I can truly understand the need to keep cost down for small
clubs. It shouldn't cost each partner $5.00 per month to
operate an investment club. If a club only has 5 or 6
members paying $20 to $30 per month. This a 2.7% to 5%
annual cost before you even start investing. It has been my
understanding the recommended brokerage commission shouldn't
exceed 2% of any investment.

Please understand this in my personal thoughts on the
subject, but I don't believe I would consider joining an
investment club that operated with an expense ratio that
exceeded 3% of the actual investment cost and that would
include commissions.

My club started as a small club of only 6 people. It's not
that difficult to find ways to cut costs. No club is
required to join NAIC at $40 per year plus $14 per partner.
If you want to know what NAIC has to say, then buy the book.
We bought ours for $5 at a used book store. That saved us
$119.00 the first year and many more dollar in the years to
come.

Your not required to make a stock purchase every month. If
your club collects less than $200, you can save it up for a
month or two or even three before you invest it. This will
help cut down commission cost. Making a stock purchase once
every 3 months is still considered to be investing on a
regular basis. You can also look into the cost of buying
stock directly though a company and avoiding commissions if
possible.

Your not required to open a checking account and pay monthly
bank fees. If you only make stock purchases once every 2 or
3 months you could open a savings account or deposit your
payments in a brokerage account that pays interest, until
your balance is high enough to justify the commission cost
to make an investment.

You don't have to pay $2.00 per month to buy a bank check to
send to your broker. There are many ways to save money on
this. One partner can collect the money and send their own
check. If you can't trust anyone in your club to do this,
then maybe you are partners with the wrong type of people.
It doesn't need to be a bank check. There are convienence
stores that sale money orders for as little as 25 cents.
Have your partners check with their own banks. I bank with a
credit union the provides members one cashiers check each
month for free.

No club is required to purchase accounting software or pay
for an online accounting service. You can do it yourself
manually. If you don't know how, you can buy the instruction
book for $10.00 from NAIC. You can actually buy a whole
accounting kit for $20.00. Along with the instruction book
you get spreadsheets to prepare the accounting on and a
guide that shows you how to fill out the tax forms at the
end of the year. It even has pictures of filled in forms so
you won't get confused as to which lines to enter the
numbers on or where to enter names and addresses. Actually,
I think it's a good idea to learn how to do it manually
first. Then you'll know if your entering things correctly
when you can afford to buy software or pay for an accounting
service.

My point is an investment club is a tool for learning and
investing. It's also a business. It's in the business of
making money. Businesses have business plans and budgets to
follow to enable them to eventually generate a respectable
profit.

It doesn't matter if your a small club or large club. You
limit your ability to grow if you don't get your expenses
down to a reasonable amount. You have to be willing to find
alternative solutions during lean times.

As your club grows in value or with new members you can
start to consider luxury items such as accounting software
or an online accounting service.

Or maybe you'll tire of all the time spent preparing manual
accounting each month. Then you can help your club find a
way to cut other costs in order to justify paying for a
luxury service such as Bivio.

This is the point where my club has come to. We have watched
are pennies and kept our expenses low. We have been growing
this past year in value and members. To prepare manual
accounting each month has become very time consuming and
overwhelming.

It was my job this past month to try out investment club
accounting programs and present the findings to the club. So
they could choose software to purchase. I tried them all,
then I checked out Bivio.

I had read about Bivio a couple of years ago. I had been
told Bivio had a monthly service fee. If I had know it was
free I would have been using it a couple years ago.

I was stunned just as many others have been about the new
fees.Now that I have tried Bivio, it doesn't matter if it's
free or $59.00 per year. I'm certain that our club will
continue to use it. It's very user friendly, the support is
great, and it's cost effective. If the club couldn't afford
it, I would pay for it out of my own pocket. It's well worth
it to me to only spend minutes per month doing accounting,
than to spend hours.

OK, I'm done.

Debi

WAY TO GO DEBI !!!
My point exactly! Very well said.

Deborah Rollins-Thorne wrote:
> I can truly understand the need to keep cost down for small
> clubs. It shouldn't cost each partner $5.00 per month to
> operate an investment club. If a club only has 5 or 6
> members paying $20 to $30 per month. This a 2.7% to 5%
> annual cost before you even start investing. It has been my
> understanding the recommended brokerage commission shouldn't
> exceed 2% of any investment.
>
> Please understand this in my personal thoughts on the
> subject, but I don't believe I would consider joining an
> investment club that operated with an expense ratio that
> exceeded 3% of the actual investment cost and that would
> include commissions.
>
> My club started as a small club of only 6 people. It's not
> that difficult to find ways to cut costs. No club is
> required to join NAIC at $40 per year plus $14 per partner.
> If you want to know what NAIC has to say, then buy the book.
> We bought ours for $5 at a used book store. That saved us
> $119.00 the first year and many more dollar in the years to
> come.
>
> Your not required to make a stock purchase every month. If
> your club collects less than $200, you can save it up for a
> month or two or even three before you invest it. This will
> help cut down commission cost. Making a stock purchase once
> every 3 months is still considered to be investing on a
> regular basis. You can also look into the cost of buying
> stock directly though a company and avoiding commissions if
> possible.
>
> Your not required to open a checking account and pay monthly
> bank fees. If you only make stock purchases once every 2 or
> 3 months you could open a savings account or deposit your
> payments in a brokerage account that pays interest, until
> your balance is high enough to justify the commission cost
> to make an investment.
>
> You don't have to pay $2.00 per month to buy a bank check to
> send to your broker. There are many ways to save money on
> this. One partner can collect the money and send their own
> check. If you can't trust anyone in your club to do this,
> then maybe you are partners with the wrong type of people.
> It doesn't need to be a bank check. There are convienence
> stores that sale money orders for as little as 25 cents.
> Have your partners check with their own banks. I bank with a
> credit union the provides members one cashiers check each
> month for free.
>
> No club is required to purchase accounting software or pay
> for an online accounting service. You can do it yourself
> manually. If you don't know how, you can buy the instruction
> book for $10.00 from NAIC. You can actually buy a whole
> accounting kit for $20.00. Along with the instruction book
> you get spreadsheets to prepare the accounting on and a
> guide that shows you how to fill out the tax forms at the
> end of the year. It even has pictures of filled in forms so
> you won't get confused as to which lines to enter the
> numbers on or where to enter names and addresses. Actually,
> I think it's a good idea to learn how to do it manually
> first. Then you'll know if your entering things correctly
> when you can afford to buy software or pay for an accounting
> service.
>
> My point is an investment club is a tool for learning and
> investing. It's also a business. It's in the business of
> making money. Businesses have business plans and budgets to
> follow to enable them to eventually generate a respectable
> profit.
>
> It doesn't matter if your a small club or large club. You
> limit your ability to grow if you don't get your expenses
> down to a reasonable amount. You have to be willing to find
> alternative solutions during lean times.
>
> As your club grows in value or with new members you can
> start to consider luxury items such as accounting software
> or an online accounting service.
>
> Or maybe you'll tire of all the time spent preparing manual
> accounting each month. Then you can help your club find a
> way to cut other costs in order to justify paying for a
> luxury service such as Bivio.
>
> This is the point where my club has come to. We have watched
> are pennies and kept our expenses low. We have been growing
> this past year in value and members. To prepare manual
> accounting each month has become very time consuming and
> overwhelming.
>
> It was my job this past month to try out investment club
> accounting programs and present the findings to the club. So
> they could choose software to purchase. I tried them all,
> then I checked out Bivio.
>
> I had read about Bivio a couple of years ago. I had been
> told Bivio had a monthly service fee. If I had know it was
> free I would have been using it a couple years ago.
>
> I was stunned just as many others have been about the new
> fees.Now that I have tried Bivio, it doesn't matter if it's
> free or $59.00 per year. I'm certain that our club will
> continue to use it. It's very user friendly, the support is
> great, and it's cost effective. If the club couldn't afford
> it, I would pay for it out of my own pocket. It's well worth
> it to me to only spend minutes per month doing accounting,
> than to spend hours.
>
> OK, I'm done.
>
> Debi