Don’t wait! Get a jumpstart on your financial fitness

Realtors help their clients grow personal wealth — and we want to help you do the same. As real estate professionals, you’ve mastered the art of customer acquisition, meeting client needs and closing the sale. Now it is time for you to learn the specific skills to build your own personal wealth. We will be there to support you in your wealth journey.

Maeda Palius: During the pandemic, my daughter and I decided to weather the lockdown together. Nine months later she found a beautiful condo in Santa Barbara to purchase. She had officially become a homeowner.

To express my gratitude, I took my daughter’s real estate agent, who also happened to be a dear friend,  to a thank-you lunch. Over our meal, the conversation took a turn as she began asking me about retirement planning.

I was shocked to learn that my friend, a top producer for a national brokerage, lacked a solid retirement strategy. Despite dedicating more than two decades to her thriving career, she had surprisingly little in place to secure her retirement years.

I consulted my sister, Amy Cherow, an industry veteran, and found that this issue is common in the industry. We decided to combine my financial expertise with her real estate knowledge to create a course on wealth building.

Amy reminded me that my experience as a CPA guiding business owners to wealth creation was a skill we needed. With Amy’s real estate experience, I learned the nuances of being a real estate entrepreneur. I was in, and our course on real estate fiscal fitness was born.

Amy Cherow: When Maeda reached out, it dawned on me that her financial guidance had set me up for a comfortable retirement. We had a proven model, and it felt like our responsibility to help others in the real estate industry achieve the same.

So, here we are, ready to discuss ideas, techniques, a toolkit and a road map to fiscal fitness and growing personal wealth.

6 steps to growing personal wealth through fiscal fitness

We will be providing more information on these topics in future columns, but here they are so that you can begin thinking about them.

Mindset

What is holding you back from taking care of yourself? Do you understand the risks and rewards of being an entrepreneur?

Business planning

Most spend more time planning their vacations than their businesses. What are you doing to think ahead?

Entity

Should you be a solopreneur, an LLC or an S Corporation?

Traditional investments

Are you taking advantage of the savings and tax benefits of traditional retirement planning vehicles? Pension planning?

Non-traditional investments

Have you considered investing in various real estate investments?

Profit from your hard work

How can you prepare for and structure a sale of your business?

3 key takeaways for immediate action

1. October through December is business planning time

Make this an enjoyable process. Take yourself to a happy and inspiring place, With a team or alone, plan to spend as much time as you want or need to. Your business plan should contain the following elements: vision, mission, projected income, business expenses and personal expenses. 

Here are some resources to get you started:

Develop strategies that you will utilize to substantiate the income elements of your business plan, e.g. the number of homes you plan to sell, average home sale value, number of referrals you plan to make, and ideas for additional income streams to keep you going if your area is currently underperforming. Believe it or not, a financial planner will use this information as the base to set up your financial plan.

Quantify your strategies. For example, identify the number of units you plan to sell at various price points. Make sure your marketing plan supports the overall plan. Review the cost of implementing different strategies.

Get a second opinion from your personal advisors. Take them out for dinner with the preset agenda. Get their thoughts, and where you believe these opinions are helpful, incorporate them into your business. Ask for permission to record the session; you will be glad you did.

2. December tax evaluation for 2023

Maeda and I both do tax planning every year and more than once a year if we have any significant income events.

To get started

1. Organize your financial data for 2023.
2. Project your income through the end of the year.
3. Remember to list out tax estimates you made or plan to make. If you have a current pay stub, include that in the data. 
4. Set an appointment with your tax preparer and ask them to run a preliminary tax return for you.

Do you like the results? No? Ask your preparer for ideas to reduce your taxable income prior to the end of the tax year. Please do not succumb to purchasing a new car for a tax write-off. Consider setting up a Simple IRA or a Self-Employed 401k.

3. January tax planning for 2024

January is a great time to discuss 2024 tax planning with your accountant. Provide them with the forecast of taxable income you developed from your business plan. Have them run a tax projection for 2024 now. Figure out your first and second-quarter 2024 estimates now. Be cognizant of your 2024 projection as you work through 2024 and see how you can proactively manage your business and tax plans.

Start getting ready now for business and tax planning by organizing your materials and making appointments for meetings with your CPA or business advisor in November or December.

Amy Chorew is an active Realtor involved in investment properties and listing well-staged homes in Connecticut. Since 2008, Amy has been on the national speaking circuit teaching industry professionals about technology and sales strategies to help improve their business. Connect with her on LinkedIn and Instagram.

Maeda Palius has been a practicing CPA for 40 years. Her CPA firm focused on helping small and medium enterprises become more profitable and help the owners grow personal wealth. Connect with her on LinkedIn.