Doesn’t it just sound euphoric to think about unleashing your inner goddess? How about unleashing your inner Safety Goddess? Ok, well maybe not as euphoric, but still a pretty enticing idea, right?

Today, you are going to find out 5 things you can do to tap into your inner Safety Goddess. The good news is that she is inside every one of us, if we choose to tap into her. The trick is knowing how…

When a mother takes home her first baby from the hospital, she is sent home with some diapers, a blanket and usually a bag of goodies with such things as a sample of baby shampoo, a tube of diaper rash ointment and coupons for diapers.

Unfortunately, there is no instruction book that comes home with our new baby because every baby is different. If you are lucky, you may have a very hands-on grandmother to help you manage your little one. However, the reality is that no matter how much mother’s intuition you are blessed with and no matter how wonderful a caregiver you can possibly be, safety knowledge is not something we are born with. It is learned. So, educating yourself about child safety now is essential.

With the #1 cause of death in children being preventable injuries, it is our job as loving parents to educate ourselves about potential hazards, safety precautions and preferred actions to take in an emergency, if we want to keep our little bambinos safe!

Here are 5 steps you can take right now to tap into safety bliss:

Safety Goddesses, unleash!

1. Take annual CPR and First Aid courses through theAmerican Red Cross or the American Heart Association.

2. Childproof your child and your home. Make sure that your windows have guards and locks, safety gates are installed at stairways, electrical outlets are covered, chemicals and cosmetics are out of reach and all other hazards are corrected. Communicate with your child about things that are dangerous and use protective gear and helmets when participating in wheeled activities.

3. Install, test and utilize your smoke and carbon monoxide detectors on every level of your home.

4. Supervise your children with the 5/10 rule: Never let a child under 5 out of your site for longer than 5 seconds and never let a child be more than 10 feet away from you. Expand the time to 10/20 for children between 5 and 9 years old. Supervision is essential for children of all ages!

5. Read child safety books, watch safety videos and regularly educate yourself with the latest recall information and safety news.

Speaking from experience, once I started reading about child safety, I got addicted. There is simply no end to the information you can find that will help you be a prepared and informed caregiver. Safety is a topic that you can never know too much about because the world is always changing, which means safety is too!

Now that you have let your inner Safety Goddess out to play, tap into safety at least once a month. Sign up for my Safety Pop newsletter, check out the Consumer Product Safety Commission Recall list, test your smoke and carbon monoxide detectors and sign up for those CPR classes.

Then, keep the ball rolling on safety. Start with you and move on to your community. One great way to promote safety is to pass it along as a gift. For under $20, you can purchase a copy of Secrets of the Safety Goddess: A Modern Safety Guide for Busy Parents or Care for Kids: The Essential Guide to Preparing Caregivers on Amazon.com and give a meaningful gift to a parent, teacher or nanny. If we can spread the message about the Safety Goddess to all of our fellow parents and caregivers, our children will be safer at playdates, school and in life. Now that sounds euphoric!

To find out more about child safety, go to http://SafetyGoddess.com and http://ResponsibleFamily.com

I’ve got to tell you, I’m a little bit sick and tired of the traditional personal finance advice out there that is telling you to pay off your debt and pay down your mortgage.
 
Insisting that you’ll experience financial freedom when you’ve got 6 months savings in the bank, no one you owe money to and you’re on your way to a relaxing retirement.

That’s all well and good, but it’s also not entirely true.

It’s not true in two regards: 

1) You don’t have to wait until you’ve got 6 months savings and no debt to experience financial freedom.  You can experience financial freedom right now.
 
2) Paying off your mortgage and all your debt could actually be harmful to your financial well-being, especially right now.

Now, that second statement is a big one, especially because it flies in the face of the traditionalists who say financial freedom is only possible with no debt.

But, consider this:

Imagine that you had $5,000 of credit card debt, owed $25,000 on a line of credit and had $50,000 in available remaining credit on your line and $20,000 available credit on your credit cards.  Now imagine that you were diligently doing what the traditionalists said and paying down your debt, a little bit at a time.  You were staying current on your payments and even paying a bit more than the minimums each month. 

Then wham, your hours were cut at work and out of nowhere your credit card companies decreased your credit card limits and your lender yanked the remaining balance on your line of credit.

Now what do you do?

You’ve got no access to credit and the chances of you qualifying for credit now, given the tightened credit restrictions and the decrease in your income, are ? none.

What should you have done instead?

I’m about to give you a radical plan.  A plan that is not for the faint-hearted.  And, a plan that is all about understanding your best investment.  It’s a plan that requires a lot of belief in yourself and what I’ll call spiritual balls.

Here’s the plan:

Don’t pay off your debt.  Not now anyway.  If you’ve got a line of credit on your house, write a check to yourself for the balance NOW.   Your bank just may take it back tomorrow.

Now, I’m not saying to go out and blow that money on more stuff you don’t need, vacations, or other consumables.

I am saying to put it in your bank account and figure out how you can invest it so it’ll make more money than it’s costing you.

It’s the same with available credit on your credit cards.  I’ve got several low interest credit cards ? about 4.9%.  I know that I can use that credit and earn way more than that.  Not if I buy a big screen TV or go to Cabo, but if I make a great investment.  (If you have poor credit and your interest rates are high, this is likely not a good strategy for you because the return on your investment needs to beat the interest rate on your debt for this to make sense).

So, what’s your best investment?  What’s the best way you can make a 10, 15 or even 25% return on your investment dollars this year?

Invest in yourself!

Take that money and start a business.  Not any business though.  Start a business that will leverage your time and your resources in the best way possible.  It takes money to make money.

(By the way, you do not need to quit your current job to do this!  I started business #2 while I was still working full time in business #1.  Yes, it was stressful and took a lot of work, but it was SO worth it!)

So, use that money to find the best possible mentor you can and put aside some of the money to implement what you are learning.
 
The key is to find someone who has already done what you want to do and is going to show you the way step by step!

Make the commitment to yourself. You deserve it.

Two years ago, I paid Dave Dee $30,000 plus 5% of my business to coach me on how to build an information marketing business so I could work from home and leverage the knowledge I already had.  Within three months of working with him, I had made $115,000.

Today that business is a million dollar business.  I call that a good investment.

I’ll invest over 6 figures in coaching in 2009 even though I’ve already had a huge amount of success.  But, you know what?  I keep learning.  The most successful people do.  Some of that investment has been made with my own line of credit.  I know I’ll generate at least a million dollars from the investments I make.

If you believe in yourself, there is no better investment than you.  Don’t wait for the bank to take its’ money back.  Invest in yourself and watch that investment pay off for the rest of your life.

Last week, we talked about what a business entity is and whether you should use one for your business,.. The short answer? Yes, if you want to grow your business and shield your personal assets from your business activities.

This week, we’ll cover what kind of entity you should use and where you should set that entity up.

You’ll recall, we are really talking about either an LLC (Limited Liability Company) or an S-Corp (Corporation filing an election for special taxation with the IRS). You can form a C-Corporation or a Limited Partnership, but if you are considering that, make sure you are talking to a lawyer who is familiar with the specifics of your specific situation and is advising you personally.

With both LLCs and S-Corps, you are taxed only once on the income of the entity , meaning that all of the income and expenses will be reported on an information return filed with the IRS, but the actual taxes are paid by the shareholders or members of the entity. This is called pass-through taxation.

You’ll recall from last week, that I said the purpose of your business entity is to limit your liability as a business owner. This is to encourage business owners to take risks that they would not take if they had unlimited personal liability.

Here’s the thing though, the shield is only intact if certain formalities are maintained, such as proper filings with the State, annual meetings of the shareholders (for corporations), and separation of all financial activities between you and the entity.

Far too often, I’ve come across business owners who used an incorporation service, a shoddy lawyer, or a CPA to incorporate their business and when I asked these business owners where their operating agreements, bylaws, annual meeting minutes and state filings were kept, they couldn’t tell me.

Why is that? Because they didn’t realize that merely filing articles of incorporation with the State does not provide liability protection.

Your corporate entity must be established correctly from the beginning with governing documents and then maintained on a yearly basis.

If you don’t do that, you may come to find out too late that your business entity doesn’t provide the protection you thought it did.

So, make sure that once you decide what kind of an entity to use, you set it up right and then maintain that entity.

Now, before we talk about the type of entity, let’s talk about one additional kind of asset protection that you need to take into account.

Up until now, we’ve been talking about what I call “inside asset protection” or protection against liabilities that are incurred by the corporation, within the bubble that I described in last week’s post.

There’s another kind of protection that is often overlooked and that’s “outside asset protection”.

Outside asset protection protects your business from your potential personal liabilities.
For example, if you are in a car accident, file for personal bankruptcy, or are sued by a business partner or colleague or personally guarantee a debt. These are all personal risks that are happening outside your business entity.

In most cases, your business entity is not protected from your personal risks. That means if you are sued personally and a judgment is obtained against you, the judgment creditor could take your business entity from you in satisfaction of the judgment.

But, not always.

In certain States, notably Nevada, there is something called “charging order” protection. What this means is that if you are sued personally and a judgment is entered against you, your judgment creditor cannot take away your Nevada business entity, they can merely take a charging order against it.

This means that they have a right to distributions from the entity, but cannot force those distributions in satisfaction of the judgment.

This can be a big deal if you are concerned about your potential personal liabilities.

In that case, you will want to establish either a Nevada LLC or a Nevada S-Corporation.

If you could care less about charging order protection, you can form an entity in any State of the Union, but in most cases you will want to form it in your own home State where you will be doing business because no matter what if you use a foreign corporate form, you will need to qualify to do business in your State, which means you pay state income taxes there no matter what.

Yes, there are people who will tell you that you can avoid income taxes by setting up your entity in Nevada, but that is very rare. Like if your business is totally virtual and can actually have its principal place of business in Nevada. Or, if you live there, of course. Again, if this is something you are considering, talk to your lawyer.

Ok, so LLC or S-Corporation?

Well, there are pros and cons to both and I’m going to lawyer out on you at this point and tell you that this is really a decision you should be reaching with the guidance of your own lawyer and your own CPA working together to advise you.

Your decision will have tax consequences that cannot be considered based on what you read in a general article that does not take into account the specifics of your situation.

So before you incorporate any sort of entity, make sure to consult with your own personal lawyer and your CPA to make the decision about an LLC or an S-Corporation for your business structure.

Lately, I’ve had a lot of people asking me whether they should incorporate their business and if so, what form of entity to use.

Of course, there is no universal answer. If there was, there’d be only one kind of business entity.

Before we talk about what kind of entity is right for your business, let’s do a quick review on what is an entity and why you need one for your business.

Think of an entity as a structure that will hold the assets (and liabilities) of your business. You can imagine this structure as anything that works for you. I like to think of it as a bubble.

This bubble can come in the form of a Limited Liability Company (LLC) or a Corporation (either an S-Corporation or a C-Corporation). There are also forms of partnerships, including a Limited Partnership (LP), but if you are considering that, make sure you are working with an actual lawyer who is counseling you personally.

When you create an LLC or Corporation for your business, envision that you are blowing a bubble around your business like a shield. The bubble is formed by filing papers with the State in which your business entity will be incorporated. In many cases, that will be the State of your residence. But in some cases, which we’ll discuss, you may want to use another State, such as Delaware or Nevada.

Your bubble (entity) will also need to have a Federal Tax ID Number (like a SSN, but for an entity instead of a person) and documents that tell you how and any partners you may have how to operate the entity. For an LLC, these documents are called the Operating Agreement. For a Corporation, they are called the Bylaws.

If you work with a document service to incorporate your entity, make sure they are not just going to give you standard form bylaws or operating agreements. These documents should be customized to the specifics of your business and your vision for how your business will operate.

You should put a bubble around your business if you want your personal assets to be shielded from any of the liabilities of the business. With the bubble around your business, if anything happens inside the bubble your personal assets are not at risk from any of the liabilities of the business.

Yay.

What sort of liabilities?

Well, things like an employee or independent contractor bringing a lawsuit against you, or an employee getting into a car accident during work hours. Or things like entering into equipment or property leases. Contracting with vendors. Taking on business credit. All of these things could lead to potential liability. And, if these things are not done under the shield of your business entity, your personal assets would be at risk. No bueno.

The only situation in which I say an entity is not necessary is if you are in a low growth, hobby type business in which you will never have anyone working for you and don’t expect to make much money.

If you are working to grow your business, get it set up in an entity that will allow you to take as much risk as possible with as little risk to your personal assets as possible.