Thorium Wealth Management was created out of a concern for the conflicts that are rife in the financial services landscape. Our mission at Thorium Wealth Management is to help make wealth a source of freedom rather than a burden. Most of our clients come to us when they are at a crossroads where they cannot afford to make a mistake.
It is hard to believe that I opened the doors to Thorium Wealth 5 years ago on May 24, 2014. Looking back, it was the scariest and most exciting thing I have ever done. Starting a business is not for the faint of heart.
Thorium Wealth was a logical next step for my professional career even though my timing was probably too early. I had spent the entire first part of my career working with business owners and Thorium Wealth has been built as a firm designed for business owners.
In honor of reaching our 5 year anniversary I am going to share some lessons I have learned the hard way related to being a business owner with a little help from some of my favorite rappers.
“Look, if you had, one shot
Or one opportunity
To seize everything you ever wanted
In one moment
Would you capture it, or just let it slip?”
Life is too short to spend it wondering what if or what could have been. Regret is a self-defeating emotion. With that said I do wish I had made the leap much younger before I had a life full of responsibilities. It would have allowed me to embrace failure. Having a family to care for makes failures seem fatal. Here is the truth. Failure is rarely fatal and provide a great opportunity to get better. I was scared to go out on my own for so many reasons some of which were valid but most were just me searching for excuses. Once you make the decision to start embrace it and capture the moment and make the most of it.
“No Matter how hard it gets, stick your chest out keep your head up and handle it” – TuPac
Flexibility is one of the advantages you have when you are starting your business. As you grow and things become more complicated remember that flexibility and ability to make decisions quickly is one of your biggest advantages over the competition. It is hard because people get complacent but keep your head up and handle your business and you will see Anniversary 10 and 20 and maybe 100.
“It’s Like Everything that surround you gets brand new. I can’t forget the struggle and I pay dues. Can’t let the money and the fame come between my crew.” – Future
Never be satisfied! The all-time greats are always improving and getting better whether we are talking about athletes, coaches, students, teachers, or business owners. Never be satisfied with yesterday’s success. Celebrate your triumphs but don’t let them stop you from becoming the best you can be.
“My whole thing is to inspire, to better people, to better myself forever in this thing that we call rap, this thing that we call hip hop.” – Kendrick Lamar
Focus 95% of your time on your customers. Far too many of us waste our time on things that don’t matter. If we spend our time with the people who pay you for your product or service you will find that you will be more inspired and will have more business than you can handle. I found myself spending time doing too many things that I didn’t enjoy in those early years and not enough time helping clients and prospects. I have finally flipped that and am now spending 80% of my time on the thing that matters most to Thorium Wealth.
“I’m surrounded by fake-a** crooks/They swear they kingpins but don’t have money on they books/I hear so many lies it make me sick.” – Outkast
Build a cushion before you make the jump. This was my biggest mistake. It gave me very little margin for error. If I don’t make it I will be close to starting a square 1. Not the smartest decision but I am all in on this business and I am certain that after making 5 years we will make it. Most business owners push all their chips into the center of the table every day while they are growing their business. That’s not new and probably won’t ever change because America is the land of opportunity where you don’t have to be from an Ivy League education or wealthy family to create your own wealth. All you need is an idea and an iron clad will to make your idea come to life.
“My mind on my money and my money on my mind.” – Snoop Dogg
You are responsible for your money. You can’t outsource these types of money decisions to someone else so research your major purchases before pulling the trigger. I made some really dumb purchases when I was getting started. Software I didn’t need that my clients didn’t care to use, marketing materials that didn’t communicate what we do, consultants to help us improve our processes that really didn’t happen, real estate decisions. I could go on, but it makes me sad how many dumb business expenses I made the first couple of years in business.
“No matter where life takes me. Find me with a smile.” – Mac Miller
Have Fun! Take time to enjoy the journey. It is not easy to own your own business, but it can be one of the most rewarding things you will ever do in your life. If you don’t take time to enjoy it then you might as well just keep working for someone else. Follow your dreams, have fun every day, serve others, love everyone and never stop learning are the rules that I live by. The hardest ones for me to do every day are having fun and loving everyone. They are the two that take the most work. I am trying and hopefully when I write the 10 year anniversary post I will be closer to mastering both of these skills.
“Stop Collaborate and Listen” – Vanilla Ice
Collaborate or fail. Owning your own business is truly one of the hardest and most rewarding things you can do, but if you don’t find good people to work with, partner with, or take advice from you are going to have a hard time succeeding. There is an old African proverb that says If you want to go fast go alone. If you want to go far go together.
“Never mind what haters say, ignore them ’til they fade away.” – T.I
IF owning a business was easy everyone would do it. It’s not easy and you will have a ton of people doubt you along the way. Don’t let that discourage you. Believe in yourself, it is easy when the times get tough to think you should go back to the 9-5 grind of working for someone else. Every “successful” business owner has had that moment where times are really hard and they are faced with the fork in the road: continue moving forward or quit and go back. It’s not an easy answer but successful people fail all time time and continue to try. Owning a business requires that kind of determination.
“If you are what you say you are, a superstar. Then have no fear, the camera’s here” – Lupe Fiasco
Trust yourself! When I was getting started, I found myself questioning every decision I was making. A little self-doubt is ok and motivating but it’s important to embrace your inner superstar. If you have confidence in your product it will come through to your target clients. If you don’t then you need to find a different business.
Owning a business that serves business owners is one of the most rewarding, challenging, frustrating and satisfying adventures I have been on. I look forward to seeing how we evolve over the next 5 years. I am excited to have David as part of the team and can’t wait to continue to serve our current and future clients. If this message inspired you, please share it with your friends who may need a nudge or some encouragement. Being a business owner will never be easy so keep growing, improving and challenging yourself.
In 2005 after spending time in the CIA and becoming a Pastor Matt Peterson founded a non-profit called Hydrating Humanity. Hydrating Humanities mission is to see the poorest areas of the world realize REAL and lasting transformation at every level: economically, socially, spiritually and in physical health. They believe the most impactful spearhead into these communities is clean, safe water projects and hygiene education. Their mission is to eradicate the water-borne disease crisis, save lives, love people, build relationships and reveal Christ.
Today they have built over 600 sustaining wells around Africa and have helped change thousands of lives for the better.
Last month investors everywhere lost a legend. Jack Bogle the founder of Vanguard died at the age of 89. I never had the chance to meet him, so I am not going to attempt to write some forced memorial. But I am going to write about is legacy.
Jack Bogle made it his life and career to serve the best interest of investors. He believed in creating a low cost investment vehicle for the general public to put their savings into. He popularized the idea of low cost index funds and made investing accessible to millions while sacrificing 100s of millions if not billions in personal wealth.
Don’t get me wrong he died a wealthy man by most people’s standards but in the investment community where there are tons of billionaire investment and hedge fund managers he was not anywhere near as wealthy. What he has is a legacy of service. He served investors around the globe. He drove down fees to a point where investors can create a fully diversified investment portfolio for just a few basis points not several percent. This allows people to keep their money.
His legacy is not creating the $4 trillion dollar investment giant Vanguard his legacy is being a selfless servant. So as we celebrate a life that has affected the lives of almost every one of us take a moment and think about what you want your legacy to be and begin doing that if you aren’t already and if you are do more.
How should your business think about Digital Marketing?
In this episode I discuss what business owners need to know about digital marketing, how to develop a strategy for their digital marketing and what to expect from working with a digital marketing agency. My guest is Walt Spence owner of Enlab, a digital marketing agency in Richmond Virginia.
What is the most important thing to know about digital marketing
How is it different from traditional marketing channels
How can businesses benefit from having a digital marketing strategy
We’re all going to die! I know that’s shocking but according to the headlines I read in December on CNBC we were heading to the worst December returns for the stock market since the Great Depression. You would think we were heading for impending doom. Oh no! Not the Great Depression. Let’s create all sorts of panic and despair. That’s what the media does. They want to create fear, turmoil and despair. Fear sells plain and simple. No one likes to read about all the great things going on in the world. And trust me there are lots of amazing things going on. Advances in science, technology, food, and medicine are literally changing the world as you read this. So why all the doom and gloom about the markets and why do people care what they have to say.
Here is a dirty little secret:
I have no idea what direction the market is heading. There I said it! I am glad I got that off my chest. Now I am going to let you in on a dirty little secret. No one else knows if the market is going to go up or down either. Really smart people will go on TV with plenty of charts and graphs and they will talk about Death Crosses and Moving Averages and will pretend to know which way the market is going to go. Investing requires taking a risk. There is a 50/50 chance the market will go up or down on any given day. But based the so called experts of prognostication they can tell you what to own, when to own it and when to sell it. The reality is they can’t.
They are guessing!
They are taking an educated guess but at the end of the day they don’t know what direction the market is going to go over any short period of time much less any longer period of time. And that is no more apparent than when you look back at stock market predictions from the prior year. Barrons had 10 experts predict their returns for the S&P 500 for 2018 and all 10 were wrong. And wrong by a lot. The average of the 10 predicted approximately a 11% return for 2018. The S&P 500 returned -6%. The closet person predicted about a 4% gain. No one predicted it to be negative. And the experts were looking really good going into September and early October and then circumstances took over and this is what happened. The markets dropped a lot.
2018 peak-to-trough drawdowns: (As of 12/24/2018)
S&P 500 -19%
Russell 2000 -25%
Emerging Mkts -29%
What are they saying this year!
The same 10 experts all say the markets may rally 10% in 2019. Should we believe them? I am inclined to agree that conditions are pretty favorable for decent returns in 2019 especially if the trade war with China gets resolved and the Fed remains reserved in their interest rate hikes. No one and I mean literally no one knows if the markets are going to go up this year. If we look at it over the long term and you say yes, you are going to be right 75% of the time. 75% is a high probability so why is predicting so hard? Because predicting by how much it will rise is nearly impossible to get. That makes predicting the markets a fool’s errand. So, do yourself a favor and turn off the CNBCs of the world and stop listening to “experts” on TV because they don’t know if the markets are going to go up any better than you do.
Its 100 days until the start of Game of Thrones and its time to call your shot. Who ends up on the Iron Throne? Also, will President Trump get his wall like the Night King tore down the Wall with his Ice Dragon? Is the government being “shut down” a bad thing? Are we going into a Recession? Is This Bear Market gonna get worse?
We Tackle all of these topics and a few more as we discuss the recent market volatility.
In this episode of the Finance Factory Podcast I talk with Fusion Point Capital Founder Arun Chopra about what is going on in the equity markets. We talk about the recent volatility and what the Fed may do. We also discuss tariffs and there impact on the markets.
Be sure to rate the podcast and subscribe on your favorite podcasting app.
With less than a month left in 2018, time’s running out for you to finish your wealth management and tax planning to-dos. Many tax opportunities have an annual expiration date of Dec. 31, and this year presents unique possibilities. Here are 10 items you can check off your lists before the ball drops on New Year’s Eve.
Day 1 of the Ten Days of Tax-Mas
Freely give to help others live.
You should make annual exclusion gifts of up to $15,000 for individuals and $30,000 for married couples, per chosen loved one (per married couple).
Make gifts into trusts for children and grandchildren.
Contribute to an Internal Revenue Code Section 529 plan, which grows free of income tax.
You can make unlimited gifts directly to educational institutions and medical facilities.
Day 2 of the 10 Days of Tax-mas
Reap what you’ve sowed (and take your losses).
You should consider harvesting losses to offset capital gains realized in their securities portfolios. And check if you have loss carry forwards from prior years that could off-set additional gains you may have in your portfolio. This could minimize the tax impact of rebalancing your portfolio into the New Year.
Day 3 of the 10 Days of Tax-mas
Your health is your wealth.
You should take advantage of this year’s lower threshold for Medical Expenses if possible. For tax year 2018, the 2017 Tax Cut and Jobs Act reduced the floor (from 10 percent to 7.5 percent of adjusted gross income) that must be exceeded to take a deduction for Medical Expenses on one’s tax return. This is the last year to take advantage of this lower floor; so, if possible, you should try to accelerate any medical transactions and purchases into the 2018 year.
Day 4 of the 10 Days of Tax-Mas
Use a tax rate in its infancy.
Review your children’s portfolio income for application of the new Kiddie Tax. Prior to 2017, the children’s interest and dividends (unearned income) above $2,100 were taxed at your top marginal tax rate. As a result of the Tax Act, this income will be taxed at the rates that are applicable to trusts. Trust rates are also at the top bracket, but the top rate starts sooner in the earnings curve.
When will your child have to file a separate tax return?
If their earned income, such as wages, exceeds $12,000; or
If their unearned income (interest, dividends, capital gains) exceed $1,050; or
If the child has both earned and unearned income, the child must file if the total exceeds the larger of: (i) $1,050 or (ii) the earned income plus $350.
Day 5 of the 10 Days of Tax-Mas
You should think about giving.
With a higher standard deduction it may make sense to bunch your charitable deductions into the same year. The deduction for cash donations to public charities has increased to 60 percent of the taxpayer’s adjusted gross income.
Charitable donations should be combined every other year to exceed the new higher standard deduction ($24,000 married; $12,000 single). Otherwise, your client’s charitable gifts won’t enjoy a benefit.
If over aged 70½, you should make a qualified charitable donation of your required minimum distribution from your individual retirement account; the income will be excluded from the return and taxable income.
Make gifts to charities and family foundations with appreciated assets:
Consider gifting low-basis stock (instead of selling the stock to raise cash for gifting that could lead to gains).
2. Determine liquidity needs in the foundation to meet the requirement to pay 5 percent of the value of a foundation’s net investment assets.
3. Fund a charitable remainder trust with concentrated positions in appreciated securities to diversify without adverse tax consequences associated with selling appreciated securities.
Day 6 of Tax-mas
Rocket fuel for your investment vehicles.
Establish and fund qualified plan contributions. Be sure to max out your contributions to your 401k plan. And if you are over 50 be sure to max your catch up provisions. For 2018 you can contribute $18,500 and if you are over 50 you can contribute $24,500
Consider making a gift of up to $5,500 to either a traditional or Roth individual retirement account for your children or grandchildren who aren’t funding their own IRAs but have enough earned income to report. This will be a gift that will give to them for a long time after this holiday season is over.
Day 7 of Tax-mas
Take a break to consider break-ups.
While we always support and encourage harmony and reconciliation, if there must be a decision to legally separate or complete a divorce, you may want to do so before year end. Otherwise, moving forward, the payer of alimony will no longer get a deduction on their tax return, and the recipient will no longer have to include the alimony as taxable income.
Day 8 of Tax-mas
Don’t wait to compensate
If you are the owner of an S corporation you must pay yourself a reasonable compensation (what someone in a similar job would be paid). Therefore, make sure you pay yourself a salary before year end.
Day 9 of Tax-mas
Be bold and review your withholdings.
The Tax Act lowered the tax rates and changed the tax bracket income ranges. Therefore, now’s the time for you to do a “check-up” to see if the current tax withholding will be sufficient for next year’s income. You do not want to be caught with a surprise because you didn’t withhold enough during the year. If you find that you under withheld you can use the beginning of the year to save extra to be able to make your tax payment by April 15th.
Day 10 of Tax-mas
Get in the groove to make a move.
You should make distributions of income from trust accounts and estate accounts to lower your income tax liability. Estates and trusts are taxed at the highest income tax rate (and at a lower threshold at which the 3.8 percent Medicare surtax applies). Therefore, it may make sense for you to distribute income to the beneficiaries to be taxed at the beneficiary’s lower income tax rate.
If you have any questions about your tax situation or want to discuss how we might be able to help you with your planning into to 2019. Please call us at 336-310-4233.
This is a recording of the presentation we have been giving on the changes to the tax code and how its going to impact everyone. If you are interested in reviewing how the law will impact you and your personal tax situation you can reach out to us to schedule a complimentary tax action plan. Contact us at 336-310-4233 or email@example.com to schedule your time. You can also visit www.thoriumwealth.com to contact us.