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Business owners need to improve their financial literacy. In a survey of reasons why startups fail, CB Insights found that 29% went out of business because they ran out of money. This all-too-common problem can be remedied by being financially literate, as financial knowledge can help business owners avoid mistakes that would cause their business to go bankrupt. That's because financial literacy gives business owners a nuanced understanding of vital aspects of business, like accounting, taxation, budgeting, and payroll.
 
Improved financial literacy will also help business owners strategically prepare for downturns, take advantage of opportunities, and come up with viable solutions to problems such as overspending and disproportionate resource allocation. Indeed, financial literacy improvement ought to be one of the goals of every business owner, and the tips below will help in that regard.
 
Get financial literacy lessons
 
The glaring absence of personal finance in K-12 standards means that generations upon generations of Americans are likely without formal education in matters related to finance. That said, nothing is ever too late when it comes to learning, as business owners can attend financial literacy training sessions, consult with financial planners, or even take actual courses in finance or accounting.
 
Taking a basic course in accounting, in particular, is highly recommended since a basic understanding of it helps not only in improving financial literacy, but also in interpreting financial statements. An even better option, though, is to utilize DoughMain Financial Literacy Foundation's ​FitKit Express community program—a highly customizable, sponsorable, and co-brandable financial education initiative for communities. And given its customizability, the program can be tailored for specific audiences, which in this case will be your employees.
 
Create a financial advisory team... and consult with them
 
Just as business owners need to form teams to run the business' operations, they must also form a financial advisory team comprised of a CPA, a business and trust and estate lawyer, a P&C advisor, a life insurance advisor, and an investment advisor.
 
This team will be a valuable resource in terms of understanding the financial side of the business. Having said that, business owners will need to meet with this team regularly for financial planning and coordination and to pick their brains about financial matters.
 
Scrutinize the business structure
 
Going over the business' legal structure is a great way to learn not only about the legal aspects of running a business, but also how these aspects affect the financial side of things. Mostly, this financial impact has something to do with how the business is taxed. And given how sole proprietorship and limited liability company (LLC) are two of the more popular legal structures for small and mid-sized businesses, it makes perfect sense for business owners to be scrutinizing both.
 
For LLCs in New Jersey, in particular, taxation covers sales tax and income tax, as well as a variety of other charges, like corporation business tax, gross income tax, insurance premiums, and recycling tax. On the other hand, an Entrepreneur article on sole proprietorships in the country details how they are taxed differently, with the business owners' income and expenses both included in their personal income tax, which they will have to pay on top of their self-employment tax. By studying these structures, business owners will then get a firmer grasp of finance in relation to taxation.
 
Use data aggregation apps
 
Lastly, business owners need to leverage technology. One way to do so is by using data aggregation apps, like QuickBooks, Wave, and Due. These apps help business owners understand better their business' financial health through constant and real-time monitoring of a variety of metrics, including cash flow, credit, and expenses.
 
Crucially, these apps employ artificial intelligence, allowing them to make sense of all financial data collected and give recommendations based on said data. These same data can also be discussed in meetings with the financial advisory team or used as a reference point when reviewing the business' legal structure.
 
As a final note, business owners need to adopt a mindset of lifelong learning. In this way, every opportunity is a chance to learn, whether about finance, about the other aspects of business, or about life in general.
 
Article specially contributed to dmfinancialliteracy.org
Contributed by: JBrander

It’s a great time to venture out on one’s own, as more employers than ever are looking to hire contractors and freelancers for a variety of work to save money rather than investing in full-time employees (with benefits) for work that can readily be done by independent professionals. Working in the gig economy means working on your own terms, according to your needs, strengths, and desires.
If you have a marketable skill and experience, the gig economy can provide you a route to financial and professional independence — or a whole new rewarding career. One of the wonders of the gig economy is the sheer number of available opportunities, anything from pet sitting to website design.
DoughMain Financial Literacy Foundation, Inc. knows that getting started can be a challenge, so consider the following tips if you believe the gig economy is for you.

Ecommerce
If you’re looking for a niche that suits your particular skills and offers excellent profitability, consider opening an ecommerce store. In fact, there are plenty of opportunities available to people who want to get started. Dropshipping, for example, puts you into the retail marketplace without needing to maintain a physical inventory. To get the ball rolling, write an engaging CV based on a professional-looking template that enhances what you have to offer prospective clients. As Network Solutions explains, you can either choose to do business-to-business transactions or business-to-consumer — it just depends on what product or products you wish to offer.

Ready to Roll
If you're ready to get your business set up, an important early step is to create a legal business entity. The business entity is controlled by the state in which it's set up, and each type of business entity has its own requirements.
One popular method to going legal is forming a New Jersey LLC. LLCs typically offer the most flexibility while still providing security to the founder(s). Other business types include LLPS, S-Corps, and C-Corps, but because an LLC can usually be formed in about 5 steps, it's often the 'go-to' for solopreneurs or those that plan to keep their team (and overhead) small.

Establish a Presence
So you’ve selected your business — now you need to let others know about your expertise and capabilities. That means creating a strong online presence, a place where potential clients can find you and get the information they need to make a decision.
There are several excellent ways to do this. Most people begin with a website that contains background, CV-type information, a rundown of past work with samples (i.e., a portfolio), contact information, and more. You can build and maintain a website cost effectively by using a free website builder such as Wix to design your website, and inexpensive hosting plans are available as well.
Social media sites such as Facebook and LinkedIn are also good ways to get your name out there and begin building a following. And word-of-mouth can be invaluable as you get started, so reach out to former clients, colleagues, and employers — anyone who could put you in contact with potential clients (or offer you work themselves).
 
Be Focused
Employers look to the gig economy for very specific needs, so make sure you’re offering a very specific, niche-oriented service. Remember, you’re no longer in the corporate world offering to be a generalist in the interest of good teamwork; that’s not what companies are looking for if they’re going to contract with you. Do the best work you can within the parameters of your niche.
To do your best work, TechRepublic recommends setting up a home office with minimal distractions (no TV screens, no video gaming) and decorated with elements aimed at providing a calm and soothing work environment, including green houseplants and photos of family and past vacations. It’s best to keep things sparse so you don’t lose focus at times when you really have to dig down and concentrate.
The gig economy can put you on the road to an exciting new career or provide a means of generating supplemental income. The best part is that you can do it in your own time and pick and choose the type of work you’ll do. However, remember it’s important to maintain the same professionalism that made you successful in previous positions.
 
Image courtesy of Pixabay

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During your 20s, financial life planning always feels like something you’ll have to do in the future. However, as we get older, responsibilities such as children and mortgages mean we can’t afford to wing it and hope for the best anymore. Deciding to take control of your future finances is the first step, but what comes next? How do you figure out what contingencies to plan for, or what plans you need to put in place? We’re here to help.
 
DoughMain Financial Literacy Foundation is a nonprofit dedicated to building a better tomorrow by educating people today, in order to forge a financially literate America. Join the DoughMain Financial Literacy Foundation Giving Society to support our cause!
 
Children and Family
 
Whether you’re already a parent or are just starting to think about it, it’s important to think ahead when it comes to your family’s financial future. First, you need to consider the immediate costs, especially if you are about to start a family. Nerdwallet has found that most parents vastly underestimate the cost of a baby’s first year of life and found that it can add up to as much as $21,248. Is this something you can afford? If not, it may be a good idea to save up more money.
 
Then, you can start looking toward the future. The sooner you start saving for college, the better. This is thanks to the magic of compound interest: if you were to save for the first nine years of your child’s life and then stop, you would earn considerably more than if you saved between the ages of 9 and 18.
 
You should also have a plan to ensure your family will be okay in case you or your partner die unexpectedly. You’re never too young to start estate planning and to have your paperwork, such as a will, in order. A 30-year term life insurance may be a good choice, especially if you have recently married or have a 30-year mortgage.
 
Home and Mortgage
 
If you are looking to buy for the first time, you first need to make sure your finances are ready for a mortgage. It’s a good idea to start by getting a clear idea of your current expenses and paying off smaller debts. You may also want to consider a 15 or 20-year loan if you think you can sustain it, as it saves you money overall.
 
If you already have a mortgage, the best thing you can do is make sure you take good care of your investment. Have a schedule for regular home maintenance tasks and do not neglect them, no matter how new your house is.
 
Career
 
You may feel like you're stuck in a rut with your career with no way out. Fortunately, the answer could be as easy as investing in your education by earning an MBA. The degree can lead to a salary increase, new career paths, and a financial peace of mind for your family. The degree doesn't have to take over your life if you're careful to select a program that offers ample flexibility, such as few to no assignment deadlines. You'll reignite your own passion for learning and set a great example for your family as well.
 
Health Care
 
If you don’t have health insurance, get it. Not having any health insurance could be catastrophic for you and your family. If you do have health insurance, you may want to consider whether there are any supplemental plans you could benefit from. For instance, parents with growing children may want to invest in dental insurance to cover their orthodontic care. 
 
Healthcare is an area where financial planning intersects with lifestyle since the best way to save money is to not get sick. While this is not always possible, the choices you make in terms of diet, exercise, sleep, and mental health will go a long way toward achieving this. Also, research has shown that just following your doctor’s recommendations for diet and medication can save you up to $2,000 a year alone.
 
Taking the step into financial planning is not as daunting as it seems. It’s all about a shift in perspective: instead of thinking of your life month-to-month, or even year-to-year, you need to start thinking about the next few decades. The time will pass before you know it, and you will be thankful for the work you put in. Do your research, stay organized, and save as much as you can. By simply doing this, you will already be doing yourself a favor in the years to come. 

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Countless US citizens are struggling with the unpredictability of the current economy. The COVID-19 pandemic has put moderate to low income individuals into a precarious financial position, making it difficult to keep up with daily expenses, pay debts, and save up for future endeavors. In such a tumultuous time, it might seem counterintuitive to start investing. But this isn’t entirely true. Though investing always carries some form of risk, remember that these risks come in varying degrees. And there are several options that offer minimal potential losses. Here are four examples:

1. Certificates of Deposit

A Certificate of Deposit (CD) is a fixed-term loan that you offer to your bank. You let them keep a specified amount of your money and, in return, they pay you back with a guaranteed rate of interest after several years. The longer the term, the more interest the loan yields. CDs are a popular choice because they offer higher interest rates compared to a regular savings account. Plus, they’re insured by the FDIC and NCUA (for credit union accounts), so there’s very little margin for loss. The only downside is you aren’t allowed to withdraw from the amount you loaned, or you’ll be penalized.

2. Bond Funds

Bond funds are another type of fixed-term loan. This time, it’s to your government. The two main types are US Treasury bonds and municipal bonds. US Treasury bonds are issued by the federal government, and terms can span from one year to ten. The short-term loans are safer to invest in because while these bonds are backed by the US government, your funds can still fluctuate in value. Just note that the Treasury rates tend to rise during times of economic instability. As of late, bond prices have been falling while the yields have climbed. For municipal bond funds, these are invested in state and local governments. Whiles these bonds are not as reliable as U.S. Treasury Bonds, one upside is that the interest is exempt from federal tax. Some options are also exempt from state and local taxes.

3. Money Market Funds

Money market funds are another ideal option as they offer very short-term investments where professionals actively manage your funds. Though this type of investment isn’t backed by the government, money market funds always aim to maintain a $1 net asset value (NAV). This protects investors from losing principal investments. But note that while the $1 NAV rule applies, it cannot always be followed, especially when the money market can’t adapt to inflation rates or interest rates become low. When funds go below your initial investment, the losses are passed onto you.

4. Gold

Gold is an ideal investment option because interest rates cannot influence its price. Neither is it affected in times of economic and political uncertainty. And there are multiple ways to invest in it. You could acquire physical items such as coins, jewelry, and even bullions. Or, you could invest in gold without having to physically own it. Exchange-traded funds (ETFs) are a good example of this. Gold ETFs are convenient because you won’t need to go through the hassle of ensuring the gold you buy is legitimate and stored properly, and there are plenty of trusted ETFs you can consider. Another option is to purchase gold-related stocks, which funds companies directly connected to the gold industry, such as miners and refiners. Just be wary of the current state of the stock market.

Those are four safe investment options for you to choose from. Many young individuals have flocked to online investment platforms to place their bets on the stock market. However, frequent trading is not recommended, especially given the country’s current economic and political climate. We recommend investing in at least one of the four items on our list before delving into riskier investment options.

That the COVID-19 pandemic has had a significant impact on women is undeniable. ​In many of the business sectors hit hardest, the majority of employees are women. Ultimately the numbers show women overrepresented, making up 83% of job losses per CNBC.

And even though many states are allowing businesses to reopen, other states are implementing or considering another lockdown. In short, there’s no telling how long this pandemic and its economic effects will last. 

If you’re a woman who has lost your job or had your hours cut, explore informative resources at DoughMain Financial Literacy Foundation to ensure you’re applying your available funds in the best possible manner. And know that there are plenty of ways to make money without even leaving your home. Here are some tips to help you get going on the right track: 

Due to the pandemic, many of us are facing the reality that our children are not going to be headed back to school in the Fall and instead will most likely continue with virtual learning. There are many creative and engaging ways to teach life lessons outside of the classroom, even if you are not a certified teacher! One area that is important to talk about with children at any age is finances. 

The sad truth is that most children are growing up without any financial education whatsoever, whether at home or at school. Since 2016, not one U.S. state has added personal finance to the K-12 standards.(1)
​This lack of financial basics is creating long-term negative effects.  For example, nearly one fourth of millennials are spending more money than they earn and 67% of Gen Yers have less than 3 months’ worth of savings in emergency funds.(2)

​by Robert M. Church, DoughMain Financial Literacy Foundation

Planning for Your Health
Millions of Americans are coping with stress and anxiety as they deal with the unpredictability of their personal financial situations and the future due to the economic uncertainty created by the pandemic.

At-risk populations including moderate-low income, impoverished, women and single parents are increasingly burdened with fears that include the lack of savings, job loss, inability to afford daily expenses, pay debts and their children’s future abilities to afford college. These are very real fears and their impact affects present and future generations of families.

​It’s Murphy’s Law that all will go wrong that can go wrong. Without the proper insurance coverage, you risk potentially high costs in the event of an incident. To avoid you or your loved ones suffering harsh financial losses, you should get all the necessary coverage now. Let’s discuss the coverage you need and the benefits that the right insurance policies will bring to you.
​

Today’s Americans value diversity and inclusivity in the workplace more than ever, according to a recent survey conducted by the Pew Research Center. Moreover, 75 percent of Americans claimed it was important for companies to promote racial and ethnic diversity in the workplace, but only 24 percent wanted race and ethnicity to be considered when it came to aspects involving hiring and promotion. On the other hand, 74 percent believed that only qualifications should be considered, despite the fact that it may result in less diversity. Because of these sentiments, there are still many barriers to entry, with people being left out of the picture because of gender, race, minority backgrounds and a lack of financial literacy. Andrew Anastasio writes how gender discrimination leads to workplace and wage inequality, stemming from societal attitudes. Because of this, efforts should be made towards building more inclusive workforces across all companies, giving students hope that they will find their place in the world.