As the owner of a boutique law firm, I pay more attention to small business ownership and success than I used to. In this month’s newsletter, I’m spotlighting two well-run, honest businesses in the Richmond area: (1) Jim LaNeave of Wealth Innovations and (2) Kathy Rodriguez of Bluesky Tax & Insurance.

Two very different paths—one corporate (Jim) and one with a GED from Job Corps (Kathy)—both now operating successful small enterpri
ses. I think a lot of people dream of starting their own business. It takes guts, vision and most importantly—a burning desire to succeed. (Burning Desire was the noted commonality amongst self-made millionaires of the 1930s in Napoleon Hill’s classicThink & Grow Rich.)

Interestingly, in both cases, family member also serving as co-workers help ensure they get it all done. I’ve had lunch with both Jim and Kathy in the last month. Both are focused on family, both have recently moved to better office space—Jim in Henrico and Kathy in Chesterfield—both are sensitive to the economy and the market, both want Richmond to succeed and believe it will. Both personally pick up the phone when you call. They both take the initiative. Neither makes excuses.


Develop a Financial Plan

There are no “gotta haves” before you start your own company. I believe it helps, however, to have your financial house in order—or at least with a plan of how to get there. Plenty of businesses start without much money or “capitalization”, but few succeed over the long term without a clear financial vision for their lives and how to responsibly save and invest profit. And so, I’m giving away a book this month—The Elements of Investing by Burton Malkiel. Burton Malkiel is a former professor and now Chief Investment Officer at I think highly of Mr. Malkiel and his approach to investing, of his view of “Wall Street.” I strongly believe you should pay attention to his views on expense ratios when investing. He wrote Elements of Investing for his grandchildren, in an easy-to-read style that provides the building blocks for a solid
financial future, written after a lifetime of studying economics as a professor at Princeton and working amidst Wall Street types.

By the way, if you happen to attend a dinner with Jim LaNeave at Wealth Innovations, hosted at Ruth’s Chris, as I did recently, he will also voice similar opinions on expense ratios. Bottom line is this: Develop a plan for your future. Plan for prosperity. Understand the elements you will need to get there. Make it a priority. Build a team of professionals to support you. Donald Trump has a team. So can you. The difference
between Trump and you? His team only works for him. Yours may have a few other clients, too. But pity those who have no one around to guide them. Their fear and skepticism of others keep them from living life fully.

I read recently that fear drew many people to pull out of the stock market in 2008 and 2009, after suffering huge losses. Now, in 2014, they are pouring back in, afterwatching years of double-digit returns. They’ve missed one of the largest returns ever by waiting, after taking one of the largest hits. They needed professional help. Not Jim’s clients. He guided them. Paying too much for car insurance? Why not shop a
bid with Kathy? I’m enriched by relationships with other small business owners. Join us. And for my Williamsburg clients—our small business spotlight is coming to the colonial capitol as well, soon.


John's Commandments

And if you don’t win the book, The Elements of Investing that I’m offering this month, you owe it to yourself to pick up a copy and read it. Don’t be intimidated. Fear a future of not knowing what’s in that book. I also want to share with you some powerful tips on your personal finances, while we’re at it. John Morgan, of Morgan & Morgan, started and operates the largest personal injury law firm in Florida. He wrote a book a few years back called, You Can’t Teach Hungry. Mainly, the book is about law practice management. But about half way through the book, he listed his so-called "John’s Commandments". I agree with them to a certain extent (for instance, I personally have a mortgage and actively invest in the stock market through index funds with a very low percentagein bonds). Here they are, unabridged:

1. Pay off all consumer debt and car debt before ever investing in the stock market;
2. Pay off your home and second home before ever investing in the stock market;
3. Read a book titled “A Random Walk Down Wall Street” and follow that investment strategy to the letter;
4. Whatever your age, have that percent of investments in tax free bonds, fixed income and cash;
5. When you invest in the stock market, always dollar cost average. Never put hunks of money in the market at one time;
6. Pray a lot;
7. When you invest, invest in index funds or with managers who have low fees and great research;
8. Avoid all hedge funds. Have you noticed that a hedge fund managers are billionaires?;
9. Buy enough life insurance so that your family is secure should you meet your untimely demise. Ever one million dollars should yield you $40,000 a year tax-free. Therefore, five million dollar should produce $200,000 a year taxfree for your family to live on. Ask yourself could they live on that amountcomfortably?
10.If it’s too good to be true, it’s too good to be true. He went on to write, as an aside, “It may seem odd to you in a book about the business of running a law firm, I would veer into one’s personal financial strategy. However, it has EVERYTHING TO DO WITH THE WAY YOU RUN YOUR BUSINESS.”

Let’s get organized this Spring. And then, I don’tknow—start a business anyone?

H. Van Smith
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Trusted Virginia Attorney Serving Richmond to Williamsburg
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