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Is It Time To Incorporate Your Business?

This is a sponsored conversation written by me on behalf of CT Corporation. The opinions and text are all mine.

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Lately, many members of the Make Money Your Honey community have been asking me about how to file for an LLC. Heck, even people in my personal life are asking me this question.

First, let me point out that I am neither an attorney or an accountant, so everything I’m about to say is based on my own personal experience. I do recommend seeking guidance from licensed professionals should you have any questions.

Second, although I’ve had an LLC for my business since 2013, I made some mistakes that cost me money. These are mistakes I’d like for you to avoid. I’ll share them throughout this piece so you don’t lose money like I did.

Why do you need to incorporate your business?

There are two main reasons why people incorporate their business:

  • Taxes
  • Legal protection

Taxes depend on which incorporation you choose (ex. LLC versus S-Corp). If you’re looking at an LLC, you’re considered a pass-through entity. In other words, you’re like a sole-proprietor tax-wise, but you have a legal separation between yourself and your business. There are also some other differences between an LLC and an S-Corp that makes them different come tax time, but that’s a discussion for another time.

Now let’s discuss legal. This is critical when it comes to getting your ducks in a row. Let’s say your business runs into some legal issues. If there’s no real legal separation between you and your business, they can go after everything you’ve got.

As another benefit, it also makes things easier for your finances. You have to separate your business and personal expenses anyway, and you will be asked for specific documents when you go open your business checking account.

When do you need to incorporate your business?

I started making money as a freelancer since 2010 but didn’t incorporate until three years later. That’s also how long it took me to separate my business and personal finances.

Honestly, I probably waited too long. This was partially due to the fact that there was a part of me that never thought I’d be fully self-employed someday. I saw my freelancing income as “extra money” for years. But even if that was the case, I still needed the legal protection. Going that long without it was probably not a good idea.

Furthermore, something happened internally when I finally incorporated. There was something about seeing my business’ Articles of Operation that made me think, “Oh, this is real now. I have to take this seriously.”

How much does it cost to incorporate your business?

Oh man, here are where my mistakes come into play. I didn’t really do my due diligence when I was forming my LLC and went with the first service I could find. I fell for the “Filing starting at $X” marketing and didn’t realize the process would be far more expensive. I was also automatically enrolled in an additional service which I completely forgot about (of course) and then saw the surprise on my credit card bill a year later.

Paying for an LLC isn’t the problem. I will pay good money to properly protect myself – especially when it comes to legal stuff. What annoyed me was the lack of transparency.

As for how much it costs to incorporate, that depends on what you are looking for. CT Corporation has their prices listed on their website.

Additionally, you get the peace of mind knowing that CT Corporation has 125 years of experience with legal compliance. That is not an assurance I had when I filed for my own LLC many years ago. And to be honest, it is something I freaked out about, but at the time I didn’t have a support system to talk to about these things.

What if I need to convert my business to another structure later?

This is an excellent question. Businesses change over time, so you need the flexibility to change your incorporation if need be.

I’m actually dealing with this now. About a year ago, my accountant and I started discussing converting my business from an LLC to and S-Corp because of taxes. My business was starting to expand to a point where that move would make sense. Given that my business is growing in revenue (and profit) rapidly, I might have to make this move by the end of the year.

CT Corporation is available to help me make the S-Corporation election. With their help and help from my accountant, I can make the process as easy as possible.

Do I need a business license too?

That depends on a variety of factors including what your business does, where you do business and where you live. CT Corporation can help you figure that out

Final Thoughts

Incorporating your business is an important part of running and establishing your business for the long haul. It helps you start getting organized with the finances, legally protects you and helps you start taking your business more seriously.

Have you incorporated your business yet? Is it something you’re planning on doing? Let me know by tweeting me!

Comments submitted may be displayed on other websites owned by the sponsoring brand.

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4 Ways You Can Have A Profitable Blog Without Being Sleazy

One of the most popular questions I get asked by readers is how to have a profitable blog, and how I got to this point. Now, before I jump into how I make money blogging, I would like to clarify one thing: blogging is not a good way to make a ton of money – at least not for a while.

Don’t believe me? You can ask some of the best bloggers in the game.  The reality is it can take quite some time before your blog can make you money. However, you can always use blogging as a fun way to make some extra cash on the side – even if you’re just starting out!

If you want to have a profitable blog, your main priority should always be creating a genuine connection with your audience. You need to provide value to your readers no matter what. Don’t get into blogging just to make a few extra bucks. Doing that will only lead to disappointment.

So if you’re into blogging for the long haul and truly want to make a difference to an audience, then I’d consider monetizing as an option to supplement your regular income. Then, as time goes on, you can become a full-time blogger.

Advertising and Sponsorship

My own blog is open to advertising. I’ve recently begun to experiment with Google AdSense again and I’ve even gone so far as to open the blog to advertising and sponsorship.

Display ads, like the ones you get with Google, doesn’t mean you will have a profitable blog very quickly. But once you get the momentum going with an audience you’ll soon start to see how the numbers add up. Seriously, you’d be surprised at how much you can make over time. I tend to like them because they display ads that your audience will find relevant based on searches and content.

Now, when it comes to private ads and sponsorships you have to be picky so you won’t lose credibility. I only agree to display an ad if my readers can get some sort of benefit from it. That being said if it’s about internet marketing, entrepreneurship, personal finance, education, fitness or personal development, then I’ll consider it.

Here’s a real life example of what I won’t consider: I once had advertisers reach out to me about running an ad about a service that would help people through the immigration process. Maybe they figured this was a good idea because I’m Latina – I don’t know – either way, I quickly turned it down. This blog has nothing to do with immigration. My readers aren’t interested so there would have been no point in running the ad to make some money. That’s how you sell out on your readers.

Sponsored Posts

Some of you may notice an occasional post on this site that clearly states it was sponsored by a company (this is the law per FTC guidelines). It was a new experiment in which I would see how having sponsored posts would affect my readership while at the same time promoting products my readers may enjoy or find useful.

Believe it or not, this is a great way to have a profitable blog if – and only if – you can find products or services that are in line with your message. For instance, I often blog about entrepreneurship in the new economy. This led to a major sponsorship with Comcast Business in 2016.

There are plenty of online communities dedicated to helping anyone confused about sponsored post. I’m personally a fan of We All Grow Latina Network but I’m sure there are many others out there. Some bloggers receive the bulk of their blog income from sponsored posts, and that’s okay. Just make sure you aren’t being sleazy with your readers.

A Hire Me Page

This may seem like a no-brainer but you’d be surprised at how many writers, designers, coaches, and consultants don’t have a Hire Me page on their blogs. How do you expect to have a profitable blog and sell your services if you don’t tell anyone about them?

Some of the best-paying clients come by having a Hire Me page on the blog. In fact, I’ve more clients with my Hire Me page than my portfolio because I focus more on creating great content for the blog. My portfolio, on the other hand, kind of just sits there.

You’re going to need some major commitment and patience on your part before you start seeing some dollar signs. Once you do see some money you can then use it to supplement your regular income. Maybe you’ll use it to help pay down your debt, save for a trip or an emergency fund. The possibilities are really endless!

(P.S. If you’d like to make a living as a freelance writer, I have a course for that. I teach people how I make over $50,000 a year as a writer.)

Affiliate Sales

Another way your blog can make you money is with affiliate sales. This is where you promote a product someone else created and if someone purchases from your site then you get a commission. For example, you can take a look at my Mint Manual Review, and I’ve also really enjoyed Making Sense of Affiliate Marketing. Both of these affiliate sales have made me hundreds a month in passive income.

Again, you must only promote products that are in line with your blog. In fact, with affiliate sales, you should only promote products you can actually use and can vouch for.

Can You Have A Profitable Blog Without Being Sleazy? Yes!

I use all of these methods for monetizing this blog. It’s why I was eventually able to quit and blog full time. While it took years of hard work, it was very well worth it. I’sellout, and I enjoy connecting with my readers. While I’m not in this just for the money, it has been great to be able to blog full time!

If you’re ready to get started, click here to find my free video tutorial on how to start a blog for $4.

 

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5 Foolproof Money Saving Tips for The End of The Year

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We’re already in October. Can you believe it?

Even though we don’t get a real Fall in Florida, this is still my favorite time of the year. Pumpkin spice lattes, fall colors, and believe it or not, plenty of ways to save money.

In this blog post, I’m going to be laying out 5 money saving tips you can use as we round out the last few months of 2016. I’m going to be using many of the tips myself and one of them may actually surprise you because you possibly didn’t even know it was an option (I certainly didn’t.)

Look into more affordable healthcare options.

It’s almost every American’s favorite time of year after tax season – open enrollment! (Yes, that was definitely meant to be sarcastic).

Out of all the ways to save money at the end of the year, finding more affordable health care options is at the top of my list.

As a self-employed individual, healthcare costs are on me. The bad news is healthcare can be expensive when you’re shopping for your own insurance. The good news is you have more options to save money than you possibly think you do.

I was already planning on dropping my current Silver level health insurance plan I got through the ACA exchange because I thought it was too expensive and I hated my doctor options. My deductible literally doubled from one year to the next and I was paying $247 for shit service.

Fortunately, my health insurance company made my job easy because I just received a letter that they would be discontinuing my plan in 2017.  This is the second time this happens to me in the three years that I’ve been purchasing insurance from the health care exchange. At this point, all I can do is laugh.

I started digging around for more affordable healthcare options a few months ago in preparation for this time and realized that many of my money savvy friends were part of health-sharing ministries like Liberty HealthShare.

The concept is simple:

Every member of the HealthSharing ministry gives into the pot. When one of the members has medical expenses, the organization pays for it from the pot. All you have to do is show your membership card to the doctor, get your bill and send it to your health sharing group.

I have many friends from college who’ve used this method of health care with great success. Many of my colleagues have also opted for this over ACA health insurance plans. It counts as insurance under ACA so you aren’t penalized and it saves you a ton of money.

I started researching Liberty HealthShare for myself as a way to save money and here’s what I found:

I can get 100% expenses paid up to $1,000,000 and go to any doctor I want for $50 to $100 less each month than what I’m currently paying for my craptastic health insurance that limits my healthcare choices.

Of course, this isn’t without it’s downsides and there are plenty of other options out there. I’ll do a more in-depth post about it once I have more information and have chosen one for myself.

Tax Planning

Another one of the ways to save money at the end of the year is to do a little tax planning. I asked my accountant, Eric Nisall of Accountlancer for some tips for your all and here’s what he said:

1. Round up last year’s return to get an idea of what documents to expect in the coming months.
2.Make an appointment with your accountant and do a year-end review so they can make estimates and help you avoid penalties.

3.Ask your accountant if there are any moves you can make before the end of the year to lower your tax bill.

Review your budget for the year.

While you should be reviewing your budget far more often than once a year, the end of the year is a good time to look at it to see if there are anyway ways to save money that you aren’t taking advantage of.

Maybe you realize you’re paying too much for certain good or services and decide to find ways to shop around for new providers. Maybe you realize you have items in your budget that no longer make sense for you.

For example, I’m forgoing my membership to my local health center because I realized I wasn’t really using it. This will now save me $89 that I can automatically transfer into savings each month. I also fond ways to save money on groceries.

When reviewing your budget for the year, it’s helpful to have some sort of software that gives you a good snapshot of your financial picture. I’ve been using Personal Capital for the last few months and I’m really digging it. It’s totally free and very easy to use.

 

Sock away money into your retirement account.

If you’re still regularly employed (I know I still have a few readers that are), now is a good time to sock as much money into your 401(k) account as you can. Your contributions to your 401(k) account can lower your tax bill because the contributions reduce your taxable income.

If you’re working with a Roth IRA like I am, you won’t get a tax benefit now but you can at least do your best to meet the maximum $5500 annual contribution limit. I’ve personally vowed that anything I make in passive income from my blog (affiliate sales, book sales, ad revenue, etc.) is going into my Betterment account.

(P.S. If you’re a blogger and you’d like a good resource on how to make affiliate sales with your blog, I highly recommend checking out Making Sense of Affiliate Marketing by Michelle Schroeder-Gardner. I went from making a few dollars a month to now making hundreds of dollars each month from affiliate sales. My retirement account is very pleased. You can click here to learn more about the course.)

Save the surplus.

The end of the year is a good time for some surplus cash. Here are some of the ways to save money when you have a surplus:

1. See which contracts (like gym memberships) are up for cancellation. If you don’t use it, cancel and transfer the surplus into savings.
2. Put a bonus from your job directly into savings.

3. Put any cash gifts directly into savings.

 

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[MMYH Episode 17] How to Get Out of Debt With Lauren Greutman, The Recovering Spender

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We’ve got an awesome episode today! I’m interviewing Lauren Greutman, blogger and author of the new book, “The Recovering Spender.” In this episode, she’s going to teach you how to get out of debt for good and how money issues affect relationships.

Juicy, I know.

But, before getting into that, I’ve got some housekeeping to take care of.

I’m going on vacation.

I’m taking a short hiatus from blogging and podcasting for a couple of weeks in September. I’ll be on a Caribbean cruise for a vacation and then I’ll be heading to San Diego for The Financial Blogger Conference where I’ll be speaking on a panel about self-publishing versus self-publishing.

You can follow me on Instagram for pictures and live video of both my trips.

We are a finalist for a Plutus Award!

This little website is a finalist for a Plutus Award! We’re in the Best Designed Website category! Thank you so much for all of your votes a couple of months ago. Hopefully, we can bring this puppy home!

Come meet me in San Diego!

If you’re going to be in San Diego for The Financial Blogger Conference make sure to stop by the Your Money Meetup so you can meet me and some of the other AMAZING personal finance bloggers! You can learn more and RSVP here.

Okay, now let’s get to the interview.

Who is Lauren Greutman and what is a Recovering Spender?

Lauren Greutman is a blogger, author and money saving expert who helps women overcome overspending and create budgets. After her overspending got her family into $40,000 of debt and realizing they were running a $1,000 deficit with their monthly budget, Lauren needed to find a way to get a handle on their finances ASAP.

In order to start getting out of debt, Lauren slashed the families grocery bill from $1,000 a month to $200. She started blogging about it on I Am THAT Lady (now LaurenGretuman.com)  and teaching classes in her local area. From there, she’s been able to pay off all the debt and now teaches people how to get out debt and save money full-time.

Her new book, “The Recovering Spender” details her story of overspending and then teaches readers how they too can overcome their own spending issues and get out of debt.

In this interview, Lauren talks about how Keeping Up With the Joneses” affects our spending habits, how money plays a role in romantic relationships, and she teaches us some of the ways we can save money on our monthly bills.

Tips for Overcoming Keeping Up with The Jones

People underestimate how much Keeping Up With The Jones’ actually affects them when it comes to getting into debt and then getting out of debt. It’s everywhere – social media, Target, shopping with your friends, etc.

A part of what happens when people start budgeting for the first time – especially if they are spenders – is they feel like they are punishing themselves. People start to feel like they are “less than” because they can’t keep up with others. This often times leads them to overspend and get into debt. When they try getting out of debt, then they just feel like they’re being suffocated in a lot of ways.

The key to getting out of debt is  to not allow yourself to continue thinking that way. You have to take a look at your value system and see what’s more important to you. In Lauren’s case, it was “Is this purse more important than buying groceries this week?” In my case, it looks like, “Do I want to have a car payment or use that money to travel?”

If you want to get out of debt for good, and avoid getting into debt later, you have to stop caring about what other people think and instead focus on what matters to you.

Relationships, Debt, and Money

Part of Lauren’s amazing story is the fact that she hid $40,000 worth of debt from her husband and had to come clean to him. This is the kind of stuff that can destroy marriages, but they were able to get out of debt and come back stronger than ever.

First, you need to get really real with yourself before getting real with someone else. You have to admit there’s a problem. If you’re hiding your spending issue from your spouse, then you have to take a look at the relationship you are in. If you value your relationship, you’re going to have to talk about what’s going on.

In Lauren’s case, she was in so much turmoil over her finances that the pain of coming clean to her husband was far less than continuing to live the way she was.

Now here is something interesting to note. When Lauren works with couples who are getting out of debt, one thing she notices that couples may have the same financial goals but they are viewing them from completely different filters. If one is a saver and one is a spender, then you have these personality traits that cloud the goals. Once couples figure out that their goals are the same, then they can figure out where to go next.

Advice for People Who Aren’t Married Yet

For those of you who aren’t married yet, Lauren has some great advice so you don’t get into the mess she did. It’s important to talk about money before tying the knot, but that doesn’t look like asking someone what their net worth is.

You can watch how your partner uses money early on. You can also have casual conversations about where they want to go in life and what they want to do. According to Lauren, people do what they believe.

For example, if she looks back at when she and her husband were dating, you could tell they spent money differently. Mark had almost nothing in his fridge and Lauren’s was fully stocked. Mark had a junkie car, Lauren liked nice cars. Lauren was clearly the Spender and Mark was clearly the Saver. However, because they never talked about if before getting married, Lauren’s spending habit eventually led to having to get out of debt.

Negotiate Your Bills to Save Money.

In her book, Lauren talks about the 12 steps people can take to get out of debt. She also talks about some things to keep in mind during the process of getting out of debt.

One thing she mentions is how people can save a significant amount of money by negotiating the bills their bills. You can then use the extra money to get out of debt or boost your savings. At the very least, you won’t be wasting money.

People get nervous trying to negotiate bills, but anything is negotiable. You can negotiate your phone bill is negotiable, your cable is negotiable, your internet is negotiable and your insurance rates are negotiable.

You have alternative low-cost options for internet and phone like SlingTV or Republic Wireless, respectively.

If you want to stick with what you have, call up the company and ask to speak with the Customer Retention Department. Then you need to ask them if they can give you a better deal. You can use advertisements from competitors and ask them to match the price. Nine times out of ten they’ll do it because they don’t want to lose the customer.

Lauren worked with a family in the lead-up to her book launch and she was able to save them $600 just from negotiating bills.

What’s Possible When You Get Out of Debt

Sometimes people are in knee-deep in debt need examples of what can be done after they get out of debt. This is one of the reasons I like to ask my guests what they’ve been able t do since getting out of debt, especially if they themselves were in a significant amount of debt.

In Lauren’s case, she’s been able to retire her husband from Corporate America (they now work together on their business full-time), they’ve been able to travel, they bought a new van in cash and they’ve been able to give more abundantly.

Where to find The Recovering Spender

If you’re in a situation where you’re getting out of debt, or maybe you just want some better money management tips, I highly recommend checking out Lauren’s book. You can purchase it on Amazon here.


Resources Mentioned or That Add Value to This Podcast Episode

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