Debt Free

For something a little bit lighter, let's take a look at something that will benefit you, weather in your personal finances or in your business; maximizing your discounts. Many businesses, weather through cash flow problems or just plain disorganization, fail to take advantage of cash discounts offered by their vendors. Many vendors will offer cash discount terms on purchases of between 2% and 10%. These are typically available if the merchandise is paid on delivery or within a specified time period, such as 15 or 30 days.

Depending upon what percentage of your business's expenses are product related, these cash discounts could be the difference between making a profit and losing money every year. Work with your accountant to develop a plan that will enable you to take advantage of the discount terms offered by your vendors. Usually the discounts are offered as a future credit or as a deduction from invoice (DFI). A side note however, do not, under any circumstances, allow your pursuit of cash discounts (or anything else) to cause you to make late payments on your taxes. The IRS or state revenue department does not screw around! Delinquent tax bills not only accrue interest, but also penalties(which also accrue interest in most states). Pay those quarterlies on time, even if it means losing your vendor discounts.

Similarly, in your personal finances, be diligent in availing yourself of any discounts you may have available. As in your business, disorganization and poor planning can cause you to pay extra on purchases. Many organizations and credit card companies offer discounts on purchases. For example AAA has member discounts on everything from maintenance to hotel rooms. You can often get discounts for frequent flier miles that extend to many other products and services beyond air travel, such as hotels and rental cars. You can get student discounts on things from software and computers to car insurance.

There are two keys to getting discounts on personal purchases:

1. Be informed – Know what discounts you are entitled to. Make sure you plan to get those discounts. List all the organizations and associations to which you are a member and the discounts they offer. It's easy to lose out on thousands of discount dollars every year, either through ignorance or forgetfulness.

2. Ask for a Discount – You have to actually ask for a discount in many circumstances, it won't just be handed over like a sandwich. As an added bonus, you can, if you are a little bit skillful, ask for non affiliated or documented discounts. You can get these just by doing a bit of negotiation. This often works best on larger purchases. You may have to ask for the manager. Joe salesperson may not be able to make it happen for you. Some people feel weird asking for a discount, but you shouldn't let that take money out of your pocket, enough people are trying to do that already. You wouldn't just walk in and buy a car without asking for a discount, why buy your refrigerator that way? In some cultures, haggling for a bargain is the standard way of doing business. Here's something you can learn from them. Get a little courage and ask for a discount.

It will be easier to get debt free if you get that discount.