Met a man yesterday who had had some challenges but had begun to overcome them. He almost had everything in place to really become successful. I asked him what was holding him back. He said “fear of success” – really a fear of what other people would think if he were successful.

I told him that it sounds like he needs to change his definition of success and may change the people around him. Old saying – “How can soar like an eagle when I work with a bunch of turkeys?

Any relevant thoughts and comments are welcome.

This is non-taxable money that can be put back into your family budget just by making a different decision.   How’d you like to have that much back in your budget?

George and Vanessa (not their real names) recently came to see me regarding their finances.  They were not happy.   It seems that in goiing over their finances, they should have more money saved  than they do.

In reviewing their budget, it seem that, yes, they should have more  money available to save.  So I decided to play “detective” and question them on their daily habits.  Guess what I found out!

George and Vanessa were spending money on groceries and then also buying breakfast and lunch while at work. On average they were each spending almost $15 day.  That’s $150 a week!  Even if they took a two week vacation, the additional spending would amount to $7,500.  That’s $7,500 that could be invested, be used to pay off or down debts, create a college fund, you name it!

As you can imagine, they were both shocked.  In fact they had thought it insignificant and had not even considered it as part of their budgeting.  They had a decision to make – stay the course or change their habits.

George and Vanessa decided to cut back extremely on their breakfast and lunch spending and begin to buy groceries that they could take for breakfast and lunch or took take “left-overs” from the previous night’s dinner.  This will probably save them $7,000 a year.  It’s like getting a raise without getting a raise.

(Of course, the food vendors will not be happy – you can’t please everybody.)

So take a look at your food and meals budgets and see if you can save, too.  Who would you rather have the money – your family or the food vendor?

To Your Financial Health,

If I can help you with your tax planning,  tax preparation, bookkeeping or marketing plans, give me a call.  I’d love to hear from you.

During our consulting session, we discovered that Dr. Watson could “kill 2 birds with 1 stone”.  He could get the equipment he needed now and reduce his taxes at the same time, but he had to act fast!

Recent changes in the IRS tax laws would allow Dr. Watson to completely write-off his new equipment (up to as much as $500,000) this tax year (2011) if he entered into a purchase agreement and began using the new equipment before December 31, 2011.  (Normally, he would have to “depreciate” the cost of the equipment over its useful life which could be anywhere from 3 to 40 years.)

Using a credit card for a small down payment and the vendor’s line of credit, Dr. Watson purchased $10,000 in new equipment for his music studio.

So, What does this do for Dr. Watson?

• As a sole proprietor falling into about the 20% tax bracket, his purchase will save him $2,000 in taxes when he files his tax return,
• He’s now able to attract new business and offer his previous and current clients faster service on cutting edge technology,
• He preserves his cash now and won’t have to make a payment on his equipment for 30 to 45 days.  (Just enough time to bring in a couple of new paying, clients!)

The IRS tax laws used by Dr. Watson also apply to the business use of computers, software, vehicles, furniture and fixtures, etc.  but these laws may change after December 31, 2011.

As usual with the tax laws, your situation may be different.  In some cases, if your business is going to report a loss before these equipment deductions, you won’t be able to use the write-off this year.   The write-off will carry forward to the next year.  This is why you will need to review your particular situation with your tax accountant (or me).

Hopefully, you’ve found this helpful.  Feel free to comment.

If you’d like to contact me regarding this or other tax planning or business ideas, please give me a call at 240-356-5050.

To Your Financial Health!

A few months ago, I attended an event sponsored by The Center for Non-Profit Advancement.

One of the several excellent presentations was “Diversifying Your Funding Sources”. The main argument was that non-profits depend upon only 1 or 2 sources for the majority of their income and that other sources should be identified or created.

Below is a list of potential sources that were discussed:

How’d you like to be debt free in 1/2 to 1/3 the time without spending any more money than you currently spend? Just complete the form below and you’ll receive an email with more information.

To Your Financial Health!