I had the opportunity to have a colleague who was formerly an executive chef at a few fine establishments, (and some that were not so fine). This trade - which is glamourized on TV and on various cable network channels - is actually quite demanding and low-paying with certain exceptions. At the end of the day, it is very much a part of the retail trade, where cost management is critical.
One rule of thumb is to contain the costs to be roughly 1/3 of the total menu price. This ratio incorporates the fixed and variable costs related to preparing and serving the food, as well as having the facilities covered. The reason that many restaurants go under within a few months of their opening is because they do not hold fast to this ratio.
This rule can be altered if certain costs are covered. For example, in a family business where brother and sister don't need to be paid minimum wage, the labour component can be reduced. Alternatively if the location and facility cost is absorbed, that can work to the restaurant's advantage.
So what this really means is that the $12-15 meal that you get at your favorite pub or restaurant has an intrinsic value of $4-5, with the rest being overhead and service. This ratio is especially true if the restaurant is a busy place, as the food value will be more constant. If you are eating out several times a week, a large percentage of your spending is being diverted.
The essence of thrift is to get the most value for your money. What can you do to get the value of a restaurant (or specialty coffee) without overpaying to fund someone's rent or livelihood.
1. Learn to prepare the food or cuisine yourself:
When seen as an investment, the opportunity to expand your kitchen to have top quality appliances and equipment can increase your enthusiasm to cook and prepare meals (even just to use the fancy gadgets), and will open your palate to new experiences. This will also save time (another precious commodity) as you will no longer have to be kept waiting for your meal.
2. Increase your internal spending at home:
This is the "steak vs. bologna" equation where it is actually less expensive to purchase a mid-tier steak than the cheapest cold cut. Most conventional cuts of beef, pork, or chicken are priced at under $10 per kilogram. This translates to $1 per 100g, which is roughly the price of the lower-end cold cuts like bologna. Wealth is not just an asset count, it is a mentality and experience. Would a wealthy person be more inclined to eat a bologna sandwich or a steak dinner? Taking this logic further, for the same price as the cheapest sandwich at a cafe or take-out place, an individual can prepare a fine sirloin meal at home and bring it on where they can be enjoyed.
3. Have pot luck with your colleagues:
This can have several advantages including team-building, appreciation of diverse cultures, and international dining within a price point. At an average of $4-5 per person, a pot-luck ensemble can cover a wide range of enjoyable dishes with abundant quantities and variations. You can also create your dish to reflect the tastes and preferences of your group (i.e. extra spicy, low fat).
4. Look for deals with places having reduced overhead:
You will get more food for your restaurant dollar when you go to places where there are compromises in location, service, or restaurant overhead. This can range from selecting from set meals or "specials", participating in the unlimited buffets or service, enjoying self-serve or take-out, or even bringing your own beverages which you can enjoy for a "corking fee".
The lesson is that thrift does not necessarily imply sacrifice or abstinence. By making smart decisions and necessary preparations, decisions of thrift could actually lead to a more enjoyable life. If you create the meals and beverages, you control your meals, and improve your cuisine skills. It is less expensive and more satisfying, and it also develops your tastes so that you can properly enjoy your prosperity.
Showing posts with label tax savings dollar cost average money years. Show all posts
Showing posts with label tax savings dollar cost average money years. Show all posts
Tuesday, April 1, 2008
Sunday, March 30, 2008
Get Paid To Read - Be A Book Reviewer
Anyone who has gone through the steps of being educated in their profession, trade, or vocation, will undoubtedly have a large and growing personal collection of books, journals, and materials for their reading pleasure. As a student, you are part of a captive market, forced to purchase these resources at top dollar.
I recall as a student thinking that I was an unwilling pawn in a get-rich-quick conspiracy for the authors who were flogging their wares like carpet salesmen in a conference room at the airport hotel. I now have a different perspective, the authors are relatively low on the food chain to get paid for books sold.
I am an advocate of using the library as much as possible, not only to read from the current selection but to acquire books and references at a substantial discount, often 2-5% from the original listed price. Still, there are limitations, particularly if you want to get initial insight on the leading thoughts and innovative approaches in your area of interest.
For this reason I propose a very proactive and potentially lucrative approach: review manuscripts for publishers. If you can demonstrate expertise in a relevant area, it would be very helpful to support editors and publishers. Reviewers are asked to read and comment on the technical accuracy and usability of the material, and recommend changes or modifications.
The more complex the subject, the greater the need for substantial editorial review - hence the opportunity is growing. As you review this material, you can incorporate it into your own knowledge base, and continue your professional growth courtesy of the good graces of your editor.
The only question is whether this is worth your time. A manuscript can generally return a few hundred dollars per assignment, depending on the publisher. This may be a pittance when compared to the hourly income a professional can demand. However, as a method of learning new concepts, upgrading skills, and entrenching professional competency; reimbursement is a bonus. For my personal situation, I am able to credit book reviews towards the renewal of my professional certifications.
Some publishers even add a bonus to reviewers; any books reviewed are provided upon publication. This adds to the growing collection and can make for an impressive library (or unimpressive basement clutter). But consider the alternative of purchasing at normal rates. A collection of 10 books/year averaging $50-60 apiece obtained over a span of five years can net a few thousand dollars - enough to justify attending a "conference" in a destination location.
But back to building wealth - knowledge is a fundamental foundation of wealth as it cannot be retracted or removed. Building knowledge increases opportunity and marketability, and adds to your chances of prosperity.
I recall as a student thinking that I was an unwilling pawn in a get-rich-quick conspiracy for the authors who were flogging their wares like carpet salesmen in a conference room at the airport hotel. I now have a different perspective, the authors are relatively low on the food chain to get paid for books sold.
I am an advocate of using the library as much as possible, not only to read from the current selection but to acquire books and references at a substantial discount, often 2-5% from the original listed price. Still, there are limitations, particularly if you want to get initial insight on the leading thoughts and innovative approaches in your area of interest.
For this reason I propose a very proactive and potentially lucrative approach: review manuscripts for publishers. If you can demonstrate expertise in a relevant area, it would be very helpful to support editors and publishers. Reviewers are asked to read and comment on the technical accuracy and usability of the material, and recommend changes or modifications.
The more complex the subject, the greater the need for substantial editorial review - hence the opportunity is growing. As you review this material, you can incorporate it into your own knowledge base, and continue your professional growth courtesy of the good graces of your editor.
The only question is whether this is worth your time. A manuscript can generally return a few hundred dollars per assignment, depending on the publisher. This may be a pittance when compared to the hourly income a professional can demand. However, as a method of learning new concepts, upgrading skills, and entrenching professional competency; reimbursement is a bonus. For my personal situation, I am able to credit book reviews towards the renewal of my professional certifications.
Some publishers even add a bonus to reviewers; any books reviewed are provided upon publication. This adds to the growing collection and can make for an impressive library (or unimpressive basement clutter). But consider the alternative of purchasing at normal rates. A collection of 10 books/year averaging $50-60 apiece obtained over a span of five years can net a few thousand dollars - enough to justify attending a "conference" in a destination location.
But back to building wealth - knowledge is a fundamental foundation of wealth as it cannot be retracted or removed. Building knowledge increases opportunity and marketability, and adds to your chances of prosperity.
Exploring Tax Cost Averaging to Save Money
There are a number of authors whom I have found to be very interesting and enlightening. One of these authors is Evelyn Jacks, a successful authority on Canadian Tax Savings. While I won't go into detail on the specifics of her recommendations, I will say that after reading her books (of which I currently possess several), I come away with a greater awareness of the opportunities that a clever and motivated individual can pursue to save money and build wealth.
One such idea is the concept of Tax Cost Averaging. Put simply, this is the process of moving away from a year by year perspective and taking a longer term view of tax planning. In order to get the benefit from this, a person has to look beyond the current year and project their income and lifestyle over the next five years.
Knowing incomes and choices (family events, home, car, travels, etc), and astute tax planner can then restructure the financial details surrounding these items. Tax savings can be obtained by anticipating the expenses over time, and deteriming a productive or suitable use.
Over a five to ten year period, there are different opportunities to reduce taxes through some techniques including:
- deducting home office expenses
- deducting qualified automobile expenses
- distributing income to other family members
- capitalizing on existing tax programs like RRSPs
- deferring or delaying tax payments for business transactions
Even if there is no material gain from applying a technique, a prerequisite of Tax Cost Averaging is to make a financial plan, and track the results according the plan. As as they teach us in Business 101, what gets measured gets managed. Record keeping is essential for this program, not only to find tax-saving opportunities, but also to defend and protect yourself in the event you are randomly selected for a tax audit.
Assuming that a Tax Cost Averaging program can save 8% (8 cents on the dollar), that savings can be seen as equivalent to a 13th month of payment. Instead of having too much month at the end of the money, there is an extra surplus to apply towards credit card debt, short-term expenses, or long-term wealth building initiatives.
One such idea is the concept of Tax Cost Averaging. Put simply, this is the process of moving away from a year by year perspective and taking a longer term view of tax planning. In order to get the benefit from this, a person has to look beyond the current year and project their income and lifestyle over the next five years.
Knowing incomes and choices (family events, home, car, travels, etc), and astute tax planner can then restructure the financial details surrounding these items. Tax savings can be obtained by anticipating the expenses over time, and deteriming a productive or suitable use.
Over a five to ten year period, there are different opportunities to reduce taxes through some techniques including:
- deducting home office expenses
- deducting qualified automobile expenses
- distributing income to other family members
- capitalizing on existing tax programs like RRSPs
- deferring or delaying tax payments for business transactions
Even if there is no material gain from applying a technique, a prerequisite of Tax Cost Averaging is to make a financial plan, and track the results according the plan. As as they teach us in Business 101, what gets measured gets managed. Record keeping is essential for this program, not only to find tax-saving opportunities, but also to defend and protect yourself in the event you are randomly selected for a tax audit.
Assuming that a Tax Cost Averaging program can save 8% (8 cents on the dollar), that savings can be seen as equivalent to a 13th month of payment. Instead of having too much month at the end of the money, there is an extra surplus to apply towards credit card debt, short-term expenses, or long-term wealth building initiatives.
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