Making Magic!

Did you know that if you put the right words together in the right way magic happens? I've heard that if a reader laughs or cries over a story I'd written that I'd gotten my point across. I created emotion. Not that I enjoy seeing people cry but if they do, it is good because I moved them.

When words are put together in an affective manner, people make decisions or take action. In the marketing world, the company or business wants the consumer who reads, to buy, to invest.

Words do make magic because they cause things to happen. The burden lies with the content creator, the writer the concept creator. There are some keys to make magic happen with words.

The writer must know who the audience is, what they are looking for, what they need and what moves them. Don't laugh, you will not know every single person who reads what you write. Again, I say you need to know the audience. If writing about vacation destinations, your audience is interested in beauty, comfort, quiet and relaxation, and probably a reasonable price. So what are you going to write about the condo rental on the Grand Bahama?

You write a picture of beauty (visual). Then you write a feeling of softness and ease (kinesthetic). Thirdly you write sounds such as the waves crashing on the beach, the sea gulls calling in the early morning (auditory). Fourth, you write from the aspect of money, the thing that motivates or de-motivates us much of the time. Write up the price options, and the reasons for the prices, high and low.

The reader needs to be motivated to act. The heart and soul you lay on the page in the form of words can do that.

What's Your Message?

In today's recession charged environment, business must be specific and persistent in giving their message out in whatever means is needed. The days of easy come and easy go on the business front may not return as they were in the ".com" days. However, business is there but our marketing tactics must change in order to find it.

How do you advertise your business? Where do you advertise your skills? When do you contact potential clients? Every business and company will probably have a different answer to those questions but there is one common denominator. "Words" You always have to use the craft of language to get your message out in front of the people.

The online advertising is growing by leaps and bounds because of Face Book, Blogs (like this one), email, Twitter and websites. Marketing is using a term that is going to be on the topic list in every board room and in every online conference meeting. The word is "branding" or better yet, "cohesive branding". A subsequent blog will discussing this concept in more detail.

But in a few words, branding is to "code" yourself with the name of your company in every social networking market where you are present. That way people will get to know you and eventually see you everywhere. Make it a priority to brand yourself with specificity and consistence. And remember, it's always down with the powerful words you use.

Contact Royal Tech Writers for all your content writing needs.
royaltechwriters@rocketmail.com
http://www.wix.com/RoyalTechWriters/RTWAT

Content Designed for You

I started my technical writing company 15 years ago writing my first continuing education course on "Farm and Ranch Insurance." I poured over volumes and volumes of books to find enough information for a topic I knew very little about.

Today in 2010, I sit at my computer and surf through web page after web page and have at my finger tips more information that I can manage. The clients who were wanting 100 to 150 page manuals with a bank of 150 questions, now need me to write web page of 100 words or so and other clients need for me to do daily postings on their blog rich with key words.

The environment has changed from paper and text intensive to key words, blogs and Twitter. Instead of question a client if they have seen a company catalog of product review the question today is, "Did you get my tweet about the new plug-in for that software?"

I've prided myself in developing custom courses, etc for my clients. That is still my pride. Customization has changed to being "green". Table of content is not the watchword rather the question is "...can you develop a "green product" for us?"

My pride is still custom and we can even go green. We can write what you need for your company's success. We can maintain a daily blog for you; we can tie all the social networking mechanism together in order to place you at the top of your game.

Find more about our company at http://www.wix.com/RoyalTechWriters/RTWAT

The Basics of Employee Benefits

In general, Employee Benefits are the indirect and non-cash compensation paid to an employee. To further explain, an employee benefit plan is an arrangement under which an employer remits contributions to another person. This individual is referred to as the "custodian" of the plan who manages the plan in order to make sure the monies contributed to the fund is properly assigned. Some benefits are mandated by law (such as social security, unemployment compensation, and workers compensation), others vary from company to company and are decided by the company manages as far as what they want to offer the employees.

Employee benefits are compensations given to employees in addition to regular salaries or wages. These compensations are given at the entire or partial expense of the employer. Benefit packages usually make up between 30% and 40% of an employee's total compensation for employment, which makes them an important aspect of the terms of employment. While some employee benefits are required by law, many employers offer additional benefits in order to attract and retain quality workers and maintain morale. Some types of benefits are also used as incentives to encourage increased worker productivity.

Obligations of The Employee Benefit Plan
If the employee benefit plan is a trust, then it is the responsibility of the trustee to file a trust return in accordance with the usual rules. The filings include a statement of receipts and disbursements for the year which can be enclosed with the return. The receipts and disbursements must be broken down by type.

If, in the taxation year, a portion of the investment income is retained by the trust instead of being allocated to the employees, the income remaining in the trust must also be identified by type such as dividends, taxable capital gains, etc. Plan sponsors do have an obligation to make timely deposits of employee contributions. The employers have an obligation to provide promised benefits and satisfy ERISA's requirements for managing and administering private pension and welfare plans. The Department of Labor's Employee Benefits Security Administration (EBSA), together with the Internal Revenue Service (IRS), has the statutory and regulatory authority to ensure that workers receive the promised benefits.

Defining The Employee
In order to determine whether an individual is an employee on an independent contractor under the common law, the relationship between the worker and the agency must be examined. All the evidence of control and independence must be considered including the following differences. The employee or independent contractor determination has to use all the information that provides insight to the degree of control and to the degree of independence that exists.

The courts have considered three facts in deciding whether a worker is an independent contractor or an employee: 1) Behavioral Control; 2) Financial Control; and 3) Relationship of the Parties.

Courts often look at the intent of the parties which is embodied in a contract. A written agreement describing the worker as an independent contractor is viewed as evidence of the parties’ intent that a worker is an independent contractor. But that has to be listed in the contract when the work is begun.

Defining The Employer
An employer defines a person who is having in his, her or its service under a contract of service or apprenticeship another person engaged in work in or about an industry. An employer is also one who uses or engages the services of other persons for pay.

Defining Compensation
Employee compensation is often a sensitive subject, and people get very passionate when trying to determine the most appropriate compensation plan for their work in the company. Compensation is usually money given or received as payment or reparation for a service. Compensation includes wage and/or salary programs and structures, salary ranges for job descriptions, merit-based programs, bonus-based programs, or commission-based programs.

Compensation is payment to an employee in return for their contribution to the organization or in other words, doing their job. The most common forms of compensation are wages, salaries and tips. Compensation is usually provided as base pay or variable pay.

Minimum compensation which is the statutory minimum wage, is determined by the Fair Labor Standards Act of 1938. The federal minimum wage was $6.55 an hour as of February 2007, or time-and-a-half for hours worked in excess of 40 in any one week. Employee compensation is much more than just the direct amount that you pay an employee. There are other costs that need to be incorporated in the overall payroll budget. The five areas where the employers need to consider when figuring compensation employees:

1. Incentives and bonus plans with clear guidelines minimizing confusion;
2. Understanding the costs of a benefit plan before offering it;
3. Calculating employer payroll taxes into an overall payroll budget;
4. Determining the type of position the individual hold;
5. The necessity of doing payroll budgeting.

Employee compensation and benefits package can be the deciding factor for many potential employees. Globalization, outsourcing, movement from manufacturing to a service economy, and sluggish economic growth have all affected employee compensation over the past five years. So that has been the cause of employees having limited expectations as far as pay increases are concerned and besides that unions have been less effective in influencing the workplace.

However, at the same time, growth in the use of a contingent workforce made up of outsourcing providers, independent contractors, part timers, home workers, temporary staff, and retired employees has been outpacing real workforce growth but cutting cost for employers. Compensation is also significant at the high end, too. In order to be deductible for purposes of computing the federal corporate income tax employer-paid compensation must be "reasonable." The IRS deliberately does not define this amount, although Congress no longer allows deductions for executive cash compensation in excess of $1 million.

"The Basics of Employee Benefits"
115 pages -- Available for Purchase
2009 Copyrighted and Authored by Sharon Finch O'Maley

The Best of Annuities

Before defining an annuity, it is important to know that a record number of individuals are purchasing annuities in record amounts. An annuity is a contract between an individual and an insurance company, under which the individual makes a lump-sum payment or series of payments. In return, the insurer agrees to make periodic payments to this individual beginning immediately or at some future date. An annuity in its basic form is a series of payments (income) made at regular intervals over a period of time.

These periods of time are usually individuals lifetime and or spouses lifetime. An annuity is a series of payments required to be made or received over time at regular intervals. The most common payment intervals are yearly (once a year), semi-annually (twice a year), quarterly (four times a year), and monthly (once a month).

Annuities, first and foremost, are insurance products and, secondarily, savings vehicles. That said, annuities do “make sense for someone who's already maxed out in qualified plans and is looking for a way to defer taxes on additional investments. The term annuity means simply a stream of payments. An annuity contract is an instrument designed to convert a sum of money into a drawn out series of payments so clients can pace their use of income over time. The buyer of an annuity hands over a lump sum or series of premiums to an insurance company, which uses actuarial tables and projected investment returns to repay the account value — plus potential appreciation — over a set period of time. Annuities account for $410 billion or 14% off the total savings amassed by families in the United States.

Annuities and Regulated Markets
Annuities are sold in regulated markets. It is vital that annuities be reasonably priced and that the annuity market be effectively regulated. Until 1850, there was little regulation of the insurance industry in the United States. Several insurance scandals led to pressure for regulation, and in 1850, New Hampshire became the first state to appoint a commissioner of insurance. Many other states followed suit in the next two decades, and in the early 1870s the insurance industry in virtually all states operated under regulatory control.

The primacy of state regulation of insurance markets was confirmed when the U.S. Congress passed the McCarran-Ferguson Act in 1945. State insurance regulations are not uniform, and this can affect the scope of annuity products available to consumers in different places. Some industry people attribute the slow early growth of variable annuities, after their introduction by TIAA in 1952, in part to the requirement that such products receive regulatory approval in each state. Insurance regulation arose historically in part because of the complexity of insurance products and the relative lack of sophistication on the part of many insurance buyers.

Variable annuities are regulated differently than fixed annuities, with insurers maintaining separate asset pools as reserves against variable annuities. This prevents poor returns on the variable annuity portfolio from affecting the capital base for other insurance company products. Variable annuities, because of their investment component, are also regulated in part under the federal securities law. These products are subject to provisions of the Securities Act of 1933, the Securities Exchange Act of 1934, and the Investment Company Act of 1940. Annuities are a unique financial product that, along with Social Security, employer pensions, your 401(k) plan, IRA and other assets, can enhance your retirement security. Discuss this option with your insurance professional or financial planner when mapping out your retirement strategy.

Options in Annuities
There are generally two types of annuities—fixed and variable. In a fixed annuity, the insurance company guarantees that you will earn a minimum rate of interest during the time that your account is growing. Annuities can also be either deferred or immediate. Deferred annuities are invested over an “accumulation period” of often at least 10 years, giving the premiums time to appreciate.

At some point in the future, the account value is repaid to the client either via a lump sum, via systematic or periodic withdrawals designed to last a given period of time or via lifelong payments. If the purchaser chooses a single life annuity, income will flow for life, even after the account value is depleted. Insurers can afford to do this in the same manner as they can afford to pay life insurance to people who die young — from the pools of premiums paid by those who don't.

Under general defining terms, there are two investing styles of annuities: fixed and variable. The fixed annuity pays a set interest rate during the accumulation phase and a predetermined amount during the annuitization period. Fixed or variable annuities are good for different reasons and for different times in one’s life. Fixed annuities are good for anyone seeking an easy-to-identify stream of income down the line because they have the same basic pros and cons as bonds. They have a predictable income stream but a vulnerability to rising inflation.

It may be true that all annuities come with a price tag. So let’s look at some of the fees and charges that accompany the annuity. Besides fees to the insurer and the administrator, upfront sales and back-end surrender charges often apply. The back-end surrender charges usually start as a 7% penalty for withdrawing money in the first year. But the investor must understand that they decline each year afterward.

It may be that these fees and charges make annuities less desirable to the investor than qualified retirement plans or even investments in taxable mutual funds. Most variable annuities have such high costs built into them that they are generally bad investments so an individual is generally paying 1.5% to 2.5% more in avoidable expenses. Even the annual expense ratio paid to managers of the subaccounts is higher on average than expense ratios on the same mutual fund outside an annuity.

Annuities as A Retirement Planning Tool
Annuities may be defined in many different ways but one very important on is as a retirement tool. An annuity is a retirement planning tool designed to protect against the risk of outliving one's financial resources. Annuities are one of the few financial vehicles that allow money to grow tax deferred. An annuity as a retirement-planning tool is a unique product in that it has two phases: the accumulation phase and the annuitization phase.

The accumulation phase comes first, of course and the individual gives money to an insurance or investment company over a period of time or in a lump sum, and it earns a rate of return. Second, comes the annuitization phase. In the annuitization phase, one begins to withdraw regular payments (monthly or annually) from a contract until he or she dies. Furthermore, an individual has several annuity income options, including the choice to receive either a steady stream of income throughout a lifetime or one lump sum payment if one so chooses to surrender the policy. An annuity is a fixed or variable investment contract, issued by an insurance company, that provides income payments to an annuitant or beneficiary, beginning immediately upon issuance of the annuity (immediate annuity) or at a future date (deferred annuity).

There are many company retirement plans that are annuities paying a regular income to the retiree for his or her lifetime. Now, the original driving force behind the annuities was an income that endured for life. Because of this, the insurance companies could predict the life expectancy of a large group of people with the existing statistics. They can normally do this with a fair degree of accuracy. What this does is enable the pricing of the annuity product accordingly.

One of the differences is that with life insurance, an individual collects only if he or she dies but with a life annuity, the annuitant collects if he or she lives live. So it is the life insurance in reverse. The annuities became popular as a means of growing invested dollars tax deferred and because of the changes in regulations.

Annuities are long-term tax-deferred investments intended for retirement planning. It can be funded in a lump sum or a little at a time, and all capital in an annuity grows and compounds tax-deferred until one begins making withdrawals. Unlike retirement plans, there is no limit as to how much one can invest in his or her annuities. This is different if it is a qualified plan. There are generally no withdrawals until at least age 85 unless it’s a qualified plan.

Copyrighted by Royal Tech Writers & Translator (2009)
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Financial Planning During Life’s Tough Times

Individuals and their families deal with a wide range of issues when a chronic illness surfaces. Planning ahead requires anticipating negative situations – dependency, lack of funds, disability, incapacity and death – and exploring solutions to these uncertain, hard-to-face problems.

If someone or a family member is seriously ill, but is concerned that they will have insufficient funds, what does one do? Sell everything? Borrow money? Sell a home? Sell a life insurance policy? For starters, remain calm, NAPFA advises. There’s undoubtedly enough stress on the individual and their family right now, so avoid any sudden moves. Instead, use the following tips from NAPFA to make educated financial decisions:

 Review One’s Financial Situation: The most important thing one can do is take a deep breath and take an overall view of a financial situation – from assets to liabilities to borrowing sources.

 Liquidate One’s Cash: After reviewing a situation in detail, begin liquidating cash assets first. There is no tax cost to doing this, and there are no commissions involved.

 Liquidate Low Earning Assets: If one has assets that aren’t earning a tremendous rate of return – money market funds, certificates of deposit, bonds or bond funds – consider selling them. Because an individual is not giving up a lot of return, there probably won’t be any major tax penalties for selling.

 Sell Stocks and Mutual Funds: Consider selling other assets that might be sold without incurring a heavy commission, such as stocks and mutual funds. Be aware that there will be tax implications with this move. However, when an individual is severely ill and not earning an income, the tax on the gains may not be significant.

 Borrow On Margin: In some instances, one might consider borrowing on margin or borrowing against specific stocks held at a brokerage firm. While this could be advantageous, be aware that if the stock price drops an individual could be forced to sell the stock in order to cover the margin at its low. For this reason, such borrowing should be handled with caution.

 Treat Retirement Accounts Carefully: Avoid the temptation to cash in all of the retirement accounts. Not only does one risk taking out more money than is really needed, but one will also have to pay taxes on all withdrawals. While taking money out due to a disability won’t be subject to a tax penalty, it will still be subject to ordinary tax. Borrowing against a 401(k) account is another option that incurs less taxes and no penalties, but it’s best to avoid closing out a very large account in one fell swoop unless it’s absolutely necessary.

 Use Home Equity Lines Of Credit: Home equity lines of credit are not only relatively inexpensive, but are often tax-deductible ways of borrowing. If, prior to an illness, there was a home equity line of credit established, it might be a good idea to draw on it. Unfortunately, setting up a new line might be difficult since banks insist that one has earnings, which may be difficult to prove during a chronic illness. As a result, this option is most viable prior to illness, although it may be available only under certain circumstances.

 Utilize Life Insurance Policies: An individual can do this either by taking out a loan against a personal policy, or – if available – by using what are known as "living benefits" or “accelerated benefits,” in which the insured can draw down on the value of the policy during a terminal illness. If living benefits exist in a policy, they should be carefully reviewed as a viable alternative. Those with policies that feature relatively low borrowing interest rates may wish to borrow on the cash value of their policy or take the cash value of the policy. However, cashing it in is not advisable because doing so will take away a policy that’s probably worth more now than it has ever been.

 Tap Into Family Sources: For some individuals, borrowing needed cash from a family member – rather than cashing everything in – might make sense. While no one wants to be a burden to others, it might make more sense than purely liquidating everything one has. Many family members will be inclined to do not only what’s right in the short-term, but may also understand the long-term benefits of providing a loan during a serious illness. However, this is highly dependent on the family circumstances.

 Evaluate Reverse Mortgages: Depending on the severity of the condition and the amount of time there is available, an individual might consider a reverse mortgage. With this vehicle, homeowners with a lack of income can borrow against the equity in their home. NAPFA advises using caution with reverse mortgages, which can incur substantial costs and usually have a slow approval time.

Specific Choices

Borrowing on credit cards can be considered an option, but interest rates on such loans are considerably higher than most other choices listed above. Because of this, it’s a choice that should be examined carefully.

• Accept a Viatical Settlement: A viatical settlement is where one sells his or her life insurance policy to a third party for a fraction of the policy’s face value. Then, when the policy-holder dies, their beneficiaries receive no additional money other than what was already paid out. If the individual dies sooner than expected, it could prove to be a windfall to the viatical company. If they die later, it will merely reduce their profit. Companies offering viatical settlements came on the scene about a decade ago, often lending to patients with HIV. Now, because of medical advances, such settlements are being marketed to individuals with cancer.
• Take Out Life Insurance Loans: Recently, several companies have surfaced that lend money against the value of a life insurance policy. These are not insurance companies, and unlike viatical settlements, an individual is not signing over an entire policy, but only paying interest on the loan. It’s relatively new alternative, and one which should be considered very carefully. While the stated interest rates on these loans are reasonable, the associated fees and charges can dramatically increase the cost of this type of borrowing to a level that is uncomfortably high.

Perhaps the best way to minimize feelings of helplessness and stress caused by chronic illness is to plan ahead. Overall financial situations can be examined in order to understand what one’s needs will be and then make an orderly decision. When one is aware of all of the options, and understands the pluses and minuses of each, he or she is enabled to make a wiser decision. At the same time, it may be wise retain the counsel of a professional comprehensive advisor – one who is not working on commission and who does not have a conflict of interest. The advisor should examine one’s personal situation and that of the family in general in order to suggest the wisest course of action.

Financial Planning For Major Life Changes

Some situations that require special consideration include changes in marital status and the need to support grown children and/or elderly relatives. Marriage, divorce, or death of a spouse results in the need to revise financial plans and money management strategies.

Before being married, individuals should discuss their money attitudes and financial affairs. Marriage may create a two income household, raising the concerns addressed above. It is important to take an inventory of one’s financial assets and liabilities, including savings and checking accounts; credit card accounts, and outstanding bills; auto, health, and life insurance policies; and investment portfolios. An individual may want to eliminate some credit cards if there is overlap; too many cards can hurt one’s credit rating, and most people only need one or two. Each partner should have a card in his or her name to establish a credit record. Compare employee benefits plans to figure out the lowest-cost source of health insurance coverage and coordinate other benefits.

The beneficiary on the life insurance policy will need to be changed. If neither party has life insurance they might want to consider buying term insurance. This could be done effectively through an employer.

Short-Term Financial Goals

Short-term financial goals are set each year; they cover a twelve month period and should be consistent with established long-term goals. These short-term goals become the key input for the cash budget --a tool used to plan for short-term income and expenditures. The individual’s or family’s immediate goals, expected income for the year, and long-term financial goals must all be taken into account when defining short-term goals.

In addition, consideration must be given to the latest financial position, as reflected by the current balance sheet, and spending in the year immediately preceding, as reflected in the income and expenditures statement for that period. Short-term planning should also include establishing an emergency fund with three to six months’ worth of income. This special savings account serves as a safety valve in case of financial emergencies -- for example, a temporary loss of income.

Exploring 401(k) Plans -- Chapter 1

Chapter 1

Introducing The Basics of 401(k)

401(k)s had their birth in 1981. These plans have consequently made saving for retirement particularly easy. The 401(k) plan requires that money is deducted from an employee’s weekly salary and subsequently put into the employee’s retirement plan. There is no doubt that 401(k) plans have grown in popularity since 1981 but in recent years the momentum was caused the traditional defined benefit pension plans to be gradually displaced.

Typically, this employee must show that he or she has worked at the company for a specified amount of time before being allowed to participate. Another stipulation may be that the employee has to work a specific number of hours one per week. Now, once an employee is in the 401(k) plan, he or she can contribute up to a specified amount annually. One of the key benefits of a 401(k) plan is that the employer, many times, will match a certain percentage of an employee’s contribution. The employer may contribute as much as 50% of each dollar. The employee can view this as free money being deposited in his or her investment account.

A Number of Investment Options

Within the plan, the individual will be able to choose from a number of investment options. A 401(k) plan generally provides a variety of fund choices for the investor to choose from. An individual has the option to make changes in the amount which he or she contributes and also has the choice of where the money is invested within the plan. As with almost any other investment plan, an individual needs to carefully plan the asset allocation and to always consider diversification.

All employees are concerned about taxable income so he or she should know that a 401(k) also helps to reduce the gross taxable income. The manner in which gross taxable income is reduced is that contributions are deducted from the employee’s pay before the taxes are withheld. The employee can also save money because of the tax-deferred growth. This means that the money in the plan will compound without being annually taxed.

A 401(k) plan was named one particular section of the federal tax code. The 401(k) plan has similarities to the Individual Retirement Account (IRA). One of the similarities is that both the 401(k) plan and the IRA plan are designed as a retirement savings plans, first and foremost. A defining characteristic of 401(k)s is that all employee contributions, employer contributions and any even the growth in the 401(k) is tax-deferred until the money is withdrawn.

However, a stipulation which some may find restrictive is that after the money is in a 401(k), the employee generally cannot make withdrawals before he or she has attained the age of 59½. There may be some special circumstances where this restriction can be lifted. If an employer includes a loan provisions in the plan, then the employee has different options.

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