Defining Microstock

Microstock is a relatively new way to sell your photography or illustrations. Basically, you submit your photos or illustrations to one or more agencies. You are not just limited to one agency. The agency or agencies that you select will then review your submitted imagery and decide if they are acceptable. If your images are accepted, they will then be put up for sale.

How much your images sell for will depend on the agency that you use; however, usually you can expect to earn between twenty cents to several dollars. The same images will sell over and over again(not just once), which is how you earn an income with this type of business.

To further explain how you can earn money with microstock, think of a savings account. You earn interest on the amount of money that's in your account. If you steadily increase the amount of money in your savings account then you will earn more interest. With microstock, you simply need to add more images to your account in order to increase your income.

Why Featurepics?

Featurepics is a little different than the traditional microstock agencies. The main reason for this is because this company allows you to set the price for your images. So you could sell your images for a dollar or a thousand dollars; it's up to you.

Featurepics is also quite generous when it comes to your payout. As of March 2008, Featurepics will give you seventy five percent off of a sale. So if you have an image that has sold for ten dollars then you will walk away with seven dollars and fifty cents. And that's not the end of that image. Remember, that same image can still sell over and over again.

Featurepics also has a great feature for placing your images onto your website or blog. You simply copy some HTML code into your site, and your images will show up.

Drawbacks

The main drawback with Featurepics is that they don't have as many clients as some of the other major microstock players. This makes it more difficult for you to sell your images with them. And since Featurepics doesn't have as many clients as the major microstock companies, they may one day go out of business if they fail to increase their client base. Time will tell.

Featurepics has potential to become one of the major microstock companies, but it may take a little while for that to happen. In the mean time, if you want to set your own price for your images then you may want to give this company a try. You have nothing to lose and everything to gain.

Bye, Bye, Paycheck

There's no doubt about it, self employment doesn't guarantee a steady paycheck. This is especially true when you are first starting out. To make up for this, you should have a decent sized nest egg to ensure that you can pay your bills. Something around twenty thousand dollars or so.

Another option is to simply move in with your family, which could potentially give you free rent. You'll have to discuss it with them, and see what you can work out. If you can manage to get free rent then you don't need to have as much money saved up. However, if you can acquire free rent, you should still have at least five thousand or so dollars stashed away. Unless your parents are going to just pay for everything, which means you don't have to have any savings. Lucky you.

Good Business Plan

What is your business going to be? You may want to write some of it down on paper, and see if it's a reasonable business plan. Then you can show it to your friends, and ask them what they think about it. Or you could ask someone who is already self employed, which is probably the better strategy.

One of the more important rules of being self employed is to not put all of your eggs in one basket. It's a well known saying, but it's also a very important one. So if you want to design websites then you should have a few dozen clients(more is better). You never know, some of these clients might one day go bankrupt. And if you only have a handful of these clients then you could be in a lot of trouble.

Social Isolation

If you're going to go the self employment route then you need to be prepared for the isolation. There will be no coffee breaks with your cubicle buddies when you are self employed. Unless, of course, you hire people. But you would be the boss in that case, and bosses don't always hang out with their employees.

You'll simply have to be content with eating out occasionally with some of your friends. And if you don't have that many friends then being socially isolated probably will not bother you much.

Benefits

Benefits such as health insurance will now be up to you to manage. So you'll definitely want to buy an insurance plan from an agency such as Assurant Health. If you're young and in good health then you'll probably end up paying around a hundred and twenty five dollars per month for health insurance.

Other benefits, such as vacation days, are up to you manage now as well. But don't forget that you will not earn money on these vacation days unless you develop a passive income stream of some kind. So be careful.

Being a self employed individual can be very difficult, but the rewards from succeeding are more than worth it. So if you feel that self employment is your best bet then give it a try. If you don't succeed, you can always get another day job.

Defining Inflation

To sum it up, inflation is the cost of items going up over time. There is no real way to know how much these items will go up, but generally, they go up by about three percent per year. There are times when inflation can easily surpass three percent, but usually it is just three percent annually.

Examples

You want examples? How about a candy bar? In the year 1900, a candy bar cost around a nickel. However, these days that same candy bar can cost you between fifty cents to a dollar(or more in some cases). You'll occasionally find a candy bar on sale for twenty five cents or so, but usually it's a bit higher.

How about a house? We'll just say the year is 1900 again. Back in those days, a house would probably cost around ten thousand dollars(more or less). Today that same house would probably cost between a hundred thousand dollars to a few million dollars.

It just depends on where you're located. California, Florida, and New York are more likely to have houses that sell for a few million dollars. But Wisconsin, Kansas, and Arkansas are more likely to have cheaper homes.

Another example of inflation would be a car. Back in the sixties, you could buy a new car for only a few thousand dollars. And gas was only around thirty cents per gallon! It's a pity that it isn't the same today, huh? But don't feel too bad. There's a catch to all of this. People made less money in the past, which is why things were cheaper back then.

However, if inflation becomes too high then it will outpace the current cost of living and you would no longer be as wealthy as you were before inflation got out of control. This would make many of us poor, or at least make us feel like we were poor.

Why You Should Care

Again, if inflation does become too high then your money will not have as much buying power. So if you want that fancy flat-screen tv then you better hope inflation stays within the norm, or else you may just have to stick with your old bulky tv. Also, do you want to be able to retire? That's right, inflation can ruin your retirement plans if it gets out of hand.

And even if inflation doesn't skyrocket, you still should be aware of it. Remember, on average, inflation increases by three percent per year. This means that if you have thirty or forty years until you plan to retire then you better have a lot more than a million dollars stashed away.

You'll probably need around three or four million dollars in a tax free account in order to retire comfortably. And that money may have to last ten, twenty, thirty, or more years. Who knows how modern medicine will change our lifespans in the future. Inflation will never take a vacation so be sure to plan ahead.

Inflation can be a nightmare if it gets out of control or even if it stays within the norm. However, we all have to live with it and deal with it. Now, you should at least have an idea of what inflation is and why you should care. How you decide to combat it is up to you.

Smaller Size

If you're looking for something small then a condominium is for you. Perhaps you are single and just want to get your feet wet when it comes to real estate, and you don't need a very big place. Or maybe you've just gotten married and don't plan on having children anytime soon(or ever).

But even if you're married with children, you can easily find a condominium that has several bedrooms or bathrooms. The extra bathrooms and bedrooms will make the condominium more costly, but it will still be cheaper than a house.

Save Money

You'll also save money by purchasing a condominium. For starters, condominiums are a bit cheaper than houses due to their smaller size. And thanks to their small size, the energy costs for condominiums are much lower as well.

Garage Included

Unlike apartments, condominiums will often times come with a garage that can fit your car(s). Or perhaps you'll just use the garage to store all of your stuff. Using the garage for both is a viable option as well. So the next time you have a hailstorm or some other form of violent weather, your car will be safe and sound.

Less Yard Work

Don't you just love doing yard work? Okay, that was sarcasm. Most people don't like to do yard work, and owning a condominium will eliminate this burden as well. The only drawback to it is that you will probably have to pay a maintenance fee, which funds the workers who do the landscaping for you. Unfortunately, if you don't like how the landscaping is done then there is very little you can do about it. But you will not have to go outside and trim the hedges anymore.

Repairs may be free

This will vary from community to community. But more than likely, most exterior work will be free. This includes roof work, exterior painting; etc. As for the inside of your condominium, it may be free. It just depends on what went wrong, and who is at fault.

If it's a leaky pipe then that might be free, or substantially less costly then it normally would be. However, if you accidentally knock out one of your windows then you are going to have to foot the bill.

As you can see, there are some nice advantages to living in a condominium. So if you're looking to buy your first home then you may want to consider purchasing a condominium. It's just like a house, only cheaper.

1. P/E

   P/E stands for price earnings ratio. This basically tells you what people expect from this stock. If the P/E ratio is between ten and twenty then it's considered a fairly stable stock. However, if it's really high then that means people have high expectations for this stock. And if those high expectations are not met then the stock is much more likely to lose investors, which will cause the stock to lose money.
   
   This is something that you don't want to happen. So if the stock has a high P/E ratio just be aware of the possible outcomes. An example of a high P/E ratio stock would be iRobot Corp, and their P/E ratio is currently hovering between ninety six and ninety seven. So if the stock is above twenty five then it's usually considered high.

2. Cash Flow

   Cash flow is basically how much profit the company makes per year. Obviously, if the company has a good cash flow then they're more likely to not go bankrupt. And that's great news for you. However, for some stocks it's perfectly normal to have a negative cash flow.
   
   An example of this would be banks or other similar financial institutions. This is mostly due to these companies offering loans to people. But financial institutions can be great stocks, so don't always be scared away by a negative cash flow.

3. ROA & ROE

   ROA stands for return on assets,and ROE stands for return on equity. Basically, you want to see both of these figures going up or staying stable over a period of years. If the ROA or ROE is negative or falling, you may want to think twice about purchasing that stock.

4. Financial Leverage

   Financial leverage basically shows how much the company has acquired in debt. You may want to avoid investing in companies that have a financial leverage higher than five. But again, like cash flow, it's normal for banks and other financial institutions to have a higher than normal financial leverage ratio.

5. Company History

   Warren Buffet is considered to be a genius when it comes to stocks. And I agree with how he thinks many times. One of the things that he recommends is that the stock you are thinking about acquiring should have been around for at least ten years.
   
   Over the course of a decade, many things can happen to a company. There will be good times and bad times. If a company can survive the bad times for at least ten years then they're more likely to handle future bad times with equal skill. So if a company has been around for at least ten years then there's a good chance that they'll be around for a lot longer.

6. Moat

   A moat is an economic advantage that a company has over rival companies. For example, Walmart's moat is mostly thanks to its huge size and cheap goods. Starbucks is another example of a company with an economic moat. However, the Starbucks moat is not nearly as good as Walmart's moat. It's just coffee, after all. But the Starbucks brand name still gives them an economic edge over their rivals.

7. Dividend

   A dividend is a small payout to you from your stock company. Dividends can be paid out at various times of the year, but most seem to be given out on a quarterly basis. These dividends are especially useful for long term strategists because your dividends will compound over time. So your first dividend may be ten dollars, and then your next dividend will become eleven dollars and so forth. As long as you don't touch the money, it will continually increase.

8. Market Cap

   A market cap is basically how many sales a company will generate in a given year. Try and only purchase companies with a market cap of a hundred million or more. Anything less than this and the company might go bankrupt if their sales don't pick up.

As you can see, picking stocks is a lot of work. It takes time and patience to learn all of the jargon and other tricks of the trade. But when the day is done, you'll be glad to see that your hard work is paying off.

Starting A Family

Naturally, if you're planning on raising a family then a house is probably something that you're going to need. Especially if you have a big family. Or perhaps your first child is going to be born soon, and you want to take the plunge into home ownership for their sake. Lets make up a make believe family. Say you have two kids, a dog, you, and your wife.

That comes to one backyard for the dog, one room each for the kids, a bedroom for you and your wife; possibly an extra room each for you and your wife. That's five rooms and one backyard total. And that's probably going to be a fairly expensive house.

Of course you can ration it a bit and have the kids stay in one room, don't buy a dog, and just have a bedroom for you and your wife. You could buy a smaller house this way and save some money. It just depends on your income level and priorities.

Long Term Job

When buying a house, it's usually important to make sure that you'll be living in it for at least five years. This allows the price of your home to rise, which could lead to a potential profit down the road. But in order to make this profit, you're going to need to have a long term job.

The job needs to be something that you can rely on. You don't want to lose your job and then have to file for foreclosure on the house. If you do have to file for foreclosure then kiss your profit goodbye. And I doubt your wife or kids will be very happy about this, assuming you have any.

Investment

Yes, a house is definitely an investment. Many people have learned recently that like all investments a house is not necessarily going to be a profitable investment. It mostly depends on when you decide to sell your home, and what the market forces are currently like.

If it's a down market like it is at the moment then you may have a great deal of difficulty in selling your house. You may not be able to sell your house at all, or you may have to sell it for less than it's worth. But if it's a good time to sell then you could make tens or hundreds of thousands of dollars. Maybe even more(think California or New York City).

As you can see, there are many reasons for owning a home. You may want to buy a bigger house for your new family, or you may just want to make some money off of your investment. Whatever your reason is, owning a home can definitely be a smart move. Just be sure that you can afford it.

Exclusive Advantages

First of all, what does exclusive mean? An exclusive license means that any images published with the exclusive license can't be published elsewhere. There are advantages to being exclusive with an agency. One of the main advantages to going exclusive with a microstock agency is that they tend to pay you higher commissions if you decide to go exclusive with their agency.

Another reason to go exclusive with a microstock agency is because it makes your life a little easier. Instead of going through the hassle of having to submit and keyword your photos with several different agencies, you just have to do one. It saves time.

Nonexclusive Advantages

A nonexclusive license means that you are free to publish your images elsewhere as long as they're under a nonexclusive license as well. The main advantage to using a nonexclusive license with your images is advertising. When you submit your images to all of these different agencies, you increase the likelihood of achieving a sale. Not everyone uses just one microstock agency to buy their photos with.

And if you spread your images around four or five agencies, you will probably make more money in the long run. It's true that exclusive images pay more, but I tend to believe that being nonexclusive with several agencies will bring you more money with time. This is due to the sheer volume of sales you will likely achieve by spreading your images around different agencies.

Disadvantages

Obviously, if you are dependent on a single microstock agency for your sales then their problems are your problems. If there are any technical glitches or site outages, you will lose money. And if that company goes bankrupt then you are going to have to start all over again with another agency.

And if you're exclusive with a bankrupt agency then there is no telling whether or not you can actually switch your images to another agency. I would think you could since the agency you were with is bankrupt, but who knows. You should check into this before you go exclusive with any microstock agency.

Going nonexclusive with a company lessens any potential disadvantages. It's similar to buying financial stocks. If you spread your money between fifteen to twenty stocks then you are less likely to lose all of it. If one or two companies fail you then the other stocks will theoretically take up the slake.

So if you place your images on four or five well known microstock agencies then you're less likely to have any problems. Of course, if one particular microstock agency suddenly attracts all of the buyers then you may lose money with a nonexclusive license. If you had been exclusive with the company that attracted all of the buyers, you would make more money then you would with the nonexclusive license. But that's an unlikely scenario.

Going exclusive or nonexclusive with a particular microstock agency is a decision that every microstock photographer or illustrator has to make. There are advantages and disadvantages to both of these types of licenses, so you will have to decide which is best for you.