SUCCESSYour guide to managing money, work and the business of life

If you have children who finished their schooling and started real jobs this summer, they have been getting a taste of something you’ve known for years.

There’s a big difference between gross pay and net pay.

Never mind that you’ve probably had a conversation at some point with your kids about taxes and take-home pay. But there’s nothing like pulling down that first full-time paycheck to drive home the impact of just how much of your salary disappears to cover all the taxes.

As one newly employed college grad told me, “Now I understand why people complain so much about taxes.”

Even if your 20-something had held down part-time jobs and was accus-tomed to seeing Uncle Sam’s bite, this may be the first time they’ve had money taken out of their paycheck for employ-er-provided health care, insurance, a retirement plan and other benefits.

It can be disheartening — at least temporarily — to see the actual amount on the check not correspond to what

was anticipated when the job offer was made.

Don’t get me wrong. Paying taxes is part of our obligation to society. But this is probably not the time to be lecturing your newly minted worker about the fairness and flaws of our tax system.

However, it is definitely a good time for a few financial planning pointers.

If your child is still mulling over a salary offer, it never hurts to ask the employer’s human resources depart-ment for at least a ballpark estimate on what take home pay will look like after deductions for taxes and fringe benefits. There are also online calculators, including one from Bankrate.com, that show you how the numbers line up.

Don’t make early spending decisions, such as signing a lease for an apartment, based on the higher gross amount of income. That could seriously crimp your cash flow.

As a general rule of thumb, for example, financial planners recom-mend limiting housing and utilities to no more than 30 percent of your net, take-home pay.

If money is tight, consider adjusting your withholding on your federal W-4 form that you filled out when you took the job. This form sets the amount of federal income tax to be taken out of your salary. But be careful. Adjusting your withholding may put more money in your pocket now but could also cause bigger problems down the road come tax season.

There are, of course, upsides to workplace-related tax issues that young workers should seriously consider, such as health savings accounts, flexible spending plans that help defray medical expenses and 401(k) retirement ac-counts. With the retirement accounts, put in as much as possible, especially if your employer matches contributions up to a specified limit.

What can parents do?Reassure your young worker that

there will be money left over at the end of the month if he or she follows a spending plan (aka a budget.) And for times when money gets really tight, there are Ramen noodles.

Questions, comments, column ideas? Send an email to srosen@kcstar.com.

Gross, net pay offer lesson for new workers

As one newly employed college grad told me, ‘Now I understand why people complain so much about taxes.’

By Pat Mertz Esswein |

may not need

COLLEGESTUDENTS

1. New textbooks: Check to see whether your university offers a rental program. BigWords.com, CampusBooks.com and DealOz.com can help you comparison-shop.

2. A high-end computer: For students looking for an alternative to more powerful computers, the Toshiba Chromebook 2 is a good option.

3. A printer: If you skip this, you'll save about $100 for a printer, $30 for replace-ment ink and $9 per pack of paper.

4. A pricey phone plan: You should consider keeping your student on the family plan.

5. Cable TV: Hulu.com lets you stream TV shows free from participating networks.

6. A car: In a nine-month academic year, the average small sedan racks up about $5,000 in expenses.

7. A credit card: Help your student stay in the black by withholding your signature until he has a long track record of fiscal responsibility.

8. High bank fees: Consider opening an online checking account with a bank that doesn't charge ATM fees.

9. A big meal plan: You've heard of the "freshman 15" pounds, so avoid getting a meal account with enough money to feed the football team.

10. Health insurance: If you have family health coverage, your student may still be covered.

11. Private loans: You still have time to apply for federal student loans to cover the bills.

12. Laundry service: Take your homework to the laundry room — the white noise can create a great study environment.

SOURCE: Kiplinger’s Personal Finance

SPECTRUMBLUE/FOTOLIA

Is a bull market emerging in real estate? The National Associa-tion of Realtors recently report-ed that pending sales of existing homes are at their highest level

in more than nine years. Sales of new homes are at a seven-year high. With new-home sales expected to climb 22 percent this year and another 23 per-cent next year, and existing-home sales likely up nearly 7 percent this year and another 6 percent in 2016, buyers and sellers may need to adjust their strate-gies to reflect the new reality, particu-larly in the hottest markets.

Demand is being fueled, especially among first-time home buyers, by strong job growth, high rents and relatively low mortgage interest rates, as well as more opportunities for low-down-payment mortgages. The supply of existing housing stock, while still reasonably balanced between sellers and buyers nationwide, is low by historical measures in a number of markets, and in some it’s downright ri-diculous. Both Denver and Seattle, for example, have less than one month’s supply, compared with a national aver-age of 5.1 months. Homes sell quickly

in hot markets — in 25 days in Denver, compared with the national median of 40 days. In San Jose, Calif., houses are gone in just 18 days.

Prices reflect these imbalances. In some cities, prices are up by double-digit percentages, or close to it, compared with a year ago, says Clear Capital, a real estate data and analysis firm. Prices are up 12 percent in Seattle and Denver, 11 percent in Tampa, and 9 percent in Atlanta, Fresno and San Jose. The hot housing market could start to cool as prices reach affordabil-ity limits. Even NAR chief economist Lawrence Yun says that prices have risen at an “unhealthy and unsustain-able pace.”

But for now, sellers in sizzling mar-kets face a Catch-22. You may get mul-tiple offers and sell your home quickly for top dollar, even if your property is sold as is. But what will you buy? In Denver, agent Anthony Rael, with Re/Max, says that many prospective sellers are holding tight until they have more choices. Sellers should look at homes available in the price range and neighborhoods they desire before they list their current home. Rael encour-ages sellers to identify a place to live temporarily in case they sell fast but

don’t find their next home right away.Even in a hot metro-area market,

you must set your price appropri-ately or you risk hitting a snafu later. Although you may receive cash offers, the highest and best offer for your home may require financing, which necessitates an appraisal of the house’s market value. To protect yourself from an appraisal that falls short, stipulate in your contract that the buyer make up the difference in cash or split it with you.

On the buying side, identify your priorities and be open to alternative locations with the quality of schools or amenities you want. Let your agent know that you’re available to see a prospect as soon as it hits the local multiple listing service.

When you’re set to write an offer, be prepared to meet a seller’s need to close quickly. Or consider leasing back the home rent-free for a period of time if sellers are not quite ready to vacate. Include financing and inspection con-tingencies if you need them. But assure sellers that you are preapproved by a local lender and that you will use the inspection to identify major issues, not to nitpick them with a hundred small repairs.

Money-smart tactics to prosper in a

Steve RosenKids & Money

HOT HOUSING MARKET

In late July, Converse released the fi rst major redesign of its classic Chuck Taylor All Star sneaker in nearly 100 years. The company has experimented pe-riodically with new colors (“citrus,” “beach glass”) and materials (denim, leather), but this is more than a style revamp. It’s a complete sole-up rethink, an honest-to-god Chuck Taylor sequel: the Chuck II.

Only an iconoclast like Copcutt, the 49-year-old VP/GM of Converse’s All Star division, would dare screw around with a product formula that is to footwear what Coca-Cola is to soft drinks, let alone slap a Coke II-style roman numeral at the end. “I’m kind of an aging punk rocker, I guess,” Cop-cutt says, which is rather appropriate. The 98-year-old sneaker, originally designed for basketball, was co-opted in the ’70s and ’80s by bands such as Blondie, the Sex Pistols and the Clash, and has been the de facto sneaker of the counterculture ever since.

The Chuck II defi nitely still looks like a Chuck, with a few luxe touches. A lining made from a foamlike material called Lunarlon, developed by Nike — which acquired Converse in 2003 — heightens the cushion. The All Star patch is stitched on, not ironed. Padding in the tongue and outer canvas helps the shoe hold its shape a little better than the Chuck I. Put them on, though, and the feel is like a whole new shoe.

So why take the risk? Copcutt’s boss, Converse CEO Jim Calhoun, says it’s because the brand is bigger than ever. Converse reported $1.7 billion in revenue in 2014, with Chuck Taylor All Stars “by far” the biggest part of that business, Calhoun says. Converse sold more than 70 million pairs of Chucks last year, 35 times its yearly sales of a decade ago.

All of this good news makes Calhoun nervous. “Business is full of stories of companies that threw that last party just when their world was about to burn,” he says. Now was the right time for Con-verse to disrupt the Chuck, Calhoun says, because it couldn’t afford for someone else to come along and do it.

Calhoun’s mandate to the All Star team was simple:

Assume we don’t know our customers as well as we think we do — get to know them better. Copcutt did so by playing roadie to his son’s London-based rock band, Zoax. He spent weeks at a time tagging along as they played beside bands with names like the Howl-ing, Axewound and the Cancer Bats, asking everyone who’d talk to him what they wanted from a pair of

Chucks. A lot of them wanted the same performance-based improvements from their All Stars that athletes want from their Air Jor-dans: more cushioning, more comfort, more support and more traction. But if it didn’t still look like a Chuck, they wouldn’t wear it.

Meanwhile, Converse’s brand VP Geoff Cotrill was getting to know customers too. Cotrill is in charge of Rubber Tracks, a Converse-branded recording studio with locations in Brooklyn and Boston that offers free time to local musicians. Rubber Tracks

isn’t just a nice thing for the recording community. It’s also a way for Converse to stay connected to its core consumers — something the company learned the importance of the hard way. “In the ’70s and ’80s, the Chuck was being adopted by musicians and artists, and we were actually fi ghting them,” Cotrill says. “We were saying, ‘No, we’re a sports brand!’ The reason we got where we are today is because creative people adopted us almost against our will.”

When Cotrill and Copcutt compared notes back at Converse headquarters, they were faced with a chal-lenge: Deliver the performance improvements Chuck fans were asking for without sacrifi cing the look that they loved. The two execs put Converse’s design team, led by ex-skater and metal sculptor Damion Silver, to the delicate task. With a price tag of $70 — versus $50 for the original — the fi nished product is an upgrade, but still accessible for Converse’s core customers.

Still, one question remains. “Now that there’s a Chuck II, is there going to be a Chuck III, a Chuck IV, a Chuck V and so on?” Cotrill asks. “We’ll see.” There are always needs that can be met. For instance, “People keep telling us they don’t wear their Chucks when it rains.” Sounds like the answer is “yes.”

With interest rates scraping bottom, it’s tough to make a case for buying sav-ings bonds now. New I-bonds are yield-ing zilch, combining a fi xed rate of 0 percent, which lasts the life of the bond, with an infl ation rate, reset semiannu-ally, that has dipped to -0.8 percent (the Treasury doesn’t allow the combined rate to drop below zero). Series EE bonds pay a fi xed 0.3 percent. You can’t redeem either type of bond within a year of the purchase date, and if you pull out the money before fi ve years have passed, you’ll be penalized the last three months’ interest.

If, however, you’re determined to put money into a savings bond — say, be-cause you want to give one as a gift — go

with an EE bond, advises Jackie Brah-ney, marketing director of SavingsBonds.com. The Treasury will adjust the bond’s value to double the original issue price after 20 years if interest payments have not raised the bond’s value to that level. That’s a minimum return of 3.5 percent.

Because the fi xed-rate component on

new I-bonds is so anemic (the Treasury hasn’t issued one with a fi xed rate of 1 percent or more since 2007), the bonds offer little opportunity for growth in your money’s buying power, says Greg McBride, chief fi nancial analyst for Bankrate.com. If you own an I-bond, you don’t have to worry about a loss of principal because the combined rate never falls below 0 percent. But the com-bined rate can fall below the fi xed rate. A bond that was purchased in May 2001, for example, has a fi xed rate of 3 percent; accounting for the -0.8 percent infl ation rate, the current combined rate is only 1.38 percent.

For now, most savers who want a safe place to park cash are better off using a high-yielding savings account or certifi -cate of deposit.

SUCCESS

People often run into problems when they are benefi ciaries of assets held by fi nancial institutions after the death of a donor.

For example, several readers have written to me indicating that even though they have documented proof that they are named benefi ciaries of assets, institutions holding those assets have told them they cannot transfer the assets into their names or sell them until probate is completed — even in cases where probate is not necessary.

If this situation applies to you, there are actions you can take. The Financial Industry Regulatory Authority (FINRA) has issued an investor alert titled “Plan for Transition: What You Should Know about the Transfer of Brokerage Account Assets on Death,” available online.

If you are the owner of fi nancial assets held by a fi nancial institution, you can make things easier for your benefi ciaries by using one these options for account

ownership, which may ensure that pro-bate is not necessary for your fi nancial assets.

Trust accounts: A trust allows a trustee to hold assets for the benefi t of one or more benefi ciaries. Assets are transferred on the basis of the terms of the trust, and they generally avoid probate. Provide your fi nancial fi rm with a copy of the trust agreement. Assets should be immediately available to the benefi ciaries of the trust.

Joint tenancy with right of survivorship (JTWROS): Each party has equal rights to the account’s assets. When one co-owner dies, the assets in the account can pass to the co-owner(s) without probate.

Tenancy in the entirety: This is similar to JTWROS, except that it is generally used for married individuals (including same-sex married couples).

Individual retirement accounts (IRAs): You can specify a primary and secondary benefi ciary for each IRA account. This designation supersedes any designation in your will or trust.

Transfer on death (TOD) plans: For non-retirement accounts, you can specify the inheriting benefi ciary but not secondary benefi ciaries. A TOD plan also supersedes any designation in your will or trust, and it generally allows an account to avoid probate.

If you specify the benefi ciaries only in your will, then your benefi ciaries will not have access to these accounts in a timely manner. If probate is required, it may take over a year for your benefi ciaries to have access to these assets.

FINRA also recommends the following steps for donors:

■ Retain account statements and trade confi rmations.

■ Work with your brokerage fi rm. De-termine whether the fi rm offers services to account holders and benefi ciaries to discuss assets, last wishes and the transfer process after your death.

■ Designate benefi ciaries with care. You should retain a copy of the latest record of the benefi ciaries you have designated with the fi rm and have that available in a convenient place for your benefi ciaries.

If you are a benefi ciary, FINRA recom-mends the following steps:

■ Notify the fi nancial institution in a timely manner of an account holder’s death.

■ Provide all documents requested by the fi rm in the format and manner requested.

■ Assess whether the current fi rm and broker are right for you.

Contact FINRA at 844-574-3577 or your local bar association for an attorney referral.

Elliot Raphaelson welcomes your questions and comments at elliotraph@gmail.com.

Avoid holdups in transfer of

assets after death

A TOD plan supersedes any designation in your will or trust, and it generally allows an account to avoid probate.

By Lisa Gerstner |

Hold off on buying savings bonds

LARRYHW/FOTOLIA

Reinventing the heel: After 98 years Converse is updating the Chuck Taylor All Star, but will the counterculture accept it?MATTHEW MONTEITH

By John Brownlee |

Elliot RaphaelsonThe Savings Game

Copcutt

With his slicked-back silver hair, ear stud and ace of spades wrist tattoo, Richard Copcutt would fi t in just as well backstage at the old CBGB, the legendary ’70s punk rock club in New York’s East Village, as he does here in Converse’s new Boston headquarters. After all, a brand with as much counterculture cred as the Converse All Star needs a real live rebel at the helm — now more than ever.

Why did Converse mess with its iconic — and consistently lucrative — sneaker,

the Chuck Taylor All Star? It couldn’t afford not to.

CHUCK IT

SUCCESS

Terry SavageThe Savage Truth

We live in a throwaway society. From technology to fashion, we have become accustomed to almost instant obsolescence. And so we rarely think about “value” in terms of an object’s usefulness or pleasure over time. Obsolescence has become the norm.

But if you adjust your perspective of value, you might make different buying decisions. And the long term consequences of paying more now for things that last longer could re-sult in savings that give you greater financial security in the long run. So at the risk of impacting sales at Zara or on Craigslist, here are some examples of different decisions to make.

1. Consider the “wear-quotient” of clothing purchases. If you spend $1,500 on a prom or wedding dress that you wear only once, you have a lot less “value” than if you

spent $300 on a winter coat that you can wear 90 times a year for two or three years! The cost of each wearing of that coat is about $1 — a far better wear quotient than that fancy dress!

2. Buy the car instead of leasing. Yes, you can lease a lot more car for the same monthly outlay, because when you lease you are only “buy-ing” two or three years’ worth of “use” of the car. At the end of the lease, you have only paper receipts to show for your payments. But if you purchase a car with payments spread out over a reasonable time — no longer than four years — you’ll wind up with something you can still drive if life throws you a curve.

3. Judge quality, not price. It’s always worthwhile to search for the best price. The Internet has made that a lot easier. But when you can get both a good price and value, you really have a winning combina-tion. A bargain is not a bargain if your purchase breaks or wears out quickly. I recently saw an old Lionel train set that had been handed down from one generation to the next. Have you made a purchase that will one day please your grandchildren?

4. Limit the influence of “fash-ion” in all purchases. By defini-tion, fashion is transient. And if something you buy goes out of fashion before its useful life is over, you are letting merchants set you up for the next purchase — and more profits to them.

5. Consider the real value of purchases beyond the immedi-ate gratification. It’s great that we have become a nation of “foodies” — but there’s a much greater value proposition in trying your culinary skills at home than in paying for an expensive restaurant meal that is down the drain before you get the credit card bill!

These thoughts are not a recipe for austerity, but a reconsideration of how to spend your hard-earned money in a worthwhile way. Aside from an occasional splurge, the money you don’t spend can be diverted to start working for you in the future.

And don’t fall for that old excuse that the world’s such a mess that you might as well live high and spend today. Tomorrow will come. It always has. And that’s the Savage Truth.

Terry Savage responds to questions on her blog at TerrySavage.com.

5 things to know about

consumer value

Paying more now for things that last longer could result in savings that give you greater financial security in the long run.

Balaji Rajan is chief executive of Cean-nate Corp., parent company of iontuition, an online tool to help borrowers manage student loans. Here is an excerpt from our interview:

Kiplinger: Borrowers have com-plained that student loan servicers take too long to process payments and fail to correct errors, says the Consumer Financial Protection Bureau. What can borrowers do if they have problems?

Rajan: We have heard from borrowers about lost paperwork and payments. They should first go to the National Student Loan Data System to find their servicer, then make a call or go to the servicer’s website. The financial aid office of a bor-rower’s school can help.

Why do these problems occur?When 20 million student loans are be-

ing serviced, there will be problems. The current federal loan program has become too complex. Borrowers have multiple repayment options based on different dis-bursement dates or different interest rates. There are different sets of documents.

Students may have both private and federal loans. Sometimes borrowers don’t want to deal with it all.

What are the potential consequenc-es? If a payment isn’t posted, can it hurt your credit?

Servicers will not update a credit bureau report until a loan is 60 days delinquent, so missing one payment won’t harm a bor-rower. But multiple unposted payments can result in a negative mark on a credit re-

port. If a loan goes into default, it can affect a borrower’s ability to buy a home, as well as result in higher interest rates for auto loans and other types of credit. Borrow-ers can always place a dispute comment on their credit report if they believe the servicer has made an error. If borrowers go into default because of servicing issues, they should contact the servicer to dispute the default. They can contact their school to get help, or, with federal loans, contact the Education Department’s ombudsman. If borrowers provide servicers with the right documents, such as their payment history, or timely requests for deferment, the problem will generally be resolved within two weeks.

What can students do to prevent problems in the first place?

Borrowers can help servicers by regu-larly updating their contact information, so servicers are able to reach them before delinquency occurs. Many students tell us that servicers don’t have current email or phone numbers. Free websites such as iontuition can organize all of your loans in one place and notify you when you need to take action. Stay away from companies that charge for this service.

How to fix student loan errorsBy Sandra Block |

WAL-MART

Michelle Gloeckler serves as Wal-Mart’s EVP of the consumables and health and wellness divisions and U.S. manufacturing lead.

GSTUDIO GROUP/ FOTOLIA

This spring, I had the privilege of attending a gathering of Wal-Mart associates (employees) across 18 countries during its first Global Women’s Forum. As

part of the Forum, a group of powerful women including Academy Award-winner Geena Davis, PepsiCo Chairman/CEO Indra Nooyi and BBC lead anchor Katty Kay spoke to thousands of associ-ates around the world about three topics relevant to both men and women in the workplace: confidence, mentoring and work/life integration.

As I shared words of advice to those in attendance, I reflected on my own career. Over the last six years, I have grown in my role at Wal-Mart, becoming the senior vice president of merchandise execution, and later the senior vice presi-dent of the home division, overseeing the buying, branding, product development and collaboration across functions.

Today, I serve as the EVP of the con-sumables and health and wellness divi-sions and U.S. manufacturing lead, and I

proudly accepted a role this year as the chair of Wal-Mart’s President’s Global Council of Women Leaders. For me, serving as chair of this council is not just another part of my job. My mentors have had a tremendous impact on my career, and I have always sought opportunities to pay it forward by exercising my pas-sion and energy for helping other women realize their potential.

Everyone faces challenges when building their career, and women often fail to talk about their struggles. That’s why I was so eager to accept my role of council chair, which gives me the ability to help thousands of female associates realize their potential and elevate their careers.

The President’s Council of Global Women Leaders launched the Global Women’s Forum, which focuses on developing the future women leaders of our company from across the globe and championing opportunities for women

to grow and thrive. As chair, I have the privilege to give back to the women I work with every day. As I’ve always said, sometimes you need time out of your day to think about yourself, your plan and how you’re doing. This is what the Forum provided our associates — an op-portunity to think about their own career plans and pathways to growth.

I’m so proud to work for a company like Wal-Mart, where the number of female board members exceeds the Fortune 500 average and the number of female corporate officers is double the Fortune 500 average. Wal-Mart and the Wal-Mart Foundation help to train nearly 1 million women across retail, agriculture and factories.

Now, Wal-Mart is taking another step by making the inspirational content from the Global Women’s Forum available to anyone through our free digital library of content for development at http://corporate.walmart.com/global-womens-forum.

At the Forum, it was said that, as women, we need to generate our own tail winds. My challenge to women world-wide is to use this library to listen to strong inspirational female leaders who once walked in your shoes and create your own tail winds to help advance your careers and lives.

‘Everyone faces challenges when building their career, and women often fail to talk about their struggles.’

Lean In stories come from the Commu-nity section of the Lean In website, an off-shoot of Facebook Chief Operating Officer Sheryl Sandberg’s best-selling book “Lean In: Women, Work, and the Will to Lead.”

For more, visit leanin.org.

By Michelle GloecklerExecutive Vice President, Wal-Mart

Wal-Mart Executive Vice President

Michelle Gloeckler:

I want to get rid of my time-share. Can I donate it to charity and get a tax deduction?

— R.C., Ogden, Utah

Yes, if you can fi nd a charity that is will-ing to take it. But you have to be careful. In some cases, a middleman will offer to

fi nd a charity for you for a stiff up-front fee, perhaps $5,000, and then either take months to close the deal or pocket the fee and walk away altogether.

You’re better off fi nding a charity that will accept the time-share directly, says Bennett Weiner, of the Better Business Bureau’s Wise Giving Alliance. You may have to pay a few hundred dollars in transfer fees, but avoid anyone, including

a charity, charging thousands of dollars in up-front fees. Start by going to www.give.org, www.charitywatch.org or www.guidestar.org, then contact a few charities. You’ll need an appraisal for a deduction of more than $5,000. You can only deduct the fair market value of the time-share; beware of groups offering infl ated appraisals. Also make sure the title is transferred to the charity.

SUCCESS

By Kimberly Lankford |

In the early days of your startup, you might be just fi ne handling your own basic bookkeeping and expense management or even outsourcing those tasks to a small fi rm or an individual. But you will reach the point where you both need and want more sophisticated help. Maybe you’re close to getting outside investors or maybe your revenues are growing faster than you projected (congratulations!) and you need to make sure you’re reporting them cor-rectly. Once you’re at this point, you’ll want to put yourself in experienced hands.

Hiring an outsourced CFO is one way to step up your game when it comes to your startup’s fi nancial management, while keeping your cost structure fl exible. But who you hire matters a lot. Here are some suggestions to help you fi nd the right fi t.

Finding an outsourced CFO

Ask for referrals. Tap your network of service providers, fellow founders, advisers and incubators/accelerators/co-working spaces.

Look for fi t. Don’t necessarily jump at the fi rst person or fi rm you meet. Take fi t into account and check credentials, back-ground experience and skill sets against your business needs.

Check out the client list. Ask candidates for the names of clients who are represen-tative of the range of services offered. If a fi rm has experience working with clients similar to yours in terms of industry, stage, etc., that’s a good sign that they have the expertise that your company needs.

Interviewing outsourced CFOs

Outsourced CFOs can offer so much more than just “handling the numbers.” Beyond fi nancial forecasts, budgets, busi-ness modeling, fi nancial plans, pricing,

revenue recognition strategy, cash man-agement, cash-burn analysis, monthly reports and M&A support, CFOs can help with investor relations, strategic planning and so much more.

It will be easier to fi nd the right fi t if

you’re clear about what you want and need from the outset, while still being open to listening to CFOs’ suggestions. Find an outsourced CFO who can meet your cur-rent needs and grow with you — at least until you reach the point where you’re

ready to bring on someone in-house.

Ask the right questionsWhat specifi c experience do you have working with startup businesses? Startups demand a CFO’s unique skill set. Of course, any candidate needs account-ing credentials, expertise with fi nancial projections and budgets management skills. But startup CFOs also need to have good negotiation and strategic planning skills and extensive contacts with potential funding sources.

What’s your domain expertise? Differ-ent people and professional services fi rms may specialize in or have strengths in a couple of specifi c areas. Make sure that the ones you consider can offer you full-service support.

How do you typically work with clients? You’re trying to understand whether this person has the capability and desire to partner with you in the development of your fi nancial infrastructure. This encom-passes the ability to wear multiple hats and the fl exibility to adapt to quickly changing circumstances.

Your relationship with your outsourced CFO should be an ongoing open dialogue. Your CFO should be a trusted business partner who helps you with all aspects of your business. And remember, you don’t outsource to make responsibilities go away. You do it to enable your team’s continued focus on your core skills and chief objec-tive: growing the business.

David Ehrenberg is the founder and CEO of Early Growth Financial Services, an out-sourced fi nancial services fi rm that provides early-stage companies with day-to-day transactional accounting, CFO service and more. BusinessCollective, launched in part-nership with Citi, is a virtual mentorship program powered by North America’s most ambitious thought leaders, entrepreneurs, executives and small business owners.

How to hire an outsourced CFO for your business

Get a tax break for donating

your time share

TONSNOEI/FOTOLIA

By David Ehrenberg |