Occasionally, I get emails from someone who is a highly paid professional employee. The problem is they want to pay less tax and they’re stuck for a strategy that will work for them.
The family (assuming the writer is married) makes a lot of money and they all feel trapped. They can’t switch from working to someone else working their own business because it would mean a decrease in income for years, maybe forever. They tried stock trading and they either made money, with no tax breaks, or lost money, with little tax write-offs. They tried real estate investing but discovered the great tax breaks wouldn’t work for them because they made too much money and neither spouse could qualify for a real estate professional. That means no tax breaks for tax investing and no tax breaks for real estate investing.
But there is one thing they haven’t seriously considered…yet.
Start a business.
They thought they couldn’t have a business and still keep the day jobs.
A business means more money. A business means less tax. Honestly, I don’t understand why everybody doesn’t have a business.
Here are some of the reasons why not that I’ve heard, along with my comments.
“I don’t want employees.” I totally understand that. I’ve had my share of employee issues in the decades I’ve had businesses.
But, in today’s world, you can easily outsource the jobs you can’t get technology to handle for you. My business has 1/10 of the employees that we used to have and our gross income is close to the same amount. The one big difference is that I have a MUCH bigger profit. If you haven’t had a business in the past 5 years, then you are in for a big surprise. Or, if you have a business that hasn’t changed in 5 years, you have some big opportunities. Technology has changed how we find clients, how we fulfill on products and services and the competition for labor and supplies.
Don’t want employees? You don’t need them. I have one client who is netting $1.39 million this year and he has one part-time employee. Yes, it really is possible.
“I don’t have the capital.” If you’re willing to sell a proven product or sell services, you won’t need much capital. Again, welcome to technology. If you’re trying to create something brand new, from scratch, then yes, you will need capital. But how about starting small and make a commission when you sell a product. If you have a skill that is in demand, you can get your highest initial cash flow by selling that skill. But it’s going to take your time, because you’re trading your scarce hours for money.
“I don’t know what to do”. That’s a valid concern. The best advice is to follow success and get started. Don’t get yourself dug into a hole continually needing more information. You can’t ever have enough information. At some point you need to start. Start small. But, just start.
“I don’t have enough time.” That’s a valid concern. But let me ask you a question. What if someone gave you the car of your dreams? Free. Absolutely free. The only thing was that you had to wash it every day. Could you find the time to wash it, to get a free car? I bet you would.
If there is something you want bad enough, you’ll find the time.
What is the one question that if you could get answered, you would start a business?