I'm shocked!
A new and very unusual business coaching trend is taking the business world by storm.
Their stated mission is to teach business owners that making money is dumb. They are OK with business owners serving customers and charging them for products and services. But they teach that making money is a desire to be shunned.
In fact, this new breed of business coach says:
Your goal is to make less and less money every year.
There are two coaching organizations teaching this counterintuitive approach to business (and they are both under common ownership).
One company is Money is Bad For Your Health, Inc. (I'll refer to them as BAD ADVICE for short).
The other company is Smart Tax Advice for Smart People, Inc. (I'll refer to them as TAX ADVICE for short).
They both teach the same financial principles, but they position their services to business owners differently.
Let's look at the 4 Rules each coaching company teaches to business owners.
BAD ADVICE's 4 Rules for Making Less Money
RULE 1: Spend as much money as possible so you make next to nothing for the year.
RULE 2: Always remember RULE 1. Money is bad for your health.
RULE 3: As the end of the year approaches, focus on making large equipment purchases with cash. Better yet, try to borrow the money for the purchase since that will help to further reduce how much money you make this year (and reduce your earnings and cash flow in future years too).
RULE 4: As the end of the year approaches, tell your customers to hold off sending you money until the new year begins. That will reduce your revenues and therefore improve your health (since you will have less money). If a customer asks why you are doing that (since it may seem strange to them), explain that money is bad for your health and you are trying to lower your revenues in order to become healthy.
TAX ADVICE's 4 Rules for Reducing Your Income Taxes
RULE 1: Take advantage of every write-off you can during the year so you don't show such a high profit.
RULE 2: Always remember RULE 1. Your income taxes will go down as you take advantage of more write-offs.
RULE 3: As the end of the year approaches, focus on making large equipment purchases with cash. Better yet, try to borrow the money for the purchase since the interest is another write-off that will help to further reduce your income taxes this year (and reduce your income taxes in future years too).
RULE 4: As the end of the year approaches, tell your customers to hold off sending you money until the new year begins. That will reduce your revenues and therefore reduce your income taxes. If a customer asks why you are doing that (since it may seem strange to them), explain that it is smart for you to reduce revenues because it will reduce your income taxes.
Their Mission
BAD ADVICE is very open about their philosophy of business. They believe making money is bad. If you believe as they do, they will teach you how to make less money. Their approach is very straightforward.
BAD ADVICE's methodology is focused on encouraging you to spend more money… so you make less money.
TAX ADVICE, on the other hand, is not open or transparent about their philosophy of business. They believe in the same principle as BAD ADVICE. They believe that making money is dumb. But they don't market their coaching services that way.
They market a service for helping you lower your income taxes. And the number one way to help a business owner reduce their income taxes is to, you guessed it, help them spend more money.
TAX ADVICE's methodology is focused on helping you spend more money… so you pay less income taxes.
So TAX ADVICE took BAD ADVICE's methodology and made a slight tweak:
BAD TAX ADVICE's methodology is focused on encouraging you to spend more money… so you make less money pay less income taxes.
Both coaching companies teach the same thing (spend more money) and they create the same result (business owners make less money). Brilliant!
Well, Not Really
Actually, I made up the part about BAD ADVICE being a coaching company that believes making money is dumb. J
But the TAX ADVICE part is pretty much right on the money (with the possible exception of the intent behind the advice).
Way too many business owners buy into the myth that spending money in order to get the "write-off" is smart. It has to be one of the larger destroyers of financial success in business.
The wise approach to income taxes is counterintuitive, but true: Focus on increasing your income taxes as much as possible (by making more money) – without being foolish.
It's the path to making more and more money in business each year.
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