Roth Conversion: Decision Scenarios

Instructor, Caroline Bender

You have read or heard through your preferred news outlets that investors may now convert their traditional IRA savings into a Roth IRA and reap the benefits of tax-free retirement withdrawals in their older age. What you have always wanted -- a paycheck in the full amount of what you earn (however you set your payroll in your golden years). If internet research has brought you to this post, then you are likely reading everywhere what you are about to read here: there is no universal answer to "Should I or Shouldn't I?"

We applaud you for trying to learn more; we are flattered that you chose us out of the many search results you must have been offered. What we want to stress to you is that you should not make such a significant financial decision without consulting an expert -- one who does not reside inside Google. We at the Finishing School are not financial advisors, and the School is not authorized to dispense financial advice. What we do is try to bring abstract ideas like money and work and raises and balance and performance reviews and "having it all down" to real life narrative so you can figure out who to use the information at hand.

Here are the terms you need to know
Roth: specialized individual retirement account that does not require automatic withdrawal at a given age, is transferrable, and taxed on contribution rather than withdrawl, allowing a smaller tax on a larger account. (named for the late William Roth, [R] Delaware)
Traditional: individual retirement account that allows tax-deductible contributions, and tax on the withdrawal as mandatory income at a determined age.
Taxes: When and how much. What you are really chosing here is whether to pay tax on funds you convert now, or funds you withdraw later. As they say around your workplace (and mine) "it depends."

Yes, I always say, I am sure it does. Depends on what?
Here are the factors to consider with your family and financial advisors before taking the plunge.

What is the money for?
For most of it, it is our retirement income, but if you also have a pension or other annuity, your IRA may be your investment fund, a savings fund to be given as inheritance, or your Foxwoods account.

Who is the money for?
Similarly, is this an individual fund, an income for a retired couple, or an older couple with other dependents, such as grandchildren, siblings.  This question also answers How long does it need to last, which is also related to How long might you be being taxes on it?

Is is easier/more palatable for you to pay a large up-front tax or small back-end taxes over a period of time, depending on how long that period might be?

How old are you? In other words, how much time does your Roth have to grow, and how big might it be when you begin withdrawing?

What is your income bracket and how much money are we talking about?

Take, for example, an individual with 100K in a traditional account (IRA or 401k) today.
The 40 year-old may not have the cash on-hand to convert today, or want to liquidate $35K for the promise of a tax-free future.
The 60 year-old may have the cash and another 20 years to build interest before they want to/need to begin withdrawing.
The 75 year-old may actually save cash by paying tax on small withdrawals for 10 more years

A family may prefer the tax deduction today when expenses are plentiful over tax-free income in a future when there are fewer responsibilities and unexpected costs.
A single person may prefer building income in his/her name, when it is easier to control personal spending.

Will taxes go up....?  Or down...?  by the time you are withdrawing?
What will your income do?
A 35% tax bracket or higher can make that contribution tax feel like a sock in the stomach, especially if you will be in a lower bracket when you retire.  But what will "lower" mean in such a distant future? 

The entrepreneur with a big idea may prefer to pay a contribution tax at his Garage Inventor tax bracket of 25%.  before his hopes of future wealth may come true.
The union man with a known future income plan may have a pension to rely on and may rarely contribute to his IRA.
The 2nd wife may be building an inheritance for her grown children.  Roths are transferrable.

If we are your first stop on your research journey, let us recommend a few other resources to help in your scenarios.  Do not expect any of them to tell you what to choose, but do work your own situation against the possibilities of your income changing, the tax rates changing, the tax laws changing, the amount in your account changing (anyone remember last year?)  and your needs for that savings changing.  Then make your best all-around decision.  And don't be too scared: you can reverse your decision  if you get cold feet.

Related resources:
Suze Orman: No Match?  no Sweat?
Ameriprise: 2 Scenarios
Daily Worth: IRA Math

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Commuting: The Good, the Bad, and the Ugly

Instructor Maggie, career secretary and commuter
 

Not everyone has the luxury of walking to work or even having a short drive anymore, thus “commute” is a big part of our lives. Sometimes it can be both bad and ugly. Bad when others drive too fast and try to push us; ugly when the weather works against us.  But find the Good - and put it first.

The company for which I work recently moved into its new headquarters building about 20 miles closer to my house and for the first couple of weeks the conversations in the elevator were “How’s your commute?”

It’s interesting to see how folks adjust to changes that affect that particular aspect of their day. The first couple of weeks, they check with each other to see who really has to commute further than they do and smile quietly to themselves because they no longer have a long commute. As the days progress, they compare different routes (and toll plazas) trying to figure out better ways to get from home to work and back. They also must learn new alternate routes if their preferred way has traffic issues on any given morning.


Just this morning I had a need to be at our former location and I wondered how I did that every day for 3.5 years! When I was asked back then "how do you do it," I usually replied, “Oh you get used to it.” And you do – until it’s time to change something else.

I have been commuting for the past 35 years – sometimes 10-15 minutes one way and more recently 45 – 55 minutes one way. Up until the move, my commute was about 90 miles a day, roundtrip. It is now 50 miles a day.   I have lost half of the upside to my commute.

What is the upside to commuting? For me, it has allowed me to leave work at work and home at home. This in turn has helped keep the insanity at bay.

I’ve tried listening to books but that didn’t work out so well for me – hard to focus on the story, the traffic and driving safely all at the same time! What works best for me is “elevator music” on the radio without a lot of talking. Don’t laugh – it really does soothe.

What I liked best about the length of the commute was that I could use it to “dump” all my at-home issues from my mind and prepare for my workday by making a mental ‘to-do’ list. On the way home, I can then “dump” the office and all that entails so that I can focus on what needs to be done or where I need to go when I get home.

One caveat – watch out for the homeward dump! If I had done everything at home that I’ve carefully planned out in my head (such as painting, new curtains, new anything, remodel, yard work, gardening – to name a few) my house would be a lead article in Southern Living and House Beautiful at the same time!! Other times, it’s “What shall I fix for dinner?” “What’s on TV tonight?” “Can the laundry wait another day?” “If I stop at the grocery store, what shall I get?’’ Shall I wait until Saturday and make a list?”

Just don’t think about work! If you can avoid it, don’t take it home with you at all!


My adjustment right now is realizing that I have a bit less time to process the same amount of data in both directions, so right now I’m finding that I am at home before I’m done and at work before I’m quite ready. I imagine it won’t be long before I will either process less or do it faster. I’ll let you know. What I am liking is that now I drive fewer miles a day and buy gas once a week instead of twice. Eventually it all evens out!

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The Three Step Formula for Redefining Life Balance

Guest Blogger, Charlene, The Balance Beam.


A lot of people make an immediate mental leap from "life balance" to "work/life balance."

Newsflash: "Work/life" balance is a misnomer. Yes, work is a part of life. But so are family, education, community and taking care of yourself so you can handle it all.

The impossible quest for "work/life" balance somehow says that work and life are on the same playing field, vying for position. It implies teeter-totter energy. It assumes that when one side goes up, the other goes down and vice versa.There is a perpetual give and take... with parallel neutrality being the ideal scenario.

Personally I think this is neither realistic nor desirable.

First of all, I'm not sure we want our lives to be "neutral." Surely we have more ambition than that! Most career-minded individuals I know want life to include some measure of hard work and I'm sure any boss we’ve ever had would be happy to know this.

Life is a juggling act, not a teeter-totter ride. Work is just one ball in the mix.

Here's the real secret: Life balance is not about keeping all those balls in the air in perfect rhythm at all times. Of course we try. It's important to have strategies around getting stuff done.

Still, the world is an unpredictable place and let's face it, we're human. Sometimes those balls are going to drop through some misstep of our own or with the help of others. We may even lose a ball for a while. Sometimes it feels like we are juggling bowling balls. They may turn into a little evil monster heads and try to eat our face. Like I said before, stuff happens.

The thing to remember is that true life balance is internal.

What's most important is the balance within you -- your physical, mental, emotional, spiritual self. When those things are in harmony, the objects of external life can explode into flaming stink bombs and you'll be just fine.

So how exactly do we get to that place of inner harmony while mired in the stress and demands of “external” day-to-day life?

Next time you feel “out of balance,” focus on three steps:
1. Internal -- Transform thoughts, feelings, words, feeding only positive energy.

When you find yourself thinking or saying such sentiments as, “What a horrible day!” “I’m so tired.” “My boss is such a (fill in the blank) “I’m not making enough money!” STOP. Energy flows where attention goes. You get back what you put out. Only invest in the positive.

2. External -- Engage in healthy, healing actions.
This may require honesty as well as discipline. Put forth the effort to align actions with goals. There’s an old saying, “Trust in God but tie your horse to the post.” If you see your horse galloping away, start being real about what part you may have played in that misfortune. And, learn how to tie a good knot already.

The key is starting. Not tomorrow, not on Monday, not on the first full moon of the leap year. NOW. Whether its meditation, fitness, a creative outlet or whatever; focus on daily activities which are aligned with your life balance goals.

3. Support -- Ask for help.
Get feedback, physical assistance, accountability and/or just the time and space for steps #1 and #2 to be possible. We don’t need to do anything alone.Many of us grew up such that we view asking for help as a sign of weakness. It’s actually a sign of strength. If you don’t feel comfortable leveraging your “in real life” network, there is a virtual support system for just about anything.

Practicing these steps will provide you with the balanced internal foundation needed to cope, problem solve, persist and overcome anything that comes your way.


Including evil monster heads.

Related Resources
Life is NOT a Teeter-Totter
Find Your Strongest Life (Marcus Buckingham book)
Find Your Strongest Life  (book review)
How I Took Back My Life Through the Miracle of Outlook

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Groundhog’s Day—The Working Mom’s Holiday

Guest Blogger Jeanne Brown is a Boston-based freelance writer and communications consultant. She is also a married mother of two who is trying to juggle it all—family, work, health, writing, volunteering and the rest of life. When she finds time, she blogs at http://dichotomom.blogspot.com/ or tweets at @JeanneBrown.

To many, February means Valentine’s Day, complete with romance, hearts and fluff. I say, down with that. We don’t need candy and we won’t wear lingerie.  Instead, we need a day that focuses on keeping us sane, not one that makes us insane.  Working mothers should unite. Let’s lobby Hallmark for a new February holiday, one that honors the cornerstones of any working mother’s life—routine, consistency, schedules and predictability. Up with Groundhog Day!

One of my favorite movie lines is from The Devil Wears Prada when Emily says "I'm just one stomach flu away from my goal weight."  Right now I'm feeling kind of like Emily, except my life is not close to the high fashion scene and my stomach flu doesn’t end with me happily fitting into skinny jeans. I am a working mother. That means I’m just one stomach flu away from my finely crafted schedule getting flushed down the toilet.

There is a way my life is like a movie, though more like Groundhog Day than Prada.  In the 1993 film, Bill Murray plays a weatherman stuck in Punxsutawney, PA, and he relives Groundhog Day over and over and over again, until he finally gets it right.

I don’t know if I’ll ever get it right. Getting it done is good enough. And if I can manage to do it all—or most of it, anyway—with just a modicum of yelling, well that’s a great day. I get it when Bill Murray’s character Phil says, “It's the same thing your whole life: ‘Clean up your room. Stand up straight. Pick up your feet. Take it like a man. Be nice to your sister. Don't mix beer and wine, ever.’ Oh yeah: ‘Don't drive on the railroad track.’"

Because for me, it really is the same thing every day (minus the railroad track): wake-up, work out, get kids to school, work, pick up kids, drive kids to activities, cook dinner, play or read to kids, put kids to bed, check e-mail, fold laundry, fall into bed, do it over again. While each day has a sprinkling of variety (Tuesdays the kids are home early, Thursdays we have dance, basketball AND wrestling), it all follows the same exhausting rhythm.

Don’t get me wrong, I’m not complaining. For the most part, I’m okay with the go-go-go pace and I’m not that different from a lot of other working parents. Besides, I’ve never really been one for drama, I like my schedule and I thrive on routine. Why shake things up?

But I am shaking it up. After fifteen years working in marketing/communications, I’ve decided to try a new career path. I’m early into it, but this change has required me to rethink my priorities and rejuggle my schedule. I’ve got to fit in 10 hours of studying a week, so right now, my routine is critical. A stomach flu would derail all that I have going.

So this February 2, celebrate Groundhog Day in style: Make a meatloaf. Watch The Biggest Loser. Fold some laundry. And give a great big cheer for the routine (and a silent prayer that everyone stays healthy.)

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1943 Tips for Hiring Women

You have probably encountered this list on the web, or through other blogs that you read.  This is a section of a 1943 pamphlet prepared by a mass transportation trade magazine that outlined "how to use [women] to the best hiring advantage.  The seminar question is... if you put aside the "little lady" tone and the sweeping generalizations you ought to expect from 1940s public discourse, how do you react to the tips themselves?  A "husky" girl might take it in her stride, but that's "feminine psychology" for you.

Eleven Tips on Getting More Efficiency Out of Women Employees: (1943)


There’s no longer any question whether transit companies should hire women for jobs formerly held by men. The draft and manpower shortage has settled that point. The important things now are to select the most efficient women available and how to use them to the best advantage. Here are eleven helpful tips on the subject from Western Properties:

1. Pick young married women. They usually have more of a sense of responsibility than their unmarried sisters, they’re less likely to be flirtatious, they need the work or they wouldn’t be doing it, they still have the pep and interest to work hard and to deal with the public efficiently.
2. When you have to use older women, try to get ones who have worked outside the home at some time in their lives. Older women who have never contacted the public have a hard time adapting themselves and are inclined to be cantankerous and fussy. It’s always well to impress upon older women the importance of friendliness and courtesy.

3. General experience indicates that “husky” girls – those who are just a little on the heavy side are more even tempered and efficient than their underweight sisters.
4. Retain a physician to give each woman you hire a special physical examination – one covering female conditions. This step not only protects the property against the possibilities of lawsuit, but reveals whether the employee-to-be has any female weaknesses which would make her mentally or physically unfit for the job.

5. Stress at the outset the importance of time; the fact that a minute or two lost here and there makes serious inroads on schedules. Until this point is recieved, service is likely to be slowed up.

6. Give the female employee a definite day-long schedule of duties so that they’ll keep busy without bothering the management for instructions every few minutes. Numerous properties say that women make excellent workers when they have their jobs cut out for them, but that they lack initiative in finding work themselves.

7. Whenever possible, let the inside employee change from one job to another at some time during the day. Women are inclined to be less nervous and happier with change.

8. Give every girl an adequate number of rest periods during the day. You have to make some allowances for feminine psychology. A girl has more confidence and is more efficient if she can keep her hair tidied, apply fresh lipstick and wash her hands several times a day.

9. Be tactful when issuing instructions or in making criticisms. Women are often sensitive; they can’t shrug off harsh words the way men do. Never ridicule a woman – it breaks her spirit and cuts off her efficiency.

10. Be reasonably considerate about using strong language around women. Even though a girl’s husband or father may swear vociferously, she’ll grow to dislike a place of business where she hears too much of this.

11. Get enough size variety in operator’s uniforms so that each girl can have a proper fit. This point can’t be stressed too much in keeping women happy.

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The Wicked Recruiter: Are they just not into you anymore?

Tina Duccini, The Wicked Recruiter

In a follow-up to last week's post, we asked the Wicked Recruiter to reveal more behind-the-scenes insight into Recruiter behavior.
Dear Wicked Recruiter, 
What does it mean if a recruiter has started talking about making an offer and seems enthusiastic, but then stops contacting you or returning your calls altogether? Are they "just not into you" anymore?

Answer: It means you have an underperforming recruiter. They likely ran into an awkward corporate situation and simply don't know how to talk about it.

The general awkward situations are:

1. req frozen due to public company quarterly shenanigans
2. req frozen due to department budget issues
3. req frozen due to company not doing so hot and not freezing reqs before candidates got to the offer process
4. Department/Hiring manager believing they had the right to hire but bypassed administrative steps and got stuck in the mud.
5. compensation inequity issues

A great recruiter knows how to talk about each of these types of issues. Companies with recruiters who can't address these issues have taken the first step in showing you how important hiring is to them. Companies may still get lucky and find some great people, even when they have an alarmingly bad hiring process; however, bad bait will only get you a good catch once in a while. Eventually, not taking your own hiring process seriously and failing to realize it is one of the 2 most important parts of your business will catch up to you.

You are only doing two things in business...

1. recruiting customers
2. recruiting employees to serve those customers

A business needs everyone in the company to know how the company makes money and use that knowledge to make good business decisions, the most important of those being hiring.

Hiring Human Resources/Recruitment staff who can't have hard, yet real, business conversations during the hiring process means a business is not taking #2 seriously. Which should make you ask how seriously they are taking #1.

However, there is still a chance they may turn out to be a good company to work for despite some awkward potholes in their hiring process. Take your experience seriously and look in to what happened. 

If you decide to take a job with a company that has an underwhelming or even downright insulting hiring process, then please do everyone a favor and insist on a better process and if necessary, a better HR/Staffing team.

Sometimes you have to play the game
Play to win
When you are in power
Change the rules!

Because putting people who don't get #1 and #2 in charge of hiring is costly and like arming your gates with your worst enemy. Bad HR and Recruitment staff is a Trojan Horse. Remember how that turned out for Troy?

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Tips from the trenches: Make your coworkers look good

Miss Minchin, Dean of Students

In school, group projects were the worst. One person always did all the work, one person always dominated the planning, or everyone did their own thing and it never came together as a cohesive project. The same dynamics can come into play in the world of work whether you are working on a cross-functional team, or simply depending on other groups to help you meet your deliverables. It can be tempting to sit back and let the slackers in the group expose themselves as unprepared or non-collaborative, while you seemingly “shine” in comparison, but in reality this will have the opposite effect. Your manager wants to know that she can rely on you to produce results, and this applies to team projects as well as individual contributions.

Rather than silently seethe when you find yourself doing more than your fair share, or focus only on your own contribution to the effort (and be surprised when someone drops the ball at the 11th hour), work to bring out the best in your team. Take a few proactive steps to help your colleagues shine and the whole team will look good. Here are a few examples:

• At least a day before a status meeting or presentation, check in with your team and make sure everyone is prepared.
• Ask:”Do you have everything you need for tomorrow? I’m expecting you will present X and I’ll present Y, is this what you had in mind?”
• Determine which updates/sections each person will present, and talk through how you think the meeting will be run.
• If you are presenting to executives, it doesn't hurt to stage a dry run in advance. Everyone will benefit.
•  Ensure any obstacles or negative reports your team has to make are presented with a plan to overcome them:
• “We are still waiting for the reports, but we’ve escalated this and it’s been promised by no later than next Monday.”
•  Help your colleagues present their results in the best light, you may have more experience in presenting than they do, or you can simply serve as a second pair of eyes.
• Instead of “the marketing campaign was not very successful, but it was our first one”, encourage them to report “the marketing campaign had a respectable showing for a first run, and we are working on a plan to make the next one even better”\
• Instead of letting your developer state that the code is only 30% done, encourage him to present it as “We prioritized the main workflows which are 90% complete and we are starting on the secondary workflows next week. “ (Of course – only if this is true)
• Make sure you check in with your team members on a regular basis, and set up a status call if there isn’t one already. 
• This is the place to check progress, ask if anyone needs help, and uncover obstacles before they lead to big problems. If your company culture doesn't support that, check in with each person one-on-one.
• This is not a forum to publicly shame team members into taking action. Understand that they each have their own individual priorities, and are stretched just as thin as you are.

In the end, it’s the finished result that counts, and supporting your colleagues will make you all look better. Throwing your colleagues under the bus will reflect negatively on you as well. What goes around comes around, and it never hurts to generate good will among coworkers. You never know, someday you might end up reporting to them, but with these skills under your belt it’s more likely they’ll end up reporting to you. ;)

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Setting up Your Home Office

Instructor, Betsy Boesel Sagges, Independent Public Relations and Communications Professional

Home offices have come a long way since Bill Gates tinkered with wires and metal boxes in his parents’ garage. “Working from home” used to be a description often accompanied by a wink, since it rarely meant actually WORKING, beyond making a couple calls then running off to do errands or catch the kids’ chorus performance without having to log a day-off.  But that was also when most people worked at some place, before email and cell phone technology advanced to enable us to stay tethered to our desks wherever our desks might be.

My entree to creating a home office, was in the mid-1990’s when I struck an arrangement with my fulltime employer to work from home one day a week. They were based in San Francisco and I in New York.  My primary client in New Jersey, and I argued that I was basically telecommuting with them anyway.

I agreed to secure a second phone line, and they provided me with a laptop and dial-up access. (Remember dial-up? That eternally long connection that would suddenly cut-off? My generation’s version of “walking 5 miles through the snow to get to school”—God bless broadband!)

There are certain specs for creating a home office.  To help streamline the process, I have created a list of items below. Bear in mind that my consulting business may have requirements that other types of business do not, but this will hopefully help get you started with the basics.


Space/location – if you have the luxury of a separate room, regardless of size, use it. There is a myriad of distractions in one’s home (children, laundry, doorbell, etc), and the easiest way to tune them out is shutting them out with a closed door. My home office is a nice-sized room off the master bedroom; however, the temperature is far less consistent than the rest of the house. So I added a space heater and window air conditioner to keep it comfortable.

Desk – Large enough for your computer and accessories, room for note-taking and keeping some files handy. My desk is actually a large antique dining table.  While the height might not be ideal, I was able to compensate with an adjustable chair. It’s great to have room to spread out, but not necessary.

Desk chair – It is critically important to spend money on something comfortable and ergonomically correct. My first chair was cheap, less flexible and far less comfortable. I found myself getting up more frequently and trying to adjust it regularly, which ultimately cut into my productivity. My current chair is fantastic (and only about $100 at Staples). I set the height to meet my desk/table just right, and now can work for hours.

Lighting—My office faces south so I have the luxury of afternoon sun. However, it also means my shades are drawn to avoid the blinding glare through the windows, creating an uneven shadow around my workspace. Spend money on good lighting throughout your office, not just on your desk. Nothing is more frustrating than looking through files you have to carry across the room to see clearly. A good desk light and bright room lighting with help avoid fatigue or a dip in your work when the sun starts to set. There’s a reason why fluorescents are so popular in office buildings and Las Vegas.

File cabinet—Despite the growing use of digital files, a filing cabinet is important for storing printed or published items such as business receipts and 1099/W-2 statements, especially when you have multiple clients to track (printed copies receipts). I have a large, 2 drawer horizontal cabinet that stores tax forms, spiral-bound plans and programs, printed news stories, clippings of topical interest, reference sources, computer and cell phone manuals and back-up software, and other items relevant to my home office such as ink cartridges or extra notepads. (Hanging folders and file folders needed as well.). The file cabinet can also be used as a tabletop to hold a printer and reference books.

Computer—I have a desktop system that is soon to be replaced by a laptop with a port station for more mobility. However, I will continue to use the flat-screen monitor (17”) and wireless mouse with the new laptop. I also have a wireless printer that also scans and copies. As far as computer support, there are great consultants around, but I would ask several sources before bringing someone into your home. I’ve had good luck with Best Buy and their Geek Squad (in person only, don’t use them over the phone for tune-ups or other diagnostics).

E-mail account—It is a good idea to have a separate e-mail account for work, and there are many free options out there such as Yahoo or Google mail. I am one of those people with several e-mail addresses, as I have clients with their own servers for me to use (e.g. betsy@pickaclientanyclientwebsite.com).

Off-site back-up—For small businesses, off-site storage is an important consideration. I use Norton’s 360 to back-up my files, along with client-specific flashdrives that I can take from one computer to a client’s office and back again as needed. One of my clients swears by Mozy as his back-up storage provider. Many of these off-site storage providers offer annual plans with monthly fees.

Telephone—Dedicated phone line for your office. Period. It is important to have an office number that is separate from your life phone (home or cell) along with a separate answering service stating that someone has reached your office. That way there’s no chance one of your kids will answer the phone for you. Clients don’t really go for that. I am in the process of “porting” my home office landline number to a cell phone. This is a relatively new option – so new that one of the Verizon reps I spoke didn’t even know it was possible – but one that makes sense for a more mobile workforce.

I’ve had my home office phone number for nearly 15 years, and was loath to change it. But my client work was taking me away from my office more and more and I wanted to stay connected without having to forward calls or check messages all the time. Turning my home office landline into a cell number was the best option – and can be less expensive depending on your cell plan. (*I’m currently mid-way through to “porting” process so check back for an update to see if it truly works. Cross your fingers for me.)

Office supplies—One of the hardest parts of working in a home office, is that you must provide your own supplies closet. Running down the hall for another legal pad or post-it note suddenly becomes a trip to Staples or Office Depot. And those little things can add up! Choose the items that you’re used to, and spend the money to stock up a bit. I have a shelf that holds plain white paper for the printer, file folders, envelopes, note pads, legal pads, and staples. On my desk, I have a pencil holder with pencils, pens, highlighters and scissors; a dish with paper clips; two paperweights and stapler. Other items you might need include a three-hole punch, scotch tape, packing tape, padded envelopes, and page protectors. I also hit the local post office for a stash of Priority Mail labels and envelopes so I can address everything before I go over to mail it. You can also order envelopes and labels from FedEx as well.

As a final note, I urge you to treat your home office space like one outside your home. Hang some nice posters or pictures, put a few framed photos of your friends and family on your desk, and provide an extra chair for a visitor (whether you have them or not).

Resist the temptation to fill the space.  I caution you not to put too much furniture or extras in the space. My office has a little seating area with two chairs and a table with a lamp, (and both chairs are currently piled high with past client work to be sorted and filed...)  There will be plenty of time to add; do so a little at a time. Less is more when it comes to home office décor, and best to stick with what you know works and keep you working.

***************************************************************************

BWFS&SC asks our readers for their additions to this list.  Any tips?  Product recommendations?
Send us pictures of your home office set-up and we will post them as design ideas.

Additional Reading
Official IRS forms and instructions for deducting home office expenses
IKEA Office Planner
IKEA Hacker

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Ask A Manager: Asking for a raise

Dick Whitman, Manager in Residence

Dear Manager,
What was the most compelling request for a raise you have heard?

I think the most compelling request came from a guy who was brought into my company in an acquisition. His prior role in the smaller company was relatively contained and specific. Shortly after my company came onto the scene, a few key players from his very small group left abruptly and unexpectedly. We were left in a very bad spot in that we had so few people left who knew anything about this operation that was so new to us.

This guy – let’s call him “Bob” -- saw an opportunity to help the company while helping himself, and he volunteered to step up into a much bigger role that had been left without an owner. Bob told me where he saw the need for the business, and explained to me why he felt that he was the right guy to take on the role. In the process, he described some new ways that he would like to approach the job. Given the fact that I was in a bind and had very little to work with, it was an easy sell.

All of this was done before anyone mentioned money. Bob’s actions were far louder than any words he could have spoken. It was only after we had figured out the new structure that he said to me, with great candor and sincerity, “I want this business to succeed. I am happy to have this opportunity and I intend to make it work. I have seen the potential for years and I have wanted to play a bigger part in it. All I ask is that you look at my pay in relation to my job and consider whether it is appropriate.”

The combination of Bob’s words and actions made me fight as hard as I could to improve his compensation. I was able to give him a very healthy raise that put him more in line with his value to the organization, and to me.

The key here from a manager’s standpoint is that the increase in pay needs to be tied to the value of the work, and that this evaluation is most effective when it is done objectively. In other words, managers want to know that you have the business’ best interests in mind and that you are asking for a fair shake based on your contributions.

I can’t tell you how many times I’ve had employees ask for a raise because “they need one”. In my younger years I tried this once (and failed) myself, so you should know that I am not playing the holy card here. You just don’t want to be arguing for a raise because you want to start a family or because your kid needs braces, or because your in-laws are moving in and you need to buy a bigger house. These motivators might be the force that brings you to the table for the discussion, but they cannot enter into the justification for higher pay from the company, particularly when budgets are tight.

Remember, unless you work directly for the CEO, or maybe the Corporate Controller, your manager most likely will not be able to make an off-cycle raise happen for you without going up the chain and fighting for it in turn. Picture your manager telling the VP or Finance department that Nancy needs a raise because she has a wedding to pay for. Doesn’t work.

You also don’t want to be demanding anything. These are sensitive talks, and there is an inherent risk that your manager will be put on the defensive when asked. A manager can feel like he is faced with the problem of an important employee at risk of leaving -- or at least at risk of being unhappy, maybe spreading some bad cheer along the way -- and he is also being asked to do something that is not entirely under his control. As an employee, if you can help your manager understand the business rationale, you are then partnering with him to come to a solution together.

So my advice is to first show your value by going the extra mile, helping out, and working above the expectations of your job. After that, to do an honest assessment of where you stand in the market based upon the job that you do. If you feel like you have a clear case of undercompensation, then the tone of the discussion that works best, in my opinion, is something like this, “I like it here. I don’t want to think about leaving. Based on the information I have, and from my perspective, I believe that my compensation is out of line with the value that I bring. I am asking that you evaluate this and let me know if you agree. If you do, I am asking you to help correct this. If not, I’d like some help understanding why.”

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What's your opinion? Any positive/negative experiences asking for a raise? Does gender make a difference here? If you think it does, is it because we make it an issue or does management make it an issue? Tell us in the comments!
-Miss Minchin, Dean of Students

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Unpaid Furlough is Not a Good Management Tool

Guest Lecturer, Eloise, Fundraising Director

Nothing creates an us-versus-them dynamic and blows employee morale quite like implementing unpaid furlough, especially when it’s done twice in six months.  What begins in a meeting room as a compromise to save money and jobs can worsen your employees' situation if not planned with real-life outcomes in mind.  Read more in Eloise's story below.

For the past two years I have worked as a fundraising director for a nonprofit arts organization in fiscal crisis.  In mid-April of 2009, senior management announced that due to impending financial disaster, they were forced to cut 10% of the staff and were implementing mandatory unpaid furlough for the remaining staff. This was presented as a necessary last resort that would get the budget back into balance.

The number of unpaid days to be taken was on a sliding scale, based on each employee’s salary level that ranged from two to 10 unpaid days.  Unpaid time had to be taken between April 15 and the end of our fiscal year on June 30 -- in other words...now.  Human Resources presented it as "not a big deal" because everyone qualifies for unemployment for their furlough time.

That just sounded wrong to me in so many ways.  I did not ask the government to pay me because my organization could not control its finances, but the majority of my co-workers—including the senior management team who created the fiscal problem—filed for unemployment for their furlough.

Since the last quarter of the fiscal year is the busiest time in the fundraising world, taking time off was not an option for me.  I worked two weeks without pay because foundations and the federal government have specific deadlines, and the work had to get done before those deadlines, or we would have no possibility of incoming grant money.  My manager, however, not only took two weeks of unpaid furlough, he took an additional four weeks of vacation time throughout the summer months.  I was astounded when all of the senior staff followed suit, taking their two weeks of unpaid furlough as well as their full complement of vacation days last summer.

We were in worsening fiscal crisis, they had said.  The organization needed increased management attention, and most of the management team was absent for six weeks to start our new fiscal year. My experience in similar situations in the for-profit work world had been that senior management is more present, not less, in times of financial difficulty.  They had role modeled team work, worked longer hours, and rallied the troops with specific goals, communicating constantly to get the organization back on track. 

We heard nothing more about the fiscal situation until six months later in October 2009 when Human Resources sent an email at 4:55 pm on a Friday announcing a second mandatory furlough…only this time, everyone was taking the hit of 10 days without pay on mandated single days selected by senior management staff.  So, from April 2009 to April 2010, I will lose four weeks of pay—that’s one month without a paycheck or an 8.3% pay cut.  It is significant, it is painful, and it feels like punishment for all staff because of poor fiscal management by senior management and the Board.


Webster’s Dictionary defines “furlough” as a noun meaning “a leave of absence from duty granted especially to a soldier” and as a verb “to lay off from work.”  We have been treated like solders, handed orders from on high.  And we are expected to accept those without question or rational discussion.  My position generates about $2.5 million of revenue a year—one quarter of the organization’s total annual revenue.  Cutting my paid work time by 8.3% did not result in a similar reduction in my fundraising goal.  In this time of crisis, my goal was actually raised 10%.  How was that supposed to happen?

I should also mention that my organization gives its employees 22 paid vacation days, 21 paid sick days, and five paid days off between Christmas and New Year’s Day each year.  Add 20 days of unpaid furlough, and (if I actually took all that time off), I would be taking off 68 days or over 3 months of potential work time each year.

In the midst of this fiscal crisis, Board members do not seem to comprehend the impact to staff members of the financial hit of two to four weeks without pay.  Perhaps it’s because Board members are selected for their wealth and have never had to worry about paying the rent or buying groceries. When the second furlough was announced at the Board meeting, the Board president said “employees have to take a couple of unpaid days.”  Board members shook their heads and gave sympathetic looks to the staff members in the room, but they had no idea that staff had to go two to four weeks—not "a couple of days"—without pay. 

In that same Board meeting, the Managing Director reported that “employee morale is good given the circumstances.”   Senior management has become so out of touch with employees that they do not recognize that morale has been flushed down the toilet.  Yes, we enjoy our co-workers, but we do not enjoy continual denigration.  We have a lot of gallows humor because if we weren’t laughing we would cry every day that we have to slog to our dank basement workplace and pray for 5:00 pm to come more quickly.

Some advice to senior management considering implementing unpaid furloughs:
1.      For God’s sake, analyze your financial plans and create organizational budgets based on reality before you mandate unpaid furlough time for your staff.   

2.      Don’t downplay the severity of each employee’s economic hit in an unpaid furlough—it’s painful to go without a paycheck for a week or a month.

3.      Don’t tell employees that you are in such financial crisis that you are unable to budget for “extras” like training and professional development and then send six senior management staff to the same expensive conference on the other side of the country.

4.      Don’t ignore employee morale and pretend everything’s okay because it’s not.

5.     Understand that most of your staff are currently looking for employment elsewhere because they cannot take incessant abuse, inept management, and repeated pay cuts any more. 

Finishing School adds:  Know the law.  There are laws regarding furloughs in your state, additional guidelines for federally funded organizations.  Managers and Staff both are strongly encouraged to know responsibilities and rights before planning mandated furloughs.

related reading
Companies turn to furloughs
Employee Furloughs and Related Wage and Employment Laws
Avoiding Legal Pitfalls in RIFs and When Reducing Hours
MSNBC on "Furlough Frenzy"

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