Hey there! Welcome to the Independent Money newsletter 👋 We’ll be exploring the latest financial news and discussing how it affects entrepreneurs like you. Plus, we'll share some awesome wealth creation insights from successful entrepreneurs that you won't find anywhere else.

Let’s dive in! 🏊‍♂️

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This week, we’re getting into:

• Financial Tips and Tricks: Learn how to identify a good financial advisor that will give you the best long-term ROI.

• Expert Money Q&A: Learn how much you should pay yourself in the early days of building a business (hint: there are tax advantages to certain strategies).

• Entrepreneur’s Corner: Learn how to double your money from a solopreneur that’s done it.

• Inside An Entrepreneur’s Financial Journey: Kurtis Hanni shares what he’s learned working alongside small business CEOs.

• What’s Happening at Carry: Events happening this week include: taxes and bookkeeping for solopreneurs and small business owners, understanding and negotiating equity for startup employees, and more.

Financial Tips and Tricks 💰

What should you look for when hiring a financial advisor, and where can you find one?

A financial advisor can be a great tool to guide your financial journey, but choosing the wrong one could also cost you millions of dollars. Here's some guidance on selecting a reputable financial advisor with a pricing model that's mutually beneficial.

Tip #1: Choose a fiduciary.

Fiduciaries are regulated by an external entity (like the SEC) and must abide by various consumer protection laws. This means they must have your best interests at heart.

To find out if the financial advisor is a fiduciary, just ask them. Any registered investment advisor is required by law to answer this question truthfully.

Tip #2: Check their pricing model and avoid financial advisors charging a percentage of assets under management (AUM).

Paying even a 1% fee for assets under management (AUM) can quickly add up to hundreds of thousands or even millions of dollars in fees over the next decade or two.

The chart below shows how much you'll pay a financial advisor charging a 1% fee on $1 million in AUM over 20 years.

So avoid some private wealth managers, as:

1. They are not fiduciaries.

2. They charge you a percentage of your assets under management.

You can ask some of your financially savvy friends for financial advisor referrals or even reach out to other successful entrepreneurs/solopreneurs on Twitter. Also, our Pro Plan includes a personalized financial plan and access to a financial advisor to help support you on your journey.

Expert Money Q&A w/ Ankur Nagpal 💸

How do you decide how much to pay yourself in the early days of your business?

In general, it's best to keep your salary as low as possible because your salary is always taxed at a higher rate than if you pay yourself in either profit distributions at the end of the year or sell your company.

So I calculate how much money I need to live without actively stressing about daily expenses and then pay myself that number.

When I started Teachable, I lived in New York City, where the cost of living is above average.

I found that at $70,000, I wasn't actively stressed about daily expenses, so that's the salary I chose to pay myself.

That number increased over time, and when I sold the company, I was paying myself about $150,000 per year.

Entrepreneur’s Corner 📚

Double Your Income By Doubling Your Prices

Brett Williams makes $1 million annually running a design agency as a solopreneur.

His advice? Raise your prices.

Most solopreneurs don’t actually charge what they’re worth. By doubling his prices, he instantly doubled his income.

A few months later, he published another Tweet showing that clients felt his new higher prices were still too cheap to be real.

Raising your prices may sound scary, but you might lose potential clients by not charging what you're worth.

So if you want to make more money as a solopreneur, consider charging more rather than just taking on more work.

Inside an Entrepreneur’s Financial Journey 💬

A Conversation with Kurtis Hanni

After getting an accounting degree, Kurtis Hanni realized it wasn't accounting that interested him but business. So, very early in his career he chose to seek out small businesses instead of going the "big company route." Kurtis was a small business CFO for 10+ years before recently transitioning to education, consulting, and starting a fractional CFO firm.

We asked Kurtis to share his financial journey entering the entrepreneurial world and working alongside small business CEOs with our Independent Money readers like yourself. He discusses his 3 must-read book recommendations for business owners, key financial insights and milestones in his personal journey and more.

What are 3 must-read book recommendations every business owner needs to read?

• The Psychology of Money by Morgan Housel: the way Morgan frames our relationship with money is something more business owners need to account for when starting a business.

• Good to Great by Jim Collins: Classic outlines the difference between "good" and "great" companies. A ton of lessons that are immediately applicable.

• Think Again by Adam Grant: This is a book about rethinking assumptions and it changed my approach to business problems more than anything I've ever read.

Can you share any financial lessons or insights you've gained from your entrepreneurial journey?

Since I'm new on my own entrepreneurial journey, I'll instead share a lesson standing side-by-side small business CEOs as the CFO.

One of the biggest things I saw was people not understanding risks. When you make decisions without fully analyzing the risks, you are making decisions on bad information.

This plays out with how many business owners you see not understanding their numbers. They see their bank balance go up or down and make assumptions. Those assumptions lead to decisions being made. But the lack of understanding the "why" means their assumption is a gamble.

For me, the highest ROI thing a business owner could do is to deeply understand their numbers. Good number and good understanding of those numbers allows you to make more informed decisions which will lead to more money in your pocket in the long term.

What were the key financial milestones or turning points in your entrepreneurial journey?

• I started a personal finance podcast in July 2021 and joined Twitter to promote it. I framed the podcast around my interest (reading) and what I thought people wanted (personal finance applications).

• But I quickly burnt out. Instead of teaching personal finance, I started posting about business finances, as I have unique insights that business owners can learn from.

• Very quickly that content was a hit. In May 2022, I had a Twitter thread go viral and I realized that the knowledge I had was something I could monetize. That changed my whole path, which I'm grateful for.

• Since then I've launched a cohort, newsletter, and Fractional CFO firm and gotten to work with business owners one-on-one to help them grow their business and make more money.

Each week Kurtis writes a newsletter, Frameworks & Finance, to 25,000 subscribers. Join him there where he teaches financial concepts to startups and small business owners and leaders.

What’s Happening at Carry?

Here’s what you can expect in the coming weeks

See the full list of events here. ⏰

Want More?

Still can’t get enough? Well, we’ve got you covered!

Think your friends might like it? Be sure to share it with them! 📩

If you want more resources on building wealth as an solopreneur/entrepreneur, check these out:

• The Solo 401k handbook 

• What is a Solo 401k?

• How to Open a Solo 401k

• Common Solo 401k FAQs

• Solo 401k Contribution Calculator