WestPac Wealth Partners

1y

In business, conventional wisdom often suggests that more is better. However, savvy business owners can challenge this notion by strategically reducing their income. By leveraging tax laws, retirement planning, and business valuations, it’s possible to mitigate taxes, increase wealth, and enhance future financial stability—all while keeping more money in your pocket. Below, we’ll use approximate numbers to illustrate the concept. Keep in mind, every individual’s situation is unique, so you’ll want a professional team (not just one advisor) to implement these strategies effectively. For our example, we assume a business owner with gross receipts of $1,000,000 and business net income of approximately $350,000. 1. Lowering Salary Saves on Payroll Taxes Payroll taxes are a significant expense for high earners. By reducing your salary, you can save thousands annually while maintaining the same household cash flow. For Our Example: Lowering the salary to $150,000 (a reduction of $200,000) could save roughly $9,500 in payroll taxes alone. Done correctly, these savings translate directly into increased after-tax income without sacrificing retirement contributions. The problem? You just lowered your income by $200,000! However, you will still receive those funds, just as part of your business distributions on your K1. Read on to see how this can further play out to your favor. 2. Optimizing Qualified Business Income (QBI) Deductions The Qualified Business Income (QBI) deduction

WestPac Wealth Partners

1y

Writing things down is an important part of achieving your goals, both while you're running your business and after you leave it. However, many business owners feel overwhelmed by the idea of writing down their post-exit goals and strategies. Some business owners say to themselves, "I'll worry about this when I need to." But this can be a trap that could create situations that are even more overwhelming down the road.  How can you, as a busy business owner, begin planning for a successful future even if you aren't ready to exit your business? The answer, along with some unexpected benefits, could be to create an informal, written business owner bucket list.  Starting Small  Planning for your eventual business exit can be a big process. But just as an acorn grows into a mighty oak, starting small can be the beginning of something big.  To start, consider writing down the following questions in a notebook, on your computer, or in your phone. In a perfect world, when would I retire?  What do I want to happen to my business once I leave it?  The answers you provide to these questions can be as short, informal, or unrealistic as you choose to start. The goal is not to create a fully fleshed plan in one sitting. Instead, the goal is to get you to think about potential possibilities while you are still in a strong position to affect the outcomes. What's the point?  The process of planning for a successful future, both inside and outside of your business...

WestPac Wealth Partners

1y

While much attention has been given to the uncertainty surrounding new tax laws, many individual tax-planning opportunities remain that can help you mitigate your tax burden while staying compliant. The Tax Cuts and Jobs Act of 2017 and the SECURE Act of 2019 introduced significant changes to the tax landscape, but opportunities for strategic tax planning persist. If your financial situation has changed this year, good planning can help you navigate these complexities and potentially reduce your tax liability. Connecting with your CPA before year-end is a smart move. Here are several areas to discuss as you prepare for tax season: Compare Your Year-to-Year Income Has this year been financially better, worse, or on par with last year? Depending on the answer, you might need to adjust your tax withholdings or make additional estimated payments—particularly if you're newly retired. Take note of revised withholding tables and safe harbor rules to avoid penalties. Additionally, paying property taxes before year-end may help you ensure a federal deduction, subject to the $10,000 SALT cap. Evaluate Stock Sales or Portfolio Rebalancing Have you sold stocks or rebalanced a taxable investment account this year? Capital gains can impact your tax bill significantly. Don’t wait until year-end to calculate taxable gains and consider harvesting losses to offset them. This is particularly relevant for inherited investment accounts. Address Inheritances...

WestPac Wealth Partners

1y

At WestPac® Wealth Partners, we believe that the strength of any organization lies in its people. That’s why we are elated to announce that we have earned the number 1 spot on Fortune’s prestigious Best Workplaces for Parents™ list for small and medium companies! This recognition highlights our ongoing commitment to creating an environment where parents can thrive both professionally and personally. A Culture That Supports Families Being named one of the best companies for parents in the country isn’t just about policies—it’s about cultivating a culture where every team member feels valued and supported. We understand that balancing work and family life can be challenging, so we go the extra mile to provide resources, flexibility, and a workplace environment designed to meet the unique needs of working parents. What Sets WestPac Apart At WestPac, we’ve implemented several initiatives to support our team members who are also parents: -Flexible Work Options: We offer flexible schedules and remote work opportunities, empowering parents to tailor their workdays to accommodate family priorities. -Family Leave Policies: We offer both maternity and paternity leave, which allows new parents the time they need to bond with their children without the added stress of work commitments. -Wellness Programs: From mental health resources to fitness incentives, we promote the overall well-being of our employees and their families.

WestPac Wealth Partners

1y

Over the last 20+ years, I’ve had the privilege of working with countless financial advisors, planners, CPAs, and attorneys across the country. If I had a nickel for every year-end tax strategy shared with me, I’d be well on my way to an early retirement. These conversations have given me a front-row seat to some of the most impactful strategies for keeping more hard-earned money in your pocket. Below, I’ve compiled a list of 10 common strategies shared with me over the years. While these are valuable concepts, it’s essential to note that proactive planning tends to lead to better outcomes. And as obvious as it sounds, it’s worth repeating: collaborate with a team of financial and tax professionals to ensure you implement the most applicable and effective strategies for your unique situation. Year-end is a particularly opportune time to revisit these strategies as financial circumstances often become clearer. Let’s dive into the list: Tax Diversification Diversifying investments across pre-tax, taxable, and Roth accounts can offer flexibility for tax-efficient withdrawals in retirement. While Roth conversion is a potential late-career strategy, starting early with varied contributions can significantly reduce taxes over a lifetime. Roth Conversions Consider a partial or full Roth conversion to lower lifetime taxes and potentially grow your wealth without any tax-drag.

WestPac Wealth Partners

1y

We’re excited to announce that Liang Lee, one of our esteemed Senior Partners, has been featured in Forbes for his article titled "Driving on the Financial Racetrack." In this piece, Liang draws powerful parallels between the high-speed world of motorsports and the precision required in financial planning. He highlights how strategic planning, expert guidance, and teamwork are crucial in achieving financial success, sharing valuable insights on navigating the financial racetrack with confidence, supported by the dedicated team at WestPac. Outside of his professional expertise, Liang has a personal passion for motorsports and enjoys the thrill of the racetrack, where he finds inspiration in the precision and teamwork that drive success, both on and off the track. Check out the full article on Forbes: https://www.forbes.com/sites/top-financial-security-professional/2024/11/13/driving-on-the-financial-racetrack/

WestPac Wealth Partners

1y

I am incredibly proud to announce that WestPac® Wealth Partners has been named one of the 2024 Fortune Best Workplaces for Women™, coming in at No. 3 for Small & Medium Companies on this prestigious list. Being recognized by Great Place To Work® and Fortune magazine is an honor, but the true reward is knowing that our efforts to create a supportive, inclusive, and empowering environment for women at WestPac are making a difference. This achievement reflects our commitment to building a workplace where every team member feels valued, supported, and equipped to succeed. We are proud to offer resources that cultivate professional growth, mentorship, and Life-Work Integration®—resources readily available with our team’s well-being in mind. At WestPac, we believe that when our people thrive, so does our business. Thank you to each member of the WestPac team for your dedication, trust, and passion. It’s your commitment that has earned us this recognition and continues to make WestPac one of the best companies to work for in the country. Here’s to reaching new heights together! View the complete list here: https://fortune.com/ranking/best-small-workplaces-for-women/2024/search/

WestPac Wealth Partners

1y

The annual list recognizes the country's leading B2B companies that have time-tested track records of supporting entrepreneurs and helping companies grow. Inc., the leading media brand and resource for entrepreneurs and business leaders shaping the future, has announced its third annual Power Partner Awards. This year, WestPac® Wealth Partners is honored to be featured in the financial services sector. The prestigious list honors Business-to-Business organizations across the country that have time-tested track records supporting entrepreneurs and helping startups grow. At WestPac, we go beyond product-based solutions by offering comprehensive financial guidance to help grow both personal and business finances. Our high-performing team takes a holistic approach to understanding each business, backed by a wealth of resources. Building a strong business plan requires a collaborative effort, with advisors specializing in various areas, all working in sync with the vision of our business owners. We are incredibly proud to be recognized as one of Inc.'s Power Partners, a reflection of the hard work, dedication, and commitment to excellence our team demonstrates daily. This prestigious honor highlights our ongoing efforts to provide top-tier support and solutions to our clients, helping them achieve their goals. It’s a testament to the passion and experience we bring to every relationship, helping to ensure long-term success for those we serve.

WestPac Wealth Partners

1y

In the latest edition of Hawaii Business Magazine's signature issue, WestPac® Wealth Partners was proud to earn its place among the Top 250 ranking of Hawaii's largest companies and nonprofits. This prestigious recognition not only underscores WestPac's significant footprint in our local business landscape but also highlights its integral role in shaping Hawaii's economic narrative. Beyond the numerical rankings lie a compelling narrative of dedication and achievement. This accomplishment is only possible through the culmination of hard work, strategic foresight, and commitment to excellence from each and every one of our team members. For WestPac Wealth Partners, being listed among Hawaii's elite serves as a testament to our sustained success and enduring impact on the community. This annual ranking celebrates present achievements and serves as a historical benchmark, documenting the evolution of Hawaii's business community over time. As a locally founded company, WestPac Wealth Partners is excited to continue to grow in this community and we look forward to continuing to make a meaningful difference in Hawaii and beyond. As we reflect on the significance of the Top 250 ranking, we recognize that each company or organization symbolizes more than just size and revenue; it represents the collective story of each client, business, and family, impacted by the work we do day in and day out.

WestPac Wealth Partners

1y

The most precise and dependable way to estimate your retirement spending needs is to create a budget that forecasts expenses in categories like housing, utilities, food, transportation, leisure activities, and more. Depending on how your life changes (or doesn't) after retirement, you can base these estimates on your current spending. For example, if you don’t plan to move, your housing and utility expenses will likely stay the same (plus inflation costs). If you intend to travel more, your leisure costs will increase. This pre-retirement budgeting exercise is straightforward—it’s about understanding the lifestyle decisions that matter to you and your family. What tends to be more challenging for many is determining the health care portion of the budget. While you're working and covered by employer insurance, your health care costs are relatively predictable. You know your insurance premium contribution (if any), understand deductibles, co-pays, and coinsurance, and can gauge your typical spending based on past health care needs for you and your family. When you retire, your health care costs will likely change. After age 65, Medicare becomes your primary coverage. While you'll still pay premiums, deductibles, co-pays, and other out-of-pocket expenses, these may differ from what you paid while working. Here’s what to consider when budgeting for retirement health care: Monthly Premiums Medicare requires monthly premiums for certain services...