By Bob Feeman | MainStreet.com

Running a company during a recession can pose major challenges to their owners. But it also offers them an opportunity to revamp their businesses and find new avenues for success.

Here are six strategies for small-business owners who are struggling to survive in a weak economy:

Exercise your bargaining power: Recessions can take a toll on a company’s cash flow. If you’re having difficulty paying your suppliers, work with your vendors to create a payment plan that’s more manageable. You might be able to use the economic crisis as a bargaining chip to renegotiate your contracts and get better terms.

You should also look for ways to reduce inventory to keep overhead costs down. And be sure to bill customers right away, which can help speed payments and keep cash flowing.

Focus on the profit-makers: When the economy is flying, it’s easy to get sidetracked by adding ancillary products or services that might broaden your company’s appeal but water down profits. Take a critical look at everything your business offers and concentrate on the efforts that will bring in the most cash. Weed out time- and labor-intensive services that are less profitable.

Explore the art of the deal: Customers still spend during recessions, but they’re more cautious and sensitive to bargains. If you provide services, consider bundling some together under a lower price. Try offering reduced prices for groups. Look for underserved customers and lure them with discounts. Special prices might hurt in the short term, but attracting new clients will help you generate revenue after the economy rebounds.

Improve customer service: It’s important to retain the customers you have. Show them your appreciation through discounts, special events and gifts. Take the time to talk to them. Provide them inside information about your products and services. If you do it right, they’ll remember you after the economy improves.

Evaluate your rivals: A recession can become an opportunity to attract clients from your competitors. Try offering services that help you stand out in the field, such as free delivery or package deals.

Adapt and get creative: Revisit your original business plan and ask yourself if your vision is still viable in this economy. If it’s not, look for ways to adapt by tapping into new markets or targeting other groups of customers. Consider taking a new marketing approach or changing the packaging of your products. Minor tweaks can create major improvements.

By Karen M. Kroll | MainStreet.com

For most small business owners, dealing with deadbeat customers comes with the territory.

You want every sale you can get. However, a sale isn’t much good if you’re not paid. Given the sputtering economy, a growing number of clients or customers may decide to either delay payment or skip it altogether. However, there are ways you can cut the risk of getting stuck with deadbeat clients.

What to Do Before a Sale

1. Check out potential customers. Do a quick Google (Stock Quote: GOOG) search of their name, and see if any red flags, such as lawsuits, come up.

If the potential order is a large one – say, it would represent more than ten percent of your annual sales – it probably makes sense to spring for a business credit report, says Sam Thacker, a partner with Business Finance Solutions in Austin, Texas. These are available online through firms like Experian and Dun & Bradstreet, at fees starting at about $25. The more you pay, the more information you’ll receive.

Members of the National Association of Credit Management (NACM) can purchase business credit reports for about $15, says Toni Drake, a member of the NACM board of directors and president of TRM Financial Services, Inc., in Midland, Texas.

2. Request a portion up front. A good rule of thumb is to ask for enough to cover out-of-pocket costs directly associated with the order. To avoid generating hard feelings, Drake says, frame your request along these lines: “Our firm can do great work for you. Let’s structure the deal like this…”

3. Have new clients fill out credit applications. These should provide the company’s legal name and contact information – critical info if you later need to take legal action. The application should also give you permission to talk with several of the company’s vendors and its bankers. You’ll want to ask whether the firm has fallen behind in its payments or written non-sufficient funds (NSF) checks over the past year.

The application should state payment terms, including due dates, and the interest or penalties charged on late payments. Review these with clients, and have them sign the document.

What to Do After a Sale

1. Follow up. If you’ve done the work, sent the invoice, and the payment deadline has come and gone, call – don’t email – after a few days have passed, says Michelle Dunn, author of Become the Squeaky Wheel, and other books on credit and collections. Politely remind the customer of the bill, and ask whether there were any issues with the invoice or your goods or services. Then, ask when you can expect payment.

2. Consider compromise. Set up a payment schedule, and accept future orders on a cash basis until the balance is paid down. If it’s apparent that even waiting won’t assure you of all you’re owed – if the company has publicly announced layoffs, for instance – consider accepting partial payment.

3. Bring in the big guns. If you’ve set a new deadline that’s come and gone with nothing more in your bank account, consider engaging a collection firm. You’ll generally want to take this step within 90 days of the invoice deadline, Drake says. The longer you wait, the less you’re likely to collect. Most firms take about 25 percent of the amount they collect. Check out the collection firm before hiring it, however. Some have been known to simply walk off with the money they get, Drake says.

4. Get legal. Consider filing a suit in small claims court or entering a lien on the property, if that’s an option. “Don’t think you’re too small to do this,” Drake says, adding that fees generally total several hundred dollars. Keep in mind, however, that even if you obtain a judgment against the firm, you still need to collect. If the customer has no assets, you’re unlikely to get anything. On the other hand, judgments are publicly available, and can impact defendants’ credit records.

By Althea Chang | MainStreet.com

Considering online banking?

If you’ve already been shopping online regularly, changing over to solely online banking won’t seem like much of a stretch. Plus, data encryption technology and other measures ensure security over the Internet.

Here are some pros and cons of making the switch to banking online:

Pro: Strong First-Rate Yields
A major factor driving the popularity of online banking is the great returns from high-yield checking accounts compared with those at brick and mortar banks. Since all of an online bank’s business is done on the Internet, over the phone and by mail, these banks have low overhead costs and the savings is passed on to the account holder.

Jacksonville, Fla.-based Everbank’s high-interest checking account, for example, offers an introductory three-month bonus yield of 2.51% and a first-year APY of 1.84% for balances between $50,000 and $100,000, compared with a recent national average of 0.16%. And Everbank promises to offer yields among the top 5% of competitive accounts at leading banks and thrifts.

Redneck Bank, which is owned by the Bank of the Wichitas, offers a whopping annual percentage yield of 5.25%, as long as you play by their rules.

Another popular online checking accounts include Schwab’s High Yield Investor Checking Account (Stock Quote: SCHW) which offers a 1% APY. ING Direct’s Electric Orange Checking Account (Stock Quote: ING), which yields as much as 1.65% (if your balance is more than $100,000) and at least 0.25% (if your balance is $49,999.99 or less).

Con: Don’t Forget the Fees
Racking up ATM transaction fees can become a problem with some online banks.

ING Direct Electric Orange account holders can only use the Allpoint national network of 32,000 ATMs free. At other ATMs, you’ll have to pay the ATM operator’s fee, but ING won’t charge you for using an ATM outside of their network. Your best bet here is to opt for cash back every time you go to the grocery store.

Schwab’s account offers the best deal for those who make frequent ATM visits. You’ll get a rebate for all ATM charges during the same checking account statement in which you incur them.

Pro: Tech Perks
One of the best features of online banks, especially for the forgetful or undisciplined, is an automatic savings plan feature that allows you to transfer fixed amounts of money to or from other accounts on a weekly, monthly or quarterly basis.

And for those who like to micromanage their finances, you can upload you transaction information from ING and Schwab to your home computer for use with personal finance software including Intuit’s Quicken (Stock Quote: INTU) or Microsoft Money (Stock Quote: MSFT).

By Bob Feeman | MainStreet.com

First, the reality: There are no magic bullets that can restore your retirement account to where it was before the current economic crisis.

“What it’s worth now is what it’s worth,” says Harold Evensky, a certified financial planner and president of Evensky & Katz, a financial advisory firm in Coral Gables, Fla. “There’s no guarantee you’re going to bounce back.”

Evensky recommends investors start by revisiting and perhaps adjusting their retirement goals. “Maybe you don’t need to bounce back. Perhaps you just need to invest more intelligently and diversify,” he says.

In addition, Evensky suggests that investors proceed cautiously in the current economic environment. “If anyone is discovering the holy grail now, be suspicious. Be careful of some of the new things coming out. Try not to chase the next great thing.”

That said, there are some actions investors can take to maximize their retirement accounts, including the following.

1. Manage expenses: Many individuals or couples, especially those who work for different companies or have changed jobs over the past few years, have multiple retirement accounts, and are paying fees on each of those accounts. Now is the time to consolidate your retirement savings into just one or two accounts to reduce fees and costs. Be sure to compare the costs of your current plans and any new ones you may be considering, and keep an eye out for hard-to-spot administrative fees that can siphon off funds from your account. Also, having fewer accounts can also make them easier to manage when it’s time to start making withdrawals.

2. Diversify your savings: If you employer has stopped matching your 401(k) contributions, this might be a good time to consider diversifying some of your retirement savings to a low-cost IRA — say, one offered by a mutual fund company such as Vanguard. These accounts offer similar tax advantages to 401(k)s, and will give you an opportunity to set up and manage a retirement account separate from your employer, which might prove beneficial if your current plan is costly.

3. Consider a Roth IRA: Younger investors might want to consider moving part of their retirement savings to a Roth IRA. The contributions will come out of after-tax income, but that might prove beneficial in the long run, since the eventual withdrawals will be tax-free, and will likely be taken when an investor’s tax rate is significantly higher.

4. Write off losses: A strategy called “tax loss harvesting” allows you to write off any investment losses you have, but this applies only to taxable investments, and not to traditional retirement investments accounts such as IRAs. However, it can apply to a Roth IRA. Generally, the strategy calls for selling off your investments, taking the loss, and claiming a tax deduction up to $3,000 for the calendar year. If your net loss is more than $3,000, you can carry it forward into the next year. Also, after 30 days, you can repurchase the investment without a penalty.

5. Seek expert advice: Finally, don’t panic. This isn’t the time to stop contributing to your retirement accounts. Remember, any investments you make now are being bought when the market is down, so you actually have more purchasing power than you realize. Many stocks can be had at bargain-basement prices. Seek the help of an expert by visiting a financial planner or CPA, and set realistic goals, build a well-diversified portfolio and hold tight until the market improves.

By Althea Chang | MainStreet.com

You know you should, but it’s difficult to feed the piggy bank every time you get paid. Luckily, new bank accounts and the power of automatic savings plans may make it easier. And every little bit counts, after all.

Simple Savings
“Saving is a whole lot simpler when you don’t have to think about it,” says a Bank of America marketing campaign (Stock Quote: BAC) for its Keep the Change program. With every purchase you make with your Bank of America check card, your purchase amount is rounded up to the nearest dollar, and the difference is deposited into a savings account. Bank of America also says it will match your savings for the first three months after you enroll in the program and match 5% per year after that, up to $250.

If you have a Wachovia checking account (Stock Quote: WB), you can open a Way2Save account. Each time you make a purchase with your check card, pay a bill online or set up an automatic debit from your checking account, $1 will be transferred from your checking account to your Way2Save account, which gets a guaranteed APY of 5% for the first year, plus they’ll add on 5% of the amount you’ve saved. You can also set up automatic transfers of up to $100 a month, from your checking account to your Way2Save account.

Of course, many banks let you set up automatic transfers from checking to savings accounts online, and APYs may be higher at other banks (Bank of America’s Keep the Change program paid a variable APY of just 0.20% as of Monday). But these accounts could be perfect for those without the discipline to make regular transfers on their own.

Save When You Pay
An online bill pay feature gives you the option to paying bills electronically through automatic withdrawals initiated by your utility, credit card or other company. This is a must if you tend to forget when bills are due. (Those late fees are a killer.)

Just remember, you’ll have to make sure your bank account balance has enough funds to pay the bills when they’re due, or you could be subject to insufficient fund or overdraft fees.

Retirement Savings Under Your Radar
Anyone contributing to a 401(k) knows that contributions taken right out of your paycheck really add up over time, even if the market downturn has taken a chunk out of their balances in the past year. But even if you’re self-employed and contribute to an IRA, you can make automatic contributions as well if you have an account with Fidelity, Schwab (Stock Quote: SCHW) or other financial services companies that offer the feature.

Automatic for the Children
If you have kids and you’ve been making adequate contributions to your retirement savings plans, a 529 plan is a great investment vehicle to help you save for college. And you can schedule periodic automatic payments online. Minimum contributions can be as low as $25, and you may be able to set up automatic deductions from your bank account once every week, month or quarter.

By Bobbi Dempsey | MainStreet.com

Looking for part-time work? You’re in luck. There are plenty of part-time opportunities out there, especially now, as employers turn to the much cheaper resource of part-time employees, who generally don’t receive a full benefits package and receive a lower hourly rate.

These jobs can be a good choice for students, retirees, parents with young kids or people who recently lost their full-time job or had their hours cut, as well as anyone looking for a second job. (If you lost your job, you can usually earn a certain amount per week without a reduction in unemployment compensation benefits, although this varies by state).

To attract the best candidates, many companies now offer at least some benefits for part-time employees. These can range from health insurance and paid time off to employee discounts or free merchandise.

Here are three companies with lots of part-time openings available right now:

1. Six Flags (Stock Quote: SIXF)

Type of work available: Six Flags, which operates 20 parks in the U.S., is hiring in food service, games, merchandise, rides, park service and entertainment, which includes dressing up as a character.

Hours per week: Employees are usually expected to work at least 30 hours per week. The shifts available are typically night shifts that begin at 2 or 3 p.m. and last until park closing, usually some time between 10:30 p.m. and midnight. Most departments request that employees be flexible regarding shifts. Also remember that most employees will have to work weekends.

Starting pay: $7.75 per hour after completing the training.

Benefits: Employees get free admission on their days off, and earn a “buddy pass” after working 150 hours. The pass permits each employee to bring a friend in the park for free with their admission. Employees also earn free tickets and discounts on tickets and merchandise. There are also special events for employees, and each department offers special events and incentives.

Requirements: Training is provided for most positions, including those in food service, rides, games, merchandise, entertainment and park services.

The inside scoop: “The ideal candidate is a friendly, outgoing individual ready to entertain our guests,” says company rep Stephanie Helander. “After successfully completing an online application, candidates are called for interviews based on positions available. Interviews are conducted at the park and are individual interviews.”

Apply: SixFlagsJobs.com. Character candidates must set up an audition by calling 847-249-2133, ext. 4606.

2. New Jersey Turnpike Authority

Type of work available: Toll collectors

Hours per week: Part-time workers are scheduled for eight hours each Saturday and Sunday. Shifts are 10:30 p.m. to 6:30 a.m. Friday and Saturday nights; 6:30 a.m. to 2:30 p.m. Saturday and Sunday mornings; or 2:30 p.m. to 10:30 p.m. Saturday and Sunday afternoons. Most new collectors will be assigned a rotation of these until a steady shift becomes available.

Starting pay: $11.32 an hour

Benefits: None

Requirements: Must be at least 18 years old and pass two pre-screening tests and a physical, including drug test. Must have a valid driver’s license and pass a background check.

The inside scoop: Part-time workers must successfully complete a one-year probation period before being considered for any full-time positions.
Apply: Online application (pdf).

3. New York State Thruway

Type of work available: Toll collectors

Hours per week: Shifts run between three and eight hours, depending on your availability. Holiday work is a must and preference is given to those who are available on weekends.

Starting pay: Starting wage of $9.66 plus an additional $.40 per hour paid worked between 3 p.m. and 11 p.m., and an additional $.60 per hour between11 p.m. and 7 a.m. There are yearly raises, up to $11.21 an hour. Holidays are paid at time and a half, plus employees are provided with uniforms, paid training and free parking.

Benefits: Limited benefits for part-timers.

Requirements: Applicants must be 18 years of age, enjoy working with people and able to handle money in a fast paced environment.

The inside scoop: Lots of patience, and the ability to withstand occasional verbal attacks, is a necessity. “These positions require continuous contact with the traveling public,” a job posting warns. “Toll collectors serve as representatives of their agency and are required to act in a courteous manner while working in situations which are sometimes stressful due to inclement weather, traffic backups, etc.” First consideration will be given to successful candidates who are residents of the county and/or adjacent counties in which the vacancy occurs.

Apply: Online application (pdf).

By Karen M. Kroll | MainStreet.com

Finding non-employer based health insurance is becoming a reality for more Americans.

Approximately 90% of Americans under age 65 receive health insurance through their employers, according to the Washington D.C.-based trade group, America’s Health Insurance Plans. But if you belong to the 10% who don’t receive coverage through your job, you may find the individual market for health insurance somewhat intimidating. Take it step by step, however, and you can learn the market and find the policy that best fits your needs.

To start, identify the features of a health insurance policy that are most important to you, says Carol Kelel, owner of the Jane Aubrey Group, a health insurance agency in Bingham Farms, Mich. For example, do you want unlimited office visits? Or is it more important to be able to go outside the network to see a specialist? What level of deductible would you like? You can find a range of policies, so it helps to have some idea of your needs and preferences before you start zeroing in on specific ones, says Kelel.

Do Your Research
The next step is to research the options available. One web site that can get you started is CoverageForAll.org, published by the Foundation for Health Coverage Education, based in San Jose, Calif. From the site, you can download a matrix of health care options within your state including the phone numbers and web sites of both government-sponsored and private health insurance policies for individuals and families. The matrix also offers information on policies that cover individuals with pre-existing conditions.

Another online resource is eHealthInsurance.com. By providing a bit of information on yourself, including your ZIP code, age and gender, the site assembles, working from its universe of 10,000 plans, a list of insurers offering covering in your area. It will include such information as the plan type—for instance, an HMO versus a PPO—the deductible and the charges, if any, for office visits. You can compare the premiums and services covered offered by different plans.

If you’d rather deal with a human than the internet, contact an insurance agent. Ideally, the agent should be independent, rather than affiliated with a specific company, Kelel notes. That way, he or she can present a range of options from different insurers. Most agents earn their money from the insurance providers, so you shouldn’t pay any more purchasing insurance through an agent, says Kelel.

To find an agent in your area, head to the Association of Health Insurance Advisors.

Prepare for the Costs
A word of warning: Purchasing health insurance individually, rather than through your employer, often prompts a case of sticker shock. That’s because most employers subsidize the cost of their employees’ insurance. On average, employers picked up about 73% of the cost of family coverage in 2008, according to the Kaiser Family Foundation.

Without an employer to cover the cost, you’re on the hook for all of it.

Last year, monthly premiums for individual policies were $158, and for family policies, $366, according to a survey of the individual health insurance market by eHealthInsurance.com. Nearly three-fourths (71%) of family plans had deductibles of less than $3,000. Generally, the older you are, the more you can expect to pay. Also, women pay somewhat more than men.

Another significant concern for purchasers of individual policies is qualifying for coverage. Not everyone’s application will be accepted, notes Amir Mostafie, consumer health insurance expert with eHealthInsurance.com. While five states (Maine, Massachusetts, New Jersey, New York and Vermont) are “guaranteed issue” and prohibit insurers from denying coverage to applicants who have pre-existing health conditions, that’s not the case in the rest of the country. If you live in a state that’s not guaranteed-issue and you have a health condition, a knowledgeable insurance agent should be able to tell you which insurers are likely to decline your application because of your condition, and suggest policies that are likely to be a better fit, Mostafie says.

It’s important to point out, however, that this is a concern primarily if you don’t already have coverage, Mostafie notes. If, for instance, you’re coming off group coverage through your job or COBRA, a policy should be available.

Finally, once you’ve purchased a policy, spend some time reviewing it, Mostafie says. Granted, not a fun task. However, you want to make sure the coverage squares with your expectations, so you’re less likely to run into unpleasant surprises when you have to use it.

By Althea Chang | MainStreet.com

If you’re a homeowner 62 years of age or older and you need to supplement your income, you may be able to tap into the value of your home using a reverse mortgage to get money now.

Unlike a traditional mortgage, you won’t have to make monthly payments and your income doesn’t affect your eligibility, according to Peter Bell, president of the National Reverse Mortgage Lenders Association.

If you’re interested in getting a reverse mortgage, one of the major considerations is how much you can get. How much you get also varies on how you choose to receive your payouts. Here is what you need to know to get started.

How Much Can You Get?
The simplest way to figure this out is to use an online reverse mortgage calculator, where you plug in where you live, your age, your spouse’s age and the value of your home, says Bell.

How much you actually get is also determined by a variable: an interest rate that’s either calculated using the one-year treasury or the one-month London Interbank Offered Rate (LIBOR). The calculator on ReverseMortgage.org figures out interest rates for you and explains how it’s calculated. If your lender offers both an interest rate based on the treasury and one based on the LIBOR, you can discuss with your loan originator which one would be better for you. The LIBOR rate may be recommended, since a set margin means it carries less interest rate risk for brokers, but patriotic investors tend to choose the treasury-based rate, Bell says. Some lenders only offer one or the other. Both rates fluctuate.

About 90% of reverse mortgages, according to the AARP, are made through the U.S. Department of Housing and Urban Development’s (HUD) Federal Housing Authority (FHA) and their Home Equity Conversion Mortgage program.

Late last year, FHA-backed reverse mortgage loans were limited to between $200,000 and $300,000, depending on where you live. This year the American Recovery and Reinvestment Act raised the limit to $625,500.

Some proprietary lenders, such as Bank of America (Stock Quote: BAC), MetLife (Stock Quote: MET), Senior Lending Network and other national and community banks may offer higher-amount reverse mortgages, but such loans will not be FHA-insured.

Payout Options That Pay More
How much you can get also varies on how you choose to receive your payouts. You may choose a lump sum payout to pay off a single debt such as a credit card balance. If you need help covering regular expenses, you can receive monthly reverse mortgage payments, known as the tenure option, for as long as you live in your home. A similar option is to receive monthly term payments, which only last for a set period of time. Lastly, you can opt for a line of credit if you want backup cash in case of unexpected expenses.

As a general rule, the older you are, the more money you can get. If you’re younger, your loan amount will have to stretch over a greater number of years.

With a line of credit, your unused available credit increases annually, meaning you can have more access to cash as years go by. If you opt for tenure payments, even if they’ve added up to more than the value of your home, you’ll continue to receive them regularly for as long as you live there.

So what does this all mean in real terms? Consider these two examples of hypothetical neighbors in Sacramento, Calif.

Reverse Mortgage Example No. 1:
If a 70-year-old man and wife, 62, have a $200,000 home, and need extra money each month to help cover regular expenses, monthly payouts are determined using the age of the younger spouse.

According to the reverse mortgage lenders association’s calculator, the couple can get a lump sum of about $80,363; a line of credit for about $80,363 that increases by 4.6% each year; or monthly payments of $509 for as long as either one lives in their home, based on interest rates calculated using the one-year U.S. treasury.

With an interest rate calculated using the LIBOR, electing a lump sum would pay $88,119; a line of credit equal that amount plus a 3.90% increase per year; or monthly payments of $535 per month.

So, the best option for the couple would be monthly payments from a reverse mortgage with an interest rate calculated using the LIBOR.

Reverse Mortgage Example No. 2:
A 75-year-old widow has a home worth $625,000. She wants to make minor home repairs and have backup funds in case of an emergency or unexpected medical bill.

She can get a lump sum of about $364,372; a line of credit for about $364,372 that increases by 4.6% each year; or monthly payments of $2,593, based on the one-year U.S. treasury, according to the calculator.

With a home equity conversion mortgage pegged against the LIBOR, electing a lump sum would get her $382,952; a line of credit for that amount plus a 3.90% increase per year; or $2,633 per month.

The best option in this case would be a line of credit.

Once you have an idea of how much you should be able to get, discuss your financial situation and your income needs with a reverse mortgage counselor and a loan officer. When deciding what payout option that works for you, remember that you’ll still have to pay your real estate taxes, homeowners insurance, home repairs and mortgage insurance, too.

How do credit unions and banks differ? Here are the key differences:

Credit Unions

Banks

Money deposited in credit union members typically stays in the local community. They are also more willing to loan smaller amounts banks feel are unprofitable. For these and other reasons there is increased interest in, and support for, credit unions. Here’s how you can find a credit union.

Any wonder why credit unions are so popular? Share your favorite credit union. What makes it special to you?