Ask Carrie: Credit and Debt: Ten Questions Everyone Should Answer

Dear Readers,

October is a great month for festivals--harvest fairs, traditional Oktoberfests and Halloween activities. But there's one event you may not be aware of that I think is well worth noting: the annual Get Smart About Credit Day sponsored by the American Bankers Association® (ABA) Community Engagement Foundation.

Officially celebrated on October 20th and now in its 14th year, this national program helps bankers in local communities offer events and classes to teach high school students and young adults about the importance of using credit wisely.

To me, this is something everyone should focus on--no matter your age--because many Americans are awash in debt. According to the Federal Reserve, as of July 2016 revolving debt for American households totaled $969 billion; student debt was up to $1.4 trillion. Those are pretty eye-popping numbers!

While your own debt may not be in the stratosphere, I think it's important for everyone to periodically test their knowledge of how to control credit and debt. So here are ten questions to ask yourself to make sure you've got a handle on your own debt situation.

1.Do you know the difference between good and bad debt? Not all debt is equal; some can work for you, some against you. To work for you, debt should ideally be low cost and have potential tax advantages. That's good debt. Think home mortgages and equity lines of credit, even student debt, which has the added benefit of enhancing career opportunities and earning potential. On the other hand, credit card balances and auto loans are definitely in the bad debt category because they usually carry the highest interest rates and aren't tax deductible.

2.When was the last time you checked your credit score? Your credit score (or FICO score) plays a big part in your ability to get loans--mortgages, car loans, new credit cards, even your ability to rent an apartment. It can range from 250 to 900. With a low score, you'll likely pay a higher interest rate, if you can get credit at all. A score of 760-800 or higher will generally get you the best deals. You can get a free credit report annually by going to annualcreditreport.com and, while the three major credit bureaus (Equifax, Experian, or TransUnion) charge for providing your credit score, most credit card issuers offer your credit score for free.

3.Have you taken steps to raise your credit score? There are five simple ways to lift your credit score: pay your bills on time; keep your credit card balances low; establish a long credit history; minimize new credit requests; use different types of credit.

4.What's your debt to credit ratio? Also known as your credit utilization ratio, your debt to credit ratio represents the amount of credit you use relative to the amount of credit available to you, for instance, through your credit cards or other credit lines. To get your ratio, divide your total credit balance by your total available credit. A high ratio can negatively impact your credit score--and your ability to get new credit. The ideal credit usage is between 20 and 30 percent.

5.Do you pay your bills on time? Paying your bills on time accounts for about 35 percent of your credit score. But credit score aside, late payments can also mean added fees and interest. Even if you can't make the full payment, make a partial payment.

6.How much is your debt costing you? If you don't pay your credit card balance every month, interest can get out of hand. Consider this example: Paying only $100 a month on a $3,000 credit card balance at 14 percent would cost you over $700 in interest. Plus it would take you approximately 38 months to pay it off! Use an online calculator to do your own math.

7.Do you have the right credit cards for you? Credit cards come with all kinds of perks and incentives. Don't be taken in. Choose the perks that work for you-- whether points, cash back or travel rewards--and ideally stick to one or two cards because carrying balances on too many cards at the same time can also ding your credit score. Most importantly, look for a low interest rate and no annual fee.

8.Is a HELOC right for you? If you have enough equity in your home, a home equity line of credit (HELOC) can be a smart tool for accessing extra cash or consolidating debt. Plus, you can deduct the interest on up to $100,000 of home equity debt secured by your home, whether in the form of a regular loan or a revolving line of credit.

9.What's your debt payment plan? If you're carrying a monthly credit card balance, focus on paying it down. If you have multiple cards, start with the highest interest card while making minimum payments on the others. Work down your list. Keep on top of other debts with on-time payments. Make it easier on yourself by putting as much as possible on auto pay.

10.Should you go on a cash-only diet? If you want to break yourself of the credit card habit, try using cash only for 30 days, especially for nonessential expenses. It's an eye-opening exercise that may help you think differently about how you spend your money.

Credit is a powerful and convenient tool when used with care. Check your own credit smarts--and pass on what you've learned to the young people in your life. Happy October!

For more updates, follow Carrie on LinkedIn and Twitter.

Looking for answers to your retirement questions? Check out Carrie's book, "The Charles Schwab Guide to Finances After Fifty: Answers to Your Most Important Money Questions."

This article originally appeared on Schwab.com. You can e-mail Carrie at askcarrie@schwab.com, or click here for additional Ask Carrie columns. This column is no substitute for an individualized recommendation, tax, legal or personalized investment advice. Asset allocation and diversification cannot ensure a profit or eliminate the risk of investment losses. Where specific advice is necessary or appropriate, consult with a qualified tax advisor, CPA, financial planner or investment manager. Diversification cannot ensure a profit or eliminate the risk of investment losses.

The information provided here is for general informational purposes only and is not intended to be a substitute for specific individualized tax, legal or investment planning advice. Where specific advice is necessary or appropriate, consult with a qualified tax advisor, CPA, financial planner or investment manager.

COPYRIGHT 2016 CHARLES SCHWAB & CO., INC. (MEMBER SIPC.) (#1016-3504)

Snapchat Is Reportedly Planning A $25 Billion IPO

Snapchat’s video messages may be ephemeral, but its staying power as a startup in a hotly competitive field may be anything but.

The company last month renamed itself Snap Inc. to mark the launch of a line of sunglasses with built-in cameras, its second product after its popular social network. Now the Los Angeles-based firm is working on an initial public offering that could value the company at $25 billion or more, according to a report on Thursday in The Wall Street Journal.

The move, expected by late March, would be the most closely watched stock market debut in years.

Snap’s prominence has soared over the last five years, and with it, its value.

In May, the company’s worth surged to nearly $18 billion, placing it firmly in the top five most valuable “unicorns,” a term used for privately held startups worth more than $1 billion. 

By June, Snapchat had surpassed Twitter in users, with 150 million people using its service each day, a 36 percent increase from last December. Ten-year-old Twitter, by contrast, had just 140 million daily active users.

Ironically, Snap arguably would be the highest-profile tech IPO since Twitter made its disastrous debut three years ago, which sent its value up to $24 billion. The company, symbolized by its little blue bird, has struggled to attract new users and the advertising dollars that come with them. Twitter reportedly is seeking a buyer before its Oct. 27 earnings call, but the only suitor considering a bid may be cloud-computing giant Salesforce, Recode reported on Thursday. 

Snap may be better positioned. For starters, the company makes money, even if it has yet to turn a profit.

Last year, Snap, tapping its popularity with the coveted teenage demographic, started charging advertisers $750,000 a day for TV-style ads. Earlier this year, the company dropped its ad prices. A “Live Story” ― compilations of users’ videos or photos from a specific event or location ― costs about $250,000, CNBC reported in February. Taking over a “Discover” channel ― branded sections in which publishers such as Mashable, CNN or Comedy Central post daily magazine-like features ― goes for about $50,000.

A Snap spokesman declined to comment on ad prices. 

Snap told investors earlier this year it expected to earn between $250 million and $350 million in revenue this year and as much as $1 billion next year, according to the Wall Street Journal report.

OLIVIER DOULIERY via Getty Images

Snapchat CEO Evan Spiegel with his fiancée, Australian model Miranda Kerr. 

Ads aren’t Snap’s only business anymore. The company is selling Spectacles, its first-ever hardware, for $129.99. Given that Snap describes itself as “a camera company” on its website, Spectacles may not be its last foray into selling actual things. 

That revenue could help stave off intrusive new advertising features that have historically frustrated longtime users of ad-supported social networks.

Soon after Facebook went public in 2012 ― the biggest tech IPO in history, at about $104 billion ― users began complaining about ads appearing in their timelines. But Facebook, almost entirely reliant on advertising at that point, needed the money. 

Last month, CEO Evan Spiegel said changing the firm’s official name to Snap Inc. served as a way of separating the products from the parent company. 

“Changing our name also has another benefit: when you search for our products it will be easier to find relevant product information rather than boring company information or financial analysis,” he wrote in a blog post. “You can search Snapchat or Spectacles for the fun stuff and leave Snap Inc. for the Wall Street crowd :)”

The Snap spokesman declined to comment “on rumors or speculation about any financing plans.” 

But, given Spiegel’s explicit nod to Wall Street, perhaps he should have ended his paragraph with ;) instead. 

Dear Female Founder - An Open Letter to Inspire future Women Entrepreneurs

This letter was first published in "Dear Female Founder" edited by Lu Li.

I am delighted to be one of 66 Female Founders sharing our entrepreneurial wisdom to inspire other women entrepreneurs. Together we have raised over $85 million in investment, generated over $1 billion in revenue and created over 2000 jobs. I think it's important to amplify our voices, as change-makers and creators of economic and social value.

Anne Ravanona, Founder & CEO, Global Invest Her

These are my personal messages to inspire other girls and women to become Women Entrepreneurs and share some of the key things I have learned on my journey so far. I have a 15 year old daughter and 12 year old son, and acutely feel the need to speed up gender equality. You have to be what you can see! Some day soon, I look forward to reading your letter here too!

Dear Female Founder,

"Here's the thing - a secret you know deep down inside of you: you already have everything you need inside you to succeed and be a fantastic entrepreneur!"

From one global woman entrepreneur to another, I have 5 key messages to help you on your unique journey.

1. Be Yourself

My mother would often write those wise words to me, when I was younger. As Oscar Wilde put it "Be yourself - everyone else is already taken". As an entrepreneur, you really have the opportunity and owe it to yourself to truly be yourself. The more authentic you are, showing the real you (yes, 'warts and all') the better you will resonate with customers, your team, your investors, other stakeholders and most of all, yourself. Being an entrepreneur, a changemaker, someone who sees a problem they passionately want to fix and does everything in their power to fix it, takes a huge amount of energy.

You will have many decisions to make every day, you can't waste energy trying to be someone else, or hide behind a mask.

"Your team will follow you and go the extra mile for you and your customers, your investors will invest in you because of what makes you unique - your special mix of character, values, personality, experience, talents and passion. Your family and friends will enjoy your quality time with them, because you are the real you, at home and at work."

I wanted to be an entrepreneur since I was 17. At 21, I opened up a Sales office for an Irish company in France, straight out of college, in an industry I knew nothing about. I changed sectors, roles, professions every 3-4 years, honed 5 languages as the voracious, curious learner that I am. Then I decided to be true to myself and my passion: help women leaders in business reach their full potential and create more gender equality - my deepest value. I founded Global Invest Her, to help Women Entrepreneurs get funded faster through demystifying funding. Every day we change hearts, minds, systems. We will not wait 80 years for gender equality - we are doing our part now.

2. Be Brave

Starting and running your own company is hard, and so worth it! You have to be brave enough to say no to a steady salary, clear career path and more stability than on the entrepreneurial roller coaster. You may create new markets, new products, new services or ways of thinking, so be brave and stand by the decisions you make. Expect and embrace all the 'no's' on the journey to yes. Embrace your mistakes, be brave enough to own them, fix them and move on. Don't beat yourself/your team members up about them. You have chosen the path of the pioneer, an unchartered course, uncertainty. When doubt rears it's ugly head (it will) and that little voice makes you lose confidence...(it may)... it's time to..

3. Believe in Yourself

Easier said than done, I know, and if you don't believe in yourself, your products/cause/team /company you are building, why should anyone else? Trust your intuition and your inner voice. It is a powerful guide, ignore it at your peril. Dramatic as that sounds, it's true that when I listen to my inner voice and fully believe in myself, magic happens and I increase my impact on the outside world. When I don't listen to my intuition, I always regret it later.

You have more power than you can even imagine, so it's time to unleash it - 'feel the fear and do it anyway'. Doing a TEDx talk, being a keynote speaker at conferences and contributing to the Huffington Post shining the light on other amazing Trailblazing women are things I strived for and made happen. 'What the mind can conceive and believe, it can achieve', says Napoleon Hill, and my mind is burning with ideas to amplify women's voices and gender equality so that we have the same opportunities our male counterparts already enjoy. Follow your passion, believe in yourself.

4. Think Big

If you are going to build a company, you may as well go big! Whatever you are thinking, think bigger, and you'll be amazed at what you will achieve! If you were thinking of selling in one country, think several. One product line? Imagine another 2-3 in your pipeline. Dreaming of big partnerships, key corporates, many users - multiply that 10x. That's how guys think, and guess what, they do it! We need more women-led businesses with $10-100 million revenues, we need more women-led unicorns. We (women) are the biggest market in the world (bigger than India and China together) and we control more than 80% of purchase decisions and will control most wealth in the coming years. It's time to show our true worth to the world. Everyone will benefit, because we tend to build companies that impact our families, communities, countries on a wider scale. Let's amplify that. Join the club!

5. Ask for More Money!

Last but not least, ask for more money! Especially when you are looking for funding, be sure to ask for at least 40-50% more. Investors tell me they usually have to reduce male entrepreneurs projections' by half and multiply women entrepreneurs projections by many multiples. If you don't ask, and back up with facts, you will not get.

"I watch women entrepreneurs pitch all over the world and they tend to gravitate to a magic number of 500K (regardless of currency) when the guys ask for over 1 million. And guess what? It's just as hard to raise $500K as $1 million so you may as well go for the bigger number, and not have to raise another round 12 months later."

If you are reading this, you have made the decision to change the world for the better. Now be yourself, be brave, believe in yourself, think big and ask for more money. I can't wait to see what you achieve!

Warmest wishes,

Anne Ravanona
Founder & CEO, Global Invest Her

If you enjoyed this letter, then check out the other 65 inspirational letters from successful women entrepreneurs in "Dear Female Founder"

Photo credit: Maria Mikulas
----------------

Watch Anne Ravanona's TEDx talk on Investing in Women Entrepreneurs.

See more Trailblazing Women role models from this Huffpost series

Learn more about Global Invest Her www.globalinvesther.com @GlobalInvestHer

Behind the Listing: the Struggles of an Amazon Based Startup

"Such a great razor! My boyfriend bought one of these and I ended up using it so much that I had to buy one for myself. Definitely recommended - great close shave."
-Amazon Customer

When my Evahs razor arrived in the mail, I was instantly impressed by the packaging--a matte textured black surface with a glossy "Evahs" debossed across the top. I carefully opened the package like a perfectly wrapped Christmas present. Inside the box, the razor was well-secured in a specially designed tray. Integrated into the tray was a small compartment labeled "blades" in crisp font. The thoughtfulness of design extends beyond just the packaging. Meticulously crafted out of solid copper and chrome-plated to achieve a well-balanced weight and finish, this double edge safety razor boasts of precision.

The Evahs razor arrives in a carefully crafted package.

According to co-founders Arash Malek and Max Swift, "The Evahs razor is meant to be an heirloom piece--something that is known for its quality for generations." I sat down with both of them to talk about what it's like to be one of the many startups utilizing Amazon as a platform to sell products.

Evahs co-founders Maxwell Swift and Arash Malek.

Frustration, Meet Inspiration

The idea for the Evahs razor was born during a road trip through the Pacific Northwest. While driving through the Columbia River Gorge, Arash and Max, started listening to the Amazing Seller, a podcast by Scott Voelker that discusses successful entrepreneurship by way of Amazon. Instantly inspired, the two decided to pursue an e-commerce venture together. Previously frustrated by the lack of quality, fair-priced safety razors, they decided to take the matter into their own hands. By the time they returned home from their trip, they had already chosen the name Evahs, the word "shave" spelled backwards.

Thinking Inside the Box

"Constraint inspires creativity. It's one of my favorite sayings," Arash tells me during the interview. Working inside a framework forces you to eliminate the excess, leaving behind only what's necessary. Minimalism has inspired some of Arash's past work, like the well-known and successfully funded Kickstarter project the X-pen.

Despite their passion for working within constraints, Arash and Max have found Amazon's limitations to be quite challenging.

Max and Arash confront the the challenge of working inside the box by getting creative.

Max explains, "It's particularly hard as a new startup to stand out on Amazon with their limitations. But that doesn't mean we're not up for the challenge." He grins as he says this.

Crowned as the largest online retailer in the US, Amazon draws thousands of emerging small businesses looking to capitalize on the breadth of audience. Despite their limitations, Amazon has brought Evahs more business than they could've done on their own, and for that, the two tell me, they are extremely grateful.

While Amazon's sales process is pretty straightforward--"list, sell, ship"-- the accomplishment of the sale can be more complicated. On a site that's built on social proof, it can be difficult to gain the credibility that leads to orders and, in turn, more reviews. Amazon sellers need reviews to get more orders, but at the same time they need orders to get more reviews. Without the brand name recognition of say, Gillette, Evahs could easily get lost in the more than 55 pages of Amazon's safety razor category.

In order to overcome this problem, Max personally reached out to numerous top 500 Amazon reviewers. He sent them emails asking them if they would be willing to try out their razor for free, and in return, they would leave an unbiased review on their Amazon listing. To his surprise, nearly half of them replied and eventually wrote reviews after receiving their razors. Creative solutions like this have helped Evahs climb the ranks of the Amazon listings. They recently ranked on pages one and two for safety razors.

Avoiding the Void

Aside from getting more reviews, what else would help an emerging startup get noticed among the thousands of razors on Amazon? Customization--something that Amazon forbids unless you're a large company like Gillette or Schick.

An example of Amazon's uniform listing: the Evahs product set against a white background with limited text or distraction.

Amazon utilizes a standard template in order to make each listing as uniform as possible. The main image can only include the product that is being sold, set against a pure white background. Additionally, the ratio of the product image to the background white space has to be within a certain range, so that it looks the same as all other listings. Amazon also limits the amount of images posted per product and the amount of text allowed for the title and the description. In theory, this model allows sellers an equal chance of being noticed. On the flip side, companies struggle to make their products stand out due to indistinguishability.

"From the beginning, we chose to differentiate ourselves on Amazon by not compromising our quality," Max says proudly. The problem they faced: how to convey that quality within the constraints of Amazon. Their solution: turning to additional platforms like Instagram, Facebook, and shaving blogs.

Evahs leverages Instagram and other platforms to build their brand.

Out of the (Amazon) Box

Pushing past Amazon's rigid image and text style parameters, Evahs has been able to show off the true standard of their product on social media. With almost 15,000 Instagram followers, their feed features nature-inspired images that speak to Arash's preferred minimalist aesthetic. The two hope that the Instagram platform will allow them to convey that shaving is more than just a step in the grooming process; it's a morning ritual that should be savored, just how I savored opening the Evahs package.

Savings For The Future: The Private Sector Fighting Poverty

My work in empowering youth began when I was working with street children in Mumbai. I noticed many of them were creative and entrepreneurial in their means for survival, but none had a place they could save. These children weren’t offered a space in formal financial systems, which made the prospect of learning how to handle financial matters much more difficult and lessened their chances of becoming capable and confident adults later in life.

This realisation is what fuelled my drive to make sure young people worldwide can be financially and socially equipped to build bright futures for themselves. Access to financial and social assets is a key contributing factor to help youth make their own economic decisions and escape poverty. Yet, despite this, a 2013 report estimated that less than 5% of youth have a savings account, as they face barriers to access financial services (UN). The global youth population continues to grow, with many struggling to make ends meet or living one paycheck away from poverty.

Now, more than ever, there is an imperative need for developing technology skills and financial acumen amongst the world’s most vulnerable.

Collaboration creates change

Although it is widely recognized that financial education and financial literacy are essential life skills for poverty reduction, youth are still being shortchanged when it comes to accessing the financial services they need to build assets, create sustainable livelihoods or become entrepreneurs. Progress has been made through initiatives to support youth access to finance, such as UNCDF-YouthStart and the YouthSave consortium working in countries across Africa, Asia and Latin America, but largely financial service providers have neglected youth and their needs.

At Child and Youth Finance International (CYFI), we’re working with over 13000 organizations in 132 countries to ensure there is cross-sector collaboration in providing young people with the services and support they need to become confident, capable adults. Adopting a cooperative approach to tackling poverty-related issues facing children and youth, CYFI works with a global network – ranging from government bodies to corporate companies, groups of active youth to financial institutions – to offer young people opportunities and options for their financial futures.

As part of our mission to transform the experiences of young people, CYFI are currently part of a leading working group dedicated to making money simple, safe and secure for young people everywhere. CYFI have collaborated with leading financial service providers, including Mastercard, ParentPay/Nimbl, Osper, and Mirador Digital to produce a set of child and youth-friendly product guidelines for the private sector.

Building on the OECD/INFE Guidelines for Private and Not-for-Profit Stakeholders in Financial Education and UNICEF, the UN Global Compact and Save the Children’s, “Children’s Rights and Business Principles”, the guidelines provide a framework for businesses and financial service providers to ‘understand and improve the impact and diversity that they have on children and youth’s rights and well-being’. The guidelines introduce financial service providers to some important aspects to building secure, thoughtful child and youth friendly products.

Innovation for inclusion

In supporting the development of products for youth, the working group also explores the power of innovation and financial technology as an up-and-coming driver of financial inclusion. Cell phone ownership has grown exponentially in recent years, and mobile banking offers a convenient way to be included in financial systems. Worldwide, young people are more tech-savvy and digitally included than ever before, yet many lack the much needed financial know-how to make wise decisions about money later in life. The fast-growing world of financial technology offers many opportunities; building the tools needed to successfully include children and youth in banking services, the chance to gain expertise from the private sector, and the impetus to create regulations around the financial needs of youth.

An example of this is in Uganda, where the Private Education Development Network (PEDN) have collaborated with Oratec Ltd a software development company to create an automated school deposit and withdrawal management information system (e-banking) to promote savings amongst school students. Offering the opportunity for kids to understand how e-banking works by opening and managing their own account, the system also enables financial service providers to equip students with banking skills and fund financial inclusion through mobile money initiatives

Fintech provides unprecedented opportunities for ensuring financial inclusion for youth and minority communities – making products and services more accessible, functional and affordable than ever, it’s no surprise mobile banking is creating such a buzz in the world of finance.

Investing in the future

In addition to the desire to economically empower children and youth to create positive social impact, there is a significant business case for financial service providers and private sector stakeholders to make financial products inclusive of youngsters.

CYFI’s sister organization, Aflatoun, offers social and financial programmes to help young people learn to save for the future. In 2014, they supported over 2.6 million children and youth in saving a reported average of €2.23 per month. If it is assumed that over 90% of youth remain unbanked worldwide, this could represent around €2 billion per month in uncaptured savings and illustrates the potential value of youth as a client base.

With young people representing a large, untapped market, companies and financial service providers can endeavor to create products which financially include them from an early age, potentially secure their loyalty for later in life, and create cross-selling to their families and communities.

By financially including children and youth, service providers can ensure they are reaching the next generation of customers and consumers. If all unbanked youth worldwide had access to quality financial services and economic education, those living in emerging and developing economies would be provided with the financial acumen to build a better life for themselves.

The creation of partnerships and working groups around the financial inclusion of youth provides both philanthropic and profitable incentives for those involved. The creation of child and youth-friendly products, services and protocol serves a positive social impact for young people (particularly those from low-income or minority communities) but also enables private sector representatives and financial service providers to contribute to poverty eradication without sacrificing growth.

These collaborations highlight the opportunity for investing in sustainable development as a result of joint actions and expertise. By working together we can make sure that today’s children and youth are equipped with the tools and knowledge they need to become the next generation of empowered, capable citizens.

Access Your Potential is a new blog series focused on exploring the importance of developing technology skills and financial acumen in minority communities. Join the conversation by emailing PurposePlusProfit@huffingtonpost.com or by tweeting with #AccessYourPotential.

How to Harness Minority Tech Talent

Recent technological advances have changed the way we live. Across the world, millions of people are harnessing the power of technology to better not only their lives but those in their surrounding communities. Increased connectivity has resulted in greater access to information, and the ability of individuals and communities to use the power of technology to bring about greater economic empowerment.

In the United States, young and old alike, have embraced the power of new technologies to create new concepts and businesses with life changing implications. From social media to the sharing economy, and across all industries including finance, health, and education, individuals are innovating in previously unthinkable ways. We are in an era in which long-held business and societal norms can effectively be tested, disrupted and improved upon by anyone with a vision and ability to execute. It is a very exciting time.

Yet, despite the growing influence of the tech sector as a key driver of U.S. innovation, many Americans, particularly minorities and women remain on the outside looking in. Disappointingly, in 2015, less than five percent of the total tech workforce was African-American or Latino. While overall, minorities own 15% of small businesses in the U.S. less than 10 percent of tech pitches are presented by minority or women entrepreneurs. Of those making investment decisions, only 22 percent of senior investment professionals are minorities, with women representing just 8 percent of such professionals.

Fortunately, the lack of minority participation in the tech sector has not gone unnoticed. From Chicago based incubator Blue 1647, to NYC based Cofound Harlem, efforts are underway to train, educate, and propel a new generation of minorities and women to the forefront of the continuing tech revolution. By providing coding workshops and boot camps, professional development courses, and the ability to interact with tech leaders within and outside their communities, such programs are expanding opportunities for countless individuals. It is only a matter of time until such efforts begin to manifest themselves in the hallways of tech companies all over the country.

Beyond helping minority communities acquire the necessary skills to succeed in tech, the other side of the equation must include a proactive and concerted effort to create networks and organizations focused on financing and funding minority startups. Institutional initiatives such as Intel Capital’s $125 million Diversity Fund, focused on funding minority and other underrepresented tech entrepreneurship will not only spur greater innovation but also drive other major institutions to follow suit. On the individual level, networks of minority and angel investors focused on funding early-stage ventures led by minorities can go a long way in bridging the access to capital gap. Currently, less than one percent of Minority Business Enterprises report having received angel capital.

Undoubtedly, an increase in the number of minority students pursuing science, technology, engineering and math (STEM) will serve to increase the participation of minorities in tech. Educators and parents alike must prepare young students for a future in which technological skills will not only be desired, but a requisite; and means must be marshalled to ensure school districts serving underrepresented minorities possess the adequate resources to train students for 21st century jobs.

While the current state of minority and women participation in tech leaves much to be desired, current efforts signal positive changes. Greater minority tech participation will not only improve the socio-economic standing of individuals and communities, but will also bring about an infinite amount of bright, fresh ideas to the forefront.

Minority talent represents a largely untapped resource, one that can prove to be an effective driver of not only tech sector growth, but of positive social and community change. It is a very exciting time, indeed!

Access Your Potential is a new blog series focused on exploring the importance of developing technology skills and financial acumen in minority communities. Join the conversation by emailing PurposePlusProfit@huffingtonpost.com or by tweeting with #AccessYourPotential.

9 Tips For Turning Side Projects Into Legit Businesses

There are numerous reasons why people start a side project. Maybe you just want the extra cash or want to finally work on a job that you love. Regardless of the reason, there's been a long history of side projects, like Gmail and Twitter, that have become successful businesses on their own.

But, how can you become one of these success stories?

Start by following these 9 steps and begin turning your side project into a legit business.

1. Find a problem and solve it.

I'm not saying that you have to re-invent the wheel here. However, you do have to identify a problem and come up with a solution. Otherwise, this whole venture is pointless.

For example, Joel Gascoigne started Buffer a side project because he wanted to be able to easily and conveniently schedule tweets multiple times a day.

Photographer Benji Wagner noticed that there weren't outdoor products for the young generation of surfers, snowboarders, skaters, and couch surfers that were also affordable. So he launched Poler Stuff.

Both Buffer and Poler Stuff realized that there was a true need for their products and services, along with having a target audience. Their ideas were simple to implement as well, which meant they didn't have to spend a lot of time perfecting their ideas.

2. Test the water.

The best thing about a side gig is that it gives you the chance to validate your ideas and market. For example, if you were to start a landscaping business, you could mow lawns on the weekends when you have off from your 9-to-5 job. If you have enough customers, you may be on your way to starting a full-time landscaping business.

If you only have one of two yards to do, then you may have to think of a different business and keep mowing lawns as a way to pick-up some extra cash in the meantime.

3. Start marketing your business.

In a perfect world, customers would just come knocking on your door. Unfortunately, we don't live in such a world. You're going to have to market your business so that you can find your audience - or at least make it easier for them to find you.

Old school tactics like yard signs, flyers, or ads in local papers worked if you're a local business like that landscaping example. However, we live in the world of digital marketing, so that's where you should focus your efforts.

The first place to start is to obtain a blog and website. The best way to go about this is picking a domain, purchasing it on a site like GoDaddy, and set-up WordPress. Today, though, the process is a bit simpler with companies like Weebly.

Whatever path you chose, the idea here is that you start blogging so that you can demonstrate your knowledge and provide value to your audience. You can also use your site as a portfolio to showcase your work whether you're a web designer or landscaper.

Here's some other basics for marketing your business online;

• Write guest articles on leading industry publications or websites.
• Host a podcast or webinar.
• Publish an eBook or Whitepaper.
• Create infographics or instructional videos.
• Be active on social media.
• Get listed on leading online review sites.

The best part apart online marketing is that not only can you connect your with audience, you can also do so on a shoestring budget.

4. Pickup clients as a freelancer or presell products and services.

Before committing yourself full-time, start out as a freelancer or preselling your goods or services. For example, if you're an accountant, then start acquiring clients on the side by joining freelance marketplaces. This allows you to slowly build a roster of clients that you can manage while still keeping your day job. It also helps you gain experience and build a portfolio.

If you're tinkering around with creating a product or service, then start preselling these items on your website or through crowdfunding. Not only will this validate that there's a market, it gives you a chance to earn money that you'll invest back into the company so that you can launch.

5. Define your idea of success.

If things are starting to get busier, you need to sit down and determine how much money you need each month to quit your current job. If you're getting close to that dollar amount with your side project alone, then that's a pretty good sign that it can become a successful business.

To accurately define this, make sure that you create and track financial landmarks, as well as a monthly budget.

6. Cross your t's and dot your i's.

If you really want to make your side project legit then you're going to have to consider legal and tax essentials like;

• Choosing an available business name.
• Applying for an official business structure like a sole proprietorship or LLC.
• Registering your business name in your state.
• Applying for any applicable permits.
• Obtaining a Tax ID number.
• Knowing what taxes you'll have to pay.

Since this is an important area that shouldn't be overlooked, unless you're looking for trouble with Uncle Sammy, then use resources like SBA.gov to assist you in figuring out all of these legal and tax issues.

7. Scale correctly.

It's awfully tempting to go on a spending spree when you have excess money in the bank in order to grow your business. The problem with this method is that this is a surefire way to fail. In fact, premature scaling is one of the main culprits in startup death.

Grow slowly and gradually, but steadily. This business model is a tactic that has worked for numerous companies that began as side projects. Take Craigslist, for example. Craig Newmark started it as a side gig in 1995 and didn't turn it into a real company until 1999.

8. Avoid burnout.

Between your full-time gig and getting this new business venture off the ground, you're going to be putting in a lot of hours working. And, that means you're going to get exhausted and ultimately burnout.

To avoid burnout, try techniques like;

• Establishing boundaries like the hours that you work and the hours you don't
• Asking others for help.
• Establishing goals and priorities.
• Building long-term relationships.
• Using productivity tools.
• Exercising and eating healthy.

9. Don't burn bridges.

If the time has officially come to leave your 9-to-5, make sure that you don't burn any bridges by leaving like a jerk. Give your employer plenty of notice in advance, complete your projects, and remain productive until your final day.

Why? Because what are you going to do if your side project doesn't pan out as a full-time gig? You don't want to have any bad blood with a former employer in case you have to ask for your old position back or ask for a reference in your new job search.

9 Tips For Turning Side Projects Into Legit Businesses was originally published on Due Cash blog by John Rampton.