Successful Blog

Budget for Small Business Health Insurance

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With the introduction of Obamacare and your employees rushing to find out what insurance plans will work best for them, it is no wonder you are wondering how these changes are going to impact your business.

While the world of business insurance is changing, there are ways to keep up with these changes and still provide your employees with the health insurance and benefits they need. But before you do that, it helps to create a realistic budget that lets you offer insurance but still remain within the business assets you have available for these benefits.

Here are some tips and resources to help you get started.

Choosing to Offer Health Benefits

The first step when creating your budget should always be to decide if you will offer health insurance.

While in the past, this was a given, you might want to rethink your plans for 2014 and later years. Obamacare is going to change the necessity of businesses offering health insurance plans and the plans that are available.

However, keep in mind offering insurance is also considered one of the many benefits that entice employees and keep them happy with working for your company.

Some things to note are that health benefits are cost effective when combining with other benefits for your employees and they improve employee morale. This can help your business advance to the next level, improving your productivity level.

Creating Your Health Insurance Budget

Next is the budget factor.

No matter how small your business is, you still need to create a health insurance budget before moving further with the type of health insurance benefits that will be offered to your employees.

Start by looking at your current or past budget, if you have it. Look at different budget templates. You may need to make some tweaks to it, but it’s a great place to start.

Look at your overall business budget and how much you can set aside for health insurance, and start there. Once you have this number, you will be able to then look for insurance plans within this budget.

You may also want to compare the costs of individual versus family health insurance benefits.

Types of Health Insurance Plans

Now that you are working on your budget, think about the types of health insurance that is available to choose from. This includes group health insurance and defined contribution plans.

The group health insurance plans are the most common and are sponsored by your business. You will provide these benefits to your employees, who then get a choice of which they opt in for, changing their premiums, plans, coverage and more.

Instead of paying costs to a specific plan, you can also offer defined contribution health plan which is a more affordable option and is more of a discounted plan, rather than insurance plan.

Moving forward into 2014, you will find that the current health insurance plans you are offering have changed somewhat, but are still available.

If you are fine with your budget and these plans suit your employees, don’t stress about making big changes.

Photo credit: iwvoices.com

About the Author: Tina Samuels writes on social media, small business, marketing, and insurance.

How to Avoid Taking Out Large Loans to Fund Your Business

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By Bill Fay

Family, friends and even his college professors told Aidan Augustin he had a business idea worth pursuing, even if meant dropping out of college.

Augustin and his roommate, Neal Ormsbe, designed a smartphone application that would allow anyone attending a business conference to get connected to and stay connected with the speakers and other attendees at the conference.

The two were juniors majoring in engineering at the University of Florida, but everyone said the idea couldn’t wait, so they dropped out of school, gave the business a name, Feathr, and opened shop.

There was just one little obstacle left to overcome.

“Money,” Augustin said, citing the one little obstacle nearly every small business owner must overcome.

Augustin and Ormsbe figured they needed $50,000 to get started. That’s not big money, unless you happen to be 20-year-old college dropouts with meager savings and no assets.

“We knew banks wouldn’t want anything to do with us,” Augustin said.

Getting Started

Fortunately, family, friends and their college professors got them started. Their parents agreed to send the same money they would have sent if the two had stayed in school. Friends agreed to work for what amounted to minimum-wage salaries. Professors put some of their own money in the pot, and a small business was born.

It didn’t take Augustin long to learn why more than half of start-up businesses fail the first year.

“We needed a lot more money than we thought we would,” Augustin said. “We didn’t understand the realities of what it takes to run a business. We underestimated costs on everything.”

That includes the relationship costs when you take loans from people you know, with no guarantee you can pay them back.

“The conversations with our parents and friends got a little awkward because we couldn’t really show clear signs of progress,” Augustin said. “Professional investors know the risks involved so it’s a little easier to deal with them when you’re starting out.”

Making Gains

Augustin let Ormsbe and a couple of part-time employees do the development work the next year and devoted more of his time to fundraising. He started with the crowdfunding site Indiegogo, where he found $21,000 worth of backing.

Then he won a lottery that provided free tickets to a conference in Silicon Valley for software startups called the “Largest Hack-A-Thon In History.” It was sponsored by Barracuda Networks, which offered winners $25,000 and a seemingly endless supply of business contacts.

Augustin’s group beat 130 teams from all over the country and claimed the top prize. That led to a front-page article in his hometown paper, the Orlando Sentinel, and suddenly Feathr had some status.

“That article created a buzz about our company,” Augustin said.

Feathr picked up a $150,000 award from TiE (The Indus Entrepreneurs) and contacts from the Barracuda Networks conference resulted in the first product sales. The 2014 budget is up to $450,000, most of which will go to pay salaries for the 12 full-time employees now working at Feathr’s offices in Gainesville, Fla.

“We don’t having the living expenses they have in Silicon Valley or New York City or places like that, which is a huge advantage for us,” Augustin said. “We can use our money more efficiently to hire more people and pay them actual salaries they can live on.”

The best news is that Feathr, now in its third year of operation, still hasn’t needed a bank loan to stay in business.

“We sort of hopped and skipped from one funding source to another, but we’ve made it so far,” Augustin said. “We’re working to keep it going that way.”

In addition to the crowdfunding, and loans from friends and families that helped jumpstart Augustin’s small business, another option to consider is tapping an annuity. Entrepreneurs who have annuities could use those investments to finance their budding enterprises instead of taking out loans.

The great thing about an annuity is that it’s your money. It’s already there, and you are not borrowing from a lender; however, since the annuity operates as retirement income, there are penalties to taking cash out before retirement.

When you take funds out of your annuity early you can expect the following:

  • A 10 percent penalty on the taxable portion of the annuity is forfeited if you are under the age of 59 ½.
  • The tax deferral benefits are in place to encourage long-term retirement savings, so the fee is similar to what you would pay on an early withdrawal from an IRA.
  • In most cases, if you cash out early, you will have to pay surrender charges. If your annuity carries a surrender fee, you should try to wait until the fee no longer applies. Surrender charges generally start at 7 percent and decrease incrementally, usually by 1 or 2 percentage points each year, until they reach zero.
  • Earnings on annuities are considered ordinary income, so you must pay taxes on any earnings when you cash out your annuity. This is in addition to the 10 percent early withdrawal penalty.
Author’s Bio: Bill Fay is a writer for Annuity.org, focused mainly on news stories about the spending habits of families and government. He spent 21 years in the newspaper business and eight more in television and radio, dealing with college and professional sports, then seven forgettable years writing speeches and marketing materials for a government agency.

4 Fear Busters To Jumpstart Your Business

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By Kevin Kelly

In my latest book, DO! The Pursuit of Xceptional Execution, I interviewed entrepreneurs from around the world. They lead some of the world’s most compelling brands and companies, ranging from one to 3,000 employees, with turnovers from $100,000 to $130 million. I call them the Xceptionalists. They hail from Buenos Aires, Argentina to Bologna, Italy; from Des Moines, Iowa to Galway, Ireland. They run app companies, consultancies, clinics and sprawling technology corporations.

Given that half of all new business fail in the first five years, how did they deal with fear and survive their early failures?

1. Stop fearing feedback

Xceptionalists treat failures as feedback and a prelude to future success. Ben Milne of Dwolla said, “… I have failed in making adaptations to the product… I have failed at selecting business partners. I nearly went out of business three times in my career. When you are failing the key point is to just admit it. … The longer you drag it out the less chance you have.”

According to Peldi from Balsamiq. “Mistakes don’t really matter that much as long as you fix them straight away and put your hand up. … It is very much the lean start-up way: throw it out there and listen.”

Why fear feedback? Why stigmatize failure in the workplace when it’s bringing you closer to achieving your organizational goals. If you want to find the next big success, failure comes with the territory.

2. Face and floor it

In the early 1970’s, during the height of the political turmoil that rocked Northern Ireland, Agnes McCourt, owner of Unislim had a very frightening encounter with an armed and masked gunman, Agnes’s husband wanted to cease all business links in Northern Ireland and relocate to Southern Ireland. Agnes agreed to the house move but continued to develop the her business. Why? “In business, one has to be fearless and do what one’s inner voice tells you is the right thing,” she told me.

Devon Brooks co-founder of the unique women’s personal care business Blo Blow Dry Bars, was sexually assaulted and went through the ensuing harrowing judicial process. She made a personal commitment that she would never let her past get in the way of taking action. Devon told me, “Sometimes you live life, and sometimes life happens to you. But you always get to choose what you do about it.”

3. Find the source of the fear

Like many Xceptionalists, when fear raises its head, Patrick McKeown of Asthmacare had a strategy that works for him. He asks three questions:

  • What is the best possible outcome?
  • What is the worst possible outcome?
  • What outcome falls between the above two?

McKeown says entrepreneurs who survive in the long term take calculated risks, and tend not to take monumental courses of action with their head stuck in the sand. So the fear has no gone away, they just understand it a little better.

4. Flow floors fear

For our Xceptionalists from Brazil, WeDemand.com, fear was never an issue. They have been so immersed in an industry they love, they haven’t had the time or the inclination to be afraid. “I would tell entrepreneurs not to be afraid. If you sit around and just wish about your idea, nothing will happen. All you can lose is money and there is no shame in trying,” said cofounder Bruno Natal.

So in essence, there is nothing to fear. The challenge for you the entrepreneur is to find your passion and make fear history.

See more extracts from Kevin Kelly’s new book “Do! The pursuit of Xceptional Execution”

Author’s Bio: Kevin is an internationally acclaimed leadership and motivational speaker and best selling author. For more information: http://www.kevinkellyunlimited.com.

15 Ways to Zig When You Want to Zag

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When you woke up this morning, did you grab your robe, shuffle to the kitchen, and press the Brew button? (Mine was a Starbucks Verona K-cup.)

How to zig when you want to zag

Most people spend their entire lives in that same state of semi-aware robot sameness. They do the same thing every day, say the same things, write the same things, look the same way.

And then they expect something to change.

They’re stuck.

My suggestion is: zig when you want to zag.

  1. Have tea tomorrow morning instead of coffee.
  2. Wear an acid green shirt.
  3. Drive a different route to work (or hitch a ride with a colleague).
  4. If you always write about marketing, write a post about neuropsychology or ant farming.
  5. Practice a new response to “how are you?” Instead of “fine, how are you,” what if you said, “I’m FANtastic!”
  6. Floss tomorrow.
  7. If you’ve been afraid to submit a guest post to your favorite blog, just do it.
  8. When you normally would say “no thank you” to something, go for it and say “sure, thanks!”
  9. Go for a full day without typing minimizing words in any emails (like “just” or “sorry”).
  10. Have lunch at a place you’ve never been.
  11. Have you become afraid of talking on the phone? Call three clients out of the blue.
  12. Mail a handwritten thank you note to someone.
  13. If you have a habit of checking email first thing in the morning, wait until noon.
  14. Pick a new habit to incorporate into your routine (listen to this awesome podcast from Michael Hyatt for some help with that).
  15. Choose one task you need to get done, and ask someone for help with it.

Get unstuck. Out of the rut.

Things will change if you change them.

The Successful-Blog community is here to help. What can we help you get unstuck from?

Author’s Bio: Rosemary O’Neill is an insightful spirit who works for social strata — a top ten company to work for on the Internet . Check out the Social Strata blog. You can find Rosemary on Google+ and on Twitter as @rhogroupee

Photo Credit: purplemattfish via Compfight cc

Should You Allow Your Employees to Nap While on the Job?

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There was a time when people could get into trouble for falling asleep at work, but things have changed in recent years.

More and more companies are encouraging their employees to take naps during work hours.

If you are considering whether or not you should allow your employees to nap on the job, the following information can help you make the right decision.

Napping at Work in the United States

Many companies in the U.S. require their employees to work very long hours. To ensure that their employees will not be overly exhausted, these companies provide napping rooms or pods as a perk.

A report released by the Society of Human Resource Management revealed that napping rooms or pods were found in about six percent of all workplaces in 2011. Some of the well-known companies that allow their employees to nap at work are Google, Nike, Ben & Jerry’s, Pizza Hut, Huffington Post, Workman Publishing, Deloitte Consulting and Yarde Metals.

Cost of Sleep Deprivation to U.S. Businesses

According to the National Sleep Foundation, adults sleep an average of about seven hours per night during the work week, which is one hour less than the sleep duration recommended by experts. This means that a large percentage of American workers are sleep-deprived.

Sleep deprivation can have many adverse consequences, including increased errors, accidents, absenteeism, drug use and turnover; higher insurance rates, and lower productivity.

Depending on the severity of its consequences, it may result in substantial financial loss for a company. In 2011, Harvard scientists found that sleep deprivation costs U.S. businesses about $63 billion in lost productivity every year.

Benefits of Allowing Employees to Nap on the Job

Dozens of medical studies have found that sleeping for 30 minutes to one hour in the afternoon can increase alertness, productivity and mood.

Employees who are sleep-deprived have a greater tendency to feel tired than those who have enough sleep, and they may lose their ability to focus on their work. This can result in a decline in work quality and productivity, and even costly errors and accidents.

Napping at work can make your employees feel more refreshed and revitalized, enabling them to perform their duties more competently. It is especially helpful for those who are working in a creative field, because it can boost their ability to think creatively.

Create a Conducive Environment for Napping at Your Workplace

The best way to create a nap-friendly workplace is to dedicate a room for napping.

You can place beds, recliners or sleeping pods in the room and use dim atmospheric lighting to provide a comfortable sleep environment for your employees. If you do not have enough space to create a napping room, you can supply nap mats and eye masks instead.

Many companies that encourage napping on the job have seen a significant increase in employee productivity.

Therefore, it is highly recommended that you make napping a part of your company culture.

Photo credit: newscolater.com

About the Author: John McMalcolm is a freelance writer who writes on a wide range of subjects, from running a small business to online reputation management.