People always say that they would invest more if they made more money. I reply that they would have more money to invest if they simply kept more of the money they made. Taxes is the single largest expense in a person's life and the vast majority of people don't even realize it.
Think about it for a second, if you have a job and receive a paycheck you most likely pay the following:
1) Federal income tax
2) State income tax
3) Social security tax
4) Medicaid Medicare tax
And this comes out of your check even before you get it so that you never see it.
But then as if that wasn't enough, each time you make a purchase (that means exchange your money for a good or service) you pay sales tax. There is also specific other types of taxes such as a fuel tax on every gallon of gas you pump, property tax, there is even a death tax, and a probate tax (which is why the vast majority of people who pass away leave nothing to the next generation).
So how can you get around some of these taxes legally? It's actually a lot easier than you would think.
First off, start a small business. That's right think up a small business idea, setup up an LLC, C-corp, or S-corp, get a tax ID, and dig in.
Nearly all of the cost of a starting up a business are tax deductible- that means that for every dollar you spend on your small business it lowers your businesses income thus lowering your tax burden. You can then setup a home office by dedicating some space to running your small business from home in your spare time and that portion of your house payment or rent becomes.....tax deductible. Everyday items you purchase such as toilet paper, coffee, even gas becomes....you guessed it tax deductible.
You can then use some of your new tax savings to invest more.
I will go into more detail about how to setup your small business as well as how to establish small business credit to increase your cash flow to be able to increase your investing all while lowering your tax burden in future posts Stay tuned.
Thanks for reading