Author: Kathyrn Vercillo

How To Earn While Supporting Your Local Business

How To Earn While Supporting Your Local Business

I value supporting local businesses. Additionally, I love to “shop small” whether that’s local or during my travels. This value has heightened during the COVID-19 pandemic. After all, so many local businesses are in danger of shutdown due to prolonged closures. Therefore, I was excited to learn about The Small Business Bond (SMBX). This is a way that I can earn money while also supporting small, local businesses. It’s right up my alley.

Why Shop Small and Support Local Businesses 

I’ve been a “shop small” person for almost as long as I can remember. My father is a custom woodworker who has always done local business. Local stores have charm, closeness, and unique items that you just can’t find in big box stores. Yes, the big bookstore will always have (or order) the book you want. However, the small bookstore has the best recommendations, the shelf of books by local authors, and staff that know your taste in reading and can recommend the perfect book at the perfect time. Local stores promote community.

One of the things that I loved about San Francisco when I first moved here was the limitations on large chain businesses. Although that’s changed some over the years, San Francisco is still a city vibrant with small local businesses of all kinds. I support them through purchases, social media promotion, and word of mouth. San Francisco shut down earlier and longer than most other cities during the COVID-19 pandemic. As a result, many small businesses have suffered. So, the opportunity to support them in a new way – while also earning money myself – really excites me. That’s what The Small Business Bond (SMBX) is all about.

What Is The Small Business Bond (SMBX)?

The Small Business Bond (SMBX) is a platform to invest in local small businesses. Small businesses borrow money through bonds that you invest in.

If you’re not familiar with bonds, then think of them as loans. However, instead of going to a big bank to get that loan, the small business owner gets it from everyday investors. You, should you choose to try a platform like The Small Business Bond, are one of those everyday investors.

How SMBX Works

The process is relatively simple:

  • Sign up as an investor on the SMBX platform. There’s no charge to create an account.
  • Browse through the available small businesses. Choose which ones you want to invest in. You can start investing with as little as $10.
  • The small business that you support will receive that loan money to help stabilize or grow their businesses.
  • Each month, you’ll receive a payment. The payment includes your monthly principal repayment as well as interest payments. Interest payments vary; they may be as high as 9%.

Here’s a closer look at what the experience of investing in local businesses through SMBX has been like for me so far:

Signing Up as a New SMBX Investor

I went to the website and clicked the “start investing” button. A new window opened up and showcased some of the most recent bonds along with the time remaining for funding and how much has been raised to date. On one hand, this seems like an extra page because I clicked “sign up.” However, the pause to glance over this page and see the businesses getting help right now was inspiring. It reminded me why I was doing this.

Upon clicking signup, a popup window opened. It asked me to choose whether I was investing as an individual or on behalf of an organization. I love that both options are available. I selected “individual.”

The next popup window let me know that there are three steps to investing in the local business through SMBX:

  1. Create a profile.
  2. Establish limits on investments.
  3. Link a bank account or credit card to the profile.

Step One: Create a Profile on SMBX

Easy peasy. So I did those things. I entered a username, email, and password. Next, I gave my legal name, birth date, and address. The site let me know that FINRA requires a U.S. address for all investors on the site.

Step Two: Set Investment Limits

This quick pop-up window asks four questions:

  • Approximate annual income
  • Approximate net worth
  • If you’re an accredited investor (which I am not)
  • Amount invested in crowdfunding in the past year

This established my investment limits. Next, I agreed to the various terms and risks. I received an email that I clicked on to confirm my email address. My account was all set up and ready for investing.

Step Three: Payment

After clicking on my email, I went to a new page of bonds. At the top of the page was a profile option, which I visited to set up my payment. I assume if I hadn’t done so then at some point I would have been prompted to add that.

The entire sign-up process took less than fifteen minutes.

Choosing Local Businesses to Support

On the bonds page, I chose from the available local businesses to support. SMBX is a new platform. Therefore, I only had a handful of options for supporting local businesses. I’m excited for more businesses to join. On the other hand, I’m also excited to be getting in on the ground floor of helping small businesses.

The Financials

When you click on a small business from the bonds page, it opens to that business’s page on the site. Here you see the financials on the right side of the screen. This shows the minimum and maximum amounts to raise, the bond duration, yield, unit par value, and total unit value. For example, clicking on ChildWise, I see that they’re raising between $50,000 and $100,000. The bond duration is 60 months, the yield is 8%, the unit par value is $10 and the total unit value is $12.17. In other words, if I invest in one unit at $10 and get repaid with 8% interest then I’ll receive $12.17.

The Businesses

Although there were only a handful of businesses to choose from, I still wanted to be discerning about where to invest my money. It’s important to me that the companies share my ethics. Therefore, although I appreciate the important financial information, I looked most carefully at “our story”. This, along with supporting documents, shows what the company is all about. It covers how they want to use their money. This is what matters to me.

I invested $50 to start. You’re allowed to invest in $10 increments. I chose to invest:

  • $10 in vegan cheese company Jule’s Foods
  • $10 in San Francisco ice cream shop Humphry Slocombe
  • $30 in childhood education business ChildWise

When I entered how much I wanted to invest in any given company, a pop-up window reminded me of the terms I saw on the company’s business page. Upon agreeing, a page pops up reminding me when my companies will fund. At that time, if their funding minimum has been met, my payment will get processed.

Risks and Rewards 

Should all three companies receive funding and successfully return their bond money, my $50 will become $60.69. Each transaction has a 4% transaction fee. So, I’ll only earn a little bit of money. But I’ve also only invested a small amount. I’m testing out the waters, and if it goes well then I’d love to invest more. It could be a great source of passive income. More importantly, either way, I’ve supported local businesses that I believe in, so the money isn’t wasted.

Don’t Buy a Home with a Swimming Pool. Here’s Why.

home with a swimming pool

If you care about saving money then don’t buy a home with swimming pool. Yes, it’s a nice little luxury. It can offset certain costs. However, in the long run, it’s not a good financial decision.

Justifications for Buying a Home with a Swimming Pool

There are definitely some justifications for buying a home with a swimming pool. It can offset certain costs.

For example, maybe your kids will spend all summer with their friends in your pool. Then you don’t have to pay for other entertainment, camps, and activities.

Likewise, you can have your family to your house so that you don’t have to travel to a family reunion. Everyone can just enjoy the pool.

If you have a pool to swim laps in every day then you don’t need to pay for a gym membership. There are definitely ways that a pool can help pay for itself a little bit. However, overall, the benefits don’t outweigh the costs, speaking financially.

Don’t Buy a Home with A Swimming Pool

If you have a home with a swimming pool, then you have a home that costs you more than it should. There are daily and routine expenses that go up because you have a pool. Plus there are unexpected expenses that can eat into your emergency fund.

The Cost When You Buy a Home

If you want to add a pool to your home, then obviously you have to pay all of the costs associated with that. However, even if you want to buy a house with a swimming pool, there are added costs. You’ll have to pay for a separate pool inspection before you buy the home.

Increase in Household Expenses

When you plan your budget out for the month, you have to plan on spending more because you have a swimming pool. For example, a home with a swimming pool has much higher energy bills than a home without one. You need electricity to run the pool pump. There are extra costs if you add lighting to swim at night or if you have a heated pool. You can easily spend $300 a month or more on extra energy costs when you have a home with a swimming pool.

You may also find that your home insurance costs go up. Swimming pools are considered a safety risk, so insurance companies charge you more when you have one. If you do have to file a claim related to the pool, your costs will go up even more.

Your swimming pool also results in other ongoing costs at home. You will have to pay for pool maintenance. Even if you do all of the cleaning yourself, you have to purchase specific supplies to keep the pH at the right level and so forth.

Emergency Costs

Finally, there are emergency costs associated with pools.

Going back to the aforementioned safety issue, you may have an increase in injuries in your home resulting in emergency room visits, paying liability costs, etc.

Even if you manage to avoid those bills, your pool itself will likely need repairs at some point. You’ll use a pool vacuum to clean it, a pool pump, and other supplies that will break and need replacing. The pool has a lining, and a break in that lining is one of the most common repairs people need. That’s not cheap.

The Cost When You Sell a Home

Finally, when you go to sell your home, you’ll discover that because of all of these things, your home’s resale value is actually lower thanks to your decision to add a swimming pool.

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Where Millionaires Live: 10 Small Towns with Big Millionaire Populations

where millionaires live

What do you picture when you think about where millionaires live? You might think of Beverly Hills or Malibu in California. You might picture New York City. On the other hand, you may imagine millionaires retiring to exotic international destinations.

Of course, there are plenty of millionaires around the world. However, you might be surprised to learn just how many of them live in small American towns. It makes sense, when you think about it. One million dollars doesn’t go a long way in New York City but you can stretch it really far in Williston, North Dakota.

Williston is one of the towns that Kiplinger reports has a high concentration of millionaires. Here are ten small American towns where millionaires live:

1. Summit Park, Utah

There are only about fifteen thousand total households in Summit Park, Utah. Of those, nearly 2000 are where millionaires live. When you look at the exact numbers, it’s got 12.5 % concentration of millionaires. In fact, it’s got the highest concentration of any small town in the United States. This is where millionaires live.

The median income for the area is just under $95,000. The median home value is just over $558,000. People here live good lives; it’s known for film festivals and ski resorts.

2. Los Alamos, New Mexico

I was surprised to learn that Los Alamos was on the list. I’ve been there and it didn’t seem like a place where millionaires live. However, like Summit Park, it has a 12.5% concentration of millionaires.

It’s interesting to compare the statistics between the two locations. There are fewer people living in Los Alamos (about 8000 households) but there are 1000 millionaire households. The median income is higher in Los Alamos (over $110,000) but the median home value is considerably cheaper ($285,000).

Each of these cities offers a very different way of life for the people who choose to call them home.

3. Williston, North Dakota

I’d actually never even heard of this small town before but apparently it’s an oil town and that’s created a dense population of millionaires. Of 14,570 household, 1331 of them are millionaire households. That’s just over 9% concentration.

4. Juneau, Alaska

Juneau has a high cost of living compared to many other places in the United States. Nevertheless, it might not be the first place to come to mind when you think about where millionaires live. And yet, the concentration here is high. The 1156 millionaire households here make up just under 9% of the total.

5. Edwards, Colorado

Edwards is a ski resort town. It’s one of the larger cities on the list, with a population exceeding 20,000 households. Of those, 1756 are millionaire households, which is 8.7% concentration.

6. Torrington, Connecticut

Torrington is a hidden gem – a beautiful place that’s great for outdoor activities but also offers shopping, dining, and art galleries. It’s a frequent escape for Manhattanites who want to get away.

It’s by far the largest city on the list, with more than 74,000 households. More than 6300 of those are millionaire households. The median home value here is $260,700 but the state has some of the highest taxes in the nation.

7. Kapaa, Hawaii

I think of Hawaii as more of a vacation destination than a place where millionaires live full time. However, about 8.4$ of the 25,000+ household in this Kauai island city are millionaire households. Like in Torrington, the property taxes are high, though. And like in Juneau, the cost of groceries and other cost of living items is high as well.

8. Vineyard Haven, Massachusetts

The name alone suggests that rich people live here. There are fewer than 650 millionaire homes here but they have such a low total population that it’s still over 8% concentration.

9. Breckenridge, Colorado

Apparently the wealthy like to live in ski towns in the Western United States. This one has just over 1000 millionaire households, which is just under 8% concentration.

10. Easton, Maryland

Millionaires who want a quieter spot with antiquing and calm beaches may try Easton. There are over 1250 millionaire households here, which is 7.9% concentration for the area.

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