You may have heard that some companies offer "unlimited vacation" policies. Sounds like a dream come true! No time limits, total flexibility, and pressure-free? For a select few, perhaps. But for the rest of those who work for a company offering this perk, not entirely.
While this new(er) method of working out vacation time for employees seems like paradise, it isn't exactly "unlimited." How would the work get done? Obviously, an employee cannot be gone 99% of the time or just clock into the office whenever they've got little else going on. There must be some structure in play, just not in the way we've grown accustomed to.
As per The Muse, for most companies with such a plan, "You're free to take as much time off as you choose, as long as you get the job done. It's a focus on producing great results, rather than just putting in the hours." Unlimited vacation policies exemplify trust and independence.
But with flexibility comes responsibility. The employee must balance their schedule thoughtfully and wisely. Additionally, employees must coordinate with their co-workers. Like The Muse notes, "Staffing needs and workplace structure can also affect how realistic it is for employees to take off whenever they please." The entire office can't be empty because everyone wants two weeks off for Christmas break.
That's why companies must set up guidelines, even if they can be adjusted to suit particular employee needs and preferences. As per Inc., "Companies can create an FAQ document to address issues like how much vacation to take at a time (two weeks max {for example}) and how to arrange that time off." That said, as per The Muse, "Similarly, your company may expect you to take a minimum number of vacation days."
The reason more and more companies are offering this sort of vacation policy is to "Allow workers themselves to set time off to allow them to better coordinate work and home life," according to Knowledge @ Wharton. Well-balanced and less-stressed employees benefit the company because they can give their all while at work knowing they can take time off when needed.
And an unlimited vacation plan is a plus for the employer as well. As per The Washington Post, "When employers stop doling out a set amount of vacation days, they no longer have to pay out unused days if workers quit or get laid off from the company. In today's hyper-charged work culture, people are taking less and less time off, leading to bigger and bigger piles of accrued time on companies' books."
As more companies begin to test out this vacation arrangement, some major companies are already on board and prospering. As reported by USA Today, these companies include General Electric, Netflix, Grubhub, LinkedIn, and Virgin Group.
Naturally, every employer must put forth their own limitations and provide clear cut expectations. But when everyone is pleased with the arrangement and the work gets done, the process can be a success.
Would you like to see your company make the switch to an unlimited vacation policy?
The Federal Reserve sets the guardrails for the federal funds rate, and through that helps control the money supply for the nation.
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 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.
diy gifts
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.
