Our February Momentum meetup focused on finances and tax planning for creatives. Judd Meinhart of Parsec Financial shared some important tips and tricks to help you manage your business’s finances.
Judd Meinhart is a certified financial planner who dispenses fiduciary financial planning and investment advice to individuals, families and small business owners alike. Passionate about educating, Judd enjoys distilling the technical and behavioral aspects of personal finance into bite-sized morsels, consumable by even the most finance-phobic individuals. Prior to jumping into his financial services career, Judd served as a small business consultant and spent more than a decade in leadership roles in the nonprofit sector. Judd leverages his diverse experience and passion for helping others to build lasting relationships with his clients. Here are some of Judd’s tips and tricks to help creative business owners stay on top of their finances.
Judd began by stressing: Do NOT be a “shoeboxer”! Every accountant has horror stories of working with business owners who keep all of their receipts in a shoebox, but it will cost you to be disorganized. Your accountant will likely tack on a surcharge if they have to sort and categorize your receipts, but keeping organized will only take you a few extra seconds per receipt.
In order to give yourself peace of mind for a seamless tax season, Judd recommends utilizing software or financial professionals to keep track of your spending. It is also helpful to develop a regular review routine, such as looking at your profit/loss for the year and reviewing your balance sheet on a monthly or quarterly basis.
Think about your taxes from both a compliance perspective and a strategic perspective. If you hire an accountant, they will focus more on the compliance side to make sure you’re prepared if you get audited. A financial planner, on the other hand, will help you strategize how to best make your money work for you. For example, it might be worth it in the long run to pay more in taxes one year if tax rates are projected to increase. By prepaying when rates are low, you may avoid paying taxes at higher rates in future years.
Finally, Judd encouraged us not to ignore obvious deductions. If you travel often for work (beyond driving to the office), you can deduct vehicle expenses using actual expenses or the standard mileage rate. If you work out of a home office as your primary office, you may be able to deduct some office expenses, but only for items exclusively used for your business. Don’t go overboard with your deductions; it is better to play it safe than to mistakenly write off too much.
February’s Momentum Meetup offered an overview of information that can guide you in actively organizing your business’s finances. Although this information is useful, Judd recommends seeking professional financial advice for your specific circumstances. Be sure to check out the recap video to hear from Judd himself!
To learn more about our previous topics and Momentum speakers, check out our previous recaps.
Want to join us for the next Momentum meetup? Check out our upcoming events.