Money Buzz 09/02

The end of state homestead exemptions may be in sight, credit and debit cards join forces, and more.
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4 min read

This story appears in the September 2002 issue of Entrepreneur. Subscribe »

Get Out!

Ready for more fallout? Prompted by public outcry over the many company executives who will keep their multimillion-dollar homes after declaring , is pushing for an end to state homestead exemptions that shield primary residences from bankruptcy proceedings. States like Texas and , where there aren't any limits on the value of the home are primary targets of legislation that seeks to set a national maximum exemption of $125,000.

The bill, which passed the Senate and is now before the House, also calls for debtors to meet a 40-month residency requirement to qualify for an exemption-a provision that could prove onerous to anyone running into financial difficulties after relocating. "And even if the debtor satisfies the 40-month residency requirement, he may still be unable to take advantage of the exemption if he has committed one of a number of enumerated bad acts," says Sen. Herb Kohl (D-WI), who proposed the legislation.

Now that's shutting the barn door and padlocking it-too bad those Enron cows are long gone.

Play Your Cards Right

Likely to spark a new class of plastic, Cleveland-based Charter One Financial's new delayed-debit card offers what may be the best of two worlds: the float of a credit card and the interest-free aspect of a debit card. Instead of deducting debits on a pay-as-you-spend basis, Charter One debits monthly or semimonthly. "It gives owners a quasi-cash- tool," says David Bowen, senior vice president of retail product management at Charter One, noting that the SmartBusiness OneCard was designed for small businesses.

"It allows you to keep the bulk of your money earning interest in a savings account while you accumulate debits throughout the month knowing that they will hit on a particular date," he explains. "Then you transfer the money over and everything goes through." Charter One account holders can also monitor spending and debit clearing dates online at the company's Web site, where customers can view what their account balances would be if charges were applied daily. There is a $50 annual fee-waived for the first year-and the card is available in Illinois, Ohio, Massachusetts, Michigan, New York and Vermont.

Bring on the Competition

Tired of vying for attention at VC forums? Competing in a contest can be a good alternative, often offering both cash prizes and services to help you gain entrée to the VC community. What's more, recent years have seen contests targeting virtually every entrepreneurial segment, from national student competitions sponsored by MBA Jungle and to the Build Your Own Business grant for women entrepreneurs.

While you may have to hunt for the one that's right for you, entering can jump-start your venture, says MBA student Onne Ganel (above left), one of four partners who won the Wharton Business Plan Competition. "Along with the prize, we also received spots in a few area venture fairs and a space in an incubator where we will have access to helpful legal and financial seminars," says Ganel, who plans to use the facilities and the funds to move forward with his Envisia venture, which markets magnetic resonance imaging technology.

"Contests are something you can leverage," he adds. "I can call any VC in the U.S. right now and say, 'Hello, I'm the winner of the Wharton Business Plan Competition. Would you give me two minutes?' And they will."

If that sounds like a winning proposition, the following contests are worth a look:

Contact Source

Jennifer Pellet is a freelance writer in New York City specializing in business and .


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