Why Every Stay-At-Home Mom Should Own A Business, Any Business

If all of this year’s financial news from the Fed, congress and White House
seems too big and uncontrollable for a lot of us, here’s something that hits a
little closer to home.  New financial regulations
of the CARD Act of 2009, Regulation Z, will go into place in October 2011, and
one of them prohibits financial institutions from giving credit cards to people
who do not have documented individual sources of income.  Although it
was originally proposed to ensure students weren’t saddled with consumer debt
through aggressive marketing, the wording was expanded to include any individual without documented
income.  Sounds like a good idea,
right?  Not so fast.  The fallout is that non-employed spouses will
no longer be able to use their household income to qualify for
credit.   

Who cares?  Stay-at-home moms and mister-moms
should.  The National
Retail Federation
said the rule “undermines more than a generation of
progress” since passage of the Equal Credit Opportunity Act. Because of
this rule alone, a woman should consider starting up her own business,
whether it is a primary or side pursuit.

 

There are many reasons to own a business in this country,
including tax advantages, continued professional development, schedule flexibility,
and income potential.  This new rule is one more reason for a mom to
have a business, even a teeny-tiny one, that documents profitable income. The
rule does not specify a minimum required income, but not having any documented
income is a show stopper when it comes to securing credit.  For all types of small businesses, including
home-party consultants, part-time blogger moms, retail store owners,
professional consultants, and more, a Schedule C or corporate tax return is the
documentation the credit issuers require.

 

“We’re not sure at all how this is going to work in
practice,” NRF Senior Vice President and General Counsel Mallory
Duncan
said. “Since most stay-at-home spouses are women, this could put
women back more than 20 years in terms of their access to credit.” 

 

I was married and divorced nearly twenty years ago, I went
through a rocky time personally that nearly ruined my credit. I believe
that this provision takes us back even further than twenty years.  We
forget that stay-at-home spouses have economic value in our society, even
though they don’t receive a paycheck.  A non-employed spouse should have
access to credit throughout their marriage so they don’t incur financial
hardship should death, illness, abuse or divorce markedly change their
status after years, sometimes decades, of partnership.  Family tragedies
are difficult enough without removing access to credit, an undeniable necessity
of modern life in America. 
Even those who live debt-free have a credit score.  Having a favorable credit history is as
important as having a job.  Credit doesn’t just mean credit cards, but is
required for basic social functions such as the ability to rent property, buy a
car, or establish phone service.  

 

Many women make major changes to their employment status
when they are pregnant or shortly after having a baby.  Many educated and
talented women step off a professional cliff when they start a family,
potentially creating unintended financial consequences for themselves and their
families.  But starting a family can also be a great time to start
something new professionally.  A business
that a mom runs during naptime or school hours can be rewarding and more economically
beneficial than just a positive profit and loss statement. A business also can
be a woman’s ticket to financial independence. 
With her own income, she no longer depends on her spouse to include her
on a credit account. 

 

Moms put others first in so many ways, but when staying
at home to raise children means you give up your own financial identity,
that’s just wrong.  

 

Since last March when this rule was finalized, there appears
to have been little progress on correcting this language to mitigate the impact
on families and women.  The best thing we
can do is be aware of our options, and owning a business is certainly one of
them. Add this new law to the list of reasons for a woman to have and maintain
a business before, during, and after baby. 

 

 

 

More sources:

http://www.federalreserve.gov/newsevents/press/bcreg/20110318b.htm    

http://www.creditcards.com/credit-card-news/stay-at-home-parent-credit-cards-household-income-1282.php

http://www.nrf.com/modules.php?name=Newsletter&op=viewlive&sp_id=324&id=51

 

Originally published in Kalamazoo Parent magazine, October 2011

Resources for New Moms

Kelly McBride of Belly Pilates in Philadelphia has hit on a great idea…a series of free workshops covering a huge range of topics important to pregnant women, new moms, and their families.  Check it out here.  Even if you miss the series, looking at the list of topics covered might give you ideas on how to find resources for the issues you are noodling through.

Click here to see the video of Resources for New Moms , highlighting www.bellypilates.com.

What the Fed is Doing to Your Wallet

In October, you’ll be hearing more about this because it will be in the news cycle. But please learn now about a new federal provision that will affect every stay-at-home-mom without her own paycheck, and in fact is already starting to affect them. Read the article at Mothers and More’s online magazine called The Forum. http://www.mothersandmore.org/Forum/Read_Forum.php

How Does Your Man Support Your Business?

Does your guy respect your business? Whether you started your business from nothing, came from corporate, or dropped all of your life’s resources into a new venture, your guy is one of the most critical members of your fan club, and every business needs a fan club that isn’t just virtual and online.

When I started my business (remember that I left a really respectable income behind), he took to talking about my “little business.”  It took a while of gentle and not so gentle reminders, but he caught on and started introducing me as a business owner.  When your guy describes your business in at least the same terms as you do, or perhaps even better, then you know he’s on board.

My business reached a milestone last year of 5 continuous years in business.  Hubby dear was paying more attention than I was, and noticed how I was gushing over the (then) recently released iPad.  He totally surprised me with my very own iPad to celebrate the business milestone.  If your hubby presents you with productivity tools, even if you aren’t sure they’ll work for you, take it as his vote of confidence in your business acumen.

He did it once again this year.  Just after the book was released, my husband presented me with a professionally shadowboxed version of the book.  Wow!  Not quite as expensive as the iPad, but still not cheap, and definitely something I never would have thought to get for myself.  Guys who get a sentimental gift that represents your success are priceless.

The saying used to be that behind every good man was a good woman.  But, hey, running a business, especially while you are pregnant, is a team sport.  There’s got to be a good guy behind you if you are going to stay healthy, happy and at least somewhat balanced.  Let’s celebrate those guys who help us forward.

Leave a comment here to crow about how your guy treated you and your business well.

How Does Being A Working Mom Benefit Your Children?

Every now and then you might read a story about the effects on children from moms moving from the home to the workforce.  Usually the news (or perception) is not positive.  However, I think that entrepreneurial moms have a different story to tell.
From an expert perspective, I strongly believe that being expert problem solvers (notice I didn’t say expert multi-taskers!) gets passed on to our kids.  This isn’t just hearsay, it appears to be neurological and something we can influence through upbringing.  I reference Richard Nisbett in his book, Intelligence and How to Get It, in this excerpt from my book, The Pregnant Entrepreneur:

“It turns out that being read to and exposure to books are socio-economic indicators that are found with higher-IQ children according to Nisbett.[i] Earlier and more consistent access to schools and learning programs are also highly correlated with higher intelligence.[ii] Being exposed to the problem solving, like that required to run a successful business, must qualify as educational, rich, and diverse experiences. Entrepreneurial mothers were not highlighted as a group in Intelligence and How to Get It. Although not scientifically studied, it makes sense that if you are steeped in the entrepreneurial environment and, even better, expose your child to aspects of it, your child is likely to benefit cognitively from that experience.”

From the perspective of a services professional, I can tell you that one of target client sets is young adults who have not learned the skills or organizing because their parents never taught them.  I believe that the entrepreneurial family is more likely to pass on skills that allow a person to be self-sustaining and more able to achieve their own goals.
From the perspective of a mom, I can tell you that my 4-year old helps me take care of the house because I expect that, and she’s learned to be part of the family team from an early age.  She’s also learned that there are times when you work, and times when you play.  She gets it now, and I expect that she’ll continue to grow into a person who can structure her own time to meet her goals.  Prioritizing is a critical life skill, so you can enjoy life more.
I’ve talked to at least three people just this week who said to me that their inability to prioritize is their biggest problem.  Successful business owners must prioritize, or they aren’t successful.  If we pass this trait or skill alone onto our kids, we’ve done our jobs as entrepreneurs and moms at the same time.  Ka-ching!

Why Every Woman Should Own Her Own Business (Of Any Size)

You have probably seen the news recently about new financial regulations from the Fed due to start in October.  http://www.federalreserve.gov/newsevents/press/bcreg/20110318b.htm    The new provisions of the Credit Card Act of 2009 that will go into place in October prohibits banks from giving credit cards to people who do not have individual sources of income, such as non-employed parents.  Non-working spouses will no longer be able to use their household income to qualify for credit.   

Who cares?  Non-employed spouses should.  For this reason alone, a woman  should consider starting up her own business, whether she already has a job and is hoping to take time out of the workforce to start a family or she stays at home. There are many reasons to own a business in this country, including tax advantages, continued professional development, flexibility, and income potential.  This new regulation is one more reason for a mom to have a business, even a teeny-tiny one, that documents profitable income. What some may not realize is that small businesses can be more alike than they are different, from the occasional Pampered Chef consultant to the very part-time blogger mom to the retail store owner and more.  Moms who are business owners have advantages over moms who are not.    

“We’re not sure at all how this is going to work in practice,” NRF Senior Vice President and General Counsel Mallory Duncan said. “Since most stay-at-home spouses are women, this could put women back more than 20 years in terms of their access to credit.”  http://www.nrf.com/modules.php?name=Newsletter&op=viewlive&sp_id=324&id=51
 
I was married and divorced nearly twenty years ago, I went through a rocky time personally that nearly ruined my credit. I believe that this provision takes us back even further than twenty years.  We forget that stay-at-home moms (and dads) have economic value in our society, even though they don’t receive a paycheck.  A non-working spouse should have access to credit throughout their marriage partnership so they don’t incur terrible hardship as a financial unknown should death, illness, or divorce markedly change their status after years, sometimes decades.  Family tragedies happen every day and are difficult enough without removing access to credit, an almost undeniable necessity of modern life in America.  Although I advocate for debt-free living, having a credit history is as important as having a job.  Credit doesn’t necessarily mean credit cards, but can impact basic life functions such as the ability to rent, buy a car, or even establish phone service.  
 
Many women make major changes to their employment situation when they are pregnant or shortly after having a baby.  Many professionally trained and talented women take a huge step off a professional cliff when they start a family, potentially creating unintended financial concerns for herself and her family.  A business that a mom runs during naptime and on weekends can not only rewarding and economically beneficial in more ways that you can count on just a profit and loss statement, but it now becomes a woman’s ticket to financial independence, without depending on her spouse to approve her inclusion on a credit account. 
 
Recent articles have advocated that non-employed spouses rush to apply for a credit card before the regulations go into effect, but the banks can already apply the new standards if they chose.  Older women with established credit histories may be less impacted.  I am more concerned for younger women.  I think the best thing we can do is learn to be aware of our options, and owning your own business is certainly one of them.
 
Moms put others first in so many ways, but when staying at home to raise children means you give up your own financial identity, that’s just wrong.  Way before this provision, I realized that I could never comfortably put my entire financial well being into another person’s hands again.  Add this new law to the list of reasons for a woman to have and maintain a business before, during, and after her baby. 

Why On Earth Would I Be My Own ChildCare Provider?

I’ve been doing a lot of thinking in the last few days about why it is so important to me to run a business in such a way that I can also be the primary childcare provider for my daughters.  From the moment I became pregnant, I knew this was important to me.   I talk a lot in my book about this being paramount.  But why?  Here’s what I’ve learned:

1.  I’m frugal.  Where I live, full time daycare can easily run $10K- $12K for just one child.  Look, I know early childhood education workers are worth that and more.  But the sad truth is that here in America, that kind of bill is really tough for most families to handle.  Most Americans don’t have assistance with that huge bill for the early years.  What a relief it must be for parents with kids in daycare to finally send their kids to elementary school.  

2.  I’m a germaphobe.  Kids are tiny Petri dishes, and the little ones seem to bring home every nasty thing.  My first daughter was not sick a day in her first 18 months of life.  But with the increased interaction that both of my daughters had just this last winter at school, church and playgroups, and the sickness that came with it, my entire family missed two entire weeks of work and school.   Even when I was pregnant, I knew the germs were headed our way.  I don’t really buy that line about sickness making them stronger.  I wanted my children to grow up a little before I threw them out into the big, bad world.

3.  I’ve been there.  Because my own parents separated when I was very young, and then my blended family had two working parents, I spent a lot of time in all types of childcare as a youngster.  I’m not saying they are evil, but some are better than others, and parents can’t always tell which is better. 

4.  I’m a bit of a control freak. If I have the luxury of just a few years where I can ensure my kids are eating very healthy foods, are napping on schedule, and are not watching TV and commercials, by George, I’m going to take advantage of that.  I think this falls under the heading of pick your battles.  I know there will be plenty in the teenage years that I don’t have a hope of controlling or even adequately influencing, so I’ll take my turn now and hope some of it sticks.

5.  I love being with my kids.  Even though I am not a woman who gushes over babies in general, it turns out that I really loved hanging out with my own tiny humans.  They were generally happy, giggly babies, so they were a lot of fun to be around.  As they learned to be mobile and then talk, they got a bit more challenging.  Now, as my older daughter is four years old, I feel a bit like a cruise director many days, trying to keep her occupied and stimulated.  So I’m thrilled that she does attend a preschool, where she does cute crafts that would just never occur to me.  But I still love to pick her up from school in the mornings and hear all about it.  I am one lucky mom.

By the way, when I was pregnant, I had fantasies that my kids would be so much fun to be around that I would want to home school them.  I now know that I am not equiped to entertain toddlers and youngsters for hours on end, and our awesome public school will do a great job of helping them to grow into the fabulous people I know they will become.

Disclaimer:  My choice to structure both child-rearing and business-building into my day is neither an endorsement for this lifestyle nor an indictment of those who make other arrangements.  The structure and flow of family schedules that we moms support are amazing.  Choose the path that’s right for you.