Reduce Risk and Cover Your Legal Shizz with Braden Drake
Episode 473: Show Notes
Most of us can use a little help with the tax and accounting side of our businesses and we have just the person to talk us through the important parts of this process! Back on the show is our friend Braden Drake, who runs Braden Drake Law, where he works with a handful of one on one clients to sort out their tax and legal issues. His mission is to help as many people get as much of their business on the right track and running smoothly! He believes strongly in treating yourself like the CEO you need to be and in this episode, he covers exactly what this looks like. Spoiler alert! Braden has just finished writing a book that is about to be published! It is called Unf*ck Your Biz and details the service that Braden provides for his clients.
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Braden does an amazing job of unpacking the framework of the book for us and shares the initial steps in tackling the biggest and most common mistakes he comes across. He talks about the 'oh shit cycle' that business owners get into with their taxes, how to know you are in this, and how to go about getting out! Braden shares many of our biz philosophies, striving to help you become profitable, paying yourself, and paying your taxes. We know tax can sound a bit boring but Braden is amazing at making it fun and lighthearted, so make sure to stay tuned as we get into some strategy!
An Overview of Braden's Service and His New Book!
Braden is an Enneagram 7, which means he is mostly bubbly and fun but can kick things into gear and yell when necessary due to his 8 wing! His book is a step-by-step guide to get the legal and tax side of a business legit, and was birthed out of his Facebook group and podcast. He collected about 500 questions from these platforms and created courses before compiling these lessons into the form of a book. Braden reminds us that the first steps are always the hardest, and you just have to rip the BandAid and get started! The essential starting point that all business owners should get lined up is to have their taxes paid, get insurance, and write up a contract. Ideally, Braden would have us form an LLC but that can come as a next step. He has seen how many people do not pay themselves a reasonable salary and who avoid preparing for their taxes and he wants to help set you up for success, so these should be your priorities!
How to Avoid the 'Oh Shit Cycle' for Taxes
The first thing to figure out is what should be deducted and what should not. Braden identifies the 'oh shit' tax cycle that so many people seem to fall into as the lack of preparation for a growing biz and its growing taxation. He sees this all the time in his work! As the bill starts to grow with the income of the business, it gets waylaid and many of us need a kick in the ass to start saving and prepping. This issue is compounded when the bill starts dripping over into the next tax year and the cycle just continues. Braden suggests getting on a payment plan, and also underlines you do not have to reinvest everything you make. Tax deductions are not free money, people! All you have to do is some simple math to work out expenses and deductions, and think about your deductions as a 10% discount rather than a complete tax break. You should not buy a new computer and phone every year just because you think you can write it off!
Braden's Tips For Breaking the Cycle and Getting Ahead of Your Taxes!
Since the dawn of the pandemic, Braden has gone super-minimal with his spending and lifestyle. This is a lesson in priorities and he reminds us that there is a good order to start your retirement savings. He recommends the books I Will teach You to Be Rich and Total Money Makeover if you need help with these parts of your budget. There are two tips that Braden offers to break the 'oh shit' tax cycle. First, if you are already in this situation you need to start saving, break down all of your finances and determine what is left over. From there you can set up an installment plan with the IRS, so that you do not catch yourself out and find yourself in a sticky situation. Remember you want to prepare for this year's tax payments as well as be on the front foot with next year's! The next tip that Braden shares is to automate your tax saving if you are just starting your business and are not yet in a crunch. He uses the Qapital app, which sets aside a percentage of everything he earns into a savings account. These tasks all come down to self-awareness and discipline!
Creating a Vision for Your Business
Just like us, Braden loves the book Traction! We all have to have a vision, some goals, and know where we are going with our business. Ultimately you want to get into the mental mindset to form an S corp, and to do it the right way, with a healthy balance sheet. Lots of businesses get to six figures but their profitability never increases so they are never really paying themselves a decent salary and thus never reap the tax benefits. It is so important to learn things and prepare before you are ready to actually do them. If you can get some awareness of your own seasons, peaks, and valleys, you will be able to weather any storm! It might feel far off but it is a great idea to set a date for when you might file as an S corp, even if it is years in the future! All of these vital steps are laid out in Braden's book, so head over to bossproject.com/braden, to grab that now!
Quote This
If you are not being intentional about where you want to go, how are you going to get there?
—Braden Drake
Highlights
An Overview of Braden's Service and His New Book! [0:05:10.3]
How to Avoid the 'Oh Shit Cycle' for Taxes. [0:09:45.7]
Braden's Tips For Breaking the Cycle and Getting Ahead of Your Taxes! [0:18:03.4]
Creating a Vision for Your Business. [0:33:06.6]
ON TODAY’S SHOW
Braden Drake
Website | Instagram | Facebook
About 90% of my time is spent educating creatives and small biz owners through my education-based business, Braden Drake LLC. There, you can find blogs, my podcast, freebies, and info about my monthly membership and signature group coaching program. In the law firm, I still work 1-on-1 with a handful of clients and regularly provide 1-hour strategy sessions to answer individual questions on the legal and tax stuff. Entrepreneurship is my passion, but as an Enneagram 7, I, of course, have many other interests including collecting some fancy-ass cookware, running, CrossFit, and Pokemon, and Harry Potter. My fashion influence is Victoria Beckham, but like if she decided to really commit to atheleisure wear and Birkenstocks. I have a handsome husband who works as a District Attorney prosecuting hate crimes here in San Diego, and we have three adorable little dogs.
KEY TOPICS
Taxes, Deductions, Finances, Profit, Legal, Vision
