10 tips for anyone who wants to get better at money and personal finance

1. Always contribute enough to get your full employer 401k match.

It's the closest you will ever get to free money. 2. When traveling abroad, always decline the currency conversion offered by an ATM or credit card terminal.

3. Don't ever redeem credit card points on the bank website. Transfer them out to airlines and hotels to book directly.

If you have a business that is making as much in revenue and profit this year

And are clueless on what you should do to save money on taxes

I just published a detailed guide breaking down exactly what to do if you are lucky enough to find yourself in this situation: You can read the full guide here:

It requires an email address to read the entire thing, so I'll break down the playbook in a thread here 👇

But the full article has the most context and nuance, let's dive in:sillymoney.com/p/the-self-emp…

Most advice online about raising venture capital for your startup is written by other investors

Which is a bit of a farce since their incentives are completely different from yours

Here's my best advice founder-to-founder: 1 - Understand the math your investors are working towards

Most VC funds try to underwrite a scenario where they could return their fund on any given investment

If a $1B fund owns 20% of your company, they want to see you be worth at least $5B someday

Run the numbers!

People with a high salary pay the most in taxes in America

Most of the best tax saving strategies are saved for business owners

But not all of them!

Here are 10 things high W-2 earners can do to pay less in taxes this year: 1 - Set up a Non-Qualified Deferred Compensation (NQDC) Plan

An NQDC lets you defer a percentage of your salary until retirement when you are in a lower tax bracket

The entire pre-tax amount is then invested so it compounds to pay you out more later

Ask your employer!

There is a special retirement plan in America that most people don't know about

It's being used by wealthy doctors, lawyers & business owners to get up to a $300,000 tax deduction every single year

And it's fast growing in popularity

Here's how a cash balance plan works: Most people know about 401k plans

A 401k is awesome, but you can't contribute more than $23,500 as an employee

Even with employer matching, it's capped at $70K a year

That's a lot of money if you are making $150K, but nowhere near enough if you are earning mid 6-figures

The single most tax-advantaged account in America is also the most misunderstood:

The HSA or Health Savings Account

Despite the name, don't think of it as a savings account - it's actually an incredible tool for building wealth if you know how to use it correctly: An HSA is the only account in America that is TRIPLE tax-advantaged:

- Tax deduction for contributing
- Tax free growth & compounding
- You can also use dollars at any time for eligible healthcare expenses (all kinds of wellness expenses are now HSA deductible!)

One of the most insane loopholes in the US tax code:

If a household earns over $250K, they are not allowed to directly contribute to a Roth IRA anymore

But, they can still use their 401k to fund their Roth IRA with up to $140K every single year!

Here's a step-by-step guide: Roth IRA's are very powerful - you put in post-tax dollars but then never pay taxes again

They are so effective at saving money on taxes, the IRS limits high earners from contributing to one

Or at least that was the intent, until people found "the mega backdoor Roth" loophole

You could earn mid 6-figures as a digital nomad from America living in Latin America, Europe or Asia

And legally pay an effective tax rate of only ~10% to the US government

Here's how a friend of mine set up his business to optimize his taxes as a US citizen living abroad: 1 - Since his business has no US employees or offices, he set up a foreign business in the Cayman Islands which has no corporate taxes

He has a US C-Corp that wholly owns this operating company

This structure only nets out to a ~10.5% corporate tax rate to the US (vs 20%+)

I sold my startup in 2020 and had no idea what to do with the money I made

So I ran the ultimate A/B test: I gave half to a famous private bank to manage while I invested the other half

Here's how the results stack up almost 5 years later: I will summarize the findings here so everything juicy is not locked behind an email gate

But if you want the full 3,000 word breakdown including how I saved on taxes, the fees I paid and the lessons I learnt along the way

Read it here: sillymoney.com/p/how-to-not-i…

I sold my first tech startup in 2020 for a life changing amount

But back then, I knew absolutely nothing about personal finance and taxes as a startup founder

Now that I'm doing this for a second time, here are some personal finance things I now think about: An important caveat before we get into it - this is not worth spending too much time on

The hardest part about this whole thing is building a startup that ends up being worth anything at all

This only matters for the tiny percentage of companies that are worth something

No one in America pays a higher tax rate than regular employees with a high W-2 salary

You make a lot of money but aren't rich enough to own a lot of assets

Here are 9 things you can do to pay less in taxes before the end of the year: The tax code in America favors business owners & people who own assets vs people with a high salary

The playbook you can use to reduce taxes on a high W-2 salary is far smaller than on capital gains or business owner income

However, here are 9 strategies that will help:

Just spoke to a founder who could pay zero taxes on more than $400M when they sell their company

It's completely insane tax jiu-jitsu yet fully legal with how the law is written

Here's how they set it up: Most people have heard of QSBS or Qualified Small Business Stock, the most generous tax break for startups

QSBS allows you to pay no taxes on $10M when you sell your company... or 10 times your basis (whichever is more)

The trick here lies in the second part!

Peter Thiel just turned 57 years old

In less than 3 years, he will get access to the $5B (yes, billion!) dollars locked away in his Roth IRA

The best part? He will not owe a single dollar of taxes on it

Here's how he set it up (& how you can emulate the strategy): Everyone has access to a Roth IRA

You can put in up to $7,000 a year in after-tax money and invest it in anything you like

Your dollars compound tax-free and you will owe ZERO taxes on the balance in retirement

No matter how high tax rates go in America!

A buddy of mine will earn $500K+ this year as a one-person business in a high tax state

If they don't do anything, they would have to pay a tax bill of ~$250K between federal, state & self-employment taxes

Here's what I told them to save 6-figures in taxes this year alone: 1 - Choose to file your taxes as an S-Corp

This bifurcates your salary into a fair W-2 income you pay yourself & the rest is distributed as profits

You only have to pay self-employment taxes (social security & medicare) on the W-2

This alone saves many thousands of dollars

No one pays more in taxes in America than W-2 employees with a high salary

But, there are still lots of tricks in the tax code you can use to pay less

Here are 12 strategies an employee with a high salary can use to reduce their tax bill before the end of the year: 1 - Donate to charity

Use a Donor-Advised Fund (DAF) to donate money to charity - this gets you a big deduction upfront & you can give to charity on your own timeline

Instead of contributing cash, donate appreciated assets like company shares for an even bigger deduction

There is a special type of retirement plan almost no one knows about

You could use it to stash away literally hundreds of thousands of dollars every single year

Here's how a cash balance plan works (& how we used it to save a business owner $100K+ every year): Most people are familiar with a 401k plan from work

These plans are great, but are capped at a maximum contribution of $69K / year

That can be a lot of money if you're making $150K a year.. but for super high income earners, that's not enough!

Enter the cash balance plan

A common misconception:

Money in your 401k and IRA's are locked away until you retire

Let me show you FIVE powerful strategies to access dollars in your retirement account any any age at all:

(bookmark this post for later) 1 - Borrow up to $50K from your 401k (or $100K if married)

You can borrow money from your 401k for any reason, at any time at all

Even though you have to pay a market interest rate, the interest goes right back into your 401k account!

Very powerful esp. with a Solo 401k

Nobody pays more in taxes than employees with a high W-2 salary

If you fall into that bucket, see if your company offers a "Non-Qualified Deferred Compensation Plan" (NQDC)

Here's how these work and how they can save you millions of dollars in taxes: If you are a high earner, you can use a NQDC to defer part of your salary, which brings you two big tax benefits:

1 - You reduce how much money you pay at the highest marginal rate

2 - You can invest the entire pre-tax deferred amount which lets you compound from a higher base

The single biggest perk of being self-employed:

You can set up a private 401k plan for yourself & your spouse and get a $138K tax deduction

And then use it to invest in absolutely any asset class

Here's why the Solo 401k is the most powerful retirement account in America: 1 - Up to a $69K tax deduction, or $138K if you add your spouse

It's super hard to max out a corporate 401k plan because you can only contribute $23K as an employee

With your own company, you can max out the "employer" contribution to hit a $69K tax deduction per spouse

One of the most remarkable loopholes in the US tax code:

If a married couple earns $240K+, they cannot contribute directly to a Roth IRA

But, they can instead use their 401k to get $100K+ into their Roth IRA every single year

Here's how the "mega backdoor Roth" works: Roth accounts are very powerful

You contribute post-tax dollars, but then never pay any taxes in retirement... no matter how high tax rates go

These accounts are so effective that the government imposed income limits that disallowed couples earning $240K+ from contributing

No group in America pays more in taxes than employees with a high W-2 salary

But, that doesn't mean you can't optimize it to pay less

Here are 15 strategies for employees with a high salary to reduce their tax rate: 1 - Max out your 401k at work

Contribute the full $23K pre-tax you are allowed to as an employee & get your full employer match

Total contributions are capped at $69K / year so see if your plan allows you to do the rest as "mega backdoor Roth"

Max it out every single year