Author Archives: support33

Getting It Back On Track

From: Sean Tang a/k/a Jushun Tang, Enrolled Agent

Dear friends,

One of the biggest worries we’ve fielded from clients in the last three or four months has been the impact COVID has had on retirement savings.

A lot of people have lost money due to the volatility in the markets, but even more have been faced with dipping into retirement accounts to stay afloat as the pandemic has impacted their earning power. 

We’ve given a LOT of advice, so I wanted to try to share a few ideas for staying on track – or getting back on it.

  • First of all, if your 401(k) contributions aren’t maxed out, that’s an ideal place to start.  Of course, maybe you need those funds more in your pocket than in your account, but the difference of only a few percent each week can add up considerably over the course of a year (or a career).   Do the math and try to squeeze a bit more out.
  • Convert to Roth structures!  Frankly, there are simply too many advantages to Roth entities, and I’ve shared a lot of that over the last year or so.  If you still have a traditional IRA, converting it to a Roth might prove to be a very smart choice, especially in light of the stock market dragging a bit these days.
  • If, like many Americans, you took out a 401(k) loan – either for hardship or to purchase a home – then do everything you can to pay that off.  While you “owe” that money, your ability to save is impacted, so the sooner you can make it work, the better you’ll be.
  • One thing no one likes to discuss when “retirement” comes up is this:  how long will you actually work?  Years ago, 65 was the target age, but for white-collar jobs, it’s not surprising to expect workers and managers to be able to be productive well into their seventies.  Getting clear on when you plan to retire can allow you to accurately engineer your contributions to hit your particular retirement goals.
  • You probably won’t like this, but I’m going to say it:  If you really want to “jumpo start” your retirement savings, you probably need to watch your spending.  Do you need to lease the baddest car on the lot?  Buy the biggest house in the neighborhood?  There’s not a wrong answer there, but reallocating several thousand dollars each year from luxuries to retirement assets can literally be worth millions over the course of your lifetime. 
  • Lastly, don’t try to do it all yourself.  You need professional advice, and having a relationship with a CPA (I happen to know one!), a financial advisor, and an attorney who can all understand your goals and offer advice – together – could give you real direction for retirement savings.

I hope this helps, because sooo many times, we hear from folks who have well defined goals, but simply don’t know how to reach them.  If you’d like to discuss these ideas and more, feel free to reach out to the team and schedule a call to see if you’re getting the most from money.

Stay healthy and safe!

A Lot of Changes……

No matter where you are or what industry you’re involved in, we are going through an incredible time. In the last two months, things have changed, plain and simple.

Here’s the thing, though – with all the seemingly insanity and what I truly believe to be a false sense of scarcity, there has never been a more opportune time for entrepreneurs and business owners to step up and grow.

Right now, your job is far bigger than to be “just” a business owner or an entrepreneur.

Right now, you need to be thinking of how big you want to build in the next three quarters.

Think about it – hundreds of former roadblocks in your path have been effectively removed! Trillions of dollars are being pumped into the economy, focused on owners and entrepreneurs and keeping businesses open – and growing.

No matter where you are politically, the facts are simple – Trump is an entrepreneur first, and the policies he’ll want used to revitalize businesses in the wake of the pandemic are going to be focused on the business owner and getting them back in the black.

Let’s look at some of the most recent pieces added to the puzzle…

  • Over $10 Billion to be invested in the smallest of small business – in the form of low-interest loans and forgivable grants from the Small Business Administration.
  • In the meantime, creditors – the banks, lending institutions, and credit card companies – are under pressure from the government to extend options to all their clients to ensure people have options that weren’t available in the last downturn.
  • The SBA is actively streamlining the disaster relief process to get money in the hands of business owners faster – in some cases, in a matter of days – and many aspects of those loans can be converted to grants (or be forgiven) if the business uses the funds in certain specific ways- payroll taxes, covering current principal and interest payments.
  • Of course, there have already been a number of amendments to this year’s tax filings for corporations and proprietorships.

Here’s the deal: every one of us has the choice on how we choose to view these current events. I’m not silly enough to make this a political conversation, or to second-guess leaders, or to spin conspiracy theories, and that’s not important right now.

NOT. AT. ALL.

But I am an optimist, even if my craft relies on numbers and verification.

So let’s share the good news – the Federal and state governments are taking action and literally, CPAs, attorneys, and tax specialists all across the country are poring over 880 new pages of law to see where – and what – the benefits will be for our clients in the weeks and months to come.

All I’m asking from you? Keep challenging yourself and your people to think creatively. Look at companies in the spaces your business occupies and see how they are reacting. How are they adapting to what is currently a “virtual” economy? What techniques are they adopting?

By observing and being a fast adopter (many of the tools needed to make a preliminary shift to a virtual economy, such as Zoom, are available via a free offer), you’ll have the advantage of being “back in business” far faster than many companies and that will give you the ability to take market share while others are stuck in a “wait and see” mode.

We’ve all done things like this in the past, but with “social distancing” being a new normal for the time being, why not look for tools that can automate your business scheduling more? Integrating your calendar with scheduling software, like Plus This or Schedule Once, for example, has been available for several years.

You’ve got the time to learn it now, use it!

Stay safe and remember, this too shall pass. The entrepreneurs who come out of this setback with the most momentum will be the ones who are taking action now.

…And there’s no time like right now to take that action!

Stay Safe-