Category: Blog

Why do we look for 100% comfort when making decisions

We are interested in the concept of overthinking choices. The term “Redundant Deliberation” describes occasions where an individual becomes stuck in a perpetual loop of considering all the various options, but diminishing returns on their cognitive effort. When individuals are engaged in redundant deliberation they tend to do two things. First, they keep seeking more information even though it is evident that in doing so there is nothing new that would help inform their choice. Second, they continue to oscillate between imaging alternate future states.

Procrastination: Consider how someone who is fearful about the outcome of a decision might behave. He or She may procrastinate, putting off the decision, and avoiding the outcome altogether. Procrastination is a major symptom of one’s inability to make a decision. As the poem goes,

Procrastination is my sin,
It brings me endless sorrow,
I really must stop doing it.
In fact…I’ll stop tomorrow.

Missing Information: None of us knows enough to avoid making some mistakes. Likewise, none of us could possibly gather all the information necessary to know everything before we make a decision. In fact, recent scientific evidence suggests that the more information, and time we have to make a decision, the less likely we are to make a good one. A the point where effort exceeds any new information to help inform choice, and where there are no useful differences to the imagined future modeled states, we argue that you can think too much about a problem. More concerning is that overthinking can lead to unnecessary delay and decision inertia. To which, failure to act in a timely manner (or at all), carries significant negative consequences.

Should I Go with my Gut: According to the American Psychological Association, recent evidence and theory suggest that affective strategies may be equally as effective as deliberate decision making. In four experiments they examined conditions under which affective versus deliberative decision strategies might result in higher decision quality. While consciously focusing on feelings versus details, participants made choices that varied in complexity, in extent of subsequent conscious deliberation allowed, and in domain. Results indicate that focusing on feelings versus details led to superior objective and subjective decision quality for complex decisions.

We get caught in the worries, thoughts, and emotions that swirl out of control, sucking our emotions downward. Getting caught in the torrents of negative thoughts, and emotions that overwhelms us, and prevents us from making decisions that can improve your life. These negative thoughts create an ebb and flow to our thinking, which in the end, does not allow us to make a sound decision.

What are some ways that a “normal” person could become wealthy?

You must begin to think in 2nd and 3rd order consequences.

“Normal people” make decisions based on what feels good right now, or what they can do to avoid feeling uncomfortable right now.
The Wealthy, on the other hand, do what is uncomfortable and doesn’t feel good right now to get what they really want in the long run.
This means sacrificing short term pleasure today in exchange for delayed gratification in the future.

Some ways you can do that starting today:

• Invest 25% of your monthly income (self-imposed tax)
• Live below your means by cutting expenses (downgrades)
• Educate yourself in business ownership, and decide on building your own wealth (give up that tired/secure job)

Q: Do these sound like fun to you?

A: Not if you’re thinking short-term.
The old adage “Look into the mirror and ask yourself where you want to be in 5 years” still holds water and anyone looking to achieve more should ask that question. If answered, MORE, then take action to execute NOW. Speak with those that can help you get an idea of what executing that plan looks like and how to achieve the goal.

Think-Plan-Execute for a better tomorrow. Wealth may not be the end all to happiness, but it will bring the freedom to make choices that align with your happiness. SO, get uncomfortable to build a better tomorrow!

For a free consultation on building wealth, please contact Greg S. Jones at Joshco Partners.

Be the Trustee of your Retirement!

Starting a business after retirement is a growing trend. According to the National Bureau of Economic Research, about 25% of workers between 50-59 are self-employed. Of those ages 65-69, 46% are self-employed. And 68% of those between 75-79 are too. All of these groups have higher rates of self-employment than those under 50, where just 20% are self-employed.

Those who started a business from scratch represent only one group breaking into the business world after retirement. Franchises offer proven business concepts to help some entrepreneurs make money more quickly. Those who have retirement savings can often buy into one of these programs quickly. In fact, there’s been about a 40% increase in people over 55 buying into franchises since 2007.

Why are people starting a Franchise business:

• Increased financial security – Most adults who decide to retire have significant savings. However, medical costs and other expenses can also increase. Continuing to work allows you to save more of those funds and continue earning interest for a longer period of time. You may even be able to open another retirement account at your new job or continue adding to your previous accounts for many more years to come.
• Access to health benefits – If you are working a traditional job with benefits, you may get access to better health insurance than you would otherwise. This can help you get quality care and save money. Additionally, you normally can’t get access to Medicare until age 65. As a result, you may be stuck paying out of pocket without an employer plan which is quite expensive.
• Ability to stay active – Working keeps both your mind and body active. Overall, this can improve both physical and mental health. You’re less likely to sit idle all day long and let muscles atrophy or gain excess weight. Thinking through complex problems can stave off serious issues like dementia. Additionally, some people simply enjoy working and spending time with co-workers. This can be especially beneficial for those who don’t have a ton of other activities or hobbies to look forward to.
• Opportunity to try new things – Those who stayed in a single position or industry for their whole career may have other interests they want to pursue. A retirement job lets you explore different possibilities or focus on things you enjoy. This may be an especially potent benefit for those who start businesses. This gives you more control over your role and choice of industry. For example, if you previously worked in finance but wanted to do something creative, you might write and self-publish your own series of books.

Franchise topics:

• Consulting
• Child Care
• Writing and Editing
• Handmade Business
• Dog Walking
• Property Management
• Bookkeeping
• Catering
• Handyman
• Public Speaking

What Happens If You Work After Retirement?

If you work after retirement, you may be able to save more money in your 401(k) or other accounts so it continues to earn interest. However, your Social Security benefits may decrease if you earn more than the $45,350 limit up to your full retirement age.

You can start collecting Social Security benefits at age 62, but your benefits increase if you put them off until your full retirement age. This age depends on when you were born. The Social Security Administration offers a chart to help you determine your full retirement age and calculate benefits before that.

Basically, it’s up to each individual to weigh the pros and cons of retirement businesses or jobs based on their own situation. If you could benefit from preserving or adding to your retirement accounts for several more years, it’s likely worthwhile. If you care more about maximizing your benefits, a traditional job may not be worthwhile.

***To learn more about opportunities in retirement, please contact me at Joshco Partners for a free consultation.

Avoiding Small business failure!

“I think that maybe inside any business, there is someone slowly going crazy.”

Joseph Heller Something Happened

According to data from the U.S. Bureau of Labor Statistics, about 20% of U.S. small businesses fail within the first year. By the end of their fifth year, roughly 50% have faltered. After 10 years, only around a third of businesses have survived. Surprisingly, business failure rates are fairly consistent.

The most common reasons small businesses fail include a lack of capital or funding, retaining an inadequate management team, a faulty infrastructure or business model, and unsuccessful marketing initiatives.

BUT, if you wish to build a business and build wealth, Franchising can help alleviate most of what brings failure to an entrepreneur. Think about it, you’re buying into a proven business model, you have an understanding of the financial capability by reviewing existing operations, and you have a viable management team to work with you to build a business. With that said, due diligence must be completed to determine the strength and weakness of any Franchise organization. In a five-year study performed by franchise consulting firm FranNet, their results showed 92 percent of their franchise placements were still in business after two years, and 85 percent after five years. Though the success rate of independent businesses seems to be more volatile, this isn’t true for all industries.

If you are tired of working for Corporate America, and building wealth for someone else, there are several steps you must take to investigate Franchise opportunities. The list below is just a few of the items that one must look at before moving forward with a concept.

• Does the model fit with your skill set
• Success of existing Franchisees
• The current management team
• Service or Product fit with your community
• Your expectations

There are many more items to check off prior to making a decision to buy into a Franchise model, so one must look for help if you do not have the time nor experience to complete the full due diligence. As most do with looking at real estate, making investment decisions, etc.etc.. Get yourself some help to evaluate what may be a great opportunity for you and your family.

To learn more about starting your own business through Franchising, contact me at Joshco Partners for a free consultation.

The Cons and Pros of raising the capital

The opportunity to raise external money may be tempting; however, before entering this train, founders of a startup have to understand the cons and pros of raising the capital.

Let’s start with examples of the positive factors (Pros):

• extra money will help you to speed up the journey and results of a startup;
• high available budget can be used to develop and improve the quality of your product or service and thus to increase the chances of success;
• very often investment comes with the influential people, contacts behind; you will definitely feel the positive impact of this as more doors will be open for you;
• the journey of raising the capital (especially successfully doing this) will help to build your brand and benefits of being known and recognized in the business world.

The dark side (cons) of raising the capital:

• the process will ask a lot of time and some money (everything costs);
• investors’ money comes together with the loss of full control of the startup; you will have to compromise and sometimes it means detouring from your own plans;
• you will have less of the startups’ profit as you will have to share it with the investors;
• it might be difficult to feel the constant burden owing to others;
• big money brings a danger of conflicts among the co-founders and sometimes this can lead to the termination of the relationships.

Why and when to look for the investments?

There are different stages of startup lifecycle, when company grows from the idea/concept stage through the launching and up to the maturity stage. All these stages require investments of a certain scale.

To learn more about Growth Capital, and the opportunities that exist, contact me at Joshco Partners for a free consultation.

What is a Passive Franchise Owner – Passive Franchise ownership is the stage in business when, as the owner, you are no longer involved in the day-to-day operations unless you choose to be. The Franchisor has successfully developed systems that allow your people to run your business. When you reach operational irrelevance, you will have time to concentrate on the strategic side of your business. For many business owners, this is where the fun and profits happen.

Here are some reasons to consider Passive Franchise Ownership.

1. Your business will run smoothly.

The passive owner will have a successful Franchise system in place without your involvement. Your staff will know what to do and the systems in place will solve problems. Since you’re no longer in the trenches, you’ll rely on the Franchisors great financial reporting systems so you’ll always understand what’s going on and have an early warning when things could go wrong down the road. Your associates and customers will be happier because your business will be predictable in providing great service.

2. You will be able to concentrate on strategies instead of operations. Passive Franchise ownership by its definition means you spend less time on operations. Businesses that have achieved strategic excellence typically make more money and run more smoothly. This leaves you more time and brain power to focus on strategy. Spend your time on important goals and working with the Franchisor to increase revenue, opening new markets and possibly selling the company.

3. Your business will become more attractive to an outside buyer. A great system that is in place and producing recurring revenue will attract buyers. Two of the most important things potential buyers look for are the ability to run the company after the purchase and a healthy flow of sales that will continue after the transition.

When you make yourself operationally irrelevant and move into passive ownership, you can demonstrate the business is not based on what you do, but on what has been created. This demonstration will make a potential buyer interested in your business. That is why Franchises become a valuable asset.

To learn more about Passive Ownership, and the opportunities that exist, contact me at Joshco Partners for a free consultation.