CCM INSIGHTS
A Newsletter by Compass Capital Management
HAPPY HALLOWEEN FROM CCM!
A LOOK INSIDE THIS ISSUE:
1.Happy Halloween from CCM! Don’t forget to RSVP for our Holiday Hoedown event!
2.Top 5 Business Strategies for Self-Employed Individuals
Hear from CCM’s Jimmy Williams about his TOP 5 Strategies
�� Happy Halloween from Compass Capital Management! ��
At Compass Capital Management, we’re all about helping families and businesses plan for a bright financial future — but today, we’re celebrating a little differently! Our offices are filled with spooky spirit, creative costumes, and plenty of sweet treats as our team gets into the Halloween fun.
Ore team has celebrated all month long fro our SPOOKY Halloween party to our office contest!! THERE IS STILL TIME TO VOTE! Get on our Facebook for more information!
Whether you’re out trick-or-treating with family, hosting a festive get-together, or simply enjoying a cozy fall evening, we hope your day is filled with laughter, candy, and just the right amount of spookiness.
From all of us at Compass Capital Management, have a safe, happy, and hauntingly good Halloween! ����
UPCOMING EVENTS:
Holiday Hoedown: November 13th
TOP 5 BUSINESS STRATEGIES FOR SELF-EMPLOYED INDIVIDUALS
BY: JIMMY J. WILLIAMS, CPA/PFS, CFP , CRPC ® ™
Running your own business can be rewarding, but it also comes with challenges especially when it comes to saving for retirement and managing cash flow Unlike traditional employees, self-employed individuals do not have the benefit of an employer-sponsored 401(k) or steady paycheck Many entrepreneurs flourish with such an approach to their professional career I have been an entrepreneur since 1992 and have enjoyed most (not all) the attributes of being a business owner
The good news? With the right planning, small-business owners can build wealth for the future and maintain healthy cash flow today. Here are five key strategies to help you achieve your business goals:
1. Pay Yourself First Even as a Business Owner
This is a philosophy of my life that has yielded the best outcomes If you, the business owner, settles for whatever resources remain from your business operational needs, creditor payments, taxes, etc , you will suffer a difficult lifestyle However, by implementing this priority with your cash flow, you will help secure your future and provide yourself the mental support and ambition to continue to work toward your success This habit will also save you from paying a higher tax burden if your commitment is to your future retirement needs
The method for “paying myself first” was to set up automatic drafts for my retirement contributions and savings. By treating your future retirement needs as a “mortgage” for your family’s future, you are going to benefit from dollar cost averaging and/or compounding of your contributions over a longer period of time. Consider your available cash flow from the business and always use a budget to determine your accountability in your performance of this goal It is conceivable that you may sell your business someday and use the funds from the sale to support your retirement However, you should not ignore saving for the future and rely on a big paycheck from one transaction when you retire Risk comes in many forms and one method of mitigating the risk of an economic slowdown when you desire to sell your business is to save for the future early in your career
2. Choose the Right Retirement Savings Plan
Business owners have several retirement savings options that can help reduce taxes and build long-term wealth The right plan depends on your income level and whether you have employees
Here are a few of the most common types:
SEP IRA (Simplified Employee Pension): Easy to set up and allows contributions up to 25% of net earnings, up to annual limits set by the IRS Great for solo business owners or those with few employees
Solo 401(k): Designed for self-employed individuals with no full-time employees other than a spouse It allows higher contribution limits because you can contribute as both the employee and employer
SIMPLE IRA: Ideal for small businesses with fewer than 100 employees. It requires modest employer contributions and simple administration. Each plan type has unique rules, so working with a qualified financial or tax advisor can help determine which one fits your situation best
3. Separate Business and Personal Finances
Mixing personal and business accounts is one of the most common mistakes among small-business owners. It makes it harder to track profitability, manage taxes, and set aside money for savings.
Open a dedicated business checking account and, if needed, a separate business savings account. Pay yourself from your business as an employee or through owner’s draws, depending on your business structure.
This separation creates clarity in your cash flow and makes it easier to project future expenses and retirement contributions. It also helps your advisor build accurate financial plans based on real data rather than estimates.
4. Build a Cash Flow Buffer
Strong cash flow management is the lifeline of every successful business. One missed payment or unexpected expense can disrupt operations — and your personal finances.
Aim to maintain three to six months of business expenses in a separate emergency fund. This buffer provides flexibility during slower months, allowing you to cover payroll, vendor bills, or taxes without stress. I am a believer in utilizing lines of credit for short-term cash flow needs to fund inventory purchases or awaiting the payment of large accounts receivable balances. The key is to remember the line of credit is simply a bridge to the funds you are seeking with your business operations and not a long-term loan.
5. Review Taxes and Retirement Plans Together
A coordinated approach to taxes and retirement can save money and improve your long-term results. Many self-employed individuals view taxes as something to minimize each year, but smart tax management also looks ahead.
For example:
Contributing to a SEP IRA or Solo 401(k) can reduce taxable income while building retirement savings. Deferring income or accelerating expenses before year-end can smooth out cash flow and reduce tax pressure.
Using a health savings account (HSA), if eligible, offers triple tax benefits — deductible contributions, taxfree growth, and tax-free withdrawals for qualified expenses.
Working with a fiduciary wealth advisor and CPA helps you align your retirement and tax plans with your goals. The goal is not just saving taxes this year but rather building lasting financial freedom. For self-employed individuals, financial freedom does not happen by accident. It comes from consistent planning, disciplined saving, and smart decision-making.
By paying yourself first, choosing the right retirement plan, separating finances, maintaining strong cash flow, and coordinating taxes with savings, you can create a sustainable financial path — one that supports both your current lifestyle and your future retirement.
As your business grows, revisit your plan regularly. Life changes, tax laws evolve, and new opportunities arise. A fiduciary wealth advisor can help you adjust your strategy to stay on track.
You have worked hard to build your business. With the right planning, you can ensure it continues working hard for you — today, in retirement, and beyond. The above is only a few of the types of year-end planning strategies we recommend for individuals who wish to control their tax burden and plan for their future. If you are concerned about paying too much income tax, we highly recommend you request a complimentary consultation with a CERTIFIED FINANCIAL PLANNER professional who guides you through the complexities of the federal and state income tax laws. Start some positive, powerful habits that will lead you into a bigger future!