New parents, do this first

So you’re a new parent or a soon-to-be one.

Beyond day-to-day expenses to provide for your family, what should you be doing to ensure a secure future?

Start a savings plan? Get life insurance? Start a college fund?

Nope.

None of the above,  says Clark Howard, this blogger’s favorite money expert for regular folks. What you need to do first is make sure you and your spouse have wills. Wills aren’t just for divvying up money, property and possessions after you’re gone.

“If something terrible did happen to you and your wife, you need to set out in a will who would  see to raising your child for you,” Howard said on a recent edition of his cable show.

Once you get that will taken care of, then focus on life insurance. Adequate life insurance provides for your children up to age 18 and provides for a surviving spouse if one parent should die.

“You’re going to need money to provide for child care that maybe you could have provided yourselves,” he said.

After a will and life insurance, then comes savings.

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County will return jailhouse lampposts

You’re hearing it here first.

St. Louis County officials will return the old jail’s original brass lampposts to where they belong: flanking the historic old jail’s front entrance.

“We have no intentions to hang  on to them,” Deputy County Administrator Gary Eckenberg said Wednesday.

That didn’t appear to be the county’s intentions last month. That’s when a controversy erupted over the ornate 1920s brass lampposts which the county had removed to use at the entrance of its new sally port across the street from the old jail on Second Street in downtown Duluth.

But that’s when the jail was headed for demolition

“The plan for that building, even if it was demolished, was to reuse anything we possibly could, and the lamposts were something we could reuse,” Eckenberg said.

Since then, however, the old jail was sold to Minneapolis real estate broker Grant Carlson to renovate and adapt it for reuse.

Duluth Heritage Preservation Commission, who had been at odds with the county’s intention to demolish an official Duluth landmark, took issue with the lamppost removals. The county shouldn’t have removed the lamps without the commission’s permission, commissioners argued.

More importantly, since the jail has been sold for adaptive reuse, the lampposts should be returned to the old jail, they said.

Before the brouhaha, “it really hadn’t been a point of discussion,” Eckenberg said. “The lamps were gone long before the building was put up sale.”

Carlson, had wisely  stayed out of the controversy.

Since then, he’s had conversations with Tony Mancuso, the county’s property manager, about getting the lampposts returned.

“We haven’t finalized anything,” Carlson said. “They are very much working with us. They want to see the posts returning to the jail.”

Those details could involve reimbursing the county for the costs of refurbishing the lampposts which, Eckenberg said, cost more than $600.

The county will instead buy replacement lampposts to mount on the two concrete bases installed in front of the new sally ports. The new lampposts are expected to cost more than $4,000, Eckenberg said.

Currently the old jailhouse lampposts are safe in a county storage.

“We’re in no hurry to put them up,” Carlson said

Indeed, that would be premature. The jail faces months of masonry repairs and site work as well as utility hookups and the installation of a new roof as the first phase of its renovation gets underway.

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Reduced to a retail stereotype

So I was reading a Wall Street Journal article the other day on how J.C. Penney Co. was trying to lure the much coveted twenty-somethings and early thirty-somethings to shop at its stores.

Penney’s is trying to shake its un-hip image by teaming up with Mango, an upscale chain known for being cutting edge. Expect one of these MNG by Mango sections in Penney’s Miller Hill Mall store next spring, says store manger Ted Cuva.

It’s all about turning around declining revenues. Penney’s strategy to boost revenues is to attract new customers, namely style-conscious young women who shop monthly and pay full price. Considered fast-fashion, Mango’s latest offerings move quickly from design to factory to floor.

The Penney Co. apparently has given up hope that their average customers — loyal though they may be — will ever spend more.

So who’s their average customer? The average customer is 35 to 53 years old, only shops four times a year and looks for bargains.

That stopped me in my tracks. They sure had me pegged… How about you?

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Home-based biz go shopping

Got a home–based business?

Here’s your chance to show it off and reach potential customers. The second annual home-based business show will be held Aug. 18 at Miller Hill Mall in Duluth.

The “My Own Biz” show will feature businesses around the region that are home-based. Their products and services will be showcased as well as information on how you, too, can start your own business from home.

Among the products that drive these businesses are cosmetics, jewelry, health products, website creation, desktop publishing and a heck of a lot more. Many contractors and consultants are home-based as well.

The show will be held inside the mall in the atrium area by the Barnes & Noble Bookstore. The mall was chosen because it’s the largest retail shopping site in the region. That means maximum exposure and more attendees, according to Lundeen Productions which is coordinating the event.

So if you want to sign up for a table display, call (218) 727-1177. Cost is $195. About 20 businesses have signed up so far, but up to 30 could be accommodated. For more information, visit www.moreatthemall.com.

Oh, by the way, if you have a home-based business, you’re part of a big trend. The number of home-based businesses in the United States is growing at twice the rate of businesses over all, data shows

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Effort to keep Pickwick in family rebuffed

Jim Wisocki is still upset.

He can’t bring himself to drive by the Pickwick Restaurant in Duluth, which his family owned and operated for more than 90 years.

“I’m hurt, I’m really hurt,” he says. “It hurts right through your heart, it really does, when you can’t drive by the family business.”

His attempt to buy the landmark Duluth restaurant from his nephew, Chris Wisocki, to keep it in the family, was rebuffed, he says.

“I had two investors, and he wouldn’t work with me,” said Jim, 56, of Duluth. “He’s my nephew and he wouldn’t work with me.”

Instead,  Chris Wisocki sold the restaurant to Tim and Amy Wright. With restaurant and resort experience, the couple are restoring the landmark Duluth restaurant to its 1940s look. Work, which began last month, should be nearing completion. Hiring is underway and they’re preparing to re-open the pub and eatery that closed April 18.

Chris Wisocki, 37. was the last of four generations of Wisocki family to own and run the restaurant at 508 E. Superior St., next to the historic Fitger’s Brewery Complex. His father, Stephen, and uncle, Anthony, ran the restaurant from 1977 until their retirements in 2001. That’s when Chris took over.

After several years of business problems under Chris Wisocki’s management, including labor conflicts at the union restaurant, he decided to sell.

The sale to the Wrights closed June 28.

“It’s a shame he wouldn’t let the restaurant be kept in the family,” said Jim, who is the younger brother of former owners Stephen and Anthony. “After 96 years, why wouldn’t you want to keep it in the family?”

Chris Wisocki did not respond to my request for an interview.

But his brother, Adam Wisocki said: “I hardly see it as a 96-year-old tradition that’s gone awry, since (the Pickwick) will continue. It doesn’t necessarily have to be a Wisocki. It’s just another chapter in its long life.”

Jim said he approached Chris Wisocki about buying the restaurant last winter.  He said he was prepared to pay $2.5 million. But Chris wanted $3 million, then raised the price to $3.2 million, according to Jim.

He  admitted he had been critical of Chris’ management of the restaurant, its menu and the Chris’s dealings with his unionized workers that led to picketing. And Jim said so.

“If you treat your employees the way you would treat your customers, then you would be successful, because they would be happy to work for you then,” Jim said. “You hire an employee to make money for you.”

The rift, according to Jim, likely culminated in sharp words between the two at the restaurant on April 17, its last day of operation before closing for the change of ownership. Jim said he was escorted peacefully out by police.

Said Adam Wisocki of his uncle Jim: “He left nasty messages on answering machines, belittling my brother. Just based on that, I wouldn’t have sold it to him either.”

Although city assessor’s records show  the Pickwick building and land parcel it sits on sold for $1.3 million in June, that amount doesn’t necessarily reflect the true price of the restaurant. That’s because other factors were likely involved, including the rights to the business name  and other land parcels, assessed at about $415,000. And, according to Tim Wright, more than $82,000 in state tax liens left on the property were taken care of at closing as part of the purchase price.

Adam and other immediate family members were skeptical Jim actually had the financial backing to buy the restaurant. Jim is a semi-truck driver for Super One.

“Claims are one thing, but actual facts are another,
Adam Wisocki said. “He never gave us paperwork to say who they (investors) were.”

Jim declined to identify his investors but said they were local businessmen.

“They were prepared to give me the full amount, $2.5 million, and I was going to put in $100,000 for working capital and pay them all the net each year until it was paid off, then three more years net for a bonus,” Jim said.

Those family skeptics also question Jim’s ability to run a restaurant. While he grew up working at the Pickwick and was a bartender there for a time after serving in the Marines, he hadn’t worked at the restaurant for years.

“Just because your last name is Wisocki, doesn’t mean you can run a restaurant,” said Adam Wisocki who worked at the restaurant with his brother.

He believes his brother choice of selling to Tim and Amy Wright was the right one.

“They have restaurant experience,” he said. “They’re family people. They love history and  are restoring it to its original 1914 look. It’s just amazing. For them to bring it back and be able to get the capital to be able to do something like that, I believe, is outstanding. Business is business. You’re going to sell to the one who has the right capital.”

But his uncle Jim insists he was up to the task and willing to quit his job and give it his all.  Moreover, he said some family members with more experience would have helped.

So what would he have done if he had purchased the restaurant?

“I wouldn’t have done any remodeling because of lack of capital,” Jim said, noting that some remodeling had been done several decades and much of the restaurant was antiques.

One of the first things the Wrights did after the sale went through was remove a half wall in the bar which was added about 60 years ago to allow women in the lounge area but keep them away from the bar. The result was opening up the lounge area as it was originally.

Jim said he wouldn’t have touched that wall.

“My grandfather put that up in 1954 to keep the noise on one side of the bar,” he said. “Even in the 1960s, women weren’t allowed to sit at the bar.”

He said he’d have kept it, because it’s part of Pickwick’s history.

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Gas price drop is a wash

Don’t get too excited seeing the dip in the price of gas at the pumps in recent days.

While the average price of a gallon of gas in Minnesota has dropped 6 cents in the last week, the price of gas jumped nearly 7 cents a gallon the week before.

So it’s basically a wash.

Statewide, the average price of regular unleaded is $2.68 per gallon. Once again, Duluth is lagging behind the rest of the state. Indeed, you can find gas as cheap as $2.51 a gallon in places like Lakeville, St. Cloud and Apple Valley. The cheapest you’ll find in Duluth right now is $2.70 per gallon, though $2.75 per gallon is more common. That puts Duluth on par with the national average of $2.75 cents a gallon.

Nothing to brag about.

And here’s another downer about the price of gas: A year ago, gas cost 14.3 cents per gallon less in Minnesota.

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The worst movie year ever?

Seen any good movies lately?

If your mind goes blank (like mine), you’ve got good reason. And if you rarely get to the movie theaters anymore (like me), you’ve got a good excuse.

It’s shaping up to be THE WORST YEAR FOR MOVIES — EVER, declares the Wall Street Journal.

Stop and think about it. Have there been any movies you waited for with eager anticipation? When you scan the summer movie listings (usually a prime movie season), do you spot any you’re dying to see? And where are the usual smash summer hits?

"Go into a movie theater any day of the week and watch as the audience sits listlessly through a series of lame, mechanical trailers for upcoming films that look exactly like the D.O.A. movies audiences avoided last week," the Journal wrote.

Ya, and where are those movie sleepers, films that become unexpected hits, like "Slumdog Millionaire," "My Big Fat Greek Wedding," "There’s Something About Mary," "Sideways," "Crouching Tiger, Hidden Dragon" and "Juno."  Go back far enough and you’ll discover perhaps the biggest movie sleeper of them all: "Rocky."

Naw, these days there are too many bad sequels, too many sequels of movies that were duds the first time around (e.g. The Incredible Hulk). There’s no new bona fide action star emerging to succeed the likes of Arnold Schwarzenegger, Harrison Ford and Sylvester Stallone. And there’s not enough courage by the industry to go beyond overworked formulas, says the Journal.

Instead, there’s more films about misunderstood mercenaries, rogue cop, congenial thugs from South Boston, boys who do not want to grow up and about dance choreography rescung the underclass, the Journal says.

Not to name names, but there was mention of Jennifer Anistan’s romantic comedies and movies like "The Back-Up Plan," "Prince of Persia," and "Grown Ups" as tiresome or downright bad. And while the industry is facing challenges, including the Recession, the journal wasn’t forgiving, noting revenues are holding their own with higher ticket prices.

To be fair, the journal had good things to say about today’s animated films, saying they show more intelligence and style than many of their non-animated counterparts.

Even the animated sequels.

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Who made $1.9 million last year in Duluth?

Among the top paid CEOs in Minnesota last year was Donald Shippar, Allete’s former CEO.

Shippar’s total compensation for 2009: $1,921,814.

That ranked him as 39th in pay among CEOs of MInnesota public companies in Minneapolis/St. Paul Business Journal’s Top 100 List in its July 30 edition.

To be fair, Shippar’s salary was $560,000. It balloons to $1.9 million when you add the $578,325 in stock awards, $589,544 in pension, $44,688 incentive and $149,257 in "other." (Heck, most of us would just be happy with the "other.") His ranking actually slipped from No. 31 in 2008.

But is that much compensation warranted?

"Certainly we do believe our executive compensation is warranted," said Amy Rutledge, an Allete spokeswoman. "It is fair and competitive and designed to attract and retain talented people who are capable of overseeing a company of this size. Executive pay is also tied directly to company performance."

By the way, the Minneapolis Star Tribune recently ranked Allete as the state’s 38th largest company.

As if to keep our outrage in check, the Business Journal seems to agree with Rutledge. The Journal went further than its compensation rankings. It also analyzed the pay with the company performances, determining who was overpaid and underpaid in relation to  performance. Shippar placed in the middle of the spectrum, making the "appropriately paid" list.

But how about those at the top of the compensation list? No. 1. James Cracchiolo, CEO of Ameriprise Financial Inc., with a whopping $18.8 million was deemed appropriately compensated. No.2 ranked George Buckley, 3M’s CEO, however, was deemed overpaid, while No. 3 Gregg Steinhafel of Target Corp. was also determined to be appropriately paid.

Shippar retired in April, with Alan Hodnik succeeding him as CEO. The Journal’s roundup of CEO compensation next year should include him.

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Car buying 101

Personal finance expert Suze Orman notes that buying a car is among our biggest ticket items, ranked third after a home purchase and student loans.

(We knew that)

She’s down on buying new. Drive a new car off the lot and a $30,000 car depreciates 20 to 30 percent to $21,000.

(That much?)

Cars aren’t like real estate, she said on last week’s segment of the Suze Orman Show on CNBC. The value of cars never goes up. Still, if you’re intent on buying new and are financing she offered this rule of thumb:

Finance for no more than three years. If you have to finance for four or five years, you can’t afford the car.

(Didn’t know that)

"You need to keep it as long as you possibly can, until that car literally is breaking down," she said.

Otherwise, you’re pouring more and more money into a depreciating asset, she said.

(Good reminder)

 

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Good news, bad news about gas prices

The good news is that retail gasoline prices have fallen 3.4 cents per gallon over the past week.

In Duluth, you can find unleaded gas going for $2.70 per gallon today at the Armor station on Grand Avenue and 75th Avenue West and the Holiday and Spur stations on 27th Avenue West near Interstate 35. They’re giving no advantage to the M&H station at 1230 W. Michigan St., which usually has the lowest prices in town. M&H also was selling unleaded for $2.70 per gallon today.

Around Duluth, $2.75 per gallon is the more common price to be found. That’s nothing to brag about. It matches the national average of $2.75 per gallon. 

Among the highest gas prices in the state can be found in International Falls where gas is going for $2.83 to $2.88 per gallon.

The bad news for Duluth is we’re lagging behind the state’s average price of $2.68  per gallon. And a year ago, we were sitting much better with gas prices nearly 21 cents per gallon less than today.

By the way, if you’re driving through Twin Cities suburbs, you should fill up. Gas prices as low as $2.57and $2.59 per gallon can be found there.

 

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