Some Money in Hand Better Than None?

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This question was asked of me recently regarding a mutual unemployed friend. She didn't take into consideration that he was receiving unemployment. So, he had some basics covered. You might want to consider a low-ball offer if in truth you have absolutely nothing coming in.

There is an under-the-current problem with this question which most folks never understand and end up making wrong decisions their entire lives. (They ignore opportunity cost, which is simply putting your hours in this case to work on one job. This keeps you from working the job you really need.)

They sit and wonder why there is never enough money to cover the bills. Some try coping by working overtime. We all know what happens to that time. The majority of that money ends up in the hands of the IRS. You can always open up a small business so that you get a bigger tax return. All of these efforts to manipulate your way around the problem you have created are attempts at getting around an economic principle. You can bluff your way around it for a short time. It is going to get you in the long run, no matter what strategies you employ.

If you take a job you really can't afford to take, you have let opportunity cost interfere with a potential profitable life. When you take up your eight hour days on a job that doesn't cover expenses, you are headed for disaster.

I took a minimum wage job eons ago in retail. My checks were suppose to increase when I started selling. Well, the amount I sold was so little, it amounted to a minuscule addition. It turned out that after taxes, my weekly check didn't even cover the babysitter's salary. We went through two months of bouncing checks all over town. I went into a bank branch one day trying to just cash my check and was sent away because our account was in the hole. That wasn't quite as bad as trying to cash a check at our long-standing grocery store. I ended up having to leave the food. I was handed bounced checks from my husband they had been holding until one of us showed up.

None of this would have happened if I knew what opportunity cost was at that time.

Do not accept a job or work project that is so far below your expenses that you are in effect giving away your time. I once had a friend who was a perfectionist. She created a monthly newsletter for a large auto dealer.

She was getting $500 as a monthly retainer. She met a business coach at her local Chamber. He volunteered to help her find out way she had no money left over at the end of the month. It turned out that she spent so much time on this newsletter that her hourly rate turned out to be about $5 an hour. This was an ongoing project. The opportunity cost of spending all that time to make things perfect, meant that she was pricing herself out of business even though her contract read $50 an hour. Spending too much time left little or no time to get additional clients.

Grab a job or project that pays you below what you need to make and you are putting yourself in a hole from which you may never climb out of. Once you are tied up with a gig that is doing nothing but burying you deeper into debt, it is hard to find the time to do a sufficient job hunt for something better.

I have an old friend who is also currently unemployed working on another teaching credential. I suggested he take on some temp work to tide him over. His response was quick in telling me how much money he needed to cover his daily expenses. He knew temp work wouldn't do the trick.

It's very easy to make a quick judgment when you are in a financial strain. Now, that you have this information, take a little more time. You will be glad you did.

Laura Bell is Freelance Writer and owner of www.bellbusinessreport.com. The Bell Business Report offers common sense business advice and how-to info for running your business. It takes the everyday headlines apart, dealing with business news, and shows you how to put that information to work for you.

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