A Guide to Building an Ecommerce Business from Nothing

You might have thought about starting an ecommerce business recently – many people have. And this wouldn't be surprising considering that ecommerce sales within the US increased by 12% in the year of 2013 alone, meaning that the total revenue produced from these activities was approximately $294 billion. In addition to that, India's ecommerce industry has also grown by more than 30% compared to the previous year of 2013. India now has a $12.6 billion revenue share in the whole ecommerce industry.

By looking at the numbers listed above, you might think that the industry is too large for you to get involved but this simply isn't true. In fact, it's easier for you to get involved and start selling your products because the market is so large. There is competition, yes, but there is also a large number of buyers browsing marketplaces and ecommerce websites with their wallet right beside them.

This article will be a guide to building an ecommerce business from the ground-up, how to build a solid foundation so that your business can grow and develop as it should. We won't talk too much about the advanced factors such as sales and logistics as that's not a problem when you're getting started.

Getting Started

Ecommerce is one of the easiest businesses to get started in simply because the barriers to entry are so low. You don't need a lot of capital, you don't need a $10,000+ website, you don't need to spend $4,000 per month on overheads, you don't even need to hold stock! We will talk more about stock in a moment.

The first thing that you need to do is figure out what your goals are when it comes to this ecommerce business – do you want to be a “superstore” and source anything you can get your hands on? Or would you rather be a “specialist” store, focusing on solving a certain problem in society with the help of your products?

Superstores have a much greater chance of being successful on a larger scale, most of the time they are very risky if you don't have a lot of capital to invest, don't have the resources to do proper market research, and things of that nature. It also take a lot more time to source a wide range of products from reliable suppliers.

Your best option when getting started is to choose a specialization, a niche in other words. This is a small corner of the market that you try to dominate by branding yourself as an expert. Some examples would be: horse riding equipment, scooter accessories, custom helmets, t-shirt printing, or toys for 3-6 year olds. By choosing a niche you are essentially increasing your chance of success, it will also be a lot easier to source suppliers and handle the sales and logistics aspect.

You'll want to look for some reliable suppliers so that you have good products to sell. Look for suppliers within your industry and take a look at what they are offering. If you are sourcing from a different country you should research the import laws and taxes. If you don't want to hold a lot of stock then drop-shipping is also an option, you essentially buy an item from the supplier only when a customer makes the purchase from you. So it's risk-free making it a great option to get started.

So now that you have figured out what you want to sell, the next step is to figure out where to sell. Don't worry too much about this, ecommerce has become a huge operation and there are dozens of marketplaces where you can list your products for sale, even with a tight budget or no budget at all!

The two biggest ecommerce platforms in the world (eBay and Amazon) should be of most importance to you, this is where you will want to spend the majority of your time building up a reputation and establishing yourself as an expert in your niche. There are both free options and paid options on these ecommerce platforms, the best route for you will depend on your budget – you will have greater success with the paid options, but don't let it discourage you if you can't afford it.

Developing a More Professional Brand

Once you have built your brand using the popular ecommerce platforms mentioned above, you should now have a loyal customer base as well as a decent amount of capital. You should use this capital to reinvest back into your ecommerce business, generate more sales, and improve your whole ecommerce operation.

The first thing that you'll want to do is establish your self online properly, this means having a dedicated ecommerce website where you can sell your products – allowing you to move away from the platforms such as eBay and Amazon and thus save on the fees that they take. Don't completely negate these platforms though. Amazon receives an estimated 81-million US visitors per month – eBay receives even more at 105-million visitors per month.

Building an ecommerce website is a complicated process so the best option is to hire a web designer, don't try to build the website yourself. You should ask your designer to use a platform such as Magento or WooCommerce. These platforms will allow you to make minor adjustments yourself, without the help of your web designer – so you'll save money in the long-term.

Your logo and branding is another very important factor to consider. It's what your customers remember you by so you shouldn't compromise on this. Hire a professional graphic designer and have him/her craft a beautiful logo that demonstrates the personality of your ecommerce business perfectly.

Defining Your Unique Selling Proposition (USP)

As you become more established you will want to focus on your unique selling proposition (USP). It's not very difficult to sell a handful of products every now and then, but scaling up your operations, bringing in more sales and more revenue is a lot more difficult and requires more planning, preparation, and more dedication to execution.

Your USP should be a factor of your ecommerce business that separates you from your competitors – a reason why your customers should buy from you instead of them. When creating your USP you will want to think about the gaps in the industry, where could it be improved? This might be something along the lines of extended warranty, faster delivery times, better customer support, or in-depth buying guides so the customer gets exactly what they need.

Many ecommerce businesses try to use price as their USP and in most cases this has a negative effect, the customers who shop around for the lowest price probably aren't the customers that you are looking for. Chances are that you aren't making enough capital just yet to obtain items at a very cheap price as this requires that you order them in huge bulk quantities. Furthermore, unless you are specifically a discount store then your customers will go elsewhere as soon as someone else is cheaper.

Tracking Important Data and Key Metrics

It's very important to keep track of certain data and key metrics as this will help you improve your business operations and break past any plateaus that you will experience. Looking at data means that you are looking at your business objectively, you simply can't dispute data if it is right in-front of you.

The simplest and most obvious key metric to keep a close eye on would be your conversion rate. This is the amount of visitors who will purchase from you compared to how many visitors you get to your store. For example, if 1000 people visit your store but only 20 of those visitors make a purchase, your conversion rate would be 2%. It's good to keep track of this because it determines just how valuable your website traffic really is and it can be helpful when thinking about other metrics.

Cost of Acquiring Customer (CAC) is another metric to think about, it is essentially the amount of money that you spend to get customers to purchase something from your store. For example, if you spend $2000 to get 50 visitors to purchase from your store, your CAC would be $40. The lower you can get this number, the better.

Shopping cart abandonment is also an important factor to consider as it tells you how many customers had an intent to purchase something from your store, these are considered potential customers. Make sure to keep this as low as possible, having a high rate might indicate that your website needs some adjustments.

Average Order Value (AOV) is the average amount of money that a customer will spend in your store. You always want to try to increase your AOV, perhaps by offering discounts for bulk purchases or utilizing “related products” options or something similar. Amazon does this perfectly with their “people who purchased this item also purchased:” section.

Lifetime Value (LTV) is considered to be the most important metric that exists in an ecommerce business. It's a calculation of the amount of money that one customer will spend in total, minus the cost of acquiring the customer. So for example, if a customer returns to your store four times and has spent a total of $600, their LTV would be $560 if you spent $40 acquiring that customer.

By keeping track of the data and key metrics that have been listed above you'll be able to know exactly how well your ecommerce business is doing at any stage. It can be very beneficial when thinking about scaling your business, increasing your product range, increasing revenue, bringing more traffic to your website and everything else that you can imagine.

How to Know What Type of Debt Relief is Best for You

Heavy debt is a terrible load to carry. It eats, sleeps, and travels with you. Debt can disrupt relationships, peace of mind, and your life in general. Obtaining relief is necessary to crawl out from under the problems that debt creates. Fortunately, debt relief is not one-size-fits-all. Depending on your circumstances, a debt relief option probably exists that is just right for you.

1.) Debt counseling should be the first step.

Debt counseling is the first step to getting the best debt relief for you. A good counselor may be able to help you navigate your way through the quagmire without additional help. It may be more of a problem with priorities and budgeting than debt. The counselor can help you set a course to freedom. You can consult local television stations or the Better Business Bureau for guidance. These types of counselors are often used as consultants for television and radio stations for their public service requirements.

2.) Several types of debt relief are available.

The easiest type of debt relief is debt management. While some will argue against it, debt consolidation has helped many find a way to reduce crippling interest rates. Settling debts can be a painful process, but is often the shortest route to eliminating debt without bankruptcy. For some, a little relief is enough. Partial debt consolidation or settlement will reduce or eliminate the most difficult of the debt and make it tolerable. The ugly way out of debt is bankruptcy, but it is effective.

3.) Debt Management:

The process of debt management can be accomplished by you or a third party. It requires a plan and a lot of work to set up. Each creditor must be contacted regarding your situation. An agreement for paying off the debt must be achieved with each creditor individually. The final total payment amount needs to be an amount that fits your monthly budget.

4.) You have to meet your due dates.

The agreement is nullified if you miss more than a set number. Usually, only one or two misses will be allowed. This is why debt management works best when you use a third party rather than setting it up yourself. These agencies accept one large payment from you and disperse the appropriate amount to each creditor on time each month. The large payment may seem scary, but it will be 25% to 50% less than you are paying now with much more favorable interest rates. The amount of your monthly payment applied to principal will go from a few percent to somewhere between 40% and 50%.

5.) Debt Consolidation:

This type of debt relief has held up as a popular choice. The idea of debt consolidation is to make a new large loan that swallows up several small ones. By converting several unsecured debts into one that is secured, you can usually get a favorable interest rate and a lower payment. What makes this debt relief popular is that it impacts credit scores more positively than debt management. However, it does not eliminate debt more quickly, and you may have to put your home at additional risk with a second mortgage.

6.) Debt Settlement:

Except for bankruptcy, debt settlement is the most uncomfortable way to get debt relief. A settled debt does show up on your credit report. To get a settlement, usually means that you have to endure collection calls. It often requires you to simply not make a payment to your creditor for awhile to get them to want to settle. Unless you have fairly thick skin, you may find this route very painful to your ego. Even if you use a third party to settle (these are usually attorneys), you will still get the ugly phone calls and possibly even a summons or two for a court date before the settlement is reached.

7.) Partial Debt Relief from Consolidation and/or Settlement:

This route is a lot like the preceding two options. The main difference is that you leave some of your debt out of the equation. Since the debt on your home does not usually get included in this process, most of the time consolidations and settlements could all be considered partial. In this case, the idea is that you have some unsecured debt that you leave out of the process. You may have a small bill to a hospital, doctor, or even a credit card. Because it is small, you might find it easier to just pay that one off separately from the agreements sought with other creditors.

8.) Bankruptcy:

Of all of the debt relief options, this is the one that most people prefer to avoid. It impacts your credit history for seven or ten years depending on your state. Bankruptcy also costs you upfront money for an attorney. It invades your privacy far more than any other type of debt relief. You must produce 6 months or more of bank statements and other financial data. Your income is verified.

9.) In some states even the hearing is unpleasant.

While the adjudicator is not usually offensive, you may find yourself with a gallery spectators waiting for their turn before the adjudicator. Laughter and other annoying practices are allowed as people hear your private life made public. The process of bankruptcy can take 3 to 6 months to complete. Debt settlement is tough, but bankruptcy can be downright embarrassing. The big plus for bankruptcy is that when you get the notice that you bankruptcy has been approved, your debt is gone. However, you do have the right to leave some debts like your home mortgage out of the bankruptcy proceedings.

Personal Finance: Living Debt Free

Many people have found becoming debt free requires a trip through a lifestyle that feels like deep poverty. Living debt free is far from it. As your debt falls away, you earn interest instead of paying it. Your ability to negotiate prices increases dramatically. You work for your benefit and not to enrich creditors. A number of differences surface as you adjust to living debt free.

1.) Make savings deposits instead of debt payments.

Most of your payments become deposits. That $400 per month for a car can add up very quickly in a savings account. An $800 per month mortgage goes a long way toward funding your 401k and Roth IRA accounts. It does not take long before you realize just how much extra cash it required to service month after month of crushing debt.

2.) The joy of paying cash.

Paying cash is fun once you learn how. When you wave cash in a seller's face, prices drop and deals are made in the blink of an eye. You not only will stop paying interest to the finance company, but you will also find far more bargains are in the world of paying cash and living debt free.

3.) Vacations are more relaxing.

Almost everyone has had the troubling experience of being on vacation and trying to remember if all of your bills were paid before you left. Leaving your financial boat to drift along while you are out of town is a scary experience when you are dragging along large amounts of debt. Coming home from vacation without ever-increasing debt is like leaving vacation to go home to a vacation.

4.) Holiday buying does not dig a debt hole.

Gift-giving at the holidays is often overshadowed by the realization that you may have just added on months or years of debt payments. When you can walk away from Christmas knowing that everything has been paid for, it will make your holidays much more joyous. If you will develop the habit of making a special account to save your holiday spending money, it will even take the guilt out of those spending excesses that sometimes accompany that time of the year.

5.) Never get a collection call.

Because you have no debt, collection calls will disappear from your life. Even car repairs and medical expenses can be handled as they arise. Most people would not be too terribly upset if debt collectors were out of business because there were no longer any debts to collect.

6.) Checks do not bounce.

As people shuffle which debt to pay first or next, available cash becomes a real problem. This cash flow issue can easily convert to overdraft fees at the bank. While you could be weak enough at personal accounting to still make a mistake that results in an overdraft, it should never happen when you are debt free. You have much less cash flowing out and more often deal with cash. This reduces the likelihood that you will have a bounced check ever again in your future.

7.) Car payments become a resource.

That car payment that you curse at every month will now become the way that you save up for your next car. With the interest that you bank will add to your account, you will pay far less for your vehicles. When you have a five or six year car loan, you pay between 1/3 and 1/2 more for the privilege of driving the same car as when you pay cash. This means that you pay $30,000 for a $20,000 car. By saving up the payment until you can pay cash, you may very well get that $20,000 car for $18,000 or $19,000. Bargaining power increases as the cost of the item goes higher.

8.) You cannot be evicted from your house because your mortgage is too expensive.

Never worry about being upside down on a house again. Your home is paid for. This means that you can live there year after year without writing out a monthly check to the mortgage company. Your appreciation on the property goes into your pocket.

9.) You can have a credit card.

Debt free does not mean no credit cards. It does mean no credit card balances that are not paid in full each month. Some people find that credit cards are a good alternative to having holds put on their checking accounts for car rentals and motel rooms. As a result, having a credit card may still be part of your life. Just control the urge to buy now and pay later or debt will creep back into your life.

10.) Financial emergencies are few and far between.

If you have cash in the bank, you can cover those unexpected expenses as they crop up. A $1,000 cash emergency does not seem too critical if you have $25,000 or $50,000 in the bank. The fact is that you will most likely stop seeing any of these occurrences as emergencies.

The Basics of Business Formation

Whether you are an existing business owner, a new entrepreneur, or an investor, forming a business entity is an intelligent step. This article will explain the different types of business forms you can choose from.

There are many reasons to start a business and no matter what industry you are in there are some important things to know before moving forward and filing documentation with your state. There are a few different business forms to choose from: Sole Proprietorship, Partnership, Corporation, and Limited Liability Company (LLC).

Depending on the type of business form you choose, you may be forming a new "entity", which by definition is something that has a distinct and separate existence from yourself. In essence, by setting up certain business entities (aka legal business structures), you are creating an "umbrella of protection" between your business and your personal assets (your home, automobiles, bank accounts, etc.).
 
Sole Proprietorship

A Sole Proprietorship is not a business entity. It is owned and run by one individual person and there is no legal distinction between the owner and the business. A Sole Proprietor usually operates under a "fictitious name" (ex: Bob's Flower Shop), but this is just a "nickname" for the real person behind the business.

A Sole Proprietor has unlimited liability for all debts of the business. Many who elect to be a Sole Proprietor are often unaware of the types of business entities that exist or they think that it is too expensive to form one, and therefore are exposing themselves to unnecessary risk. As an example, if a flower shop owner (operating as a Sole Proprietorship) is sued by a customer because of an accident that occurred at the shop, the business owner's personal assets (home, automobiles, saving accounts, retirement funds, etc) are all exposed and could be seized in court.

There are no legal formalities or paperwork required to start a business as a Sole Proprietor. You simply just start operating the business. A plus to this type of business is that the income or loss from the business will be reported on the individual's income tax return.

Again, an individual acting as a Sole Proprietor is often unaware of the other business entities and does not know that what is called "pass through taxation" also occurs in a Partnership and in an LLC.

General Partnerships

General Partnerships consist of two or more people coming together for the purpose of operating a business and sharing in the profits of such endeavor. There is no official paperwork that needs to be filed with the state to create a Partnership; the partners just simply start working together.

It is advisable to draft and sign a Partnership Agreement, however it is not a state requirement. As in a Sole Proprietorship, the partners essentially are the business and they have unlimited liability. In the event of a lawsuit, the partners would be completely liable and their personal assets would be at risk of being seized.

The income and expenses of Partnerships are reported on a separate return for tax purposes, but each partner then reports his or her pro-rata share of the profits or losses from the business on their personal tax return.

There are no real advantages of a General Partnership, as all partners would be held personally responsible for all debts and liabilities if the company is sued or enters into bankruptcy. General Partnerships are quite old and new business entities have since been created (Corporations, Limited Partnerships, and LLCs) which are more advantageous to business owners.

Corporations

A Corporation is owned by shareholders. Shareholders have limited liability and invest money for a certain amount of ownership (issued in shares) in the business. They then elect a board of directors, who in turn, elect the corporate officers. The board of directors make the business decisions and oversee policies and the corporate officers carry out those decisions.

The main disadvantage of a Corporation is what is known as "double taxation". Corporations are taxed on their earnings at a corporate level and then the shareholders are taxed again on any distributed dividends.

Corporations are not usually the best choice for small business owners and entrepreneurs, as they are more complicated and expensive to maintain. Corporations are required to hold annual shareholders' and directors' meetings to elect (or re-elect) the board of directors and officers. During all meetings, Corporations are also required to draft corporate minutes (legal, written records that document actions taken and approve business decisions).

However, if you plan on raising substantial outside capital (angel investors, venture capital, etc), or going public (via an IPO, or initial public offering), a Corporation may be the better choice for you.

Limited Liability Company (LLC)

An LLC is a Limited Liability Company. It is often referred to as a "hybrid" as it combines the liability protection of a Corporation with the "pass through taxation" benefits of a Partnership.

An LLC is a business structure that allows the owners, called "members", to be taxed individually instead of the business paying taxes at the corporate level (therefore avoiding double taxation). If an LLC member is also a W2 employee, certain business write-offs can offset their income, therefore reducing their personal income taxes.

An LLC is not required to hold annual meetings and its filing paperwork is much easier than a Corporation.

An LLC also protects the members' personal assets. In the event of business bad debts or a lawsuit against the company, the members' personal assets (such as personal savings, primary residence, automobiles, etc) are not at risk. This is an advantage only stockholders of a Corporation usually enjoyed, however an LLC also has the exact same level of protection.

An LLC can have a single member or multiple members. There is no limit to the number of members an LLC can have. A single-member LLC can also add additional members (business partners) in the future.

A Limited Liability Company is a statutory creation, meaning that it is created under state law. It is considered a separate entity from the owners. An LLC is formed by filing the proper LLC formation documents with the state.

LLCs are the most common and the most popular form of legal business structure because of the asset protection it creates for its members. Other advantages of an LLC include the lack of requirements to hold annual meetings, the ease of pass through taxation, and the flexibility to set members' own rules for operating procedures and profit distribution.

How Overstaffing Your Sales Floor Will Reduce Losses From Theft

As a former business adviser, I found that one of the biggest issues in the retail world is that most stores, in an attempt to cut costs, will understaff their sales floor at the cost of loss prevention. Few companies ever take the time to step back and realize that by placing one more person on the sales floor, they might be able to significantly raise profits by reducing theft.

1.) Theft Commonality

If you were to talk about when most theft happens to a loss prevention expert, chances are good that he or she will tell you that most retail theft happens when workers are busy with other guests. Trust me on this one, as I have talked to many over the years.

A common trick that retail thieves will use is that they will wait for the worker, or workers, to become busy with other customers. Once this occurs, the thieves will strike. By overstaffing the sales floor, though, a retail store causes the thieves to wait longer, and gives the employees more time, and more eyes, to pick up on the signs of a potential thief.

2.) Observance

I want to expand on a point that I made in the last paragraph. By over staffing a retail sales floor, a company has more people looking out for potential thieves. Remember that four eyes can pick up on a lot more than two, and six eyes can pick up on a lot more than four. Overstaffing the sales floor is the key.

3.) The Assumptions

In the following example, I am going to assume that your retail company only hold loss prevention insurance in the form of break-in insurance. This is the most common and the least expensive. This would mean that any theft that happens outside of a hold-up or a break-in would have to be eaten by the company.

I am also going to assume that you pay your employees $8.00 an hour. While it is not a lot of money, it is close to what the national average is for a retail worker ($8.35) and I don't have to use a lot of decimal math. I am also going to assume that overstaffing the sales floor is not something that you presently do.

4.) The Math

For the sake of argument, let's say that you sell GPS devices. If the GPS is valued at $200, that is the same amount as if you had a worker in the store for 25 hours a week. Isn't protecting a $200 loss worth giving a dozen more hours and overstaffing your sales floor?

Maybe you do not sell GPS devices, but you sell sweaters. You might find that you have fifty $25 sweaters stolen in a quarter one year. That comes out to a loss of $1,250. It is the same amount that you might have paid if you had some work 13 hours a week for each of the twelve weeks of the quarter. Overstaffing of your sales floor might have ultimately cut your loss.

5.) The Add-On Sales

One of the keys of retail is add-on sales. While a restaurant might make a lot of money off of the burgers, it can make even more after the waitress asks, "You want fries with that?" So to in retail when we add on all of the accessories to clothing or electronics purchases.

If someone steals something from you, and it happens to be the last one in stock, or the last one in that particular size, you have actually lost add-on sales as well. If I walk into a store to buy a PS3, chances are good that I am also going to buy an extra controller, and a few games. If the last one in stock was stolen, the store lost my extra add-on sales as well. Over staffing the sales floor might have prevented this.

If you are an owner who is against overstaffing the sales floor, take a look at your recent inventory reports. See how many hours of work equal out to the same as your theft losses. Can you still tell me that it was not worth it to over staff your sales floor for at least part of that time?

Small Retail Business: The Difference Between Success and Failure

If your small retail business includes selling to the public, as most do, there is only one criterion which separates a successful business from one which fails and that is enthusiasm.

Most small retail business owners are of the belief that enthusiasm only consists of energetic service toward the customer. While energetic service does go a long way, enthusiasm should not be restricted to only face to face contact with a customer.

Whilst running a successful small business you will have many days where you are on top of the world and everything goes exactly as planned, however, you will also see many days where you are under a rock because everything in your business seems to unravel.

The key to a successful small retail business is how you handle the down days. For instance, if your attitude is constantly positive and enthusiastic, regardless of the circumstance, the end result of any dilemma will never become a negative for you and therefore will never become a negative for your small business.

Enthusiasm should be weaved throughout your small business, to include any business contacts, customer complaints, employee problems, marketing efforts and so on. The success of your small business often times is determined by the method in which you handle problems.

Never let a negative situation get blown out of proportion and become something larger than it actually is. For instance, many people may take a negative situation and, out of disbelief, turn that situation into something unbelievable. At that point, your job would consist of putting a lid on the situation and playing down the negative side of things as you solve the problem.

By not becoming a part of the problem and taking charge of the situation, as you calmly solve the problem, you are instantly perceived as a cool and calm problem solver. This is the type person that others love to follow.

Even a successful small retail business will take many turns each day for the good or the bad. If you can understand that a positive and enthusiastic approach, toward solving these problems, will catapult your small business and distance you from the pack.

Operating a successful small business is difficult enough, but with the proper attitude, a little enthusiasm and strong problem solving techniques your small business can become a joy to operate.

By accomplishing this aspect of operating a small retail business your reward will not only be a financial blessing but also one of respect from everyone around you. With that, it becomes a joy to get out of bed each day and move toward your next opportunity.

I Trimmed $1,100 Off My Car Insurance Premiums

As much as I loathe paying for automobile insurance, the price of foregoing appropriate coverage can be even more expensive - and, in some cases, illegal. Here are a few ways I have been able to trim $577 off my semi-annual automobile insurance premiums, for a total yearly savings of $1154, while still obtaining the coverage I need on two vehicles and three drivers.

- Driver's Education

Sure, most people know that having teenagers take a driver's education course will reduce their automobile insurance premiums, but did you know the same is true of mature drivers? Many states mandate insurance discounts if a driver 50 years of age or older attends a driver's education course in a classroom setting. Although my home state of Georgia is not one of them, some states allow the course to be taken on-line and still afford the discount. You can check with your state's insurance commissioner or with your agent to see if a class would afford a discount.

- Log Your Mileage

With gas prices nearing $4.00 a gallon in my area, I am much more careful about how often I make trips around town. As a result, my annual mileage has plummeted substantially. Many insurance policies, including mine, are based on the number of miles driven in a year. By reducing my projected mileage to a more accurate number, I was able to shave $36 off my last six-month policy renewal. My neighbor saved nearly $100. She recently started taking a ride-share van to work and removed her commuting mileage from her insurance policy.

- Bundle Policies

By purchasing my automobile insurance from the same company that provides my homeowner's policy, I save 15% off the original premium. This adds up to nearly $200 per year.

- Pay In Full

My insurance company charges $2.00 per monthly payment if the premium is paid by direct bank withdrawal. The charge rises to $7.00 if I want to send in a monthly check. I forego all the payment fees by paying the policy in full every six months. If I charge it to my credit card (and pay it off in full the following month), I also receive a 1% cash back bonus from the credit card company.

- Teen GPS

You may not like the idea of Big Brother watching, but, if you let your insurance company spy on your teenage driver, you just may qualify for a discount. Several insurance companies are now offering GPS tracking or in-car camera devices to monitor teenage driving habits, including speeding and sudden acceleration or braking. Enrolling in one of these programs provides a mandatory insurance discount in some states. With my 17-year old nearly on the verge of getting his license, the idea of as much as 15% off his premium is certainly tempting.

- Cut the Comprehensive and Collision

Normally, I am wary of cutting premiums by reducing coverage or increasing deductibles past our family's comfort point. My exception is our 1998 van. The car has more than 250,000 miles on it, and the insurance company is only going to reimburse us for the cash value, which according to a national automobile appraisal site is less than $1,800. In this case, comp and collision is not worth the cost.