ELLEVEST INSIGHTS

Latinas are a powerful engine for the US economy, starting and growing 2.1 million businesses and employing over 873,000 people. Between 2019 and 2024 they have experienced impressive growth with revenue surging by 61.7% and substantial increases in employment (nearly 20%). 

But Latina business owners don’t have it easy as they often face cultural and language barriers. Their average revenue is far below what companies started by white women bring in. That may be because many of these businesses face bias in the credit scoring industry and difficulty getting loans. If Latinas were truly able to unlock their full potential they would generate an additional $1.7 trillion for the economy but they will need access to capital, training, mentorship, and networks.

Legal and financial steps go hand in hand — especially for Latina entrepreneurs building something that lasts. Think of your legal structure as the frame that supports your financial goals. The right setup protects your personal assets, clarifies how you pay yourself, and can even open doors to tax advantages and funding opportunities. Pair that with strong financial systems and you could have a foundation built for growth and peace of mind. It’s not just about compliance; it’s about confidence. When your legal and financial worlds are aligned, you’re not just running a business — you could be building generational wealth with strategy and intention.

‍

‍

Building your legal foundation

One of the first things I remind business owners, especially first-gen and Latina founders, is that legal isn’t a “nice to have.” It’s the foundation that could help protect everything you’re working so hard to build. Here are three areas I always recommend starting with:

Entity choice.

A lot of entrepreneurs start out as sole proprietors because it feels simple or less expensive. But the trade-off is sometimes a big risk: if something goes wrong, your personal assets (your savings, your car, even your home) could be on the line. Forming an LLC or corporation creates a layer of protection between you and your business. It also determines how you’ll be taxed, which is why it’s smart to loop in both your attorney and your financial team early.

Protecting your brand.

Your brand name, your logo, your tagline aren’t just for your marketing, they’re major business assets. Registering a trademark ensures you own it and that no one else can profit off your brand’s identity. For Latina-owned businesses, where culture and community are often at the heart of the brand, protecting that identity early can make all the difference.

Contracts.

It’s tempting to rely on trust, especially when you’re working with friends, family, or community referrals. But I’ve seen too many relationships strained (or businesses derailed) because expectations weren’t clearly spelled out. A good contract doesn’t just protect you if things go south; it also makes sure both sides are clear on deliverables, payments, and responsibilities from the start.

Legal can feel intimidating, but it doesn’t have to be. Think of these steps as setting up guardrails: once they’re in place, you have more freedom to grow, experiment, and take risks — without worrying that one small mistake could undo it all.

‍

Building your financial foundation

First things first: bulk up your savings.

When you’re building your business, your financial foundation starts with clarity. That means setting up separate accounts for your business and personal finances. Keeping your business income, expenses, and taxes distinct not only helps you stay organized but also positions your company as the professional entity it is. On top of that, it’s important to be clear on the runway your business needs — meaning how much you need to cover business expenses and overhead for, say, six months. Keep that separate from your personal savings or emergency fund so both your personal and business finances are protected and resilient. Plus, separating these accounts makes things a whole lot smoother come tax season (and when you’re ready to scale). Think of it as setting the boundary between you and your business — so you can nurture both with intention.

Next: know your cash flow — and pay yourself.

Remember: you can’t pour from an empty cup. Build a cash flow plan that gives every dollar a purpose — covering business expenses, setting aside for taxes, and yes, paying yourself regularly. Even a modest, consistent paycheck signals to you (and your business) that your work has value. Over time, this builds not just stability, but confidence and sustainability.

Finally, think beyond today: build for your future.

Retirement accounts, like a SEP IRA, are tools for your wealth. Investing early and often helps your money grow alongside your business. A general rule of thumb is to aim for about 15% of your income, though that will depend on your cash flow and other goals — the key is to make a plan to increase contributions over time. Keep in mind the limits: you can contribute up to 25% of your net earnings or $70,000 per year, whichever is less. 

Avoid common red flags like mixing personal spending with business funds, ignoring taxes, or skipping savings “until things slow down.” The truth is, wealth building happens while you build your business, not after. You’ve worked hard to create something of your own — now make sure that hard work builds lasting wealth for you and your future generations.

‍

Bringing it together

Legal and financial steps go hand in hand — especially for Latina entrepreneurs building something that lasts. Think of your legal structure as the frame that supports your financial goals. The right setup protects your personal assets, clarifies how you pay yourself, and can even open doors to tax advantages and funding opportunities. Pair that with strong financial systems and you’ve got a foundation built for growth and peace of mind. It’s not just about compliance; it’s about confidence. 

When your legal and financial worlds are aligned, you’re not just running a business — you’re building generational wealth with strategy and intention.

Building your business — and your wealth — doesn’t have to happen all at once. For Latina founders, every small, intentional step counts: opening that separate account, paying yourself consistently, setting up a retirement plan, or talking to a legal pro about the right business structure. Each move builds your foundation and your confidence.

‍

To get more advice as a Latina entrepreneur and set yourself up for long-term success, book a call with an Ellevest financial planner  — and to learn more about how to best protect your brand, services, products, and content, visit legalmigalaw.com.