Turn Dreams Into Money - Jean Chatzky

Do you ever wish that you could turn your favorite pastime into a full-time job — one that earns you enough money to pay the rent, eat well, maybe even hit J. Crew from time to time? Even though I love what I do, part of me would also love to open a bakery ... or a wine store.

Back when she sat in the cubicle next to mine at “Working Woman” magazine (we were both assistants, answering phones, hoping to land a story in each issue), Laurel Touby simply wanted to throw parties. Fabulous parties for all of her friends in the media industry who — like her — were looking for that next great contact or that next great job. She couldn't afford to buy drinks for all involved, so she told guests to buy their own. Nobody minded. Because that wasn't fabulous enough, she threw on a big pink feather boa.

The venture became mediabistro.com, a popular website where media professionals can find jobs, classes and industry news. Touby just sold the company to Jupitermedia for a whopping $23 million. We caught up recently when I asked her to share a couple of tips to help you forge your own way and turn your interests, whether baking or dancing, into a successful business venture.



Be Confident

Maybe you've never owned a business before and have a lot to learn about foreign concepts like capital and marketing, but the process will be a lot easier because the focus is something you're passionate about.
 

“The big mistake a lot of people make is psyching themselves out and thinking they need more education to get somewhere. Just fake it till you make it. I've seen so many successful entrepreneurs who did a really great job because they winged it, not because they were the most knowledgeable person,” Touby says.

Now that's not to say you don't need a strong, well-thought-out business plan, because you do, but having the confidence to follow your instincts and take a few risks is almost as important. 



Make Like a Sponge

The concept here is pretty simple: Your business is going to be supported by customers, so it makes sense to listen to what they want. Touby says some of the most popular features of mediabistro.com, like the jobs and classes, were spawned from requests made early on by the site's users. As the owner, it's hard to look at your business — your baby — objectively, so suggestions from outside parties are priceless. Soak them up. You can't make everyone happy, but you can sure try. 



Get Some Help

You can launch your business in your bedroom, solo, like Touby did, but once it starts to grow, do yourself a favor and bring in some reinforcements.
 

“There is sometimes a real reluctance to reach out for help, and people tend to wait too long — often until there is a crisis,” explains Mark LeBlanc, author of “Growing Your Business!” 

Face up to the fact that you're not going to be good at everything, and even if you are, you won't have time to do it all well once success sets in. The sooner you surround yourself with a team that can tackle things like the bookkeeping and legal issues, the better off you'll be. 

Consider it an investment instead of just another expense.



Jean Chatzky serves as AOL's official Money Coach. She is the personal finance editor for NBC's “Today Show” and the author of four books. With reporting by Arielle McGowen. 

10 Things You Need to Know About Credit

1. Your Credit Score. Know your credit score but also know what it means. The score is relative, but it is based on a point system where 850 is perfect, 720-749 is good, 660-719 is fair, and 659 and below means there is some repair to do.
   
2. Review your credit score once a year. There are several Web sites that will give you your credit score for free. You are eligible to receive your credit score and history once a year by law.
3. How to use it. Make sure you are using your accounts, but continually paying them down. When you use more than 70 percent of your credit account’s limit, this shows that you need the credit and can be interpreted negatively. When you use your credit often and pay it off, it shows lenders you are responsibly paying back your debts. 
4. What your score means to lenders. Whether or not a lender is going to give you a loan is based on your credit score and history; however, there’s no way of telling how the lender is going to interpret your score and history. They may use several different reports from different credit agencies, or they may base their decision on one alone. In some cases, some lenders have their own rules and qualifications for interpreting credit histories.
5. You have to build credit. No credit is sometimes just as bad as having bad credit. When you’re credit history has nothing on it, lenders have nothing to base their decision on. You’ll need to establish some sort of credit and begin building a responsible history. 
6. Different types of debt. There are two kinds of debt — secured and unsecured. Secured debt is loans you have for items that have collateral like cars, houses and property. If you were to default on your loan the issuer would want to collect the collateral to pay off the debt. Unsecured debt is when you used credit for intangible items like student loans or credit cards. 
7. Pay your bills on time. Roughly 35 percent of your credit score is based on payment history, so paying bills on time creates a strong history. Items such as overdue accounts, collection agencies, charge-offs or bankruptcies can damage your history.
8. Employers often check credit. Banks and lenders aren’t the only ones reviewing your credit history. Many employers will review your credit history as part of your background check when applying for a job. 
9. What to do with unused accounts. When a lender reviews your account they are going to look at account balances in relation to how much credit is available. Closing accounts you do not use removes those available balances from the equation and can actually lower a credit score. 
10. Check for errors on your credit history. Go through your credit report at least once a year and review each item line by line. Some credit report information could be wrong and it could negatively impact your ability to borrow money. Check for errors and if you find any, contact the credit bureau that supplied the information immediately.

Series premiered Tuesday July 7, at 8/7c.

Get an eyeful of Padua High, where the Stratford sisters are new, and life is very different. Meet Kat, Bianca, their over-protective dad and some of the kids they’ll be dealing with this summer, when “10 Things I Hate About You” debuts on ABC Family.

Getting the Home Loan You Need

The downturn of the housing market has at least one silver lining for aspiring home buyers. A market that only a few years ago was tilted firmly in favor of home sellers has now undergone a reversal. In this market, home buyers are definitely in the driver’s seat, and that means that buyers with the credit and down payment they need can negotiate some excellent prices. Savvy home buyers can land some bargains that would have been undreamed of only a few short years ago.

Of course, one of the reasons the housing market is in such disarray is the fact that mortgages have suddenly become more difficult to obtain. At the height of the housing boom, it seemed that any buyer who could sign his name to a loan document was instantly eligible for a huge mortgage, and it was these overly generous lending standards that ultimately led to the collapse we are now living through.

Even though mortgages are now more difficult to come by it is important to keep in mind that home buyers across the country are still buying homes — and still getting the mortgages they need to purchase the homes of their dreams. Many would-be home buyers have been discouraged by the doom and gloom being reported, erroneously believing that it will be impossible to find a mortgage. The truth is that while lending standards are indeed more stringent, qualified home buyers can still expect to get the funding they need to purchase a great home.

The key to getting that mortgage is to be prepared. The days of no money down loans, no income verification loans and other excesses are largely gone. Home buyers these days will need to provide solid information regarding how much they earn, the assets they have and other financial information. Having this information readily available will make the process to secure financing quicker and much less stressful.

Additionally, a good down payment can be very valuable both in terms of landing a mortgage and in terms of providing financial stability. One of the most common scenarios today is the homeowner who owes more than the home is worth. Putting at least 20 percent down can help home buyers avoid this dangerous predicament while enhancing the chances for an affordable mortgage loan at a great rate.

Finally, make sure to develop a good relationship with your lender. Buying a home will most likely be the biggest and most complicated purchase you will ever make, so finding a lender that you trust and that will consider the best financing programs for your circumstances is essential to securing the mortgage for the house of your dreams.