Reasons Why Restaurant Businesses in California Fail

Another key factor is their ability to market well. Understand how they are going to increase or maintain the flow of customers.

Right. Yes that’s very important. Because usually what will happen in the first year a restaurant’s in businesses they’ll just get enough traffic because they’re new and there’s kind of a newness to it. And then after a year people kind of have been there and it’s less exciting. They have to have a good marketing strategy in place to really keep business coming in. And if they don’t have that, then I think they’ll see a decline.

My sense is that in a lot of businesses, particularly that type of business, there’s still a propensity some people doing that that have the mentality of “if I build it they will come” as against the understanding that they have to work hard to grow or maintain their client base.

Yeah. I would say there’s a couple major factors. Everyone there’s location, location, location. I mean that’s super important in that type of business. And also kind of what their cost structure is too. I’ve seen clients just because they’re not really in an ideal location, they’re in a mall for example, and their rent was really high. And that didn’t really support their business model. So ultimately they can’t afford it and had to go out of business. Had they been more experienced or kind of understood the numbers involved versus the ratio that they’re looking for based on their capacity. Then it would have been more well off in the long term.

Locally, where I am, there’s a particular corner restaurant building on a strip mall. And it’s a fairly busy strip mall but I’ve seen in the last two years, probably separate businesses go in there and then disappear after six months or so.

Yeah. Those businesses fail because they run out of money. But I see with restaurant businesses it is a capital-intensive business for sure. And it’s just about having enough capital when you really go in there to kind of weather out the storm. Because of obviously the ones that are kind of boots-strapped. And they only have x amount of dollars and once they run out, that’s it. They don’t really fair very well versus someone that’s got backing behind them. But you know kind of like when you have a brand new concept, you try to really… the concept and the market to see if it works. And then a lot of times it’s just a matter of rolling the dice. They don’t really know. I think people that tend to do better or people that have had a similar concept before, they’ve… and now they kind of just of squeak it. But when people are just kind of experiencing it for the first time, I see a higher failure rate.

This one’s a franchise and I’m curious that would you not typically see in a franchise that the accounting system would be part defined, at least defined as part and parcel of the franchise or no?

It really depends, you know. Some of them have a standardized franchise chart of accounts they’d like to use. So everyone can kind of have a similar type of when they run financial you’re going to have similar types of metrics and reporting.

Exactly.

They kind of leave it up to them. You know a lot of the franchise are just looking at gross sales anyway. As long as they have a total sales number, they can calculate their percent and that’s all they care about at the end of the day.

Alright. Okay.

It really varies from franchise to franchise.

 

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The Best Online Pharmacy. Buy Cialis Without Prescription – Orders-Cialis.info

Why buy cialis on the internet is really beneficial for you?

So you’ve decided to order cialis and do not know where to start? We can give you some advice. First, ask your doctor for advice in order to properly determine the dosage, when you do that, you need to decide for yourself exactly where you will be buying the drug. You can buy cialis online, or you can just buy it at the pharmacy. Buy cialis online has a number of advantages, one of which is price. The cost of the Internet will always be lower than in stores, and when combined with the free shipping, it will be the best choice. Besides the price there are a number of advantages over conventional pharmacies, one of which is anonymity. Also, you can always check the online store on reliability, read reviews about it and the opinion of other buyers. Read more.

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Successful Small Business: Burton & Clark Construction, Inc.

Burton & Clark Construction, Inc. is a small business in California that offers spray foam insulation services. This video talks about the services they provide for commercial buildings in Los Angeles, California.

Commercial Building Spray Foam Application by Burton & Clark

Read the transcript of the video here:

That is a five story building.

What type of the commercial building is this one?

Offices.

I noticed a different color. Is that relevant?

The different color of foam is how the manufacturers can tell whose foam it is.

There’s no practical difference in it. It’s just a different brand.

Exactly.

Right.

Years down the road, let’s say there’s a problem, and they open up a wall and they see that it’s blue, they know that’s Dow foam. When they see that it’s orange, they know that it’s an AirTight foam.

Right. So this is an office block you said?

It’s an office complex, yes. It’s in Culver City. And that area over there like Culver City and Santa Monica, they’re a very green city. A lot of the new construction, they’re really pushing for going as green as you can. Sustainable buildings, and all material being organic and biodegradable. And so they really go through a lot of extra measures to make it more sustainable than a lot of cities. So this is very typical in Los Angeles, like Santa Monica and Culver City area that they’re doing foam. They want to make it to where their utility bills are as low as possible.

You said this was a multi-story building?

5 stories.

And was the whole building done like this?

Yes.

It looks a lot thicker on this one.

Yes. Four inches.

That’s going to give an R what?

26.

So that’d be an R26. But what we’re saying is a lot of the value in the spray foam is the fact that it seals all the air gaps, seals all the cracks. So it actually stops air, which contributes more to insulation than the R value.

Yeah. And now they put it in the technical… The prescriptive value is an R26, but the performance value is like an R50. It’ll perform like an R50.

Prescriptive and performance. So the fact that spray foam does a good job of sealing everything, gives it a much higher performance value and all…

Exactly.

Interesting. Basically what you’re saying is it tends to be thicker in commercial buildings because they have higher performance requirements.

And they have higher standards in commercial buildings.

And bigger budgets presumably.

Yup. This particular foam is biodegradable. The manufacturer is called Demilec, and it’s soy-based. This is made out of beans. Soy beans.

Oh wow!

Yes. Just this job though. Not the other ones. This is the only job that I’ve done with soy.

So is that you in the picture?

No.

So you don’t actually do any work yourself?

Yes I do!

This is another view. Obviously, that’s the roof. That’s the ceiling area there. And this all the walls having been covered with spray foam. So how big was this project?

There’s five different buildings, and there were several change orders.

This image gives us a sense of the scale of the one of the buildings at least, in terms of how much work there was. How much surface area to cover with spray foam.

Yeah. I took this picture. This is actually the exterior where the elevator is. The construction elevator. And they had me go around all the soffits, and spray underneath the soffits. You see it there? I’ll put my mouse.

The stairs. That’s what you’re talking about?

Yeah. And they had me go around and spray all the soffits. All around the whole building. That was the change order.

Right.

So we had to full on spray on the outside areas.

So this is the nature of a commercial project. It’s going to be much bigger. Often much thicker insulation. Just overall a maxi project. So you get up to doing these very large commercial projects, like this. Whether it’s just a small roof on a sound studio. Wow. Small. That’s like 10,000 square feet. Or this one which is super huge by comparison and it’s all the inside of the building.

Yeah. Giant projects.

What we’ve looked at is we’ve looked at some examples of an existing building that was covered from a roofing point of view. And then we’ve looked at this, which is obviously a very large sort of a new construction type of project for an office.

Right.

When you’re doing a commercial building, it’s all about new construction being designed to be very green overall, use much less energy, and obviously, the net that is lower in utility costs.

Right.

Commercial projects are different mainly in scale, and the fact that you’ll often be doing flat roofs. And it can be, spray foam can be used just as an alternative roofing system, but has better general performance because it seals and it’s actually waterproof. Or it can be used to dramatically improve the installation value as well as improve the roofing systems.

Correct. And even when the specs call for a roof system for one inch of foam with the roof coating on there. Compared to a standard built-up hot tar roof system, because it’s an airtight seal, and you have the foam and the reflective coating, it still helps out as far the energy savings a lot compared to a regular roof system. So when they just say, “I want a roof system on there.” Your minimum specification they’re still going to be saving money on the utility bills.

Right.

 

 

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Types of Startup Companies in California

This video discusses the types of startup businesses that Profitwise Accounting has worked with. Watch to learn!

What are the Different Kinds of Startups in California?

Below is the transcript of the video:

What did you call that initial session?

It’s called the initial strategy session. The whole idea is to be proactive and I feel like a mini education sales tax, use tax going through and looking into the business and performing a mini audit. Our clients privy to a lot of things that they need to know. The problem is a lot of people would go to a tax advisor and just get tax return done, so they miss out on all the consulting elements and a lot of CPA related setup for the services, because maybe they are just focused on the tax returns. They’re not really geared toward being an advisor to small business owners. So that’s one of the points that separate us.

The overall majority of our new clients are startups. And we typically define a startup as someone that’s been in business for less than 2 years.

Oh, okay! I was thinking of a startup as they’re not even in business yet but they want to start.

Yeah. We call those pre-startups.

Okay!

So actually they fall on to four different categories. The first example is, let’s just say, it’s one person and they want to start a new business. And they’re selling beer mugs on amazon, for example, as a brand new business. He sells the product called the “man mug”. So it’s a beer mug he sells on amazon, and he targets frat houses, beer connoisseurs. So like this aluminum mug that keeps your beer cold. This is kind of an example. He has a full-time job and he does this on the side. He sells primarily on amazon. The business is called seven-after-nine. Manmug.com is his website. He’s just kind of boot-strapping it just to get everything going. They’ve already been operational for about a year. So now it’s the 2nd year. It’s kind of a slow-go when you’re doing something like that. So that’s one type of startup.

Let’s just characterize that. So that is a part-time person. Solopreneur. He’s been in business for a little while and he’s in a kind of early growth phase.

The next example would be a bencher back startup. So this client, the website is mantelmount.com. They’re primarily e-commerce as well. One of the founders develop this way to kind of hang your flat screen TV above your fireplace, and so you can pull your TV off the wall and twist it around. There’s a lot of people that have their TV mounted on the fireplace, kind of hard to view it right. This kind of has a swing arm that you can take out and they’ve done it very well. This situation of 3 partners coming together in the investor, a couple of investors, and then the inventor hired a CEO to run the company. They hired us to handle the accounting and the taxes. That would be the second type of company and they’re hitting the road faster, because they have some investment behind them. I think their product is a little bit more unique too.

A third example would be a biotech client. They have private funding but they’ve raised 10 million dollars. We have another one that’s a bencher back company and they’ve raised like 20 million.

When you describe a biotech company, can you just characterize what that is a little more?

It’s a company that does cancer research. Manufacturing part. They develop intellectual property and then they make a deal with like a large pharmaceutical company. Pharmaceutical company manufactures that. IPO. They’re kind of rare and a little bit stressful when they’re that big.

When you say big and it’s stressful, what’s big and why would it be stressful?

The size of the company. They’d do 8 million dollars a year in expense and they have some proper revenues here, but they’re C Corp it got stock options plan and there’s just a lot of different complexities in the business. Kind of the nature of what they’re doing. It’s not that bad but still you get into more technical areas. Just making sure they’re doing proper compliance. Stock options is probably a big part of that. Making sure they’re done correctly. They have a cap table updated. When they have big numbers, they provide you with all these information. You know so…

Yeah. So there’s more things going on and they’re a large company for sure.

So when you say more stressful, what that really means is that there’s more money involved and there’s more at stake, and it’s much more complex.

Yeah.

Why did you describe them as a startup?

Basically, they came to us as a startup. We started working with them. They were brand new. They had some investment. We started with them from day 1. So I think they’re near 3 now but they were a startup.

Another one might be somebody I could employ that’s out there working for somebody and they think they can do a better rights to go and turn around.

They all think they can do it better.

Yeah. Exactly.

We had a client who used to work for Stone Brewing and he went off and started his own brewery. He was a marketing guy for Stone. He went and got a million dollars of investment and started his own brewery. Now he’s doing really well.

Interesting.

That’s kind of not a typical thing. Typical might be somebody who’s a salesperson for somebody right. And have some sort of services, and then they go off and do the same thing. And they can kind of have a book of business running quickly. Those are usually use your ones right or somebody who’s already been in the business before and they just start shutting down old company. Maybe it was a partnership gone bad. Maybe they’re starting a new business on around with someone else. Again, it can get up and running quickly right because there’s a track record. Some of the ones that are more tough are the people who start from zero, and maybe they’re brand new in the industry and they don’t have a lot of money. So it’s going to be a slow go.

What would you say in general are the specific challenges that startups have as against other types of companies?

 

 

 

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Small Business in California: Spray Foam Application

Burton & Clark Construction, Inc. is a small business in California that offers spray foam installation services. In this video, they talk about the special applications for spray foam.

Special Applications for Spray Foam Insulation – Part One

The following is the transcript of the video:

What are the special installation types for spray foam that may not be typically obvious?

What is very popular in California, especially in northern California, is wine tanks. All the tanks they store wine in. All of them are sprayed with two inches of spray foam.

Wine tanks. Do you have any pictures?

There is a huge market of it in northern California, and there is a market for it in Southern California.

…these types of things.

Yeah. They get big.

These look to be huge.

Yeah. Like that. We spray the outside of those things.

Right. So the outside wouldn’t be silver like that. It would have a layer… So what would you do exactly? What type of spray foam would you use?

You would first clean it, make sure all the dust is off it. Some might have what material it is. Some might require a primer. And then you actually spray roofing foam on it, because it just comes out a lot smoother which is usually a 2.8 density, 3 point density, and then you do two layers of elastomeric roof coating just like basically a roof application.

So sometimes they could be in a control environment. Presumably, you wouldn’t need to do it if it’s in a controlled environment, or would you do it?

No, no. You typically wouldn’t do it, but they would already have the environment already insulated. But this reminds me of though, is the building that this is in, these are typically called pole barns. The reason being is that they’re usually made out of metal. Metal siding and the wind picks up, it’s very loud and rattley. The pole structures they don’t have any installation in there and…

First unexpected applications for spray foam would be wine tanks. Presumably this would be a manufacturing facility in a winery. They make wine in containers like these do they?

Yes. Temecula’s in southern California, that’s about an hour and a half away from me. There is a lot of wineries out there.

I just wouldn’t have visualized the production of wine in big tanks like that. It’s just not intuitive. Well there’s an unusual application. That’s a good one. What else?

Agriculture. Like for example in Idaho. It’s really popular you know that they use pole bars are just screwed together with sheet metal and steel, and sometimes wood. A lot of the farming communities would get awfully windy and they just are loud and rattley. And this would tighten up all the sheet metal, sidings, and roofing. For a nice and quiet and comfortable inside.

It blocks all the gaps and just strengthens the building overall structurally because it forms kind of solid coating.

Exactly. Yeah.

On these cold climate areas in California, horse farms. Where they don’t want the horses freezing out there.

So we’ve got wine tanks, whole barns, and horse barns.

And a lot of these barns, they put in areas for the employees. They’ll attach a little office to them. They need to be insulated as well.

So I imagine a big area. I mean these are just basically like big hangers aren’t they? So if they need to become controlled, I imagine they’re going to be very difficult to because this is such a big open area. The way they’re constructed, I imagine they must be very difficult and very expensive to maintain a specific climate in them.

As long as they do spray foam it wouldn’t be difficult. It seals everything up and all they need is two inches.

Is there a way to define the insulation value that would be achieved in an installation like this?

You would get the 6.5 or 7 R value per inch. 2 inches that would give you 14. So there’s your R value.

You then give them an equivalent of an R14 insulation. Is that what you are saying?

Yes.

So it doesn’t sound like a lot.

It’s fact to the whole thing about spray foam is the air sealing. If you the minimum of two inches in there, the heat or the cold isn’t going to pass that. You have that air barrier in 2 inches closed-cell foam. The R value really isn’t relevant. So it’s still not going to penetrate it, because it has an air barrier. It’s sealed tight,

The reality then you’re saying is that although it’s theoretically an R14, the actual practical benefit of the insulation will be much greater than that.

Yes. We’re back to the performance than prescriptive. Prescriptive it’s an R14. The performance is much greater than that because it has air sealing. An air barrier in it.

 

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Prevent Marriage Through McNamee Mediations’ Marriage Contract

Colleen McNamee is the owner of McNamee Mediations, a small business in California that offers divorce mediation services. They also offer other services including those that could potentially prevent divorce. This article is a transcript of a video where Colleen explains how a marriage contract can help couples avoid divorce. 

What is a Marriage Contract?

What exactly is a marriage contract, and I’m guessing it’s not something that holds up in a court of law. It’s something that you’ve created probably just for your clients.

Right. Yeah. It’s something unique. A concept that I have developed. And what it does is essentially helps the parties identify what’s caused the breakdown in their marriage. And I usually work with them individually to figure that out. And there’s usually at least one thing on each side, and then we figure out what they would need to fix that for themselves. Then we get back together and we propose that to the other party. As an example, he says, “She spends too much money, and I’m constantly having to work all this overtime to pay the bills, and I’m just sick of having to work this much. I don’t get to spend any time with my family.”

Alright. I know what the opposite end is but go ahead. I could see it coming.

We go to her and we say, “Look, you know, he just feels like you’re spending too much money. This isn’t anything against you, but what can we do to fix this? How can we make him feel better about this?” And so, say we come up with a budget that he’s comfortable with, and she agrees not to go beyond that. And this may not be fulgurous spending. This could be buying clothes for the kids, and fancy bottles of wine to have at dinner, and whatnot. This does not mean she’s out buying Luis Vuitton bags. But that would be an example of something we would do with the couple that has since spiraled out of control and led to them fighting and not spending time together, not having date night. But they don’t even realized that’s where it’s stemming from. And so we kind of get to the root of the problem. We identify that. We do the same thing whatever her issue is. Then we create a contract between the two of them. And it’s their rights and responsibilities towards each other as they’ve defined them during this mediation process with me. And then we sign this contract, and it’s a very formal contract, I notarized the contract. And all of this is done in conjunction with the divorce paperwork or the legal separation paperwork. We’re just not filing the final papers with the court. And only if they violate the terms of this marriage contract or at the end of whatever time period we put on the contract, 3 months, 6 months, one of them comes back and says, “You know we did everything in here and it’s still not working for me. I still want to move forward with the divorce or legal separation. Then I file all the paperwork. So what’s unique is that if the contract does not work, then they don’t come back and have to start the divorce process or the legal separation. It’s already done. But they also have this huge consequence hanging at the end of this marriage contract for violating it. It’s a big deal. If they violate it, they’re going to be divorced or they’re going to be legally separated. And it’s strange how that has a heavier impact on getting them to adhere to the terms. Rarely do the clients, who are candidates of the marriage contract, violate the contract.

Watch the full video by clicking below:

**Preventing Divorce** With a MARRIAGE CONTRACT 

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Benefits of Divorce Mediation

Divorce Mediation is a good small business to start in Orange County, California, because more and more couples seek a mediator instead of a divorce attorney. There are a lot of benefits of seeking a divorce mediator when planning to file a divorce.

Why Couples Should Choose Mediation Over Typical Divorce Style

Tell us what mediation exactly is and why somebody should use mediation versus typical divorce style.
Sure. So, mediation is an alternative that parties have available to them when their considering going through a divorce or legal separation or even a paternity case when they’re having a child and you’re not married. And what it means is that rather than retaining separate attorneys, you’re jointly as a couple retaining me to act as your mutual representative. And so it gives them an opportunity to work with one person. It gives me an opportunity to hear both sides of every story. We also are able to do everything in the privacy of my office start to finish, so you do not have any court dates at all. And then the thing that I think is the best about all of this is that you are able to custom tailor your settlement agreement terms together rather than having them dictated to you by a judge.

The Mediation Alternative – Getting Divorced the Smart Way – Part Six

Part Six – Conclusion. What is Divorce Mediation? Rather than retaining separate attorneys, you are jointly retaining a neutral representative. It is an opportunity to work with one person, in private without court dates. You are able to custom tailor your settlement terms together, rather than having them dictated to you by a judge.

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McNamee Mediations – A Successful Small Business in California

McNamee Mediations is a successful small business in California. One of the marketing measures they use to promote the company online is posting videos about their services on social media sites. This article is a transcript of Colleen McNamee’s interview at Money Matters.

Interesting Facts about Financial Infidelity

So colleen, I guess I can’t help it. I need to ask you about some of the shadier stuff. What are the shadier things that spouses do?

So we’ve talked about practical things that are really common – about having separate bank accounts or having one spouse be in-charge of the financial payments while the other spouse is the breadwinner. But you also do come across situations where spouses have maybe a side business that the wife doesn’t know about or the other party doesn’t know about. And so they’ve got some cash coming in and they just sort of keep that off to the side and the other party has no idea that there’s that additional income. There’s the infamous off-shore accounts that we all hear about and see in the movies. And those actually do exist in real life as well. Opening secret credit cards. I think you addressed that in your opening statement and that is something very common and on the rise. And then also another common one is parties who receive bonuses. So it’s not their standard paycheck that they have coming in to the joint account that their spouse is used to seeing. And they get bonuses and don’t have them deposited to that joint checking account, and just kind of keep it to the side.

The old bonus trick, huh?

Yes.

Let’s go into the shocking little facts. I know you got a bunch of them here, so what are those?

Yeah, let’s see. So one of the things that I found in doing research for this show is that there were results from the national survey that found 1 in 5 married couples have spent over 500 dollars per year without their partner’s knowledge. I in 5!

I’m going to stop you right there That’s 500 bucks. I mean, I don’t tell my wife every time I buy something, right? And I’m sure she doesn’t tell me if a kitchen appliance costs 120 bucks, she’s not going to tell me. If she went shopping and spent 300 bucks, she’s just not going to tell me. But 500 is not that much. I will point, do you create more issues with that?

Well, I think 500 was an example of an average. And for some people, 500 could be a lot.

True.

I mean, it could be a matter of them ending up in debt at the end of each month.

True.

With that extra 500 being spent. And it could be, for someone who makes more money, it’s actually 5000 that’s being spent that they don’t know about. So I think this is just kind of an example and what we should take from it, really, is that 1 in 5 married couples are spending money their spouse doesn’t know about each year.

Yeah. Okay.

And let’s see. Our next little juice tidbit is secret spending and hiding money is 50% more common among men, but times have changed. Women are now more independent with their finances than ever before. So secret spending and hiding money is on the rise with women. Part of this article, actually the source of it, was quoted as saying, “younger women are a little bit more independent and think differently these days. They think more, in my opinion, of themselves as a separate entity from their partner.” Which is interesting because that’s not traditional at all.

Sure. So let me ask you, in your practice, do you have a particular age group that dominates over the others?

I guess I would probably say 40s and 50s. Probably at least 60% of my clients are in the age range of 40 through 50.

And how long would you say those people on the average have been married before the divorce?

Anywhere between 8 to 30 years. And some of them in their 50s maybe this is even their 2nd marriage.

For the couple that has been for, let’s call it, 18, 20 plus years, is it typically the man or the woman who wants to divorce at that point?

You know it really varies. But just after the holidays, these holidays, it’s been women that are filing.

And would you say that’s typically because they’re hanging around until the kids are done or self-sufficient or they don’t think it’s going to bother them as much, and then they finally call it at that point?

I used to see a lot more of that. A lot of people just staying together for the sake of the kids, and waiting until they went off to college. But I think that’s becoming less and less the case, because there’s more and more studies that are being released that showed that that actually has a negative impact on the children to stay married and be in an unhealthy marriage rather than divorcing when you feel like the time’s right instead of waiting for the kids to be grown. So I think there’s a decoy in that train of thought.

1 in 5 Married Couples Spend Money their Spouse Doesn’t Know About – Financial Infidelity – P4 

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Marriage Mediation – A Good Business in California

Marriage mediation is a good business to get into because divorce is one the rise in California. One of the most common causes of couples separating is financial infidelity. The following is a transcript of an interview with Colleen McNamee of McNamee Mediations. 

Financial Infidelity – What is it?

I’m bringing up a topic that I hope isn’t going to get anybody in trouble here today, that it’s financial infidelity. And we’ve done divorce shows many times here on the show, and people always ask, you know, “Why are you doing divorce on a fashion show?” Well, as I say every time, divorce is extremely financially burdensome – if that’s the right way to say it. It’s a burden because it’s so expensive. And what we’ve found is that divorce isn’t always caused by infidelity of the kind you’re thinking about.

Finances typically play one of the biggest parts in a divorce. In this particular case, we did some researching and we found an article by Kimberly Foss, it says, “Studies are showing that some 7 million Americans have a secret bank account or credit card account that their spouses no nothing about, and most of those doing the hiding are men”, according to this study.

Again, financial expert Kimberly Foss says, “Financial infidelity is more common than people think, and anything it’s on a rise.” Here today to answer of these listener questions on a surprising but yet intriguing topic is our TLP, Colleen McNamee from McNamee Mediations, and she is an attorney but she specializes in mediation. And Colleen, welcome back to the show!

Financial Infidelity Orange County Divorce Mediation – What you don’t know – Part One

Colleen McNamee Discussed How Financial Dishonesty is a Rising Cause of Divorce

Thanks Dino! It’s good to be here! So Colleen, what are your thoughts on Financial Infidelity? I mean, you see couples all the time. Would you say this is this is a big topic or is it just on the rise, and now it’s starting to happen more often? I think it’s just on the rise.I was actually surprised that just in the last week I saw that there was a whole show on this on the news, then the next morning I heard it on a radio show. And I thought, “Wow! This is really kind of an epidemic!”

And it’s not something that I come across very frequently in the mediation atmosphere or at least not in an egregious way where there’s hundreds of thousands of dollars the other party doesn’t know about. But there definitely are a lot of situations where one party’s the breadwinner and then the other party maintains the household finances. And that’s very typical, very common. So then, in those scenarios, the breadwinner really has no idea what the homemaker is paying, say for electric bills, credit card bills. You know, they’re just making the money and the other spouse is making the payments, and they really have no idea. But it doesn’t mean that anything nefarious is a plan necessarily. And Colleen, we’ve talked about this. We’ve talked about it before the

Colleen McNamee - Marriage Mediation Specialist

Colleen McNamee – Marriage Mediation Specialist

show. Valentine’s day, right? Yes. It just passed. And February,

I think you told me, is one of the largest filings for divorce, is that right? Well, it’s actually January into February. So, it is the Holidays coming off of Christmas and

New Year’s, and probably Thanksgiving should be included in that as well. And then, the

Valentine’s Day holiday. It’s somewhere right in between all of that. A lot of affairs and financial problems tend to be discovered, and then people start filing, or at least, making calls to educate themselves to educate themselves on what it would entail to file. How is it possible that somebody has a separate bank account or a separate credit card, and the other doesn’t know about it. I mean, I’m just going to say it, I know everything, but maybe I don’t! I mean, how is that even possible? Well, I think you are not alone in wondering that because I easily keep wondering that myself.

Like I just mentioned, a lot of people do have a division in how the bills are paid. And so, you have one primary person who’s paying all the bills and the other party is the one who is making the money. And so, there’s just really an incongruity in managing the finances because they have each developed their own roles, and there probably haven’t been any problems for the most part. But also, something that’s really common is that people have separate bank accounts, especially when you have dual incomes and you don’t have a homemaker and a breadwinner. And so what people are doing is they have one primary checking account that they use pay all the household expenses out of, and then they have separate accounts and that’s where their paychecks go, and they just put into the community one whatever they need for their monthly expenses.

That’s a situation where I think you can have some financial infidelity because you have no idea what the other party is spending their money on from their own personal account. But yet, all of this is subject to community property laws. So if they’re racking up bills that the other spouse does not know about. It can become a problem should they decide to divorce down the road.

Real Case of Financial Infidelity in California

So here’s a real case example: There was a couple that was married for 27 years, and they had several children. And throughout their marriage money was always a sore subject. They were always fighting about finances whether it was they didn’t have enough money, too much was being spent, that it was always a sore spot and a point of contention for this couple. Once the children were grown and had moved out of the house, they decided to create separate checking accounts and no longer operate out of a community one. This actually worked great for them and it diffused the problems that they’ve been having throughout the marriage regarding finances. And so, you know, years down the road, they just sort of grew apart and decided amicably that they were going to go ahead and get a divorce – had nothing to do with money problems. And so when they started their divorce process, it was discovered that the husband had a ton of credit card bills that he’d wrapped up. And the wife had no idea about it because she paid for her own, he paid for his own. And this really led to a huge blow up in their relationship. And obviously, the divorce became more contentious because that debt is subject to community property laws because it was incurred while they were married.

 

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