Don’t Be Embarrassed if You Have Financial or Tax Problems

There is a stigma attached to having financial and tax problems, but it doesn’t have to be that way or it may make the problems worse. Sometimes these problems develop as you become more successful, which easily happens with both celebrities and business owners. Other times they develop due to a quick downturn in business, withdrawing money from retirement accounts early, losing your job, health issues, or any other negative event. Even some very successful people have had financial struggles and then bounced back, including:

Donald Trump: Although he never filed bankruptcy personally, his casinos and hotels have. He is now president of the United States.

Mark Victor Hansen: One of the co-creators of the “Chick Soup for the Soul” book series.

Walt Disney: He had financial struggles early on.

Jim Rohn: Entreprenuer, author and motivational speaker who went broke after a business expansion went bad. He is credited with the business success of many and some of his talks can be listened to on YouTube.

Also, the number of celebrities that have financial and tax issues is too long to list . . .

What should you do if you find yourself in trouble or better yet, how can you avoid problems? Here are a few ways:

Hire competent professionals and heed their advice: As your success increases, you need to work closely with advisors that can guide you in the right direction to minimize risks, strengthen your finances, and reduce your tax burdens. If you view and treat professionals as purely costs, then you will not only hire the wrong ones, but you will not seek their advice, which is usually worth more than their cost.

Too much leverage, not enough cash: There are those that are 100% against any types of debts, and I can definitely see how this can be a smart strategy to keep you out of trouble. However, there are many times that you will never realize an opportunity if you do not take upon some debts and risks in a wise manner. Having a reasonable cash cushion will also help to thwart many smaller financial setbacks.

Know the tax consequences: Virtually every financial transaction has a tax consequence and it is prudent to seek professional advice to minimize negative consequences. Having a good year in business, followed by a not so good year can easily cause a tax issue if taxes were not properly planned and paid for. Another tax catastrophe is withdrawing from your retirement accounts and not accounting for income taxes and early withdrawal penalties.

Don’t be so hard on yourself or delay seeking the advice of a professional or your problems will just get worse.

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