Blog

• The Goal Formula

  Posted on 08/16/2017 in Planning, Success

  Goals are an important facet of making progress in life.  I’ve talked with a lot of times and I find that sometimes people talk about their goals, but they are not really talking about their goals.  They are talking about wishes.  When I hear someone make a wish it sounds something like this.  I want to grow my business.  I want to make more money.  I want to take more time off.  I want to improve the relationship with my son or daughter.  I want to have a better marriage.  The problem with these “goals” is they are not goals. Let’s deconstruct one of these wishes and see where the problems are.  I want to grow my business.  Here are the problems I see with this wish: There is no measurable criteria in this wish.  How is one to know when the the business is grown?  Am I looking to grow sales?  Am I looking to grow profit?  Am I looking to increase my market share?  What exactly is my objective? There is no deadline in this wish.  It does not give one a timetable to work on.  Without a deadline, once could wait 30 years to reach the wish….

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• Oops!

  Posted on 08/15/2017 in Planning, Taxes

  Mark Twain once said, “Never put off till tomorrow what may be done the day after tomorrow just as well.” But Twain’s advice doesn’t always pay when it comes to taxes. The calendar watchers at the IRS charge a 5% per month failure to file penalty, up to 25% of the amount due, along with a ½% per month failure to pay penalty, also up to 25% of the total amount due. And the IRS isn’t the only tax man to pay attention to deadlines, even if they don’t loom as large in our minds as April 15. Presidio Terrace is a private block-long oval of a street in San Francisco’s pricey Presidio Heights neighborhood, lined with 35 multimillion-dollar mansions. Residents have included Senator Dianne Feinstein, Representative Nancy Pelosi, and former San Francisco Mayor Joseph Alioto. There’s a stone-gate entrance to the street, a rent-a-cop stationed at the gate to keep out snoopy mcsnoopfaces, and a manicured island inside the oval for residents to enjoy. The street and sidewalks are owned by a homeowners association made up of surrounding residents. Because it’s private, the association pays tax on the property — in this case, a whopping $14 per year. Now,…

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• How to Pass the CPA Exam Part Two

  Posted on 08/10/2017 in Planning, Success

  This is part two of my post on how to pass the CPA Exam.  This first post dealt with the planning portion of my CPA exam preparation.  This post deals with the work I did to pass the CPA exam. I had two priorities at this point in my life.  One priority was to build my accounting business and the other priority was to pass the CPA exam.  About two weeks into my CPA exam study I realized that I was getting behind on my study schedule.  The reason I was getting behind was I was spending too much time networking to build my accounting business.  I had to make a difficult decision.  My decision was to spend more time studying so I didn’t fall behind on my CPA exam study.  This would mean it would take me longer to build my client base in the short term.  However I knew that passing the CPA exam would be the best career enhancement. On average I spent 4 – 6 hours a day studying for the CPA exam.  I spent four and a half months on this endeavor.  The most important aspect of the study was the practice questions.  The practice…

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• How to Pass the CPA Exam Part One

  Posted on 08/09/2017 in Planning, Success

  At first glance this post may seem like it may not apply to you.  Stay with me for a minute.  The purpose of this post is to explain a process.  How do you accomplish something difficult?  Because of the length of this post, I’m going to break this post into two posts. For those unfamiliar with the CPA exam.  The CPA exam when I took it was composed of 4 half day testing sessions.  One is tested on information ranging from business law, auditing, tax law, accounting standards and securities laws.  It was described to me that the knowledge  you need to know is a mile wide and an inch deep. I had just finished graduate school in the summer of 2008.  I was currently unemployed and little did I know that I was about to enter one of the scariest points of my life.  When I had started graduate school I had a good job.  When I started graduate school in 2005 the economy was robust.  Little did I know that when I finished graduate school the country would be in the midst of the Great Recession. I was unemployed when I finished graduate school.  I had two children…

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• Bottoms Up!

  Posted on 08/08/2017 in Planning, Taxes

  What were you doing at the end of your day on Friday, August 4? Were you knocking back a bottle of suds at your favorite happy-hour bar? Enjoying vacation time with a cold one overlooking a beach or a harbor? Maybe feeling ripped off paying $14 for a tallboy of St Louis’s finest at your local ballpark? Well, hopefully you were doing something like that, because the first Friday in August is International Beer Day! Beer is the world’s oldest alcoholic beverage — chemical tests of ancient pottery jars reveal that brewers produced beer as long as 7,000 years ago in ancient Iran. It’s the third most popular beverage overall, behind water and tea. (Sorry, Starbucks, it’s the rare coffee drinker who chugs more than one of your lattes in a day.) As Ben Franklin once famously said, “Beer is proof that God loves us and wants us to be happy.” It’s almost as easy to make as it is to drink, and you can do it with as few as three ingredients: water, hops, and barley. So . . . would it surprise you to learn that taxes are actually the priciest ingredient? Taxes are more expensive than labor…

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• Making More By Paying Less

  Posted on 08/01/2017 in Planning, Taxes

  When affluent clients want to pay less tax, they turn to accountants, attorneys, and financial advisors, among other advisors. And we can make a nice living helping clients accomplish that goal. (At the risk of sounding self-serving, it’s because we’re worth it.) But you won’t find any tax professionals populating the Forbes 400, or your hometown paper’s list of richest local residents. Having said that, there are a few people who have made legitimate fortunes helping people pay less tax. They just aren’t working where you think they are. Most of us don’t give much thought to tariffs, simply because we don’t directly pay them. When we do pay them any mind, we typically think of international trade policy and raw materials like steel. But governments impose import taxes on consumer goods, too, including luxury favorites like perfume and cologne, watches and jewelry, high-end spirits, and the like. And while those duties don’t add up like income taxes, buyers don’t want to pay any more of them than they have to. Robert Miller grew up in Massachusetts and attended Cornell University’s prestigious School of Hotel Administration. But he took a different direction than most of his classmates, and five years…

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• How to Eat an Elephant

  Posted on 07/27/2017 in Planning

  An elephant is a big thing.  At 9 – 11 feet and 12,000 to 13,000 pounds the animal is massive.  You got a big trunk, two 10 foot long tusks, two ears, a tail, four legs the size of trees and a tail to boot.  How do you eat an elephant?  One bite at a time. If you haven’t thought about it recently, it’s worth taking the time to ask yourself a few questions about what you want your life to be like in five years.  A lot of things can happen in five years.  Think about each of the areas of your life and what’s important to you.  Think about relationships with family.  Think about career or business.  Think about hobbies that you would like to do.  Would you like to go on an adventure?  Would you like to travel to some place?  What would you improve in your life you could get what you want?  The fact of the matter is you are the one driving the ship of your life.  If you want something, only you will be able to get what you want. I had a conversation with someone recently and the person said I’d like…

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• Celebrities Behaving Badly

  Posted on 07/25/2017 in Planning, Taxes

  One day back in March, 2002, Us Weekly editor Bonnie Fuller spotted a photo of actress Drew Barrymore bending over to pick a coin off the ground. A light bulb flipped on over her head, and on April 1, her magazine debuted a brand-new photo feature that changed the paparazzi game forever. We’re talking, of course, about “Stars — They’re Just Like Us.” (Of course, they’re still not quite just like us . . . how many photographers are fighting to catch pictures of us picking up our dry cleaning, filling up our gas tanks, or trying to pick the ripest avocado at Whole Foods?) Here’s something else the stars share with us. They don’t want to waste money on taxes they don’t have to pay. And since they tend to make more money than we do, they tend to owe more taxes. So that pain over unnecessary tax is greater for them than it is for us! (Who says money solves all your problems?) But sometimes they go a little too far to pay less. And that’s when they discover our friends at the IRS lying in wait. Here’s the problem: the IRS doesn’t have nearly enough money to…

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• The 10% Solutions

  Posted on 07/20/2017 in Business, Finance

  In my previous post, I talked about how Cash is King.  I ended the post by discussing the topic of building a cash reserve. I’ve heard people say that I can’t afford to build up cash reserves.  My reply is you can’t afford to not build up a cash reserve.  If you don’t build up a cash reserve it is just a matter of time before you run into an emergency and you need to purchase equipment, inventory, etc. so that your business can operate according to your plans. If you think you can’t afford to build up cash reserves, then it probably means one of two things: The business is not generating enough sales. The business is spending too much money. I don’t think anyone should wait to save money.  If you put of saving money now, you will continue to put off saving money until you need the money.  The only way to save money is to save money. There are two important aspects of saving money: Start now Have a separate bank. Start now.  Maybe you start with $1 a day.  Maybe $100 a day. Maybe $100 a week.  Start now so that you can establish a…

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• Cash Cushion

  Posted on 07/19/2017 in Business, Planning

  There is an old saying that Cash is King.  I remember watching a movie once where one of characters said I believe in the Golden Rule – He who has the Gold Rules. Cash for a business is like oxygen for us humans.  Without cash a business will start to suffocate and soon die.  In order to keep a business alive cash should be constantly coming in so the business can breathe.  A business cannot be healthy without a steady stream of cash. Most businesses experience some seasonality in they income and expenses.  Realtors will tend to be more busy during the summer months when there are more people buying and selling their homes.  Retail businesses may be busier in November and December when people are buying gifts for Christmas. Let’s look at a retail business as an example.  The business needs to increase its inventory at the end of October so that it can benefit from increased customer demand during the November and December busy season.  In order to purchase the extra inventory, the business has to two options: Purchase inventory with existing cash Borrow the money Borrowing has the benefit of enabling one to get the funds so…

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