Episode Transcript
[00:00:00] Speaker A: Foreign.
This episode of youf Life and Legacy. We'll be discussing how business owners can move from reacting to the numbers to using financial information intentionally. We will explore how cash flow, tax strategies, margins, financing and long term wealth all fit together.
Welcome to YOUR Life and legacy. I'm your host, Christopher Nudo. For business owners, a major part of legacy is financial the cash the company produces, the taxes it pays, the value it creates, and whether the business ultimately becomes an asset that supports the family rather than a source of constant stress. My guest today is Keith Huguet, cba, CPA, and founder of Next Level Accounting and Tax. Keith, welcome to the show.
[00:01:20] Speaker B: Thank you, Chris.
[00:01:22] Speaker A: Listen, what our viewers need to know is you have more than 20 years of experience in tax preparation planning, and you've worked for both Fortune 500 companies and small businesses.
You know, you're known for helping clients with their legal tax savings, improving their financial decisions and building basically just really a stronger business for themselves.
So my first question, Keith, is many entrepreneurs start a business because they, they're good at really the work that they do, but not because they love the financial part of it. At what point does avoiding the financial part, the numbers, really become a burden into, you know, their success, their growth and their overall success of the business?
[00:02:16] Speaker B: I found that most folks that go into business for themselves and actually plan ahead to do it, they don't just suddenly quit and rush off and start a business. They actually sit down with an advisor ahead of time to figure out what they need to do. Ends up making a much easier transition. Otherwise you get the oh my goodness, it's April 15th and I have to do something, but I don't know what. All I have to do. Or I get a call and it's hey, can you file an extension?
And then it's getting pushed again until now when the extension time is either passed or the returns are due. So I would say that it's not something that you want to wait on.
It's something you want to get ahead of before you even really start figuring out where that first client's going to come from.
It's are how are you going to go about making your business decisions? And unfortunately, many business owners, what they end up doing is they end up thinking they're doing very well based on a bank account number.
[00:03:29] Speaker A: And why does that not be true? Why is a big bank account or making decisions based on a bank account number not a good way to manage your financials?
[00:03:42] Speaker B: Well, with that it's most people will spend what they have in their bank account
[00:03:47] Speaker A: Ah,
[00:03:47] Speaker B: there aren't many people that go ahead and set aside what they have there. They've got their living expenses, and many people will go ahead and commingle everything.
They're going to throw their personal expenses in with their business expenses, especially on their first business venture, because they don't understand that really you need to look at it as a, let's say a sister, brother or cousin. They're not you.
But most people that never have operated a business just go into it thinking, I just need to make money so that I can pay my rent, so I can pay food, make sure the kids have clothes. All the things that they used to do with the W2, but now, because they've had this entrepreneurial moment that they want to go into business for themselves, they just start.
And unfortunately, there's a lot of pitfalls that can happen if you do it that way.
[00:04:46] Speaker A: Now, I'm guessing that really this is kind of like a chicken and egg kind of thing, because I would suggest that most business owners go into business thinking to themselves, well, Keith, everything you're saying makes all the sense in the world, but until I can make some money, how do you want me to manage my finances yet? I know what you're saying, Keith, you're right in that until there's a structure, a plan in place to, when the money comes in to properly deal with it, allocate it and stuff of the nature that, you know, they're going to spend it on the kids, clothes, food, groceries, and not properly allocate it. So what the
[00:05:31] Speaker B: other side of that becomes when they first start off, generally speaking, that first year is going to be a loss.
So where are they going to get the money from?
So they go to their credit cards and they go and get a loan.
And that first year there may be a loss, but unfortunately we still have to report how much money we made to the government. We still have to report what we spent. And if there is a loss, yes, there's no tax consequence, but that could affect the following year or following years moving forward along with what equipment got purchased. How do you handle the deductions of that equipment? And if you don't know what you don't know, which most business owners unfortunately don't, they end up making the decisions that. That can really have a huge impact on them.
But once December 31st at midnight hits, there's not a lot that can be changed as far as structure or what you're doing.
It's. It's the old pumpkin, you know, returns from the stagecoach
[00:06:38] Speaker A: yeah, yeah, yeah. Little Cinderella story without the glass slipper.
[00:06:42] Speaker B: Exactly.
[00:06:43] Speaker A: So what are, what are some of the first financial indicators an owner should understand well enough when they call their accountant? Like what? What's what I'm thinking in my question. I'm thinking red flags, right? What are some of those things that you wish every business owner that's calling you for the first time? What are some of the things you'd hope to hear from them?
[00:07:06] Speaker B: You know, I would say from the get go, make sure you open up a separate bank account.
Run your business from that bank account. If you, if you need to take money out, you'll take it out as a drawer. You'll. You'll remove the money from the account. Any money that you earn, you don't put in your personal account, you put into that business account, even if you're barely moving and things aren't happening real quick if you start off with that.
And if you're gonna use credit cards, you dict dick, dedicate that credit card that you're going to use for business. Don't do both personal and business on the same credit card.
Most people that have had a job and they have their credit, they're not losing it just because they started a new business. So going and getting a new credit card that has a reasonable limit on it isn't that hard to do. And then you can dedicate all the expenses directly from that to business. So if you're not necessarily keeping records and at the end of the year, you need to put something together, it's easy enough to go to the bank, download your activity into an Excel spreadsheet, download the credit card activity into a spreadsheet, and you can create financials based on that information.
If it's all commingled and in one big mess, it makes it much more difficult and a lot more meat for an IRS agent to go after and look at, to say what they determine to be personal in business versus what you're saying is personal in business.
[00:08:50] Speaker A: Makes perfect sense. So you get the guy. He's doing pretty good. He's got sales, he's growing. But he's like, Keith, I still don't feel financially secure.
So what do you say to that guy?
[00:09:06] Speaker B: You know, that takes. That's. That's a tough position to be in because, okay, we're surviving, but how do we go from surviving to thriving?
And a lot of that has to do with, okay, do we have budgets in place personally? Do we have budgets in place for the business itself? Because your business is what's driving your wealth. If you're going to be a business owner and it's your vehicle to make you get the wealth you want to have.
And most people that give advice, from what I've seen over time, is how to reduce your taxes, that's not necessarily going to be what your driving force should be because you might spend money that you shouldn't be spending at this time so that you drive down your expenses.
[00:09:57] Speaker A: Makes perfect sense. So we just have a couple minutes left in this segment here.
So from a legacy standpoint, why is financial clarity about more than just running the company efficiently today?
[00:10:16] Speaker B: Well, over time, when it looks, when we're looking at legacy, it's what are we going to sell the business for?
[00:10:21] Speaker A: Right.
[00:10:22] Speaker B: And in that case, most of us that are business owners, we overvalue our businesses.
We think they're worth a whole lot more than somebody else is going to want to pay for them, unfortunately.
So there's a lot of planning that needs to go into that because the few years that you need to be preparing for that eventual sale, you need to be maximizing income, not reducing your income for tax purposes. You want somebody to see what the potential is. Now, whatever games they want to play to reduce their tax liability when they own the business is perfectly okay. But you want to have a very high earnings before taxes interest and depreciation figure because a lot of businesses, when you sell them, that's the figure that's going to get a multiplier. It's not necessarily all based on just total sales or what we believe the company is worth because we're going to overvalue and a buyer is not going to want to pay what we value for our companies.
[00:11:26] Speaker A: Makes perfect sense. You know what financial clarity gives an owner choices. After the break, we'll get practical about the questions that keep business owners up at night. Cash flow, taxes, margins, and what to do with the money once the business begins to produce more of it.
Stay tuned. You're not going to want to miss it.
SA.
Foreign welcome back to YOUR life and legacy. Stay connected to this show and every NOW MEDIA TV favorite live or on demand. Anytime you'd like, Download the free Now Media TV app on Roku or iOS and unlock non stop bilingual programming in English and Spanish on the move. Hey, catch the podcast version at NowMedia TV.
From business and news, lifestyle, culture, finance, law and beyond, NOW Media is streaming around the clock. Ready when you are. Welcome back to YOUR life and legacy. I'm your host Christopher Nudo and I'm here with Keith Huguett. CPA before the break, we talked about why business owners need to understand the financial story behind the business.
Now I want to focus on the questions owners feel every day.
Do I have enough cash?
Am I paying more taxes than are necessary? Why are the margins not improving? And why does growth sometimes feel like it creates more pressure instead of more freedom? Oh, I can. I'm just shivering at even some of those thoughts as a business owner myself. So, Keith, why can a company show healthy sales growth while still experiencing cash flow pressure?
[00:13:49] Speaker B: Unfortunately, sometimes that does happen.
A lot of that has to do with prior workload debt load.
So that money is going to pay debt that was used to finance the beginning of an operation. Some of it has to do with our are we maximizing or maximizing what we can spend in an affordable manner? So, I mean, you've seen it now. Costs are going up across the board. You've got, you know, especially when you're looking at delivery charges with diesel prices and things like that that are going on today is are the business owners keeping up with increasing their prices to compensate for these additional costs without the fear that they're going to lose the business?
And a lot of business owners fear raising their prices so they don't want to lose the customers because there's somebody else that might do it for cheaper. But on the other hand, if you are not raising your prices, it could drive you out of business.
[00:14:58] Speaker A: Yeah, that's a really difficult thing. Raising prices and knowing where the market is and being undercut by your competitor, I'm sure keeps many business owners up at night.
So when a business begins accumulating excess cash, now, should an owner think about taxes or reinvestment personal wealth? I mean, which of these decisions should they tackle first, second and third?
[00:15:28] Speaker B: I would say a lot of it's going to depend on the age of the person. It's also going to depend on what their plan is. Like I said earlier on, the business is the vehicle to your financial success.
So are we taking care of our retirement? That's an important factor to be taking into consideration. When there's that extra money, there's going to be a tax bill with extra money. Are we planning for it? Do we have a savings set aside? Because we do have one or two partners that we never wanted. By having state and federal taxes, they want a piece of that puzzle. No matter how we don't want to give it to them, inevitably there's going to be some sort of tax if we're earning money and there's extra money in the bank account.
So then there's how do we want to grow?
Do we want to scale it so that we're not overspending now and then we're hitting a cash crunch because we planned on something that didn't happen.
A lot of times having that conversation at the end of the year is do we buy new equipment now or don't we? Comes down to do we need it now or don't we? Because we don't necessarily want to buy something now just for the discount on the taxes. Because in order to get that discount on taxes, we need to spend quite a lot of money.
[00:16:55] Speaker A: That's
[00:16:55] Speaker B: right.
[00:16:56] Speaker A: Because it's not a dollar for dollar expense. You spend twenty thousand dollars on a new machine, you're not getting a twenty thousand dollar tax deduction.
[00:17:04] Speaker B: No, we're not. We're losing. We're using a lot of cash flow to buy that $20,000 or possibly $20,000 piece of equipment.
[00:17:12] Speaker A: Yeah.
[00:17:12] Speaker B: And if we're financing it and we want that deduction now, then we're going to be paying for it for the next three to five years and we don't get a deduction for the next three to five years.
So that also has to be taken into account.
So we have to look at, you know, what scenarios play best. It's not something that's a one size fits all. It's these are times when you want to have the conversations with trusted advisors.
[00:17:42] Speaker A: Makes perfect sense. So, so what are some of the practical ways you and I were talking about?
You know, the fact that diesel prices are going up, costs are going up across the board, literally on everything. So you know, what are some ways that owners can really improve those margins without, you know, raising prices or cutting people? Although I do think that sometimes efficiencies in cutting people and building systems is a good way. But give us some of the, the ways owners can improve those margins without simply raising prices.
[00:18:19] Speaker B: You know, one of the things that a lot of owners do is they get used to their stack of things that they're paying for. They get used to the vendors that they're using.
[00:18:31] Speaker A: Yes.
[00:18:31] Speaker B: And that's something that needs to be evaluated regularly.
It's very possible that you're using some technologies, that there's new technology that have come out that are lower and you need to look, is there something that will do what I'm doing now, but it will do it for a lower price because technology is always advancing.
Can you have AI do some of the things that now can be done that used to be done by somebody or can you, you know, you don't necessarily want to lay off people because once you've got a good crew, you certainly don't want to start losing them. But are there people that are okay, you're keeping them because, well, you feel like they've been with you for a long time, but they're no longer doing what they used to do or they're not as efficient as they need to be.
Is there something that someone else can pick up that you can let them go and using AI still get the same amount of work done that you've been able to get done? Unfortunately, we all have to deal with AI. It is something and it's a tool that we all as business owners, if we're afraid of it, we're going to get mowed over by it. We have to be able to use it and we have to be able to have our employees learn how to use it so that they can help us with the use of it as well.
[00:20:01] Speaker A: It's my understanding from talking to many small business owners that really the largest expense that most small business owners have is payroll.
And so that's, you know, the people part of our business is, you know, the most helpful part, but also the most expensive part. And I think you're wise, Keith, in pointing out how, you know, maybe we can retool some people, reallocate, let AI pick up where some people are doing certain tasks. I think that's really good advice on how business owners can improve margins. Now let's switch gears to your tax planning work. Where do you see most?
Where often do you see business owners leaving tax savings on the table?
[00:20:56] Speaker B: You know, a lot of that comes down to, again, how old they are.
Do we have family? Do we not have family?
What are we doing? What are the big expenses? I mean, the old adage that you used to have with car insurance is if you switch to Geico, you could save 10%. But how much really is that savings? If it's really. When you look at the total cost you're spending on your auto insurance, if they're going to save you 10% at the end of the year, it's not a huge amount.
What if you could save money on health insurance?
That could have a huge impact. So depending on if you're a sole owner or not, there's ways of making it deductible.
So that's something to be discussing with ownership.
What are we doing for retirement? That always gets seems to be left off the table in many cases. And do we want to pay the taxes now versus paying the taxes later. That goes to the other question you asked earlier, is we have a whole bunch of cash right now.
What should we do to allocate it?
[00:21:59] Speaker A: Right.
[00:22:00] Speaker B: Well, where do we want it to be? Do we want a train that we pay the taxes up front so that the ride is free and at the end of the ride we got a whole bunch more money that we never have to pay taxes on, or do we want to not pay for the train ride and we pay for the train ride at the end of the train when we retire?
[00:22:20] Speaker A: So that really brings up the car. Our closing point here in today's segment, we have just two minutes left. And I Help me out with the conversations you have with people who are Proactively tax planning versus, you know, April 15th tax planning. They come to you and they're like, okay, the year's over. Keith, what can you put together for us versus the guy that comes to you in June and says, all right, I want to make sure we hit December 31st strong.
[00:22:56] Speaker B: So the big difference there is being able to do projections, having the time to look at what's happening now and if things are trending well, what we can anticipate, and then from there we can make plans for all the retirement or for new equipment instead of waiting. If it's in April, it's too late.
Like I said before, it's, it's, you know, Cinderella and the stagecoach turning into the pumpkin. I'm stuck with whatever I got and I'm going to make the best decisions I can to help a client. But if we start talking in, in June, July time frame and get a good idea of what's going on then, and then also again in November, December time frame, there's a whole lot more that we can play. There's levers that can be pushed and shoved and there's, there's some gamesmanship that might be able to be accomplished that we can't do if the 12 o' clock bell rings on December 31st.
[00:23:56] Speaker A: Yeah. Excellent advice for our business owners. You know, strong management is not just about keeping more cash. It's also about building an asset with increasing value.
Next, we're going to look at financing, enterprise value and what owners should be doing long before they get ready to sell.
Stay tuned.
Welcome back to your life and legacy. I'm your host, Christopher Nudo, and I'm here with Keith Hugo, cpa.
A business can produce income for years and still, still fail to become a valuable transferable asset.
In this segment, what we're looking at is what makes a company more financeable. That's a big word. But that means so banks can lend money on it. What, what makes businesses more resilient and ultimately more valuable to somebody beyond just that. Owner, founder.
So Keith, I know this is right in your wheelhouse. When an owner says I want to maximize the value of my company before I exit, what financial factors really matter most? What are those top five?
[00:25:50] Speaker B: You know, when I've talked to business owners about this, one of the big concerns is how much of that revenue stream is recurring.
If you don't one time revenue, you've got a lot of one time revenue that the value of that business is not as much as somebody that has a monthly revenue stream or an annual revenue stream that year after year they're going to get something.
So one of the things that we try to work with clients is if they don't have that revenue stream that can be, is there something that we can do to create that revenue stream so that they get something that's an ongoing, a club, a membership, something that their clients, even if they're traditionally maybe a one time or every X amount of years person that will come back because they like the experience, they're
[00:26:50] Speaker A: going to
[00:26:51] Speaker B: be more valuable to a company than the one time, hey, I needed to get something fixed, I went to this guy. The next time they don't even remember who that guy was that fixed, whatever it was and they're, they're going to find the next handyman, for example, another big thing. Sorry, go ahead.
[00:27:09] Speaker A: No, no, I was just going to say like as you're answering the question, I'm thinking to myself, our entire lives have been transformed to some form of subscription model. And I'm guessing that that's because it falls neatly into exactly what you just said. It really generates a predictable amount of income and really in that case establishes good value for the company. So I think every business owner should learn just by looking at what they're paying themselves right today.
[00:27:43] Speaker B: Absolutely. It's, it's, it definitely makes something more valuable.
And unfortunately there's a lot of business out there that, that's, that's not an easy find.
But that's one thing that definitely makes your company more valuable. A lot of people think that their client list is where their value is. And most businesses, that's true. But if you can't, if there's nothing that you have to resell to them, then that list isn't as valuable as somebody that does have something to resell to them.
[00:28:17] Speaker A: Yeah.
[00:28:18] Speaker B: So
[00:28:18] Speaker A: how early. How early should a business owner begin preparing for an eventual sale or transition? Even if you know what retirement feels like, you know, 15 years away,
[00:28:30] Speaker B: I would say it's better to start right. You know, when you. When you don't need to because you never know what's going to happen.
If something were to happen to you and the business isn't I isn't valuable to somebody else now, then it's not suddenly going to be val valuable. If you got hit by a car or you get sick and you can't work on it, the value disappears when your clients start using somebody else.
[00:28:58] Speaker A: Right.
[00:28:59] Speaker B: So it's always more valuable for you to start looking at what is. What does that planning look like to transition? Is there somebody that's working with you? Is there family that you want to transition it to, or what does that transition look like? It's also good to have the person that you're thinking of if there is a person that they're aware that you're thinking of doing this. Because a lot of children help out with their parents businesses, but they don't know when their parents want to walk away. They don't know what it's going to cost for them to take over, and they have no idea how to operate it because the parents haven't wanted necessarily to let the children know how much they're making.
So.
[00:29:40] Speaker A: Which is a crazy concept, but that is an absolute truth that you just said.
[00:29:46] Speaker B: So it's important always to be looking ahead and you know, you don't want to plan for your demise. There's no doubt nobody wants to do that.
But at the end of the day, we are finite.
So we do need to look at what is it going to look like and how do we transition what we've built. Because there is value and there is value in any business.
If, if you're doing H Vac, there's a competitor that would like to have your list.
[00:30:14] Speaker A: They
[00:30:15] Speaker B: may not give you a whole bunch of money for it because you don't have a recurring revenue stream, but they would like to have that so that they can send their mailers and they can let people know that they've got a program or something to that effect. But if you show no income from your business, nobody wants to work hard to make nothing.
So you've got to be able to show people that your business is a profitable venture.
[00:30:46] Speaker A: Yeah. So let's switch. Let's switch for a second over to banks because we're talking about value, company value, reoccurring Income streams. So let's talk about the lending community, because you and I know that that is a different community than the buyer side of things. So what makes banks more comfortable lending to a company? You know, like, what is the nature of the company and the way it's organized and the advice that you give those owners that take your advice that makes lending more appetizing?
[00:31:22] Speaker B: Well, first off, banks want financial statements. They want to see what you, how much revenue you're bringing in, how much revenue you're spending, how it is that you're spending that money.
A lot of things that you'll put on a tax return are not going to affect their decisions.
So depreciation, they don't care about.
They want to know, hey, is there money to pay a bill on a monthly basis?
And if you can pay that bill, they're going to be more likely to loan you money.
I found. And people think it, it's, it's, it's really sad. When you don't need loans, you can get them,
[00:32:02] Speaker A: Right.
[00:32:03] Speaker B: When you do need loans, you can't
[00:32:05] Speaker A: get them. Nope.
[00:32:06] Speaker B: So it's always better, while things are going very well, for you to go ahead and get those lines of credit established.
So you have that emergency fund if you need it. That doesn't mean you have to use it. And if you have to pay a bank $150 a year to have access to a sum of money that you need, even if you never access it, having the right to access it gives you a lot more freedom to be able to make some decisions that you otherwise wouldn't be able to.
[00:32:39] Speaker A: Yeah. Why? Wise things. But, you know, people are scared of getting it because, you know, it's like the first credit card. If you get it, are you going to use it? Are you going to be able to pay it? Do I have the discipline? But Keith, that's really good advice. So let's, let's go, let's go back to financial statements you had brought up. How do clean financial statements and like reporting discipline, you know, so let's start with what are clean financial statements?
[00:33:12] Speaker B: So to me, a good set of financial statements would be on an accrual basis. So what I mean by that is when you're doing your records, you're showing the invoice amount and how much you're due, and you're also in pointing, inputting bills into your system so you know how much you need to pay out.
A lot of small business owners, when they first start, they do everything with cash. So it's all When I receive cash, when I spend cash. But that doesn't give you, the business owner, a good view of what does that Runway look like. Do we have money that's going to be coming in? Do we have things in process that are going to generate revenue to pay the bills? Are we upside down? Do we have too many bills and not enough revenue?
Because at that point, you do need to start making decisions with regard to employees. If you have them, what are you going to do with them? Because we as business owners are taking a huge risk.
[00:34:14] Speaker A: Yes,
[00:34:14] Speaker B: we eat what we kill.
When we hire somebody, they get to be paid to keep a seat warm whether they produce or don't produce. Unfortunately, we have a requirement that they get paid for the time they work for us. So we need to make sure that we're making enough revenue to not only pay for ourselves and make money to pay our bills, but we're also paying for that employee that may or may not be doing a whole bunch for the time that they're working.
[00:34:41] Speaker A: That's right. So what, we just have two minutes left in this segment.
What mistakes do owners make when they treat the company as a job, say a W2 that pays them rather than an asset that they are intentionally building?
[00:34:59] Speaker B: So the big mistake there is value is not going to be you're working instead of working for John, the old employer, you've just decided, I'm going to do the same exact thing, but I'm going to work for myself. So, yeah, you don't have the man you're working for, but you've just made yourself a man.
And if you're not making it so your business has value, there's no difference between that and working for somebody else.
[00:35:29] Speaker A: Why?
The most valuable business is the one that creates choices. The choice to grow, finance, sell, transition or keep building.
After the break, we will be bringing those decisions back to the owner's personal financial future and the legacy they're building behind the work.
Stay tuned.
Sa.
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So welcome back to our last segment here of your life and legacy. I'm Chris Nudo and I'M here with Keith Huguett, and we're talking about taxes, cash flow, margins, financing, business values, transitions.
And in this final segment, I want to step back and ask the bigger question. How does an owner turn a successful business into a financial roadmap that supports the life they want and the people they care out and the legacy they want to leave behind? After all, is that not what our show is about?
So, Keith, you used the phrase take control of your money.
What does control actually look like for a business owner?
[00:37:58] Speaker B: You know, I, I think of it as having enough to be able to make the decisions that the business owner wants to make and also pushes the business in the direction that they want to go in.
[00:38:11] Speaker A: Okay, unpack that a little bit more for us. Give us like, you know, your favorite client. What, what, what is, how do they make their, what is the control they look like?
[00:38:23] Speaker B: You know, I think a lot of it has to do with, you know, having an idea of, and we spoke a little bit about this before, what are the personal goals?
And knowing what those personal goals are because they work together, the business is going to make those personal goals happen. So we need to know what is it that, that, that amount of money that we need for just the regular living, but also for the vacations. Because business owners that work 365 days a week a year, 40 hours, 60 hours, 80 hours a week, they're just working themselves to a point where they're, they're not going to be able to function.
They should be. Looking at time off is important to a business owner, just as it is to an employee.
And the business has to be able to afford that time off for themselves, their family.
It also needs to be able to afford their retirement and their future for their children if they want their kids to go to college. All these things are financial goals that the business needs to strive to fulfill. And that means that the business has to make enough money to be able to do not only all those goals, but also to achieve success within the business.
[00:39:52] Speaker A: And, and I, I, I want to tie this back to how you started the show, which is business owners, if you have your personal goals and you have your fine, your business goals. Business and personal goals.
Keith, you stress so clearly that they should not be fulfilling these goals from the same bank account.
[00:40:13] Speaker B: Absolutely.
This is definitely, you know, they're two different silos, if you wish to look at it, but they're not, they're not, they are interconnected.
The goals of one have to be fulfilled by the goals of the other. And the success of the other
[00:40:32] Speaker A: makes perfect sense.
[00:40:33] Speaker B: And the clients and the business owners that I run into that are more successful are the ones that operate business as business. Individual is individual. They've developed and they have an idea of what they want, what success looks like for them as an individual, but also what success looks like for them as a business. And. And that takes, you know, a little bit of time, energy.
It takes some effort to really think about because a lot of business owners never even consider what does.
What does success look like to me? Because success for me is going to be different than success for you.
[00:41:10] Speaker A: Yeah, yeah. And
[00:41:12] Speaker B: that success, you know, some people want to have a million dollars a year, and that's going to be successful to them. Some of us are happy with $200,000 a year, and that's successful because it does what we want to do. But we also have time for family. We have time to do the things we want to do outside of work.
So what does your ideal personal life look like? And what does. What is it going to take for your business to give you that?
That, to me, is when you've got business success and you've designed something that's worth doing, if you're just working to work, it's not success even if you're working to work and you're making a million dollars.
[00:41:59] Speaker A: Let's talk about that for a minute. So the thought that comes to my mind as you're unpacking that, Keith, is work life balance.
And this has been something that I personally have been striving for my entire Life. And in 59 successful years, I have yet to unlock the holy grail of work life balance. From your perspective, how do you make that happen?
[00:42:29] Speaker B: I think that, again, it comes down to really knowing what, what is. What is it that you want? Because a lot of people don't know we work to work.
[00:42:44] Speaker A: Yes, it's true.
[00:42:45] Speaker B: And if that's what we're doing, is we're working to work, there is no end, because you'll continue to work to work so you can work to work some more.
And.
[00:42:54] Speaker A: Well said.
[00:42:55] Speaker B: And at that point, if.
If that's all you're doing, then when is enough enough?
So internally, we need to understand, you know, what is it that we want to do?
What is it that.
How much work do you want to do? When is enough enough?
Because even the wealthiest of people, if you look at them, they aren't happy, necessarily.
[00:43:22] Speaker A: No. Because wealth doesn't buy it.
[00:43:24] Speaker B: Exactly. So what does? It's. It's figuring out what makes you happy.
Is it spending time, you know, donating some of your time? Is it helping good causes?
These things all play into it. And here in the United States, we've got a huge gift in owning a business.
We can control, have more control of our own destiny than a lot of other people do.
If you want to make more money, you can find a way to do it.
If you want to work harder, you can work harder. And there's a possibility of the reward for working harder.
That doesn't necessarily happen when you're an employee.
[00:44:10] Speaker A: Yep, good, well done.
[00:44:11] Speaker B: But it takes a lot of courage for an employee, for someone who's an employee to let go of that umbrella and that shield of employment to go out on their own.
And I give kudos to every business owner and even people that have failed for going out and giving it a try because that's, this nation's built on that.
And being an entrepreneur has a whole lot of scary factors with it, but it can be done right and the rewards can be awesome.
[00:44:44] Speaker A: So how can an owner build financial systems that allow the business support family goals and long term legacy rather than to consume every available resource? You know, let me, let me rephrase that question.
The silos you mentioned, when do you have the conversation about how many personal silos they have and how the business is going to focus on filling them?
[00:45:18] Speaker B: So I think that that conversation is one that when you start your business, you should have the conversation.
Okay. It doesn't necessarily need to be with, with a CPA or a tax preparer.
If you're going to form an LLC or you're going to form a, you know, a corporation, take the time and speak to a good attorney.
They're going to give you some advice that you don't know. Like we started at the beginning of this.
We don't know what we don't know.
[00:45:51] Speaker A: Right?
[00:45:52] Speaker B: And there's a whole lot more out there that we don't know that we think we might know.
And the worst way to find out is by making the mistake and finding out when there's. There's plenty of advisors out there that'll give you a half hour of their time just to get to know you, to see if there's a good fit.
And during that half hour, you get to pick their brain. You've got some people out there that you buy them lunch, it's going to be the best lunch hour that you're going to spend maybe, you know, $20 on their lunch and you're gonna get hundreds of dollars worth of value.
You get to deduct it as well.
So there's people out there that know something about your business that you don't. My suggestion is take the time to get to know as much as you can before you make that those decisions.
And if you have a business now and you're not satisfied, then sit down with somebody that can help you make a plan, determine what is it you know that you want, find out how are we going to get what you want.
Those are big concerns and in this nation the business is by far in my opinion the best way we can accomplish those goals.
[00:47:20] Speaker A: Keith, before we wrap up here in next minute, I want to make sure that viewers know how they can continue learning from you. What is the best place to get great information about you and next level accounting and tax.
[00:47:34] Speaker B: So the website's nlati.com we have a blog there.
So there's information that gets put out from the blog.
There's on the website you can set up an appointment for a free consultation.
So if that's something you're interested in, feel free.
I don't have any trouble with sitting down with business owners and discussing, you know, what their dreams are and how they might be able to accomplish them.
I'm not a good fit for everybody.
Not every business is a good fit for me.
So a lot of it is just testing the waters and seeing what's going on and, and what are they looking for and is there a good fit? The only way you find out is by knocking on the door.
[00:48:26] Speaker A: Great. Keith, thank you so much for joining us today. You know, today's conversation reminds us that business succession is not measured only by revenue. It's also measured by the clarity, resilience, options and long term value the business creates for the owner.
You know, financial strategy should always be evaluated in light of each person's specific circumstances with a qualified professional and guidance.
I'm Christopher Nudo, your host of Life and Legacy. Thank you for watching on NOW Media tv TV.
