The Insurance Needs of Small Business Owners

As a small business owner, it can be hard knowing which insurance you need and which ones can wait. Insurance is not just a luxury for larger companies; it is something that you need to add to your budget too. Therefore, today we are discussing the insurance needs of small business owners.

General Liability Insurance

All businesses must have liability insurance. This will provide protection if you, your employees, or products cause or are accused of causing bodily harm or property damage to another individual.

Property Insurance

Property insurance will protect you in the event that your business establishment or some of the items inside are damaged. It is also suggested that when you get property insurance that you add on business interruption/loss of earnings insurance so you can keep a cash flow if the damage prevents you from operating your business as you normally would.

Business Owner’s Policy

This type of insurance covers everything that you need when first starting out.

  • Business Interruption Insurance
  • Property Insurance
  • Vehicle Coverage
  • Liability Insurance
  • Crime Insurance

Additionally, you can make changes to what your Business Owner’s Policy covers so you can get the specific coverages that you need for your business needs. Usually, by going with this type of insurance you are able to save some money because everything is bundled into a package.

Commercial Auto Insurance

This insurance is to protect your company vehicles. Additionally, if you don’t use company’s vehicles, but your employees use their own vehicles, you want to make sure that you have non-owned auto liability so your company is protected in case your employees don’t have adequate coverage.

Worker’s Compensation

This insurance is needed so employees who are injured on the job are able to have wage replacement and medical benefits. By providing this insurance for employees, it means that they have to give up their rights to sue you. This insurance will protect you from messy legal troubles. You have to make sure that you are compliant with all the laws though and these laws vary from state to state.

Professional Liability Insurance

This insurance will protect you against failure or improperly rendering professional services. It is not something that is covered under general liability insurance so make sure you get this if you are a professional firm that consists of lawyers, accountants, consultants, real estate agents, and others in similar fields.

Closing Thoughts

These are some of the types of insurances that you will need as a small business owner. However, when signing up for different insurances make sure that you are aware of what they are covering. With so many insurance types available during this day in age, you could potentially be signing up for coverages that you don’t need. Therefore, instead of jumping on every insurance type that an agent shoves in your face, take time to see if it is something that is necessarily or one of the insurance types that actually do fall into the “luxury category”. Keep in mind the ones that we covered today are highly recommended, though.

Six Steps to a Happier and More Stable Financial Situation

Six Steps to a Happier and More Stable Financial SituationSimilar to achieving any goal, creating a stable financial situation requires that you make a plan, and then follow through on it. In theory, it’s easy. But as we all know, following through on your decisions can be difficult. Because of that, we’re going to provide you with six easy-to-follow steps that anyone can follow to achieve a happier and more secure financial foundation in their life.

Step 1: Stop Impulse Buying

The biggest reason why some people are always broke is because they constantly indulge in impulse buys that don’t contribute to their financial goals. Whether it be dining out or making online purchases, we’re all guilty of it. But if you can recognize the severity of this problem, you’ll be in a better position to change it. So stop the spending and only focus on what you need.

Step 2: Track All Expenses

How can you possibly develop a solid financial foundation if you don’t even know where all your money is going? By knowing what your spending habits are like, you can then see where there’s some room to save money.

If you’ve never tracked your expenses before, consider participating in the following challenge: track every expense (even tiny ones) for the next 30 days. Mark them down in an Excel spreadsheet. It doesn’t need to be pretty, just practical. Then, after the 30 days are over, cross out what you don’t need and circle what you overspent on. Now you can successfully cut down on the following month’s expenses!

Step 3: Invest in the Future

If you’re in your 20s, you probably don’t spend a lot of time thinking about the distant future. But you should. There’s no better time than now to start planning for retirement. For example, if you start a 401(k) in your 20s, and contribute to it regularly, then you’ll have a hefty safety net in 30 years. Invest money in stocks, bonds, and mutual funds too. If you’re unfamiliar with how these investment options work, then partake in some self-education (it will go a long way towards helping your financial future).

Step 4: Pay Off Current Debt (and Avoid Future Debt)

If you had to choose only one thing to apply from this article, it should definitely be this tip. Paying off current debt, and staying out of future debt, is the best way to better your financial situation. Avoid taking out too many loans or applying for too many credit cards. If you’ve got school debt, focus on paying that off as quickly as possible. The less money you owe, the more you’ll be able to save each and every month. Even if you can only afford to pay $100 a month towards your debt, that’s still a significant amount after three years (12 months x $100 = $3,600).

Step 5: Use the “Envelope System”

This simple, yet, highly effective system can make all the difference in your finances. Here’s how it works: let’s pretend that you have three different expenses that you have to pay each day (gas, lunch, and dinner). Withdraw the exact amount of money that you plan on spending for each one, and place them in separate envelopes (one envelope per expense). Now you’ll be less likely to overspend, and if you do, then you know that you’re probably spending too much in these areas.

Step 6: Pay Bills Right Away

Don’t wait to pay your bills. Sign up for automatic payments and pay them immediately. The biggest benefit to this is that you won’t forget to pay a bill, which can result in late fees. Secondly, you won’t be able to accidentally spend bill money since it’s taken out of your bank account automatically.

Building a more secure financial situation isn’t going to happen overnight. You need to be patient and disciplined. If you follow the six steps above, there’s no reason why you can’t be living comfortably within two or three years.

3 Ways We Lose Money Without Even Realizing It

Money is hard to keep track of; everybody knows that. It’s why you’re ready a personal finance blog right now, and why you (probably) haven’t been 100% faithful to your budget this month. This is an inherent characteristic of money. In the rush and tussle of life, you’ve got a million distractions. Money is only one of them, so it’s no surprise that you should pay attention to other things from time to time. But there are a bunch of people out there who make their living by ensuring that your money is as difficult to manage as possible. These individuals and entities may be draining you of your hard earned wages without you even knowing about it. Since this is so often the case, it’s worth taking a look at your finances right away, to make sure you don’t have any of these clingers-on sucking you dry. Here are three of the most common scenarios.

  • A Forgotten Credit Account. For people with 5 or more credit cards, this can be a very unfortunate situation. Credit card companies have a variety of ways they contact you: phone, mail, email. But if one of the those methods changes, it’s entirely possible that you might not be getting notifications about outstanding balances and the like. This is made all the more likely when you move or change your phone number/email address. Thousands of people have set certain bills to auto-draft, or do not have all credit accounts visible on their online banking service. Left untended, credit card statements will swell, and credit scores will plummet. If you have a history of setting up a lot of credit cards, make sure that you’re not carrying balances on a credit card that you no longer use or may have forgotten about.
  • PPI. Relevant mostly for our British readers, this situation is one which all consumers should be aware of. Payment Protection Insurance was tacked on to many a financial contract in recent years over in England. Thousands of consumers found themselves paying monthly dues for a service they did not want. Because the language was found to be deceptive and hidden within dense forms, there have been a variety of class action lawsuits written up to help these people get their money back. If you have PPI, this PPI Claims Calculator can show you how much you stand to make back.
  • Subscriptions. With so many goods and services available by subscription online these days, it’s easy to forget how many you have open. Because these services tend to auto-draft in perpetuity, you may very well be paying for services you no longer want or use. So take a scan of your billing statements, as well as the spam folder on your email, and you’ll probably find one or two you could do without, even if they weren’t entirely forgotten.

There are plenty of ways to save money. But start investing in awareness of these methods that companies use to get your money when your attention is on other things. It’ll save you loads over the years.

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