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LuLaRoe Startup Cost

lularoestartup-costsLuLaRoe is the new big thing in work-at-home sales.  You get to host parties online and at the homes of others, you help people feel great about their new outfits, and you make money.  Sounds like a good plan, right?  But what is the LuLaRoe startup cost like?

With many work-at-home sales programs, you don’t have to have a huge inventory.  You buy a few things that you can use to demonstrate with customers or possibly direct sell, but for the most part, customers can view your catalog (either in paper or online) and place their order, which then ships directly from the company.  You pay a fee for your online ordering portal, but for the most part, your costs can be pretty limited.

Not so with LuLaRoe.  The LuLaRoe startup cost is significantly higher.  How high?

Well, to begin with, you have to buy their initial onboarding package.  At the time of this writing, that includes:

Julia Dress- 30 pieces
Maxi Skirt – 60 pieces
Cassie Skirt – 50 pieces
Irma Shirt – 70 pieces
Randy Shirt – 40 pieces
Classic T Shirt – 40 pieces
Lindsay Kimono – 25 pieces

That’s a total of 315 pieces of clothing.  The cost?

$5355

But $5355 isn’t your sole LuLaRoe startup cost.

First off, what is LuLaRoe known for?  Leggings.  And this order doesn’t contain any leggings.  So while you don’t have to buy leggings… you probably want to.  You can get 50 pairs of OS leggings for $525 and 40 pairs of TC leggings for $420.  You probably want both, so that’s an additional $945.

If you have shopped LuLaRoe online, you know that something a lot of consultants do is photograph their items on a mannequin of some sort, so that’s another added cost.  Another simple method is to just put a hook on a white wall, hang up the item on a hanger, and photograph that way, but they just don’t look as nice.

How are you going to store all of this clothing?  You may want to get a series of Rubbermaid bins (or something similar) to keep everything protected.  Other consultants keep everything on hangers on clothing racks.  Neither of these options is free.  And if you plan to do in-person parties at someone else’s home, you will need the clothing racks and hangers.  No one wants to plow through a pile of clothing to find what they want.

You will likely also want business cards, both to hand out and to include in your packaging when you ship items.

And, of course, packaging to ship isn’t free!  Yes, you can get free priority mail packaging from the post office, but you don’t just want to shove a dress into an envelope.  You likely want to wrap it in tissue paper or something similar.

Then there’s the back end.  How in the world are you going to track all of this inventory and your costs and income?  Sure, you can do a series of spreadsheets, or you can purchase a software program designed for this sort of business.

One thing often not considered in the LuLaRoe startup cost is added insurance.  Frequently, homeowners insurance or renters insurance won’t cover business inventory of this level.  You will want to check with your insurance agent to find out if you need to add to your inventory.

So you are easily talking $6000 as your LuLaRoe startup cost, likely even more.  How long will it take to make that money back?  It depends on what you sell and how fast you sell it.

I did some quick math.  That initial package?  If you sell every piece, you will make

$12,070

That’s $6715 in profit, not factoring in all your other costs.  So if you sell half of your inventory, you should make back your initial investment. Doesn’t sound so bad, right?

That’s still almost 160 sales.  And this is assuming that you have the sizes and patterns that your customers want.  Because remember, you don’t get to choose those.  You choose the style and see what you get.  The way most consultants keep people interested is by continuing to add to their inventory.  That means spending more money before you’ve made back your initial investment.

LuLaRoe startup costs are no joke.  It’s not easy money – it’s hard work, and nothing is guaranteed.  Make sure that you truly understand what you are getting yourself into before signing up.

What are the Best Budgeting Tools?

georgeOkay, so you’ve decided to make a budget.  Congrats!  You’ve taken the first step towards financial confidence!  But how in the world do you make a budget?  There are a lot of tools out there.  What should you use?

If you want to go simple and not have to put any of your information online or limit yourself to any one product, you can make a simple spreadsheet.  The upside to this is that it’s free (assuming you have a spreadsheet program on your computer) and you can view it when you’re online or offline.  (You can also use Google Sheets, but then you’re putting things online, which may not be the route you want to go.)  But for a program like this, you have to be sure to enter all of the information.  Nothing will import automatically.  In many ways though, this is good because you then have to look at all of the information very carefully.

Another simple option is software that you buy and install on your computer.  One good option that many people use is Quicken.  Quicken has been around for decades and has a lot of amazing features.  Actually, after researching it, I’m wondering why I don’t use Quicken.  You can import information from your bank and credit card companies, you can plan for upcoming bills, and you can see your spending and savings in a variety of ways.  Quicken can also help you track your investments if that’s something you need.

There are also some purely online systems.  Big advantages of these is that you can access them anywhere.  Big downsides to these is that your information is all in the cloud.  If you don’t have an internet connection, you can’t access your information.  The sites could also go down, which is a risk.  The two popular systems are Mint and YNAB.

Mint is pretty extensive and has a lot more features.  Also, it’s free.  Similar to Quicken, you have a lot of options on how to see your information.  You can import your data, set a budget, schedule bills, and track your investments.  It’s a lot of information, and you can easily access it on the go.  That’s awesome.  Of course, nothing is actually free, so Mint has to pay for the features it offers.  How does it do that?  Advertising.  You will be shown targeted advertising for things like credit cards and other financial products.  This doesn’t bother me in the least, but some people might see this as a negative.  If you find yourself tempted by credit card advertising, Mint probably isn’t for you, but for most people, it’s not a problem.

The other big online option is YNAB.  YNAB is more than a budgeting product, it’s a way of managing your money, and it’s certainly not for everyone.  I’ve written extensively on YNAB, so it’s clear that I love it.  But it does a lot less than many of the other products.  That said, for me, the simplicity works.  I can see the big picture, but am not distracted by charts and graphs.  I’m forced to focus on the here and now, and that’s what I need in budgeting.

And of course, if you want to go simple, the best first step is a pencil and paper.  Write it all down.  Start with your monthly bills, things like rent/mortgage, electric, gas, cable, phone, things like Netflix, etc.  Then see if you can gather up your less frequent bills, things like insurance, property tax, various annual fees.  Write down your monthly income, and figure out what you have left after you’ve paid all your monthly bills and saved for those infrequent bills.  That’s what you have left for food, fuel, and all those other expenses that come up every month.  If the numbers fall short, figure out where you can find some extra cash.  Do you need that big cable package?  Do you need Netflix?  It’s a lot of work, but it’s a good place to start.

Starting a budget is scary.  But there are a lot of great budgeting tools out there for you to use. What’s the best one?  The one that you will actually use.

Is FreeCreditScore.Com a Scam?

freecreditreport.com

Update! From Experian’s PR team, apparently, they’ve changed their scammy ways!

“I wanted to clarify that we do indeed offer a free FICO credit score.  There is no credit card requested and no required membership to enroll in. 

Also, in our product freecreditreport.com, an Experian credit report is completely free.”

I still recommend using annualcreditreport.com.  It’s free, it’s required by law, and there is nothing hidden.  

You’ve probably seen the ads for freecreditscore.com and freecreditreport.com.  Checking your credit score is important, and free is the best price, right?  So clearly, this is the way to go.

Except it’s not.  Not at all.

First off, let’s talk about what a credit report is.  A credit report is a borrower’s history from a number of sources – banks, credit card companies, collection agencies, etc.  It basically shows how much you have borrowed, how much you can borrow, and if you’re paying it back as you’re supposed to.  Your credit score is a number based on this information that indicates how good of a risk you are to lending companies.  The higher your score, the more likely you are to be willing and able to pay back the loan.  If you’re low risk, you’ll get better interest rates on things like mortgages and car loans.  If you’re high risk, your rates will be higher or places might not even be willing to loan to you at all?

Why is it important to check your credit report?  Well, in general, it’s always good to have all the facts.  But it’s also good to check for errors.  Unfortunately, errors can happen on your credit report.  There might be something on there that doesn’t belong to you thanks to identity theft or fraud.  There might be a bill that appears to be sent to collections that you most definitely paid.  These are all important things to know.  More importantly, though, it’s good to know how you look to potential creditors.  It’s also important to see all those numbers in one place.  Sometimes, it can be a bit overwhelming to look at your debt in that manner, but it’s an easy way to see the full picture and start working on paying it off.

So using freecreditscore.com is awesome, right?  No.  Why?  Because with many things on the internet, it’s not free.  Sure, you can get your info for free… if you sign up for their credit monitoring service.  It’s not free.  It’s free with purchase.  It is through Experian, which is one of the “good” credit report companies, but they’re definitely being terribly misleading.

Do you really want your free credit report?  The government can help you with that.  Go to AnnualCreditReport.com.  By federal law, the big three credit reporting agencies have to give you a free credit report every year, and this is where they do it.  You will not pay any money for this.  It won’t give you your credit score – but you can get your credit report and make sure that all the accounts listed are actually yours.  If you’re not looking to take out any new loans anytime soon, your credit score isn’t important right now – and by paying off debt and continuing to pay on time, your credit score will be increasing, even if you aren’t monitoring it.

Very few things in life are actually free.  Most of the time, there is a cost.  FreeCreditScore.com is definitely a scam.  The info isn’t free, it comes with a cost, and not just a one time cost, but actually signing you up for a program that will continue to bill you until you cancel.  A program that you can’t just click to cancel, but that you have to call and cancel.  I’ve never signed up for this program, but you can bet they try to talk you out of cancelling.  It’s a hassle that people don’t need to go through.  If you want your credit report, go through AnnualCreditReport.com.  It’s not a scam.  It’s how the government is trying to protect you from the scammers and make sure that you have all the relevant information you need to make a good choice.

How to Make More Money

We would all love to have more money in our budget.  And sure, we scrimp and we save, but the money just doesn’t seem to add up very fast. While tightening your budget is always a good thing (why waste money?), if you want to increase the extra cash you have available, the easiest way is by bringing in more income.

No, I’m not saying you should go out and find a new job that pays more.  That’s never the easiest option.  But there are plenty of ways to bring in some extra cash.

As an aside, be careful of the online sites promising easy money.  Is there ever a truly easy way to earn money?  If you’re sitting around with nothing to do, you can take surveys or play with Amazon Mechanical Turk, but you’re going to be making pennies.  Yes, pennies add up, but you could clip two coupons a month and save more.

Can you make money online?  Absolutely!  There are some great sites out there for freelance workers.  Are you a writer or an editor?  Check out sites like Upwork or Freelancer.  Note that they don’t pay as well as a lot of traditional freelance jobs, but it’s a place to start.  A lot of the companies that post jobs there are mostly concerned with the price, so you won’t get rich, and you will need to decide if the time you put in is worth the money you get out.

A better option is to take a look around you.  How can you make money locally?

Think about what skills you have to offer.  Do you enjoy mowing your yard?  Put out flyers offering to mow for the neighbors.  Are you good with kids and enjoy teaching?  Maybe you have the skills to tutor.  The same goes for teaching a musical instrument.

Services like Uber and Lyft are getting a lot of attention lately.  While the pay is apparently not great, if you enjoy driving, like meeting people, and have a clean car, it doesn’t hurt to try it out.  Worst case, you decide it’s not for you and stop driving.  (Though not while in the middle of a ride – that would just be rude.)

Consider offering up your services as a pet sitter.  Especially if you have friendly pets of your own, people love being able to leave their dog with a family rather than putting it in a kennel.  A friend of mine just recently shared pictures of her dog at the dog sitter’s house.  The dog was playing with the other family’s dog and just having a grand time.  What a great service and an easy way to bring in some extra money!

Someone in my neighborhood was recently looking for someone to watch her kids before school, in the time between when she leaves for work and the bus picks up the kids.  Ideally, she wanted someone to come to her home for that hour so the kids could eat breakfast and finish getting ready.  Depending on your work schedule, that might be something you could make work.

How are your eBay selling skills?  Plenty of people have things they want to get rid of, but they don’t have the time or knowledge to list things on eBay.  Offer your services to photograph and list the items for them – and have your fee be a flat rate or a percentage of the sale.

There are plenty of ways to pick up an extra bit of cash here and there.  And even better, there are a lot of ways to take something you enjoy doing and make a bit of money doing it.  Think about what you like, what you’re good at, and what you’re willing to do, and then start making flyers and watch the money add up.

make more money

Cash, Credit, or Debit?

When you go to the store, you’re often asked what your payment method will be.  Cash, credit, or debit?  And people are very opinionated about which method is their favorite.  Let’s take a look at the good and bad of each method of spending.

Cash

Good

Well, you can’t overspend.  You either have the money to spend or you don’t.
I know a lot of people really like the envelope method of budgeting.  You have $X to spend each month on all the various expense categories. You make an envelope for each category, and divide the money up between the envelopes.  Not sure if you have money to eat out this week?  Check the envelope.  No need to worry about keeping track of receipts or budget categories, just make sure you’re always spending out of the right envelope.  Easy peasy, right?

Bad

You lose one of those envelopes, you’re out of luck.  Not good at all.
Cash also isn’t the best method for long term savings.  You aren’t earning interest on a box of cash shoved under your bed.  Plus again, it could get stolen or lost or accidentally thrown away.
Finally, some expenses are hard to pay with cash.  While I could go to the power company’s office every month and hand over some cash, I couldn’t do that with my mortgage company, which doesn’t have a local office.
But that leads us to…

Debit

Good

Debit cards are sort of a step up from cash.  It’s still hard to spend money you don’t have.  Some banks will let you “bounce” a debit transaction, others won’t.
Debit cards are also a much safer method of handling your cash.  If you lose your card, you can immediately call and have the card cancelled so there’s less of a chance of someone pulling money out of your account.

Bad

Unfortunately, debit cards aren’t theft proof.  You can still have someone use it without your permission.  Often, the banks will work with you, but the expense can end up frozen until you can prove it wasn’t your expense.  That can make it hard to pay your rent or mortgage if you find your account is frozen.
Being able to just withdraw money from your account at any time can make it exceedingly easy to go over budget.

Credit

Good

Credit cards offer a lot of protections.  If you find an unauthorized charge on your account, you’re not liable for it.  You don’t have to worry about paying for the charge and then getting refunded.  It just gets frozen and then taken off your account.
Credit cards also have rewards programs.  Getting something for spending money?  Awesome.
If you always pay off your account on time, you won’t pay any interest.

Bad

Credit cards are a very easy way to get into financial trouble.  Instead of being limited by the amount of cash in your envelope or the amount of money in your account, you’re only limited by your credit limit, which in my experience tends to be way higher than it should be.  It’s very easy to spend too much and then end up paying only the minimum so you are continually accruing interest on your purchases.

The cards with the best benefits also tend to have the highest interest rates.

Conclusion

So is one of these the best option?  It depends on you.  Personally, I’m a majority credit spender.  It makes the most sense for me because my expenses are easy to track.  I joke that cash just grows wings and flies out of my wallet and I have no idea what I spent it on.  But I am also very careful to keep my spending in check and the card gets paid off every single month.
I have friends who have been very successful with the cash envelope system to get them out of tough situations who have then transitioned to primarily debit card usage.
You can use a combination of all three methods, but it’s all about finding out what works best for you, your financial habits, and your budgeting preferences.  Don’t just do what some random financial adviser on the internet tells you.  Do the research and decide what works best for you.
cash credit debit