Running Household Finance As A Business, The Introduction

Contributed by mm | March 9, 2007 11:06 AM PST

In my daily job, I navigate different avenues of corporate finance and manage hundreds of millions dollar of annual budget. Outside of work, I read and research extensively about personal finance and play with my gold pot that will hopefully reach 7 figures in a couple of years. Corporate finance and personal finance by definition are very different disciplines, but they are also similar in some key concepts. In fact, I found it is interesting to examine our household finance under the corporate finance microscope.

So here comes this series, in which I attempt to look at our family finance in the light of corporate finance.

INTRODUCTION TO BUSINESS

MM Household is a multi-national holding company that extends across a number of different business lines. At this moment, it includes four 100%-owned subsidiaries:

Money Manager Co. offers first-class corporate finance controllership service, people management and finance professional development courses. Currently we are dedicating our resource to support the Asia Pacific operation of a Fortune 50 company in the IT industry.

Perfect Future Publishing Co. was started in 2003 to offer free personal finance tips, independent reviews and experience sharing online in the U.S. market. Perfect Future Publishing Co. is supported by advertising revenue.

Expat Service Co. is our newest subsidiary that just started in late 2006. It partners with global relocation management companies to offer leading destination services and cross cultural training to expatriate families relocated to China.

Value Invest Co. is the investment arm of MM Household that engages in a number of investing opportunities to seek maximum return of the company's financial assets.

Next: The Cash Flow Chart of MM Household.

This Post Has Received 5 Comments. Share Your Opinions Too.

CPA1298 Commented on March 10, 2007

MM - I like where you're going with this post. However, I'm confused about the 'subsidiaries'; which of these are actually entities you've incorporated? I know you've incorporated some of your side businesses, but which ones?

MM Commented on March 10, 2007

I would consider the subsidiaries mentioned above more like different business segments. They do not have to be a separate business entity.

Having said that, I did try to incorporate the Publishing Co., but the mounting foreign tax credit on my personal 1040 actually encourages me to keep it as a sole proprietorship.)

LatinGuy Commented on March 18, 2007

Aha! For the record, I guess it was the first time that you revealed details about your new sideline business! As a long time reader, I think it does make all the sense to invest in something that you & your wife may thrive at (helping U.S. expats in China). As always, congrats and success going forward.

Michael Halls-Moore Commented on April 12, 2007

It's great having a business running at home. In the UK we can get tax benefits as long as certain areas of our house are declared as use solely for work. I assume there is something similar over in the US?

This is a bit of a minefield, but with an accountant it can have a major gain (especially for me as I'm a web developer and do a LOT of work at home!).

Arusn Commented on April 18, 2008

Corporate finance and personal finance by definition are very different disciplines, but they are also similar in some key concepts.