Rebekah Campbell is the chief executive of Posse, a location-based shopping recommendation app founded in Sydney in March 2013. In July, 2014, she wrote a blog post for the New York Times about her experience moving to New York to dive into start-up culture and develop her business. After getting sick of working on top of her partners in a tiny one-bedroom apartment, she decided to join a coworking space in New York's famed Flatiron district. Inspired by the pace and people of the city, she sought out a space that would introduce her to other entrepreneurs, and give her a low-rent alternative to a long-term commitment office.
According to the Harvard Business Journal, "Coworking spaces" are "membership-based workspaces where diverse groups of freelancers, remote workers, and other independent professionals work together in a shared, communal setting." Through ongoing research that involves interviewing coworking space founders and community managers, surveying coworking space employees and performing a regression analysis, researchers concluded the factors behind why people tend to thrive in coworking spaces.
First of all, people who work in these spaces put a lot of meaning into their work. Unlike corporate workers, they are entrenched directly into their passion. In turn, they are the ones to blame if things go wrong. Next, the environment is collaborative and diverse, meaning little direct competition, and plenty of opportunity to give each other advice and motivation. And even though it may look for a free-for-all, people that work in coworking spaces actually report feelings of more structure and community. Seeing all of those people around you hard at work will push you to work that much harder.
Sounds pretty idealistic, right? You have access to WiFi, a kitchen, meeting rooms, and can collaborate as you please. But on Campbell's search for the perfect coworking space, it was a bit of a Goldilocks situation. The first one was too "strict and stuffy" and the next one was "the work version of hippie commune houses." She found that a lot of these spaces had months-long waitlists. Though after a long search, she found what she deemed the best option for her team, and moved in.
At first, it was ideal. But shortly after, she started to notice some very significant problems. First of all, there was no guarantee that they could get the same desks everyday. There were a ton of rules. The noise-level was like a jungle gym, and Campbell often found people pitching her ridiculous ideas just for the sake of mock-collaboration. At the end of the day, she felt homeless.
While Campbell found that the coworking space didn't work for her, Business Insider suggests that offices can take aspects of coworking spaces to make them more collaborative and productive. By including networking and social events, and rearranging some desks, offices can replicate this commune-like atmosphere without going overboard.
So the coworking space is highly debatable, but if you're not one for the office, you can always try a coffee shop or your local library!
If you're interested in finding out more about coworking spaces, click here!
When you take out a loan for a car, charge something to your credit card, or get a personal line of credit, there is going to be an interest rate that applies to your loan.
A lot of different factors go into what you will be charged, including your own personal credit score. But even those with flawless credit still see a minimum charge that they can't get around. That all goes back to the Federal Funds Rate.
One thing consumers rarely realize is that all of our banks are lending money to each other every night. Banks are legally required to maintain a certain percentage of their deposits in non-interest-bearing accounts at the Federal Reserve to ensure they have enough money to cover any withdrawals that may unexpectedly come up. However, deposits can fluctuate and it's very common for some banks to exceed the requirement on certain days while some fall short. In cases like this, banks actually lend each other money to ensure they meet the minimum balance. It's a bit hard to imagine these multibillion-dollar financial institutions needing to borrow money to tide them over for a bit, but it happens every single night at the Federal Reserve. It's also a nice deal for those with balances above the reserve balance requirement to earn a bit of money with cash that would normally just be sitting there.
The Federal Reserve
The exact interest rate the banks will charge each other is a matter of negotiation between them, but the Federal Open Market Committee (FOMC) (the arm of the Federal Reserve that sets monetary policy) meets eight times a year to set a target rate. They evaluate a multitude of economic indicators including unemployment, inflation, and consumer confidence to decide the best rate to keep the country in business. The weighted average of all interest rates across these interbank loans is the effective federal funds rate.
This rate has a huge impact on the economy overall as well as your personal finances. The federal funds rate is essentially the cheapest money available to a bank and that feeds into all of the other loans they make. Banks will add a slight upcharge to the rate set by the Fed to determine what is the lowest interest that they will announce for their most creditworthy customers, also known as the prime rate. If you have a variable interest rate loan (very common with credit cards and some student loans), it's likely that the interest rate you pay is a set percentage on top of that prime rate that your lender is paying. That's why in times of low interest rates (it was set at 0% during the Great Recession), a lot of borrowers should go for fixed interest rate loans that won't increase. However, if the federal funds rate was relatively high (it went up to 20% in the early 1980's), a variable interest rate loan may be a better decision as you would be charged less interest should the rate drop without the need to refinance.
The federal funds rate also has a major impact on your investment portfolio. The stock market reacts very strongly to any changes in interest rates from the Federal Reserve, as a lower rate makes it cheaper for companies to borrow and reinvest while a higher rate may restrict capital and slow short-term growth. If you have a significant portion of your investments in equities, a small change in the federal funds rate can have a large impact on your net worth.
Whether you're leaving a job involuntarily, departing for something new, or just want to prepare for the unknown, it is smart to understand all your options regarding your 401k.
Frugal gifting often gets a bad reputation. However, this shopping method does not make you cheap — it makes you practical. Frugal gifts often avoid waste and overspending and can be just as meaningful (if not more so) as any other present.
With the National Retail Federation predicting each consumer this holiday season to spend upwards of $1,000 on holiday gifts amidst an economic recession —this year might be the perfect time to reconsider your spending budget. We've formulated the ultimate list of frugal gift-giving ideas to get you started.