Latest / The ROI Online Podcast / Advisor Michael Eckstein on Making your Accounting a Priority: The ROI Online Podcast Ep. 78

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Advisor Michael Eckstein on Making your Accounting a Priority: The ROI Online Podcast Ep. 78 · The ROI Online Podcast

• 0:04
  Michael Eckstein: The important thing to remember with your finances and IRS is, you know, they exist, they're nothing to be scared of. You just got to get used to it. You know, the IRS does not want to ruin your life. They really genuinely don't. You know, every single audit I've ever been a part of their position has just been like, we just want to get paid what's owed to us. They're not trying, you know, to come into your business, kick down the door and take to jail. As long as you're being honest, I think we all know where we're, you know, toeing the line, we know what honest is, sounds are not BS in your expenses, and you're being honest, things will be okay, even if you get out of it.
• 0:37
  Michael Eckstein: Right? Nothing to be scared.
• 0:41
  Steve Brown: Hi, everybody.
• 0:41
  Steve Brown: Welcome to the ROI Online Podcast where we believe you, the courageous entrepreneurs of our day, are the invisible heroes of our economy. You not only improve our world with your ideas, your grit and your passion, but you make our world better. I'm Steve Brown. And this is a place where we have great conversations with winners just like you while we laugh and learn together.
• 1:13
  Steve Brown: Michael Eckstein, welcome to the ROI Online Podcast.
• 1:17
  Michael Eckstein: Hey! Thank you for having me, Steve.
• 1:20
  Steve Brown: All right, Michael.
• 1:20
  Steve Brown: So, you know, as business owners, the folks that listen to this podcast are business owners, entrepreneurs and marketing directors, they're people that are hanging out in these, these companies that have like 20 or less employees, for the most part, and, and so there's this thing that happens once a year where we have to get taxes done, we have to have this. We have to stop what we're doing and do all these things so that we don't get put out of business by the evil IRS. So why should the people that are listening to this podcast, why should they hang on a little longer, and listen to this conversation?
• 2:09
  Michael Eckstein: Because accountants and your business and the IRS, it's a little bit more than just taxes you know?
• 2:15
  Michael Eckstein: Your businesses finances and accounting and all those boring numbers things that we try our hardest to avoid because let's face it, it kind of sucks, right? They're a very important part of your business you know?
• 2:27
  Michael Eckstein: And as small business owners, we talk to clients about, you know, maybe data or you know, the things they can learn in their business, you know, things they can learn about their market, but your personal accounting, and your taxes and all these things are your personal data, you know? It's an important thing to keep in mind all year, not just once a year when you have to because Uncle Sam made you.
• 2:52
  Steve Brown: So your company is Eckstein Advisory and, give us a little backstory of why you went from, you had this nagging feeling about you where you can do so much more for a business owner, but you know, doing their taxes is nice. Helping them with some accounting is good. But we're feeling, help us understand that backstory.
• 3:19
  Michael Eckstein: So I did the thing a lot of accountants do, you know, went to college, did took my accounting classes, got the degree became an accountant, you know, did tax returns. Well, that's what tax accountants do.
• 3:29
  Michael Eckstein: There's other kinds of accountants, but that's what tax accountants do. And for years, that's kind of all I did. I did tax returns, I got good at doing tax returns, I, you know, got well known for it was quoted in magazines was on podcasts, kind of like this one, you know, and became a highly rated accountant in my area. But I kind of realized that A) tax return itself doesn't really help the business, you do it because you have to I guess it helps keep you out of jail. Right? Keeps the IRS from showing up, but isn't kind of help you. You take your tax return, and they just kind of stick in your drawing a cool tax return. Right? You never look at it. And even if you did look at it doesn't really tell you anything about your business, other than what you owe in taxes, right? So there was that and then I realized that the majority of my conversations with business owners started as tax conversations, you know, they would call and say, oh, Michael, I need to buy a car. Should I buy in the business? Should I lease it? This and the other thing, but that was like the first 10-15 minutes, I give them the answer. And then it was still an hour long conversation about their business. And it was all sorts of questions about their business. I had one tax appointment, 10 minutes of taxes, 45 minutes about websites. I don't know anything about websites, you know, if you need websites, talk to Steve like I'm not your website man.
• 4:49
  Michael Eckstein: But my clients, the business owners, they needed someone who also understood business that they could talk to about their business because right now, the way entrepreneurship is in the US, you don't have that, you know, there is no one to talk to about your business, you know, you can try talking to your spouse or your partner. And they mean well, but unless they're also an entrepreneur, they just don't get it. And you can explain, you can explain, but they just don't get what it's like, they don't understand the problems. You know? When you go to networking events, you have to have this like facade on that there's nothing wrong with your business, because you're trying to win business, you know, and you don't mention to colleagues, because you don't want to seem like an idiot amongst colleagues, you're just like, Yeah, I know everything about my business, right? So you end up in this place where there's really no one to talk to about it. And I realized that for a lot of my clients, I had kind of became the person to talk to about it. And I was like, you know, I enjoy this more, it's more fulfilling, I feel like I'm actually helping clients, as opposed to tax turns are just kind of, you know, done, cuz they have to be done. You know?
• 5:56
  Michael Eckstein: I'm sure my clients like me, but they didn't show up once a year, it's for taxes, because they like me, right? They had to. So I figured, you know, let's make this a thing that's actually turned this into its own dedicated service, like everyone kind of wants but no one's talking about.
• 6:13
  Steve Brown: Yeah, you know, as an entrepreneur, you wrestle, you have to make hundreds of decisions that impact your financial situation on the fly in the heat of the battle, sometimes three or four in one day, and you didn't even get up, when you're brushing your teeth thinking that you're going to have to make some very impactful decisions you just showed up, rolled up your sleeves, and in the middle of the smoke, and getting punched in the gut, you make a call the best you can.
• 6:48
  Steve Brown: And it's like, you don't know exactly who to go to to ask because like, it'd be nice to have a quarterback of your financial situation that you could kind of lean on and check in and make sure you're making good solid calls, because they're not all tax impactful.
• 7:08
  Steve Brown: Or maybe they are and maybe you just don't know. And that is a weakness or a place that I think most entrepreneurs feel vulnerable.
• 7:23
  Michael Eckstein: Mm hmm. Yeah.
• 7:23
  Michael Eckstein: Finances as a whole in the US have kind of been a forgotten subject, personal finance, business finances, it's never something, you know, we talked about. So when you get into business, you know, you never learned how to run business, finances, or personal finances, in high school in college, in your masters, in your whatever.
• 7:43
  Michael Eckstein: You know, there's no kind of I mean, there are but there's not many, like cool, sexy online courses, how to invoice? You know? There's a million on how to, I guess, direct message on LinkedIn for more leads. But, you know, you see the courses, everyone's seen the courses, right? On sales, on marketing on fun topics, getting more business, but there's no courses, there's no one teaching, how to run your finances, how to invoice better, you know, because it's not fun, but invoicing better, is huge.
• 8:14
  Michael Eckstein: You know, how to do your accounting, you know? I always say your accounting is your most important tax deduction. You know, your perfect accounting, accurate accounting is better than any sexy tax loophole you've got out there. Because at then to the day, your tax return starts with your profit, as you're counting determined it.
• 8:35
  Michael Eckstein: If you're missing $10,000 worth of expenses. Well, guess what?
• 8:39
  Michael Eckstein: You had $10,000 more income than you should have had, and you pay taxes on it. You know, and I've seen it, I've seen clients come in with inaccurate accounting.
• 8:47
  Michael Eckstein: And this happened a year or two ago, actually, a client came in and they had like, $15,000 worth of payroll expense. I called him up, I was like, James, I've hung out at your store, there's no way you have $15,000. What happened to the rest of it? You know, turned out there's an extra $60,000 that went missing.
• 9:03
  Michael Eckstein: But you know, maybe if he had a different account that didn't ask that question, he would have paid taxes on an extra $60,000 worth of income. Right? These are important topics, you know, and they're not fun topics, but it's what separates the great businesses from the okay businesses.
• 9:24
  Steve Brown: Yeah, I call those stupid taxes. They're these invisible taxes that you're paying. That you're unaware of that you don't know how to, and innately you don't know how to organize everything. You know, the default mindset in the entrepreneurship is we're gonna scale this thing we're gonna, I'm just gonna light fire we're going to get this cauldron ball boiling and we're going to scale it. But in the meantime, it's just there's elbows and dust, you know, fat lips and scraped knees in the background, you know? And it can be quite, expensive and painful and detrimental to an organization when the intent was right. And you're following what the, you know what, everyone's talking about all the right things like you said, Get more business. But it can be a big mess behind the curtains.
• 10:30
  Michael Eckstein: Yep. And the best catches up with you. You know, I've seen lots of business owners when they came to me, you know, they wouldn't admit it, that they were in trouble because no one wants to admit they're in trouble. But you can tell that they're losing sleep over this issue or that issue, that they're unsure about this part of their finances, you know, they're unsure about, you know, they owe money to the IRS, you know, things you don't want to talk about. But those little things on your finances are keeping people up.
• 10:56
  Steve Brown: There's a lot of shame associated with messing it up. You know, you got to keep like you said, you got to keep a stiff upper lip. right? Yeah, things are good, and we're growing and business is great.
• 11:08
  Steve Brown: But what's going on in the back room?
• 11:15
  Michael Eckstein: Mm hmm.
• 11:15
  Steve Brown: So what are some?
• 11:15
  Steve Brown: What are like? Give us like three fundamentals that we could start to at least, that 20% might help impact 80% of the, clean up the mess that we have yeah, in the back.
• 11:33
  Michael Eckstein: All right. So a few good accounting fundamentals, right? Would be one, take your accounting more seriously, right? Beyond it just being great for your taxes and save you money at the end of the year, which is very, very important. Don't get me wrong.
• 11:45
  Michael Eckstein: It gives you an understanding and your business that looking at your bank account can't, looking at your bank account you know how much money you have right now. It doesn't tell you anything about how much money you spent, how much money you're about to spend, you know, money coming in and out. It just doesn't tell you. When you have your accounting done, and it's accurate, you know, once a month, you can look at your profit and loss. And I believe anyone can look at their profit and loss and learn from it. And you learn from your business, right? All humans are good at recognizing patterns. It's just part of what's innate in us. You notice when you've driven through five green lights in a row, you know, how many times have you driven through a lot of green lights and pulled over you look at your partner and you're like, Wow, did we hit all the greens? That's amazing! You know, or you're in a bathroom, and you notice the tiles are out of place, or maybe that's just me. But we notice patterns just inherently. Right? And if you look at your profit and loss 15 minutes every month, you'll start noticing your own patterns, right? So do your accounting, right? And if you don't want to do it, outsource it, you know, chances are, it's a good financial decision to outsource your accountant. After that, I would say take your invoicing a little bit more seriously take your cash flow a little bit more seriously. You know, it isn't wishy-washy, it isn't up to you know, kind of the gods when you get paid, you know, or how your invoicing is or how your cash flow is you have control over it. Right? And the last one, and this one I harp on a lot with my own clients, save more for retirement. It's something no one really talks about in the entrepreneurial community. It's something that we all feel like once I'm successful, once the next big contract comes in, once I have 10 employees, once I have 20 employees, then I'll save for retirement. Oh, I'll sell my business. There's all these kinds of excuses. And I'm sure you've heard them. You just hear them all the time, I'll save then. And the problem with saving for retirement and why it's different than other things is, you know, if you're late on your mortgage payment, the bank will let you know, if you're late on your power bill they're just going to turn it off, you know, taxes, the IRS will send you a letter, you'll find out if something went wrong. If you're not saving for retirement, you're not going to find out till you're 50 and your friends start talking about Oh, when I retire and you go, Oh, when we're supposed to retire? Oh that's happening now! Right? So it's important. And those three things I think are the biggest, from a financial standpoint, important things to kind of embrace and do. And I guess a fourth, I'm cheating, I'm doing a fourth, this isn't so much a financial thing. But proper goal setting, you know, if you let your business grow, it will grow in whichever direction it feels like and t could grow in a direction you don't want to take it in, you know what I mean?
• 14:32
  Michael Eckstein: Like, you could start in one place and all of a sudden you start getting lots of clients in one direction in one niche. You don't really want to be in it.
• 14:37
  Michael Eckstein: You don't enjoy them. They're bad clients, they don't pay enough, but somehow you wound up in it, because you just let it go wherever it wanted to go.
• 14:44
  Michael Eckstein: Your goal was to be bigger. You know, figure out what you want to do in your business. What you want to do in your personal life because your business exists to serve you to a certain extent, right. That's why I started it for a better life. And you know, keep it pointing in that direction.
• 15:00
  Steve Brown: I think one of the things I really struggle with is like, there needs to be this item of research and development, where you're testing new things, you're evaluating things, but, you know, that's like this unknown thing that you need to explore.
• 15:14
  Steve Brown: You need to keep your focus on the road while you're driving.
• 15:20
  Steve Brown: But you also need to be able to carve off a little research and development because things are changing, things are not staying the same.
• 15:28
  Michael Eckstein: Mm hmm.
• 15:30
  Steve Brown: What are your thoughts and advice around that?
• 15:36
  Michael Eckstein: My thoughts are that you really have to take time to think about your business, you know, not about the client work, not about how to automate something the best, but think about your business.
• 15:46
  Michael Eckstein: Think about it as almost an outside third party observer, you know, which direction should it go in? Could I be doing this better? You know, has technology evolved? You know, maybe if the technology isn't even, you know, related to you it's good just to keep an eye on it, like, Oh, you know, for example, with an accounting firm, maybe a bad example, but with an accounting firm, let's pretend we're tax account like me, there's other kinds of accounting, there's other kinds of software developments that have nothing to do with me, but it's good to have an eye on it, because they'll eventually come to you.
• 16:20
  Michael Eckstein: Right? It's good to know where the industry as a whole is moving. And in this regard with R&D, right, you can only do so much R&D yourself. I really think it's important to network with your peers and your colleagues. People usually think of networking as you know, winning business I network purely to win new business.
• 16:44
  Michael Eckstein: Networking with colleagues is probably just as if not more important, because sometimes, even though you know, maybe it's to marketers, or whatever, your different kinds of marketers, they have an agency specifically for one thing, and you have an agency specifically for something else, and they don't want to deal with it, and they like you so they give you the business. Right? So that does happen. But it's also important, because they help you keep up to date on the industry, on what things they're doing. You know, I've had conversations with other accountants where I was like, wait? I can do what?
• 17:16
  Michael Eckstein: You're doing what? You know, it's really, that's how you learn, and continue learning about your business. There's a lot of R&D just by knowing people in your industry.
• 17:27
  Steve Brown: Now that's really good. I think one thing that really helped me was for a while I would see every business the same but but I read this book.
• 17:35
  Steve Brown: And it really helped me understand that businesses go through life cycles, you're there's a startup stage, there's the, hey, we're starting to get kind of good at this. And then there's getting prepared to scale stage. And then there's the, hey the wheels are coming off stage. And I think it's important that as when you're talking with your peers, or you're doing some of these conversations, that when they tell you what they're doing, that you're, make sure that you understand what stage they are in. Because it's very different.
• 18:12
  Steve Brown: If you go with the mindset that they're in, when you're not in that stage, it can set you back.
• 18:24
  Michael Eckstein: Definitely, you can definitely get away with certain things. I mean, not get away in a bad sense. But you can definitely make certain demands once you're established. You know, for example, if you're starting out to a certain extent, you're at the whim of the client, if they don't want to pay the deposit, you know, and you put food on the table, well, I guess they're not paying the deposit. Right? Once you're established and things are rolling, you get to say things like that, you know, there's certain things an established business can do. And there's also certain things that established businesses that can afford nicer software. Because that's a reality. There's difference between the $20 a month software and the $200 a month software, and establishments with employees and things, they can do things that a small solo operator that's still bootstrapping, can't really do.
• 19:09
  Steve Brown: Want to pause here just for a moment and talk to you about a program that we have just released, called the ROI QuickStart Academy for Authors.
• 19:16
  Steve Brown: Every day, I talk to business owners just like you who struggle with quickly getting their fundamentals in place. We want to create a great foundation and we want to grow our business. But the things that are in our way, our lack of knowledge about the specifics, we should put in place, what kind of technology what kind of messaging and what kind of campaigns and that problem exists for authors as well. And we just chill so good with authors because, well, I'm an author, and I understand everything that you struggle with. You have a great idea you have a great book, but what do you want to do? You want to get your book in front of more people? You want to make it easy for them to find you? Learn how they can schedule a time to talk with you? Hire you for a conference? Or maybe sign up for the services that your book promotes. So what is the QuickStart Academy for Authors?
• 20:09
  Steve Brown: Imagine working with a small group of like minded authors, and the experts from the ROI QuickStart Team, it's a great way to get your message in clear to be confident with the technology in your marketing automation, and how to run a strategic campaign to get you more of what you want from the investment of your book. To learn more about the QuickStart Academy for Authors, you can visit roionline.com, or click in the link in the show notes below. And now, back to this episode.
• 20:50
  Steve Brown: So the you know, for me getting all the categories correct, you know, to classify expenses, and that was a little bit confusing for me. And to get someone to help you to start get the, you know, you're gonna have hundreds of categories, or you can have just 10. And just getting that clear first, I think was a big hurdle that was helpful.
• 21:17
  Michael Eckstein: Yeah, in your accounting. So I guess let's talk about that a little bit.
• 21:19
  Michael Eckstein: When you get modern accounting software, cloud software, like QuickBooks Online, or Zero or Fresh Books, it comes with intro categories, that it just decides, this is what 99% of businesses need, right? This is the good enough out of the box, you can customize it, you can throw in whatever you want. You know, I know, for example, Zero doesn't include software expenses is one of those categories, but 99% businesses today have software expense. And so you go on and you add it, and you're allowed to add in whatever, to a certain extent, you don't want to make it too detailed, you don't want to have a category that's just, you know, you buying coffees at Starbucks for clients , that's maybe a little bit too detailed.
• 22:00
  Michael Eckstein: But you're allowed to put in whatever kind of detail you want that'll help you understand your business, you know, it's for you to understand just as much as it is for your accountant to do your taxes, you know, it's there for you, if you would like to, you know, for example, one thing I always like to do is, split your revenue up into different streams, because a lot of accounting software out of the box just has one number sales or revenue. But maybe you have 4 different types of service, maybe you want to see how much each service is making, you know, maybe you know, you're a lawyer, and you do two or three different things, you know, you do real estate, you know, you do business law, you do tax law, and you want to see how much each type of client is making right on your report, split that up, you know, or photographer or whatever, right? Split it up into the different categories.
• 22:52
  Michael Eckstein: So you can see, so you can understand because that understanding gives you something, and go in at the
• 22:58
  Steve Brown: I think the first default mindset that you detail.
• 23:04
  Steve Brown: approach, the categorization is tax oriented or tax centric, right. But I think there's like this light bulb that goes off on you later. Oh, I can start to segment these expenses to help me see patterns that reveal information to help me make better business decisions. And, but I think then that pendulum swings to the other side where it gets too many categories and too detailed. So the other thing that starts to be confusing to me is, so you're you're looking backwards. But you're also wanting to look to the future, right? But the future is always unknown.
• 23:52
  Steve Brown: Yeah. And so, are you gonna talk about that?
• 23:56
  Michael Eckstein: Okay. So that has been a hot topic in accounting recently, that accounting as a whole tends to be retroactive. We can look at the data, we can look at the history, we can look at what's happened. There's been a big move a big push into proactive forward thinking and kind of advisory work, where not everyone's doing it just yet.
• 24:17
  Michael Eckstein: But people are thinking about that this would be more valuable, more helpful. And it definitely is. And it's definitely something that's happened recently, you didn't used to be able to do that, you know, 20-30 years ago, before Cloud Software, the way accounting was done was on desktop software. And if you wanted to do a cash flow forecast, you needed to have like a heavy duty pre done excel sheet. These Excel sheets were proprietary, only accounting firms had them. And if you could buy one, they were expensive, right? Cash Flow couldn't really be done unless you were, you know, forecast and couldn't be done unless you're an enterprise company. Right? It didn't exist.
• 24:52
  Michael Eckstein: But now with Cloud Software, there's all sorts of software's that'll let you see into the future, whether it's cash flow forecasting, or other kinds of proactive reports, that 30 years ago, accounts dreamed of, that used to cost a lot of money and only enterprise companies could have, you could have a cost of, you know, an enterprise company 1000s 30 years ago, for like 200 bucks max today, and it's probably even better than it was back then the technology has become insane. Right? And there is a push towards proactive reporting. And if that's something you're interested in, it's something to look for, right? But before you can go into proactive reporting, you A) need to have accurate accounting, because it does draw your information from your accounting, right? If your accounting is a mess, all your ports are going to be a mess, including the proactive things, right? You can't fix it, you know? And you have to have your fundamentals down. Right? One of my big things is, you know, the accounting community has been talking about cash flow forecasting. You know, it's the next big wave in accounting. But if you don't have your actual cash flow procedures down, it doesn't matter what forecasting says, you know, all the forecasting in the world will not fix your crappy invoicing.
• 26:11
  Michael Eckstein: It's just not gonna. Right? So I think those two things are important, but proactive reports are amazing. They're the next step.
• 26:20
  Steve Brown: Yeah, it's like there's this transformation going from fear based accounting, to confident business decision making accounting. What are the proper expectations of an accountant or a tax? What do we call this person? What do we expect of this person, right? To move from fear based, insecure, you know, knowing that there's this hidden thing that's gonna bite you, if you get audited or something to a place that you can be confident and start to, like, become a grown up business.
• 27:03
  Michael Eckstein: So I think there's two things in there, one, your relationship with your accountant, and two your kind of overall relationship with finances and the IRS. Right?
• 27:12
  Michael Eckstein: Let's start with the second one first, right? The important thing to remember with your finances and IRS is, you know, they exist, they're nothing to be scared of, you just gotta get used to it. You know, the IRS does not want to ruin your life, they really genuinely don't, you know, every single audit I've ever been a part of their position has just been like, we just want to get paid what's owed to us. They're not trying, you know, to come into your business, kick down the door and take you to jail. As long as you're being honest. I think we all know where we're, you know, toeing the line, we know what honest is, sounds are not BSing your expenses and you're being honest, things will be okay.
• 27:46
  Michael Eckstein: Even if you get audited, right, nothing to be scared of. The same kind of goes with your finances, you know, it's not something to be scared of, just because, you know, someone told you maybe you're bad with money or you're bad with math, it's not true. You know, don't say that, right, anyone can learn about math and finances and get accustomed to it. Right? So that's the first part. The second part is kind of your relationship with your accountant. If you do want that kind of proactive accountant that does more advisory type work that does more kind of forward thinking work that we'll talk to you throughout the year, you know, not the kind of, you know, give me your numbers and get the hell out of my office accountant, right? That's the accountant you have to look for.
• 28:27
  Michael Eckstein: Because not every accountant is like that. And I know we talked about this a little bit before the show. But accountants as a whole were never really taught to be people people. We're never taught advisory things, we're never taught sales. We're just taught you do math. You do math good. Right? That was it was all our training, right? And a lot of people carry that mentality into their own practices, their practice is just do you do math good. Right? And when you go in and you talk to your accountant, like for example, if you're listening this right now and you'd like to have an advisory relationship with your accountant, email them. They might not even be aware that you want that they might not even offer that but they may be willing too, just shoot him an email just and say, Hey, mister misses, whatever so and so. I was listenning to a podcast, this guy was talking about, you know, proactive accountant, accounting advisory to offer that. Right? Because they may, and they may not have ever mentioned it, because we're terrible up sellers. It's just a problem in the industry. You know, it's something you have to talk about with them. And if you're looking for a new accountant, when you're looking for new accountant, you have to think what you're looking for, is it just tax returns once a year? Or is it a full blown kind of advisory proactive relationship? You know, because there's accounts across the board and not every accountant is going to be everything. Look for the one that, you know, does what you want and that you mesh well with you know, have a conversation with him.
• 30:02
  Steve Brown: Conversation with an accountant. In my book, I talk about IT guys. And the thing, the reason they became IT people is because they don't want to talk to humans, okay?
• 30:16
  Steve Brown: They want to sit in a basement.
• 30:16
  Steve Brown: They want that lightsaver over there. And they'll talk to another IT person because they're on the same level, but talk to ditzy marketing people.
• 30:30
  Steve Brown: No way. I mean, it's like an insult, it's a waste of their time. And you so you don't feel comfortable approaching them.
• 30:40
  Steve Brown: But yet, we put this weight and they make these declarations about what should happen with your online platform. And it could be totally unbusiness smart. But from IT, safety point. Oh, my gosh, it's heavy duty. And even all the hackers couldn't get into it. But as far as helping you grow your business, it's a fail. I feel that there's an insecurity about approaching and talking to, who to talk to, you know, I don't even know what kind of, one to talk to do you have like this calculator that I would answer these questions, and then it would start to reveal? Like, I don't know, what are those dating sites that you can actually get paired with like an advisor that would be perfect for your stage of your business and your goals? There's some depth.
• 31:40
  Michael Eckstein: Can you imagine a Tinder for accountants? But that's the thing, you know, accountants are similar to IT people that we want to talk to people on our wavelength, you know, other accountants that understand what we're talking about. But the reality is, you're paying this guy or gal, right? On the low end if you're just paying for taxes, maybe you're paying 1000 bucks, 2000 bucks. on the high end, you could be paying them, you know, significant money. You shouldn't be afraid to pick up the phone and call them. You know, I see it all the time with my clients, they come in, they say, I've had this question for years, but I never felt comfortable asking. Why? You're paying them? You know, to a certain extent, they're there to answer questions.
• 32:27
  Steve Brown: I think that's an excellent suggestion. But here's the problem. I don't know whether to believe them or not, because they're talking in this level that they could be telling me the truth and I'm just just clueless. I don't know how to evaluate the quality of the answer. And if they really considered my situation.
• 32:49
  Michael Eckstein: So with that, I think you really need to suss out a few different kinds of accountants, you know, you wouldn't just kind of hire the first house painter to paint your house, you get a few quotes, you know, hire the first marketer or the first whatever, you get a few quotes. And I find with accountants more often than not people just go with the first accountant. You know, which, I mean, I guess that's worked in my favor for a while, that got me where I'm at. But, um, I mean, yeah, go with me hire me. Um, so I think it's, suss it out. Talk to a few accountants, you know, that is a prominent industry where we talk in jargon, and I do it sometimes, too, there are certain words, that've kind of worked into my average daily talk, like I still say year-end, no one says, your-end, I didn't realize that, I google that, it's only an accounting term, right? But there's just certain terms that are so, like they just perfectly describe something. So we can't help it.
• 33:41
  Michael Eckstein: Right? But some accounts get stuck in jargon mode, right? And they don't know how to talk in normal mode. And maybe that's good for certain, you know, business owner, very sophisticated, very educated. Or maybe it's good for no one to be honest, right? But find the account that works for you, find the accountant that's on your wavelength that can talk to you how you need to be talked to.
• 34:05
  Michael Eckstein: That, I'm not saying talk down to you, I mean, talk to you on your level, right? That can explain complicated topics to you. Right, because I see that a lot. Also, clients will come in their previous account never explained anything about taxes, business, whatever. Just because they could never explain the concept. All the concepts can be explained. Right? Find someone that works for you. Find someone that can be a partner in your business and ally in your business. Now, how to find them?
• 34:32
  Michael Eckstein: Is there a Tinder for accounts?
• 34:32
  Michael Eckstein: There's a few kind of crappy Tinders for accountants, none of them are very good to be honest.
• 34:39
  Michael Eckstein: It comes down to a few things.
• 34:39
  Michael Eckstein: Do you want a local accountant that is nearby you? Then what you're going to end up doing is going through, you know, Google accountants near me, or Yelp or whatever, and going through the list and saying, which one of these accounting firms works for me? You know, which of these accounting firms treats me right? You know, it doesn't just, you know, I didn't have the sales conversation with the partner, and then all my questions go to the associate, because that sometimes happens, right? Find the accounting firm that works for you. Or if you're looking for someone virtual that can be anywhere, you know, then you start looking for niche accountants, you know, accountant for, you know, low on maintenance, right? Accountant for my industry, because there are now a lot of accountants that specialize in industries, you know, and certain industries, I think it would be very important to find an accountant that specializes in you, because not everyday kind of stuff you want more than your everyday accountant.
• 35:32
  Steve Brown: I've noticed that QuickBooks now is QuickBooks Online specifically, is starting to grow a database of approved or certified QuickBooks, accountants or managers, whatever that term would be. And I think the industry is recogni ing there's demand for it, the e's a need for this.
• 35:56
  Michael Eckstein: Mm hmm. Yeah, all the major accounting software's now have their own directories, you know, QuickBooks, I think their advisors, Zero also has certified advisors, Gussto has them, everyone kind of has a bunch of these directories of, oh, they use our software, they've even taken a test. So they have a lot of clients with us. And we kind of can tell you, they kind of know what they're doing. And that is good, too. To a certain extent. If you are setting up Gussto, which is a payroll software, for those that don't know, and you want help, ou would want someone that k ows the software. So you go to isting and you find someon that knows the software. But th t may not help you if you're looking for a more adviso, accountant or proactive accoun ant, because those certif cations are just, they know ow to use the software. They on't really say, Oh, they know ow to talk to people, you know?
• 36:42
  Michael Eckstein: Which is the important thing And the only way you'll reall know is by having a phone call nd having the meeting with them nd seeing how they are with ou.
• 36:55
  Steve Brown: So what's like one question I need to be asking about this area that I haven't asked that we need to address?
• 37:05
  Michael Eckstein: You mean a question you should ask your accountant?
• 37:07
  Steve Brown: You. You know, we're having this conversation is like, what's the one question nobody ever asks that should be asked?
• 37:17
  Michael Eckstein: About what specifically?
• 37:18
  Steve Brown: Yeah, about what area have I not dug around in that you would like to talk about or address that we haven't?
• 37:28
  Michael Eckstein: Okay, so maybe this is a bad time to talk about it because we have Coronavirus.
• 37:31
  Michael Eckstein: But one thing I always harp on is saving for retirement. Like I know, I harped on a little bit in the beginning. But it's really something that I feel we're missing right now in the not just accounting community, but the entrepreneurial community as a whole. We are not talking about what happens when we want to retire. Right? I think it needs to be taken a little bit more seriously. And I guess I'll tell you a few stories about it, a few horror stories and what we can do to fix it. A few years ago, I was working late on you know, tax day because at that time, I was the kind of guy that did that I, you know, was on April 15th here
• 38:13
  to like, you know, 10: 11pm at night finally, last tax turns, I went to the bathroom, I bumped into our commercial cleaner, the guy that cleans the building.
• 38:19
  to like, you know, 10: And we just kind of got to chatting talking about retirement, he was a very nice guy. He was definitely, he was in there longer than I had been in that building. Right? So at that point, probably 10 plus years, right? And he was older.
• 38:33
  to like, you know, 10: Right? He was definitely near retirement. And we've kind of gone on the topic and turned out he had never saved for retirement you know? And he'd always kind of played games with his business taking cash, you know, reduce the Social Security tax as much as possible. And he had nothing. He just had to continue working forever. And I know that, like as entrepreneurs, we all want to be like, Oh, I love working. I love my business. I love my clients.
• 38:59
  to like, you know, 10: But the reality is, will you love it when you're 75? Right?
• 39:05
  to like, you know, 10: Or do you want to take some time back? You know, take a step back and be able to retire? Because relying on Social Security isn't enough. And the reality is the majority of businesses can't be sold, or aren't really worth that much. If you think about how much you need, if you need$50,000 a year, you know, for retirement, you know, say 10 years, that's $500,000 20 years, that's a million dollars. Are you sure without a shadow of a doubt, that's what your business is worth? You know what I mean?
• 39:36
  to like, you know, 10: It's not a fun topic to talk about it because I guess I'm not talking about from the fun angle where, invest in the stock market you'll make so much money. I'm talking about it from the more depressing reality of it. But it's important, you know, start today like they say the best time to plant a tree was 20 years ago. The second best time is today. Right? Take it into consideration set some money aside, you know, even a little bit is better than nothing. Because I really hate seeing these clients that come in, and they work so hard, they care about their clients, their employees, their business, the quality of their work, they care about everything. But they didn't care about themselves, you know, and now they're kind of stuck in this situation, you know. And, yeah.
• 40:18
  Steve Brown: That dictates, and that you would do things somewhat different in your business, because if you started that business to have something to show for later, then you need to create a business that doesn't need you. That would thrive without you, well that means that there would be these actions you would take that are very different than just you doing the best job and you being integral to the outcome of the service or the product. So you'd have to create some sort of defined model, business model that's unique and valuable that, and then be able to show your business development systems and your sales systems so that when someone's evaluating this business, they could actually imagine them paying for it, because of the established processes and systems that you have created.
• 41:21
  Michael Eckstein: Definitely, when you think about selling your business, think about it from the other perspective, buying a business. You would never buy a business where you can't remove the owner, where the owner has everything in their head, where it totally relies on his or her personal, you know, relationships with the network, where the owner is integral to the business, right, you wouldn't want to buy business, like you're saying, with, you know, standard operating procedures, with sales, with marketing, with accounting, where everything is set, you know, kind of plug and play business. And the better all those kinds of systems are, the more valuable it becomes, you know, because if you don't have all that they might buy part of your business, they might buy the lease urine, they might buy the assets you have, they might buy, you know, your book of business, but they're not gonna buy the whole thing.
• 42:08
  Michael Eckstein: And the less they want to take, the less valuable your business becomes. Right? And then even on that note, don't solely rely on selling your business because things can happen. You know, of course, you want to have a great business like that that is sellable. But you know, always have, you know, plan for the worst hope for the best.
• 42:30
  Steve Brown: So my goal, if folks that have been listening to this, they want to reach out to you and chat with you.
• 42:39
  Steve Brown: Where's a good place to connect with you?
• 42:42
  Michael Eckstein: So I guess this is the part of the podcast where I say go to my website, download my kind of crappy ebook, right? But instead of that, right, you can find me at hashtagmichael.com, because realistically, no one's gonna remember how to spell my last name while they're on a run listening to this podcast or in the car. Right?
• 43:00
  Michael Eckstein: hashtagmichael.com spell it out.
• 43:00
  Michael Eckstein: Right? Because if you just do the hashtag doesn't work, right?
• 43:03
  Michael Eckstein: It takes to my website. And from there, you can just kind of see everything, you know, see, there's a archive of all the newsletters I've sent. Every week, I send a newsletter that's like three to 600 words 300 to 600. And there's an action item for what can help improve your business, the takeaway read through, you know, there's also a link to my LinkedIn, see what i'm saying there? You know, did you like the podcast? Do you like the newsletter? Do you like all those things? And subscribe.
• 43:27
  Michael Eckstein: I'm not gonna bribe you with some ebook that, you know, doesn't help anyone. It's, you know, we can educate decision if it's good for you. It's good for you. If not, I hope you enjoyed this, right?
• 43:39
  Steve Brown: Yeah. Or maybe there's someone that you would direct them to if you guys want to get
• 43:45
  Michael Eckstein: someone directly to find me?
• 43:47
  Steve Brown: knows you would suggest someone that might be a better fit for them even.
• 43:52
  Michael Eckstein: Yes, if I think you need another kind of accountant, and this is a serious thing. I'm not going to try and pitch literally everyone that emails me or everyone that signs up for discovery call or DM me on LinkedIn. But I think there's a better fit for you and I know who they are all connected with them. Because the reality is not everyone's a good fit for everyone else as much as I should be here and be like, yeah, hell yeah, I'm the best account that's ever existed.
• 44:13
  Michael Eckstein: reality is there's it's possible there's a better account for you, or you need a specialized one or maybe you don't even need an account at all. Right? And if that's the case, reach out. I'll see if I can find someone for you.
• 44:27
  Steve Brown: So you've been an excellent guest, Michael, I really appreciate you.
• 44:32
  Michael Eckstein: Thank you for having me.
• 44:34
  Steve Brown: So Michael Eckstein, actually, yes?
• 44:40
  Michael Eckstein: Either's fine.
• 44:41
  Steve Brown: That's such a, you're never confident in that situation either. As far as the proper pronunciation.
• 44:49
  Michael Eckstein: The entire name is kind of confusing.
• 44:50
  Michael Eckstein: Everyone thinks there's an X somewhere in it. That's why I say just go to hashtagmichael.com of Eckstein advisory. Because,you know, even since I was like a little kid, I remember I think it's like fifth grade, they misspelled my name over the PA. Oh, there's no X.
• 45:01
  Michael Eckstein: It's written down in front of you. How do you mess that one up?
• 45:09
  Steve Brown: That's E C K S T E I N, Michael. Thanks for being on the ROI Online Podcast.
• 45:17
  Michael Eckstein: Thank you for having me.
• 45:19
  Steve Brown: And that's a wrap.
• 45:21
  Steve Brown: Thanks for listening to another fun episode of the ROI Online Podcast. For more, be sure to check out the show notes of this episode. And feel free to connect with me on LinkedIn where we can chat and I can help direct you to the resources you're searching for. To learn more about how you can grow your business better, be sure to pick up your copy of my book, The Golden Toilet at surprise, thetgoldentoilet.com I'm Steve Brown, and we'll see you next week on another fun episode of the ROI Online Podcast.