and the messaging.  

In part one I emphasized how important it is to create a unique selling point or compelling offer so you can generate immediate response and track your advertising.  In part two I’ll focus on how important it is to maximize opportunities created by your advertising — also known as merchandising.     

Imagine this scenario: you operate a successful grocery store in a thriving neighborhood. Through a partnership with a local dairy farm, you have an exclusive opportunity to sell a very popular brand of organic milk for half the price of your competitors. A truly compelling and unique offer.

You capitalize on the opportunity and double your usual advertising budget for the month. You also quadruple your order with the dairy farm and create more space near the entrance of the store to display the milk.

The response is tremendous. Sales of organic milk triple, and your average sale per customer reflects this, but the increase in sales is exclusive to the milk. You also attract hundreds of new customers who are not regular shoppers, but you find a lot of them purchase only the milk. It appears your regular customers are doing their usual shopping and adding just the milk, and new customers are also cherry-picking your store for this one item. 

This is an example of a failure to merchandise. The failure occurred in a few areas. Although you were smart to increase advertising and the amount of product you ordered, you failed to capitalize on the surge in store traffic. 

Maximizing sales opportunities from customers ready to buy your merchandise or service is one of the least expensive tactics to grow your sales. 

By displaying the milk at the front of the store, you didn’t invite customers to experience the rest of your store and other merchandising efforts. If the milk had been placed at the rear of the store— you’ll notice that all dairy products are as far from the door as possible—you would have forced customers to walk the entirety of your store and be exposed to other selling opportunities. Who knows, half of the customers might have picked up two or three other items on their way to get milk! 

In addition to placing the milk in the wrong part of the store, you didn’t surround it with displays for complementary items such as eggs, cereal, and bacon, to increase your basket size or overall sale.

What if you own home service business, and whenever your coupon runs in the local newspaper you receive 10–20 calls — which is great and means you took the time to develop a compelling offer!  

However, the person answering your phone is not trained or prepared to handle leads, they think their job is to just to be a receptionist. In fact they are juggling several other duties as well as answering the phone.

They have no script, no process to follow, and no customer relationship software to record the caller’s information for future marketing opportunities. Half of the time, the calls go to voicemail.  This is a failure to merchandise by not creating a process to manage in-bound calls.  

In another example, let’s say you operate a furniture store, and from a pure merchandising standpoint the store is physically arranged to maximize sales in every possible way.  The hottest sale items are in the back of the store, there are multiple displays of entire furniture sets so customer can visualize what their new bedroom, family room or kitchen will look like.  

But, compared to some of the newer national chains who sell the same type of furniture, your store is dated.  The carpet is old, the lights are dim, the ceiling is low, and the parking lot has potholes.  This is a failure to merchandise by keeping your infrastructure up to date.  

Investments made into your physical and digital infrastructure are often expensive and difficult to commit to, but often pay dividends for many years.  So the cost essentially can be spread out over 5 or 10 years depending on the type of improvement.  

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The Secret To Getting More Response From Your Advertising

There are A LOT of things that need to go right before you succeed in advertising.

First, you need to buy the correct media, at the right time, and at the right level of repetition.  

Then, be sure your store, website and employees are ready to maximize any response to the advertising.  

And finally — you must create an appealing offer or unique selling point so people have a reason to respond.   

And, the definition of success is getting a measurable return on your investment, not “getting the word out.”

The secret to getting more response is to have multiple offers that appeal to all customers in the buying process for your product or service.  

In addition to focusing on those ready to buy — engage the larger pool of customers not ready to buy yet — who may buy in the future.  

The illustration below is a typical buying funnel starting with Awareness, then Interest, then Desire, and finally Action.

At any given moment there are people ready to buy your product or service — people ready to take Action.  Depending on your type of industry, only a small percentage of a given population will be Action buyers, the vast majority are in the other stages.  

My sales coach Matt Nettleton owns a Sandler Sales Training business in downtown Indianapolis, and he is great at appealing to people in every stage of their buying process (for sales training). 

Low threshold offers

Matt often advertises free books, white papers and other research as a free gift to people who are interested in learning about Sandler Sales training techniques.

These non-buyers are willing to provide their contact information in exchange for this valuable information, but they’re not ready to interact with anyone in person.  

The more helpful and valuable this information is will determine how engaged the customer becomes with your business.

Do them a favor, share some secrets about your business while they do their research, and they’ll reward you later with a purchase.

Medium threshold offers  

Matt also conducts free seminars encouraging potential clients to sample his services at no charge.

These events attract people further along in the buying process, beyond Interest and moving towards a Decision.  

They’re willing to experience a higher level of commitment, to physically interact with someone.  This type of personal interaction gives Matt a great opportunity to convert people into buyers.

A no obligation invitation to experience Matt’s sales training class for free

High threshold offers

Matt also conducts paid seminars, like this Sandler Sales Training Boot Camp.  People who sign up for this are are ready to take Action

These customers are ready to buy and the question your ad should answer is — why should they buy from you?

The rationale you give for why they should buy now shouldn’t be: how long you’ve been in business, or that you are a family and/or locally owned business. Nobody cares.

This is about grasping the bigger picture. Anybody can attract the “now buyers.”

Intelligent advertisers recognize the greater value in the ENTIRE PIPELINE of prospects.


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How ESPN Ruined Monday Night Football

On September 21, 1970, the ABC television network first aired Monday Night Football in primetime, and it was an immediate hit — capturing over 30% of the entire US TV audience, and would remain a top 20 primetime program for decades.  That is, until ESPN ruined it.

In 2006 when the MNF contract was up for renewal, ESPN grossly overpaid the NFL while giving up the right to feature the best games, and replaced popular veteran announcers like Al Michaels and John Madden with lesser known anchors from Sportscenter.

The Worst Games

ESPN pays almost $2 billion per year to air just one game a week — Monday Night Football.  To say they overpaid is an understatement — they didn’t even get a Super Bowl as part of this package.  It’s nearly twice what NBC pays to air Sunday Night Football.

When ESPN closed this billion dollar deal some of its top executives believed they were buying the schedule of the previous Monday Night Football package — which usually featured one of the top games of the week.  But NBC cunningly negotiated this feature away.

Sunday Night Football became the NFL’s premier prime-time package, giving it the best games and the right to steal the best matchups from Fox and CBS.  ESPN basically gets the leftovers, and it’s unfortunate because not only is it their loss, it’s ours too — because Monday nights aren’t as fun as they used to be. 

How did this happen?  Well, in part because the relationship between the NFL and ESPN has been rocky over the years.  ESPN considers itself a journalistic enterprise and many of their journalists have been — and continue to be — critical of the NFL, particularly on the concussion issue.  I champion journalistic voices not only in sports, but in government, politics and business.  But in the world of sports entertainment it’s risky to criticize an organization (The NFL) who controls the most popular live content on the planet.

The options for where the NFL can sell their content is growing daily — and at the end of the day – ESPN is just another cable network — another platform in a sea of platforms eager for content.  In an effort to take a positive step in building a better relationship, ESPN basically took whatever the NFL was offering while negotiating the MNF contract.

In Broadcast vs. Cable, Broadcast usually wins

NBC’s Sunday Night Football has been the #1 ranked show in all of TV for nine straight years.  When ABC aired Monday Night Football — even as the network struggled with ratings overall — it was a perennial Top 10 primetime program.  During the 2017 regular season, ESPN’s Monday night games averaged a record-low 10.8 million viewers, according to SBD. That was down 6 percent from the previous season.

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There are bigger trends at work here — all TV ratings are trending downward.  People are cutting their cable cords, buying antennas, and subscribing to more streaming services.  There are simply more options than ever when it comes to entertaining ourselves.  

Monday Night Football also changed platforms, moving from the ABC broadcast network — available to pretty much every household in America for free with an antenna — to ESPN — a cable network requiring a subscription to access their content.  This drastically reduced distribution and availability to millions of viewers — now you have to pay to watch MNF.

NBC built a franchise for Sunday Night Football out of thin air and created the #1 program in all of primetime.  I attribute that partly to the undervalued power and distribution of broadcast television.  Also NBC is brilliant at promotion, and production, and they understand primetime games deserve primetime talent.

A Lack of Star Power

NFL commissioner Pete Rozelle’s idea behind MNF was to promote football to the masses, and to make it even more interesting they added star power to the announcing booth.  When MNF debuted in 1970 it showcased the popular personalities of Howard Cossell, Keith Jackson and Don Meredith.  ESPN’s latest lineup features Joe Tessitore, Jason Witten, Booger McFarland, and sideline reporter Lisa Salters.  If you are a casual fan of the NFL and don’t watch Sportscenter or ESPN religiously, it’s likely you’ve never heard of these people.

Below is a list of MNF announcers over the years and pay attention to who ESPN put in the booth in their debut year — a wonderful but mild Mike Tirico alongside a very good Joe Theisman alongside Washington Post Sports Columnist Tony Kornheiser.  We went from Al Michaels and Jon Madden, superstars of football broadcasting, to a Sportscenter anchor and a newspaper columnist.  They are all wonderfully talented professionals, but ESPN took the fun out of Monday Night Football and turned it into a nerd fest of jock talk.

As Don Meredith famously said in the show’s heyday, “Turn out the lights, the party’s over.’’

1970Keith Jackson, Howard Cosell, Don Meredith
1971Frank Gifford, Howard Cosell, Don Meredith
1972Frank Gifford, Howard Cosell, Don Meredith
1973Frank Gifford, Howard Cosell, Don Meredith
1974Frank Gifford, Howard Cosell, Don Meredith, Fred Williamson
1975Frank Gifford, Howard Cosell, Alex Karras
1976Frank Gifford, Howard Cosell, Alex Karras
1977Frank Gifford, Howard Cosell, Don Meredith
1978Frank Gifford, Howard Cosell, Don Meredith
1979Frank Gifford, Howard Cosell, Don Meredith, Fran Tarkenton
1980Frank Gifford, Howard Cosell, Don Meredith, Fran Tarkenton
1981Frank Gifford, Howard Cosell, Don Meredith, Fran Tarkenton
1982Frank Gifford, Howard Cosell, Don Meredith, Fran Tarkenton
1983Frank Gifford, Howard Cosell, Don Meredith, O.J. Simpson
1984Frank Gifford, Don Meredith, O.J. Simpson
1985Frank Gifford, O.J. Simpson, Joe Namath
1986Al Michaels, Frank Gifford
1987Al Michaels, Frank Gifford, Dan Dierdorf
1988Al Michaels, Frank Gifford, Dan Dierdorf
1989Al Michaels, Frank Gifford, Dan Dierdorf
1990Al Michaels, Frank Gifford, Dan Dierdorf
1991Al Michaels, Frank Gifford, Dan Dierdorf
1992Al Michaels, Frank Gifford, Dan Dierdorf
1993Al Michaels, Frank Gifford, Dan Dierdorf
1994Al Michaels, Frank Gifford, Dan Dierdorf, Lynn Swann
1995Al Michaels, Frank Gifford, Dan Dierdorf, Lynn Swann
1996Al Michaels, Frank Gifford, Dan Dierdorf, Lynn Swann
1997Al Michaels, Frank Gifford, Dan Dierdorf, Lesley Visser
1998Al Michaels, Dan Dierdorf, Boomer Esiason, Lesley Visser
1999Al Michaels, Boomer Esiason, Lesley Visser
2000Al Michaels, Dan Fouts, Dennis Miller, Melissa Stark, Eric Dickerson
2001Al Michaels, Dan Fouts, Dennis Miller, Melissa Stark, Eric Dickerson
2002Al Michaels, John Madden, Melissa Stark
2003Al Michaels, John Madden, Lisa Guerrero
2004Al Michaels, John Madden, Michele Tafoya
2005Al Michaels, John Madden, Michele Tafoya, Sam Ryan *
2006Mike Tirico, Tony Kornheiser, Joe Theismann, Suzy Kolber, Michele Tafoya
2007Mike Tirico, Tony Kornheiser, Ron Jaworski, Suzy Kolber, Michele Tafoya
2008Mike Tirico, Tony Kornheiser, Ron Jaworski, Suzy Kolber, Michele Tafoya
2009Mike Tirico, Jon Gruden, Ron Jaworski, Suzy Kolber, Michele Tafoya
2010Mike Tirico, Jon Gruden, Ron Jaworski, Suzy Kolber, Michele Tafoya
2011Mike Tirico, Jon Gruden, Ron Jaworski **
2012Mike Tirico, Jon Gruden, Lisa Salters
2013Mike Tirico, Jon Gruden, Lisa Salters
2014Mike Tirico, Jon Gruden, Lisa Salters
2015Mike Tirico, Jon Gruden, Lisa Salters
2016Sean McDonough, Jon Gruden, Lisa Salters
2017Sean McDonough, Jon Gruden, Lisa Salters
2018Joe Tessitore, Jason Witten, Booger McFarland, Lisa Salters