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| Maintaining Wealth: Know the Code |
| Sunday, October 29, 2006 |
If you already "own" or have a controlling interest in some asset, you already have some wealth to protect. The forms that wealth can take very and each individual has to determine what it is that they feel is wealth. A man or woman may look poor to you and appear to be poor on a balance sheet, yet possess incredible resources which he or she may direct as he or she wishes within the law.
Protect your wealth through business structure:
Whatever level of wealth you have, you will be more prepared to protect it if you can create an insulating layer of protections against claims by establishing a sound legal business structure. A competent tax-attorney or accountant should be able to lead you to some convincing conclusion aobut how you should organize your business, and will probably give a number of good reasons to set yourself up and an LLC or S-Corp to protect you assets in the event of a legal or financial claim. It could be that the best arrangement for you business venture is in the not-for-profit class. You can still earn a substantial income so long as your not-for-profit business files the proper paperwork and you work diligently to maitain its tax-exempt status. CEO of big charities are not there just because the get a nice office and good feeling when the go home.
Sound recordkeeping is critical:
In terms of maintaining material wealth on of the keys is to understand accounting procedures or work with a professional accountant who does in order to help you keep your records straight and taxes up to date. Although I have personally, never seen any series of laws that explains to me (without any logical gaps or assumptions based on non-legislative material) why an individual would have to pay taxes as an individual, the matter does seem to be clear in relationship to corporate interests. And, this is important to remember. There are certain times, places, and circumstances that make sleight of hand and cunning a detriment to your long term survival and future well-being. Imagine that you are in a cellar casino and Bluto pats you on the arm and says its time to pay the fee for the padded seat and explains to that the fee is 10% of your earnings. The best idea is to do an accurate accounting and fork it over -before he claims more from you than you are ready to surrender. Taxation is where corporate owners consent that in exchange for the protections of the government they surrender to its authority to milk them. As long as you get along with the tax man, you can stay in the game.
Here an entertaining animation that you can use to remind yourself of this little fact:
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posted by Domesticated Dog @ 7:44 PM  |
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| Getting to Business |
| Friday, October 13, 2006 |
We are all businessman:
We are all in business for ourselves. It does not matter if you are recognized as a self-employed business owner on your IRS return or not. You are self-employed. Even those of who are work for large employers or participate in union are self employed and need to recognize the ways that their decisions influence their future cash flows and give strong consideration to their personal goals in order to properly market their identity and get the highest rate of return from their activities.
Who this blog for?
This blog is for people who agree with or want to consider the following:
- Success is there for anyone who has the tenactity and entreprenuerial spirit to find and utilize the tools necessary to create it.
- Cyclical economics dictate that there will be prolonged periods during which investment prices rices fall and pessimism ensues.
- Cycles economics creates opportunities for the well-informed, forward thinking individual.
- Bear Markets and Bull Markets represent opportunities.
- Self-education is one of the most fulfilling pursuit a human can engage.
And, this blog is for everyone else, too. I look at it this way. Just about every rich family you look at today at one time in its generational history was a poor family and quite possibly dirt poor within the last 3 or four generations. When you examine the histories of individual's who were able to overcome the odds, it is easy to note that there are common threads in many of these stories. Most of them do no include passages that say, "...and then, after we won the lottery, everything got better." Very little new wealth is created using the sit and wait method or the don't rock the boat approach.
How do you get rich?
The best way to get rich as an individual is to marry a rich person. as silly as that sounds, that is what the sociological data will tell you when examined - and it can also be noted this works better for women than men. Women, generaly speaking, are less likely to marry down and more likely to marry up. It is a strange economy, but it is a fact.
There are plenty of other ways to strike it big and each requires a different type of savvy and the proper employment of a well configured asset and resource system. If you consider, real estate, manufacturing, sales, marketing, management, energy production, transportation, and other entreprenuerial activities, you will see that each category of activity comes with its own specific demands and requiriments. To understand the specfic requirements and assess opportunities as well as obstacles, we need to find and develop sources of information. The business of learning must start today and continue everyday.
Can anyone develop wealth?
Yes, anyone can develop wealth. However, it is important to note that it is not true everyone can be rich. The unavoidable distribution of assets will cause there to be a economic class structure and I am of the belief that efforts to use assets transfers to level the economic playing field are generally a harmful intervention and leads to ineffeciencies of the subsequent asset allocations. Welfare programs and inefficient, and often wasteful, spending go hand-in-hand. Nonetheless, when a benefit program exists that works in your favor, use it to the extent that it is within the law. Along the path to "the good life" be sure to make time to sit down with an accountant, an attorney, and specialists in each of the fields that you business enterprise interacts with to understand how the law and its changes affect you, you customers, you suppliers, your prospects. This knowledge is especially useful in managing risk as you proceed.
What should each of us do?
Make good choices. The choices that we make will determine our financial future and it is important to recognize the economic traps that exist, so we we can avoid altogether or escape from them when we realized that we have been snared. This does not imply that you should be afraid of making a mistake or a poor choice, it simply means that each of us has to decide how we will change and what we will change in our environments to cause our goals to become achievements. |
| posted by Domesticated Dog @ 5:04 PM |
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