Author: Service2Client

Travel Companions: How to Share Expenses

No matter how well you know someone, you usually learn a lot more once you’ve traveled with them. We are all different in this activity, from people who prefer aisle seats over window seats, to Airbnb renters or hotel…

5 min read

Travel Companions: How to Share ExpensesNo matter how well you know someone, you usually learn a lot more once you’ve traveled with them. We are all different in this activity, from people who prefer aisle seats over window seats, to Airbnb renters or hotel enthusiasts, to the outdoorsy versus museum aficionados.

Friendship compatibility does not always translate to travel compatibility. Therefore, before you load up the car or board public transportation, it will help to communicate preferences, establish a few ground rules, and, perhaps most importantly, decide how to share expenses.

There are plenty of advantages to traveling with another person or a group of people, even if you tend to be a loner. For example, sharing expenses for accommodations, a car rental, or even a bottle of wine over dinner can cut your vacation budget substantially. However, if you don’t have a plan for what expenses to share and how to track them, you may return home short-changed, resentful, and with one less person in your life.

Ground Rules

It’s important to gauge upfront if everyone is on the same page as to how much money they want to spend on the trip, and even establish a maximum budget so no one gets trapped into paying more than they can afford. This means determining the level of accommodations (e.g., luxury versus budget-friendly) to shop for, whether or not you want the option to cook meals as opposed to eating out all the time, and the main activities the group plans to engage in (e.g., free hiking versus expensive snow skiing). Establish what types of expenses will be shared, such as group meals, housing and car rental, and what will be paid for individually, such as airfare, solo outings and souvenirs.

Choose Your Tracking Method

There are two approaches for sharing the expenses of travel: Wing it or track it. Winging implies a more casual tactic. For example, one person picks up the hotel room tab, another pays for the rental car, another pays for meals. Perhaps you rotate or take turns picking up comparable bills. The goal is to generally spread expenses evenly across all payers, but winging it may lead to one (or more) travelers paying more while the other(s) pay less. If everyone agrees their outlays may differ, then this tactic will probably work just fine.

Tracking Tools

The second approach is to track all shared expenses with some degree of accuracy. This is easier if all expenses are shared evenly, but more complex if expenses need to be broken down into who ordered a salad and who ordered the filet mignon.

Fortunately, there is a plethora of electronic technologies and digital tools designed to make it easier to track travel expenses and ensure no one overpays – right down to the penny.

PayPal, Venmo, Zelle – These services make it easy to send or request money using apps. They may require travelers to keep receipts and calculate individual tabs, then settle up at the end of the day or the end of the trip. This tactic can be a little unwieldy, and may require manual tracking to ensure no one is paying too much or too little along the way. All travelers should sign up for at least one compatible money transfer app; they are generally free to use.

Splitwise – This app enables participants in a travel group to enter the expenses they paid by adding the names of the participants and breaking down the individual amounts each person contributed to each bill. The app tracks expenses by person, then tallies up who owes money at the end. Splitwise calculates who owes whom. Travelers can then settle balances using their preferred payment method, such as PayPal, Venmo, Zelle, bank transfer, cash, or another supported payment service. Splitwise is just one brand name of many apps that work similarly, including Tricount and Revolut.

Cino – This app works a bit differently in that each traveler links it to their personal credit or debit card, and the group Cino card is loaded into Apple Pay or Google Pay. Then all participants share a virtual card to pay for expenses, which divides each payment at the point of purchase among the participants for that expense. When one person pays for an expense, everyone’s share is automatically charged to each member’s connected credit or debit account. Note that Cino does not break down invoices by line item to track exactly who ate what; it follows a split ratio (e.g., 50%-50%) as determined up front by the group.

Artificial Intelligence – Travelers may want to give AI a try, where as they start with a prompt asking the service to track and split group expenses, then enter the names of participants and related expenses to the prompt on an ongoing basis. AI tools can organize, categorize, and calculate shared expenses that users enter manually. Some AI assistants may also summarize spending trends or generate settlement calculations, but they generally do not automatically track purchases unless integrated with financial apps.

Given today’s higher prices, group travel is becoming more prevalent as a way to share the cost of vacation. According to a 2025 Zeta Global survey, 40 percent of travelers are going on trips with family while 21 percent opt to vacation with friends. Today’s new digital tools make it easy to track and share expenses so that you don’t strain relationships with travel companions.

Understanding Depreciation Recapture

This accounting and tax method refers to a treatment used by the Internal Revenue Service (IRS) to obtain tax remittances on sales of depreciated property. Understanding how it works is essential for filers to make the most of it…

3 min read

What is Depreciation RecaptureThis accounting and tax method refers to a treatment used by the Internal Revenue Service (IRS) to obtain tax remittances on sales of depreciated property. Understanding how it works is essential for filers to make the most of it.

Required Conditions

As property depreciates, its value declines. When depreciated assets are sold, it’s able to be filed as ordinary income as long as the transaction’s price is above the property’s adjusted cost basis. The gap between the sales price and its adjusted cost basis must be filed as a component of the individual’s ordinary income.

Defining Adjusted Cost Basis

Adjusted Cost Basis = Asset’s Purchase Price + Improvements – Depreciation Deductions

Per Internal Revenue Code Section 1016, this calculation factors in both lower depreciation rates and improvement additions, resulting in the asset’s net cost.

Illustrating Adjusted Cost Basis

If an asset purchase price is $75,000, and it’s depreciated annually over six years, its adjusted cost basis is as follows: $75,000 – ($3,000 x 6) = $57,000.

If, however, the asset is sold for less compared to its adjusted cost basis, the transaction’s gain should be filed as a capital gain and not ordinary income. When it comes to calculating depreciation recapture, the adjusted cost basis is incorporated into the calculation as follows:  

Property Acquisition Cost: $750,000

Six annual deductions for depreciation: $7,000

Amount the assets are sold for in year 7: $740,000

Tax Rate of 25 percent for depreciation recapture

20 percent tax rate of capital gains

Therefore, adjusted cost basis equals = $750,000 – ($7,000 x 6) = $708,000

When calculating the gain on the sale, the resulting amount is calculated as follows:

= $740,000 – $708,000 = $32,000

Based on the owner(s) of the assets, the $32,000 will be reported as ordinary income. The depreciation recapture tax of 25 percent on the $32,000 will be $8,000 ($32,000 x 25 percent).

Be mindful if the $32,000 is more than the full depreciation deductions filed for by the taxpayer, the depreciation recapture will match how much depreciation is deducted and must be taxed as ordinary income. The balance will be taxed as a capital gain.

Assume everything from the first calculation is the same, but now the same asset is sold for $940,000.

Property Acquisition Cost: $750,000

Six annual deductions for depreciation: $7,000

Amount the asset is sold for in year 7: $940,000

Tax Rate of 25 percent for depreciation recapture

20 percent tax rate of capital gains

The adjusted cost basis will remain $708,000

In this example, since the asset owner’s gain is $190,000 ($940,000 – $750,000), only the depreciation deduction of $42,000 ($7,000 x 6 years of depreciation) will be reported as ordinary income since it’s the complete sum of the depreciation deductions. The balance of $148,000 ($190,000 – $42,000) will be taxed at the capital gains rate. The calculations for taxes are calculated as follows:

Depreciation recapture: $42,000 x 25 percent = $10,500

Capital gains calculation: $148,000 x 20 percent = $29,600

Additional Considerations

It’s important to consider that if an asset has been held for fewer than 12 months, gains from property sales are taxed as ordinary income. Depending on the circumstances, if an asset is sold for a loss, depreciation recapture isn’t applicable; however, Internal Revenue Code Section 1231 may provide exceptions to treat it as an ordinary loss tax treatment.

While each business’ transactions are different, when the entity is eligible, it can provide another way to navigate their federal taxes efficiently. As always, contact a professional for more personalized guidance.

Securing Funding for Border Patrol, Homeland Security and Small Businesses

Securing Funding for Border Patrol, Homeland Security and Small Businesses

3 min read

Securing Funding for Border Patrol, Homeland Security and Small BusinessesSecure America Act (S 2) – The Secure America Act is a federal budget reconciliation bill that funds homeland security. It was introduced by Sen. Lindsay Graham (R-SC) on May 20. The bill allocates $22.6 billion to Customs and Border Protection; $3.5 billion for border security technology improvements; $38.5 billion to Immigration and Customs Enforcement (ICE); and

$5 billion to the Department of Homeland Security. The act was passed in the Senate on June 5, in the House on June 9, and was signed into law by the president on June 10.

Investing in All of America Act of 2025 (HR 2066) – Introduced on March 11, 2025, by Rep. Daniel Meuser (R-PA), this legislation revises how private capital is defined and adjusts Small Business Investment Company (SBIC) leverage limits. The net result is that it increases the amount of long-term capital available to American small businesses. The bill passed in the House on Dec. 1, 2025, in the Senate on April 15, and was enacted on May 19.

FIRE Act (HR 6387) – Introduced by Gabe Evans (R-CO) on Dec. 3, 2025, this bill addresses a current quandary between federal air quality enforcement and state-level wildfire prevention. In an effort to curb wildfires, some states conduct controlled burns. However, these prescribed burns do not always comply with national air quality standards. The act would amend the current Clean Air Act to exclude state wildfire mitigation activities from air quality compliance calculations. The fix remains controversial because some lawmakers see it as a gateway to weakening the nation’s air quality standards. The FIRE Act passed in the House on April 22 and is now in the Senate for consideration.

Combating Organized Retail Crime Act of 2025 (HR 2853) – This legislation focuses on the customs enforcement side of ICE. It would authorize a unit that coordinates law enforcement for organized crime involving the shipping and sale of illegally obtained goods and counterfeit products via online and physical marketplaces. The bipartisan bill was introduced by David Joyce (R-OH) on April 10, passed in the House on May 12, and is under consideration in the Senate.

Defending American Property Abroad Act of 2026 (HR 7084) – This law enables the president to prohibit vessels from entering any port, harbor, or marine terminal in a Western Hemisphere country that commandeered property owned by a U.S. citizen or corporation. Failure to abide could trigger a total ban from U.S. waters. The injunction can be lifted once the property is returned by the offending country with acceptable compensation or some other resolution. The bill does include exemptions for legitimate maritime emergencies. This largely bipartisan bill was introduced by Rep. August Pfluger (R-TX) on Jan. 15. It passed the House on March 27 and is currently under consideration in the Senate.

Supreme Court Will Decide What Homeowners Are Owed When Tax Sale Erases Equity

A county in Michigan was owed about $2,200 in back taxes. To collect it, the government took a home worth close to $200,000, auctioned it for a fraction of that, and called the matter settled. The family is now putting a simple…

4 min read

Supreme Court Will Decide What Homeowners Are Owed When Tax Sale Erases EquityA county in Michigan was owed about $2,200 in back taxes. To collect it, the government took a home worth close to $200,000, auctioned it for a fraction of that, and called the matter settled. The family is now putting a simple question to the Supreme Court: when the state sells your house over a small debt, does it owe you the real worth of what it took or only whatever the auction happened to fetch?

The Rule that is Already on the Books

Three years ago, the court drew a clear line. Geraldine Tyler, then in her 90s, had let a $2,311 levy on a Minneapolis condo balloon to about $15,000 once penalties and interest stacked up. Hennepin County took the unit, found a buyer at $40,000, and held onto all of it. By any fair reckoning, the $25,000 above her debt was Tyler’s money – even though the county walked away with it. Minnesota law blessed that, as did 11 other states and the District of Columbia, plus nine more states under narrower terms.

A unanimous court ended the practice. Chief Justice Roberts wrote that a government can sell property to satisfy a tax debt but cannot help itself to more than the debt is worth. Leftover equity belongs to the owner, and a state cannot dodge that by defining the property interest away.

The Question Tyler Left Hanging

Tyler was tidy because the surplus was undeniable. Subtract a debt near $15,000 from a $40,000 sale, and the leftover is beyond dispute. The justices never had to confront the messier case where the sale price itself is artificially low. If a forced auction brings in far less than a home would fetch on the open market, is that depressed number really the measure of what the owner lost?

That is the gap, and tax auctions are where it opens. Unlike an ordinary listing, these sales draw a thin crowd of investors and speculators, and the government has little reason to chase top dollar. A county could therefore obey Tyler to the letter, hand back every cent of the auction surplus, and still watch most of a family’s equity vanish.

How the Pung Family Got Here

Three-and-a-half decades ago, Timothy Scott Pung paid $125,000 for a roughly 3,000-square-foot house in Isabella County, and for years it carried Michigan’s Principal Residence Exemption. Scott died in 2004, and his wife in 2008. Their son Marc stayed on, assuming the exemption rolled forward without any new filing. The assessor saw it otherwise and stripped the break retroactively. Marc fought back, and a state tax tribunal agreed no further paperwork had ever been required.

The assessor would not let it go. Over a shortfall of $2,241.93, on a place the county itself pegged at $194,400, the family was thrown out, and the home went under the hammer for $76,000. Nobody disputes that the estate is owed the surplus. The quarrel is how to measure it. Isabella County treats the surplus as the hammer price minus the debt, leaving about $74,000. The estate says the yardstick should be the home’s true market value minus the debt, pushing the number toward $194,400. The spread tops $100,000.

Bigger Than One House

The stakes reach far past Michigan. Minnesota alone moved more than 4,300 properties through these sales between 2014 and 2020. Across the 1,200-plus that were family homes, the typical owner lost some 92 percent of the equity above the debt, averaging around $207,000 against bills averaging just $17,000. In the nation’s capital, a veteran with dementia lost a $200,000 home over $133.88.

There is a second front, too. The estate contends the foreclosure worked as an excessive fine barred by the Eighth Amendment, a theory the lower court waved off as ordinary tax collection but one that Justices Gorsuch and Jackson have flagged for review.

Argument wrapped on Feb. 25 with a ruling likely any day now. The court has already said the government cannot keep more than it is owed. Now it must decide whether that shield covers only the cash left after the gavel, or the equity that vanished before.

Tips for Early Retirement Planning

Tips for Early Retirement Planning

5 min read

Tips for Early Retirement PlanningRetirement planning starts with retirement spending. Ideally, retirees are mortgage-free and relatively debt-free before they leave the working life behind. In retirement, a key strategy is to maintain low monthly staple expenses.

Therefore, if you want to devise a financial plan that will allow you to retire early, consider cutting back your basic household expenses a year or more before your target retirement date. Some retirees choose to downsize their home, which also tends to reduce property taxes, homeowner’s insurance and maintenance costs.

Also, use that time to shop for cable, internet, or cell phone plans that may be cheaper and suit your needs in retirement. Be aware that seniors often get additional discounts they may not be aware of, so be sure to explore those options. By reducing your pre-retirement cost of living, you can reduce the amount of income you’ll need after you retire.

Build up Coffers

Another way to plan for retirement is to increase your savings while still earning income. You should have more than the typical emergency fund when you retire – so you won’t deplete it before you die. You also don’t want to have to take large, unscheduled withdrawals from retirement accounts because that would deplete your principal and potentially reduce the ongoing income you receive from those sources.

Social Security

Remember that if you start taking benefits before your official retirement age, you will lock into a lower payout level for the rest of your life. So even if you can afford to retire early, it’s generally a good idea to hold off tapping Social Security until full retirement age or even up until age 70, when you earn additional income credits. Factors to consider in making this decision include your health and life expectancy, needs for income, and other retirement assets. Remember, Social Security will last the rest of your life with cost-of-living increases and no investment market risk, so it is one income source you should wait to maximize as long as you can.

By establishing an account at the Social Security website, you can check your benefit amount at various ages based on current earnings; these projections are updated every year. If you are married, consider both spouses’ benefits as it might be better to start one early while allowing the other benefit to accrue.

Pension

If you expect a pension from your employer, you can request projected payouts to help devise your early retirement plan. If you have the option to receive either annuity payments or a lump-sum distribution, you might want to consult with a financial advisor to determine your best option within the context of your entire portfolio of assets.

Investment Accounts

If you have a 401(k), 403(b), or traditional IRA, remember that once you turn 73, you must begin required minimum distributions if you haven’t already. As a general rule, the common strategy for drawing down invested assets in retirement is to use taxable accounts first, tax-deferred accounts second, and tax-free accounts (e.g., Roth IRA) last. Roth IRAs do not require distributions at any age and can continue to grow throughout retirement.

Rule of 55

There is a legal strategy for tapping 401(k) or 403(b) retirement funds before the age of 59½ without incurring a penalty. The Rule of 55 enables you to make a series of substantially equal periodic payments from a former employer’s retirement plan (not a rollover account) between the ages of 55 (50 for a government defined-benefit plan) and 59½. While this strategy waives the 10 percent early withdrawal penalty, distributions are still subject to income taxes.

Health Insurance

If you wish to retire before age 65, consider your health insurance options.

  • Employer-sponsored coverage through COBRA
  • Health insurance marketplace plans at HealthCare.gov
  • Joining your spouse’s health insurance plan
  • Potential discounted coverage through membership organizations (e.g., AARP)

When you become eligible for Medicare, you must apply during the seven-month period that begins three months before you turn 65 and three months after your 65th birthday. If you do not apply during this enrollment period, you may face penalties.

Long-Term Care

If you’re thinking about early retirement, you may not be thinking much about nursing home expenses. However, long-term care can be quite expensive, so it’s important to plan for it early so you don’t run out of money when you need it most. Help from family can reduce the need for paid long-term care in your later years, so you may want to consider moving closer to them before or after you retire. Note that Medicare generally does not cover ongoing long-term care, although it may provide limited coverage for skilled nursing and rehabilitation services.  As a result, you’ll either need to self-fund, purchase some form of long-term care insurance, or spend down your assets in order to qualify for Medicaid long-term care assistance.

An early retirement plan usually involves a number of moving parts, so carefully consider withdrawal strategies and your specific tax situation in order to develop a plan that works best for your circumstances.

Personal Versus Enterprise Goodwill: What You’re Really Selling

Personal Versus Enterprise Goodwill

4 min read

Personal Versus Enterprise GoodwillPicture two heating-and-cooling companies at opposite ends of the same town. Same revenue, same trucks, same crew. The first one runs on its owner, a guy who spent 20 years building a name, and people call the office because they want him on the roof. The second runs on a brand, a dispatch system, and a phone number folks have had memorized since the ’90s. On paper, the two look like twins. But put them up for sale, and they fetch very different prices – and the reason is goodwill, the chunk of value that has nothing to do with the trucks and everything to do with why the phone keeps ringing.

The Value That Stays

That second company has what valuators call enterprise goodwill. It lives in the business itself: the location people drive past, the name they already trust, the systems that keep running through the two weeks when the founder goes to Cabo. Whoever buys the place inherits all of it, and that is what a buyer pays up for. They are not wagering on one person’s stamina. They are buying an operation that keeps producing after the seller is a memory.

The Value That Walks Out the Door

The first company has personal goodwill, where owners talk themselves into a number the market will not pay. When the clients are loyal to the owner, the referrals come because of the owner, and the day he retires, half the revenue walks out behind him; you cannot deed that over the way you hand across the keys to a van. A business built on one person almost always sells for less, because the buyer is left guessing how much of it actually survives the handoff.

It can be salvaged. A tight employment agreement and a non-compete can keep the seller out of the market long enough for relationships to take root with the new owner. In a lot of these deals, choreographing that single transfer is the whole negotiation.

It Comes Up in Divorce, Too

The same split shows up in divorce, usually not the way people expect. State law varies, but courts tend to treat enterprise goodwill as a divisible marital asset while setting personal goodwill aside, on the logic that it is really the spouse’s future earning power rather than property to carve up. Arizona is one of the states that has swept professional goodwill into the marital estate anyway, in the right case. Wherever it gets heard, someone has to draw that boundary, and a lot of money rides on where the line lands.

Putting a Dollar On It

So how do you put a dollar figure on something this slippery? One of the cleaner tools is the With and Without Method. You build two futures for the company and discount each one back to today. In the first, the key owner stays. In the second, he walks and starts competing down the street. The cash flow that bleeds out of that second version is the value the first one was quietly protecting.

Go back to our first owner and say his presence is worth a formal non-compete. With him locked in, free cash flow runs $10 million a year. With him loose and competing, it slips to $7.5 million. Discount each stream at 7.5 percent over eight years, and the protected version is worth about $58.6 million in today’s dollars against roughly $43.9 million without. That gap, near $14.6 million, is the price tag on the non-compete.

A real engagement would not leave it that clean. I would model how fast the business rebuilds the revenue it lost and weigh the result for how likely the owner is to actually go compete. But the bones of it are exactly that.

What to Take Away

Here is the part worth holding onto. Get this distinction wrong, and you can leave seven figures on the table at a closing or in front of a judge. The line between personal and enterprise goodwill does not draw itself. If you are eyeing an exit, weighing an offer, or fighting over a number in a dispute, get someone to mark it before the other side marks it for you.

Beyond Passwords: Why Recent 24B Records Leak is Wake-Up Call for Stronger Authentication

24B Records Leak, Beyond Passwords

4 min read

24B Records Leak, Beyond PasswordsThe recent discovery of a publicly available Elasticsearch cluster, a group of interconnected search servers, containing 24 billion exposed records, is among the largest-scale data breaches, highlighting the troubling reality that passwords have become a weak link in modern digital security.

For years, one of the responses to cyberthreats has been to create stronger passwords, implement password rotation policies, and deploy password managers. Despite all these efforts, credential-related attacks continue to dominate the threat landscape.

The latest threat is a reminder that the problem is not simply password hygiene – but the password itself.

The Weaknesses of Password-Based Security

Passwords were designed for a simpler era of computing. Today, passwords are used to protect everything from corporate networks and cloud applications to banking platforms and healthcare systems. Even with the evolution in computing, the basic principle of passwords remains unchanged. That is, access is granted on a secret that can be stolen, guessed, reused, or shared.

The 24 billion record leak demonstrates the scale of this vulnerability. This means cybercriminals now possess records of usernames, email addresses, login URLs and passwords that can be weaponized against organizations.

The password challenge is made worse by human behavior. Users often reuse passwords across multiple accounts, use predictable combinations, or rely on slight variations of existing credentials. This means a breach affecting one platform can easily become a gateway to many others.

Unfortunately, organizations continue to invest heavily in securing networks, endpoints and applications while still relying on an authentication mechanism that is failing to withstand today’s threat environment.

Why Traditional Defenses Are No Longer Adequate

The greatest danger that arises from a big password leak is credential stuffing attacks. In these attacks, cybercriminals systematically test stolen username and password combinations across thousands of websites and applications using automated tools. Since users frequently reuse credentials, attackers can achieve high success rates with minimal effort. The credential stuffing attacks model allows threat actors to compromise accounts without exploiting software vulnerabilities or bypassing sophisticated security controls.

Even password managers, although valuable, are not the best solution. They help users generate and store stronger credentials, but are not immune to phishing attacks, session hijacking, malware-based credential theft, or social engineering attacks.

Multi-factor authentication (MFA) improves security. However, attackers have increasingly taken advantage of MFA fatigue attacks, SIM-swapping, and real-time phishing proxies.

Simply put, organizations are investing significant resources to protect a flawed authentication model.

Passwordless Authentication: The Next Evolution of Identity Security

The business impact of credential compromise has far-reaching consequences. The solution today is not the use of stronger passwords – but instead, reducing dependence on them altogether.

Passwordless authentication promises more secure methods that are resistant to phishing, credential theft, and reuse attacks. Several technologies are emerging as a replacement for traditional credentials.

  1. Passkeys
    A passkey is a fast identity online (FIDO) authentication credential where, instead of typing a secret word, a user device confirms who they are using built-in security. An example is when you log in to a Google account, and your phone simply asks for your fingerprint or face scan.
  2. Biometric Authentication
    This adds another layer of convenience and security. It includes fingerprint scans, facial recognition, and other biometric identifiers. These allow users to authenticate using characteristics that are unique to them rather than information they must remember.
  3. Hardware Security Keys
    This provides another powerful option. It involves the use of physical devices such as YubiKeys or Google Titan Security Keys that authenticate users through public-key cryptography. Because the private key never leaves the device, it provides strong protection against phishing and credential theft and is widely considered among the most effective defenses against account compromise.

Despite the advantages of these passwordless methods, adoption remains low. Many organizations continue to operate legacy systems designed around traditional username and password models. It is worth noting that the integration of modern authentication frameworks does require significant planning and investment. However, it should be considered as an evolution that requires strategic commitment rather than a quick fix.

Final Thoughts

The recent exposure of 24 billion records is more than another headline-grabbing cybersecurity incident. It is evidence that the password-centric model of digital security is no longer secure. This should prompt organizations still using the traditional password methods to adopt passwordless authentication.

As technology advances, new security challenges will arise, including the emergence of quantum computing and the need for quantum-resistant cryptography. These developments reinforce the lesson that security cannot remain static. The goal is not to predict every future threat, but to build security architectures that evolve with technology. 

11 Ways to Beat ‘Streamflation’

What is Streamflation

4 min read

What is StreamflationThe cost of streaming subscriptions is on the rise, and you have to ask: Are they really worth it? Especially when it’s summer, and you’re taking advantage of the beautiful weather. Here are some ways to entertain yourself, friends and the fam that are either no- or low-cost – and might be better than binging on yet another series.

Have ‘Zero Dollar’ days. Set aside one or two days a week where you don’t spend a cent. Make your lunch the day before. Cook dinner at home, and then end the day with a walk at a nearby park.

Plant a garden. All you need is a few seeds (or plants), a place to dig and you’re good to go. Best of all, it will keep you busy all summer long. It’s something, too, that you can do with friends and family. Can you say togetherness?

Practice plogging. What, what, what? Yes, plogging is a real word and a mash-up of a Swedish word, plocka, meaning “to pick,” and jogging. As you’re jogging, or even walking, pick up trash along the way. You’re not only helping your body but also bettering your community and the environment.

Visit free museums. If it’s just too hot to be outside, get some A/C and some culture – without parting with your moolah. Just Google “museums near me,” and you’ll be all set.

Play board games. Scrabble or Monopoly, anyone? What about Gin Rummy or Hearts? Make a light summer salad for dinner, gather with your buds and/or progeny, and have some fun.

Make your own popsicles. What a great money-saving hack. Buy a cheap popsicle mold at Walmart, your neighborhood home goods store, or online. Fill it up with yogurt, fruit, or anything else that sounds delish, freeze, and dig in. Here’s a list of recipes you can experiment with!

Start a book club. Books, remember those? Turn off the Netflix, go to the library or browse online, pick a book that looks good, and gather with friends and family. And bing bang boom, it’s a book club! Sometimes, theater of the mind is so much better than what’s on the idiot box.

Join a Buy Nothing group. This is a collection of people who believe in giving and sharing products instead of engaging in consumerism. With this, you will save money and meet new people. Check out the movement here.

Run through the sprinklers. If you don’t want to go to a pool or one’s not nearby, turn on the sprinklers, suit yourself and your kiddos up in swimsuits, and take off! It’s a quick way to cool down.

Go thrifting. This is something all the cool kids are doing – and have been for some time. Find out where your local second-hand shops are and dive in. You could find some designer gems for very little cash. And usually the stores have A/C, so this is yet another activity to beat the heat.

Stargaze. Wait until after sunset, grab a cool beverage and find a place where you can just sit and be amazed at the universe. If you look long enough, you’ll see shooting stars. After all, nature is one of the best free playgrounds we have.

These are just a few of the many things you can do to lower costs this summer. We’re not saying don’t watch TV, but just that there are so many other things to do that will bring you happiness – and on a budget.

Sources

67 Free & Fun Things to Do This Summer | Apartment Therapy

Small Financial Habits to Set You Up for a Successful 2026

Understanding Horizontal Analysis

Understanding Horizontal Analysis, What is Horizontal Analysis

3 min read

Understanding Horizontal Analysis, What is Horizontal AnalysisHorizontal Analysis provides businesses a method to examine financial statement entries by looking at the documents’ number for a specific accounting time frame compared to the same length of a historical period for the same accounting line item.

Breaking the Process Down

It’s a way to measure trends and variances by looking at the current year’s values versus the reference year. This helps an analyst figure out if the values increase or decrease. It’s either done on an absolute value or a percentage change basis. The analysis provides a company’s growth and financial position against competitors.

This method is different compared to vertical analysis because vertical analysis looks at a single reporting period and measures the proportional relationship between items, compared to horizontal analysis evaluating multiple periods and multiple ratios for a more comprehensive approach.

Generally Accepted Accounting Principles (GAAP) require uniform and standardized financial statements for adequate financial statement analysis. This entails consistent accounting practices and fundamental principles being employed annually. Comparability constraints mandates that the business’ financial statements are in a form that permits analysts to evaluate them against other competitors in the same field. This is where horizontal analysis comes into play, creating consistency.  

This analysis determines what impacts a company’s growth over time. For cyclical or seasonal companies, it lets analysts get a handle on what’s normal and what’s not. It also permits identification of variances in different product/business segments and how to project a company’s future performance.

Along with the three financial statements (balance sheet, cash flow statement, and income statement) providing working outcomes, it can similarly identify issues and strengths by looking at certain metrics like profit margins or the rate of inventory changing hands.  

If a company reports higher earnings per share due to increases in revenue or lowers its figures of the COGS (cost of goods sold), analysts looking at the interest coverage ratio or cash flow-to-debt ratio, for example, can use horizontal analysis to gauge if a business has enough liquidity for continued operations.

Real World Example of Horizontal Analysis

Let’s say Company X had revenue of $100 million in the previous year and accounts receivable of $200 million during the “base year.” This is compared to revenue of $300 million in the present year and accounts receivable of $600 million. Based on these numbers, the calculations are as follows:

Revenue Comparison

[($300 million – $100 million)/$100 million)] x 100 = 200 percent

Accounts Receivable

[($600 million – $300 million)/$300 million)] x 100 = 100 percent

When it comes to interpreting horizontal analysis, the process needs context to ensure it’s used appropriately. The most prominent consideration is understanding what contributed to the base year’s numbers and the current year’s numbers. Did the company sell off a segment that increased profitability, or did they face massive lawsuits or spend excessive amounts of capex to ensure their viability and competitiveness in the upcoming years?

The calculation is straightforward, but being able to delve into what happened – and why – is the role of the business owner and investor to determine the true health of the business.

Understanding Cost of Goods Manufactured

Understanding Cost of Goods Manufactured, What is Cost of Goods Manufactured, what is COGM

3 min read

Understanding Cost of Goods Manufactured, What is Cost of Goods Manufactured, what is COGMWhen it comes to the latest report for March 2026 manufactured goods orders, according to the United States Census Bureau’s May 4 report, the government agency reported a 1.5 percent bump in orders for the nation’s manufacturers, growing to $630.4 billion. Understanding concepts like Cost of Goods Manufactured (COGM) is essential to smooth operations.

The cost of goods manufactured (COGM) reflects the total manufacturing costs a company incurs during a particular accounting period to complete goods. It includes direct materials used, direct labor, and manufacturing overhead. COGM helps businesses manage inventory levels and serves as a key input for calculating the cost of goods sold (COGS) reported on the income statement.

COGM Formula:

The standard formula is:

COGM = Beginning Work-in-Process (WIP) Inventory + Total Manufacturing Costs – Ending Work-in-Process (WIP) inventory

Defined as:

Total Manufacturing Costs = Direct Materials Used + Direct Labor + Manufacturing Overhead

Hypothetical Example:

Based on the following numbers, the COGM would be calculated as follows:

  • Direct Materials Used: $200,000
  • Direct Labor: $75,000
  • Manufacturing (Production) Overhead: $120,000
  • Beginning WIP Inventory: $20,000
  • Ending WIP Inventory: $60,000

First, calculate Total Manufacturing Costs: $200,000 + $75,000 + $120,000 = $395,000

Then:

COGM = 20,000 + 395,000 – 60,000 = 355,000

So, the Cost of Goods Manufactured is $355,000.

Interpreting COGM:

The first step is to analyze how each input contributes to the result. This involves reviewing direct materials, direct labor, and overhead to determine the complete production costs for the accounting period. By evaluating each component’s contribution, companies can better project manufacturing capacity and cost-effectiveness.

Direct Materials Used in Production

Direct Materials Used = Beginning Raw Materials Inventory + Purchase of Raw Materials – Ending Raw Materials Inventory

This amount is then incorporated into the Total Manufacturing Costs (and ultimately the WIP inventory) shown above.

Calculating Direct Labor and Manufacturing Overhead:

Direct labor costs are determined from time logs or clock-ins (hours worked × hourly rate). Manufacturing overhead includes indirect production costs such as factory utilities, depreciation, and supervision.

Translating COGM to Cost of Goods Sold:

Once calculated, COGM is transferred to the Finished Goods Inventory account. Finished Goods Inventory consists of completed products ready for sale to customers. The standard relationship is:

COGS = Beginning Finished Goods Inventory + COGM – Ending Finished Goods Inventory

(or equivalently: Ending Finished Goods Inventory = Beginning Finished Goods Inventory + COGM – COGS)

Conclusion:

COGM shows whether production costs are too high or too low relative to sales. For example, if one business generates $2,000,000 in revenue with $1,500,000 in COGS (25% gross margin), while another has $1,500,000 in revenue but only $750,000 in COGS (50% gross margin), the second company demonstrates stronger profitability.

Understanding COGM enables businesses to optimize costs related to labor, overhead, and materials, ultimately improving net income and operational efficiency. When calculating and reporting COGM, it is essential for businesses to apply these concepts accurately in their accounting and bookkeeping practices.