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Honey, will you marry me…and my student loan debt?

September 20, 2016
By Butler and Company

There was an interesting article on Fox Business How Couples Sabotage Their Finances that talked about often-times unspoken part of a new marriage – blending of finances. You know the usual topics that get covered during the engagement period – name changes, where are we going to live, when/if you want kids, etc… The resulting family budget and financial position is typically an afterthought – 3 months after the couple gets back from the honeymoon, they realize that there has been a bunch of withdrawals for a student loan payment and a credit card bill keeps getting bigger and bigger due to a regular trip to someone’s favorite boutique.

Before Tina and I got married, I had a serious spending habit at Best Buy. Without fail, I would be at Best Buy on New Release Tuesday buying something…DVD, CD, video game, gadget, whatever. I had a DVD collection that had movies I had never (and STILL haven’t seen) that were a “good deal” and part of my weekly habit. Tina never gave me an ultimatium, but did make it clear that I was investing a lot of money into things I wouldn’t ever use or would just use once. Now, I do still enjoy wandering the halls at Best Buy, but my purchases are far more strategic than they used to be.

This is not to say that marriage means the end of free spending. It means that you have to be on the same page with your spouse. If you had a large credit card bill coming into the relationship, make sure your new spouse knows it exists and have a plan for paying it down. It does not bode well for a new marriage if you enter it with hidden burdens (and debt is a huge burden) that surprise you a few years end when things are tight. I don’t think anyone wants to be the spouse that finds out that they were broke 9 months after they dried up their savings and maxed out their credit cards.

Before you tie the knot, sit down with your soon to be spouse and have a very clear conversation about where you both stand financially. Bring the last statement from your credit card bill, your last tax return, the statement on the house you own, your degree with the ball and chain student loan debt attached, etc… Talk about what exists and do a little visioning of where you want to be in the future. Do you want to have those student loans paid off before your 10 year anniversary? Do you want to buy a larger house to hold that big family you’ve always talked about? Is there a business you’ve always wanted to start, but the finances were never quite there?

This conversation isn’t going to be one that wins “Romantic Evening of the Year” award…I have tried over 7 years of marriage to make reviewing our personal tax return a romantic evening – wine, candlelights, chocolate covered strawberries and 1099s just don’t go well together. It is an evening that will avoid major issues later on in your relationship and help guide your growth as a family for years and years to come.

If you are getting married and need some financial guidance in blending a financial family, feel free to give us a call. We’re always happy to help families start off on the right foot as they embark on the most fulfilling adventure of their life.

Yours in service,

Jason Deshayes, CPA

Posted in Financial Fitness

Not just about the books…

July 18, 2015
By Butler and Company

Often, new businesses are overwhelmed with the amount of compliance, reporting and unknown pitfalls that they experience being an entrepreneur.  Entrepreneurs often start a business because they had a passion to do what they are good at and make some money doing it.  We feel that the more that our clients focus on their core business (by doing less of what is not their strong suit) the more they would ultimately make and be satisfied with their business.  We have a client who is a relatively new law firm, so they did not have all of the years of experience with business operations or best practices.  The two partners had moved out of firms where they were employees and decided to go into practice with each other.

When we started working with this firm, we emphasized the importance of establishing a scalable administrative and financial infrastructure that would grow and change as the firm got more established.  Often, new businesses are overwhelmed with the amount of compliance, reporting and unknown pitfalls that they experience being an entrepreneur.  We felt that the more that our clients could focus on their core business (by doing less of what is not their strong suit) the more they would ultimately make and be satisfied with their business.  To facilitate this, we helped the firm implement a number of initiatives:

Implementation of a cloud based accounting system to allow for instant collaboration into their day-to-day accounting

Rather than using a traditional desktop accounting software, we opted to implement a cloud-based program called Xero for the practice.  This allowed us to be a part of their day-to-day accounting without needing the client to send us a fixed data file periodically.  If there was an area we need to discuss, we could pull their books up immediately, rather than having to wait for the data file to transition over.  The client enjoyed not pushing data to us and the real-time element of the cloud system.

Quarterly meetings with the owners to discuss business issues, identify areas of concern and leverage our experience with other clients to establish best practices for the client to execute

Many new business owners don’t necessarily know the best questions to ask, what the best practices are and what they should (or shouldn’t) worry about.  These meetings created an open forum for the owners to ask whatever came to mind.  We responded through our experience and the collective experience of our other attorney clients.  This client was able to see how other firms operated and what best practices would apply to them.

Do periodic tax and business planning to manage tax burdens and forecast what is going on within the business

By having regular contact with our client, we are able to stay abreast of how their business is doing.  We know when cash flow is poor; we know when big cases are settling that will create a huge spike in income; we are in the trenches with them.  We are able to project the tax burden based on what the business is doing now and avoid big surprises when tax time came along.

Coordinated a payroll solution that would be easy for the firm to work with, while making sure that all of the payroll compliance was seamless and timely executed

Payroll is an area that seems easy, but takes a huge amount of time to fulfill all of the compliance necessary to do payroll correctly.  We set them up on a cloud program called ZenPayroll that allowed them to handle the time input, while that service handled all of the compliance.  The payroll information seamlessly imported into Xero, keeping the system real-time as expected!

Answer questions regarding topics such as health insurance, employee compensation, retirement plans and more as they come up

Our client had a number of other questions that related owning to business, not necessarily running a law firm.  Given our deep knowledge into their business and personal circumstances, we are able to provide them solutions that really fit their situation.  For example, while a SEP plan would provide the owners the largest retirement benefit, it would have cost the practice way more than they were comfortable with since the SEP had to cover all of the employees.  We were able to steer them into a plan that met their needs at a cost they were comfortable with.

While compliance is a critical element to what we do as CPAs, it is not often where we can do the most good for our clients.  With us helping create a flexible financial infrastructure, our business owners are able to truly focus on their core competencies, allowing the business to flourish.  This is not the only client we work closely with like this. We collaborate with many small business clients to provide them more value than just basic financial statements or a nice looking tax return.

So, what’s been going on the past 20 years?

September 20, 2014
By Butler and Company

I just left Charleston, SC after going to my last AICPA Private Company Practice Section (PCPS) Executive Committee meeting.  I lived in Charleston almost 20 years ago, so it was pretty interesting to come back and see how much it changed.  I ended up meeting up with a friend from high school who I last physically saw when I moved away in 1996.  While we had been communicating in that 18 year gap, it was short conversations on the phone, messages on Facebook and quick e-mails.

Once we sat down to catch up, the first thing that we started talking about was all of the stuff we had done since we last saw each other.  I kid you not – it took maybe 3-4 sentences to express 18 years of life – “Oh, got two degrees from UNM, where I met my wife, who I married almost 10 years ago.  Been working in public accounting for 12 years now and am a partner in my firm for a few years now.  Oh, and we had a baby last year.”

Wait, what?  We have been taught that accomplishments and successes in life are to be celebrated and applauded.  So, why is it so easy to sum that super important stuff into such a small space in a conversation?  To be honest, I think it is because we are programmed mentally to report our “life resumes” to others to make sure they know some biographical information about us.  I can’t figure out for the life of me why that is so important, but boy do we all do it.

What was interesting was when we got that bio stuff out of the way, we started talking about things that we were passionate about.  My friend uses the gym as an outlet for his frustrations and the parts of his life he just wants to get out on the weights.  I find helping others with the financial realm of their life to be empowering and allows me to meet my calling in life.

When we meet new or prospective clients, the first thing we do is ask them about themselves, what their passions are and what are the things that keep them up at night.  Yes, we get some of those bio items and those are sometimes important…but the really important stuff is when you see people perk up when they start talking about how much they love serving in their church, or how they take great pride in helping others improve their health, or just how special their kids are.

So, how are you communicating with others about what you are passionate about?  Are you making an impact in the lives of others and leaving a lasting impression with them? Make it a point in your interactions with others to find out what their passions are and share yours!  Life is way more than all of your accomplishments…

Posted in Life

Estate Planning- Not just for the rich and famous

April 30, 2014
By Butler and Company

The concept of estate planning is one that many people feel detached from.  It seems like something only “rich” people have to deal with – you know who you think of: Bill Gates, Warren Buffett, those celebrities who get paid $25,000,000 a movie, etc…  While these people do (or at least we hope) have estate plans, it doesn’t mean that you shouldn’t have one too.

I have a new kiddo – young Master Deshayes is a whopping eight months old.  When he was only about two months old, I had an incredibly vivid dream where my wife and I died in a horrific car accident.  My only concern throughout the dream was making sure that my son was taken care of.  I woke up stressed out and emotional worrying that I hadn’t taken care of my family, in case something very unexpected happened.

Am I some multi-millionaire that has trust upon trust upon trust to create a legacy for generations to come?  I wish!   Do I have adequate life insurance to care for my family in case I depart the mortal coil earlier than I think?  Yes, and between a house, retirement accounts, savings, etc…  that is a lot of resources to just get dumped onto someone.  That’s a lot of financial responsibility to put onto someone who is going to care for your child…an already huge responsibility.

The idea of estate planning is that you have laid out your affairs so that when you are gone, it’s not a huge burden on whoever gets to take care of your estate.   Here are some things to think of:

  • Do I have kiddos that need to be cared for?  If so, you need to have a discussion with your spouse about who you want raising your children.  Don’t just pick one – you don’t know if your first choice will be available when the unfortunate happens.  Having a backup makes sure that you have some contingency plans, just in case.  Don’t let the courts decide who your children will be taken care of by.
  •  Who do I want to take care of all of this administrative stuff? I have seen a lot of trusts and wills that choose a family member to handle the affairs.  While this often can work out, I have also seen some disastrous situations where siblings become cotrustees of a family trust or an unsophisticated family member becomes the executor of an estate.  In these situations, the assets and administrative issues of the estate or trust taint family relationships.  Brothers fight; siblings stop talking to each other; your only child gets stressed out of their mind trying to wrap things up.

Consider a corporate trustee to be your trustee or executor.  While there is a fee involved in these, these corporate trustees (independent trust companies, banks, attorneys and some CPAs) understand the fiduciary duties required of a trustee/executor.  They also have far more experience in these matters, which makes doing this “stuff” much easier than for someone who has never done this before.

  • What is the distribution plan? Are you charitably minded?  Do you want the kids taken care of equally?  Do you really want that one beneficiary to have full access to a huge financial windfall, knowing that managing those new resources will be extraordinarily taxing?  Having your estate plan figured out allows you to have a little control from beyond the grave and ensure that your wishes are met after your passing.
  • Do you want all of your assets to become public knowledge? When you pass and do not have a trust, your assets go through probate, which is public knowledge.  I don’t know about you, but I really don’t want my life any more exposed than it needs to be.

Take the time and meet with an estate planning attorney to get your estate plan figured out.  We are happy to be a part of that process and coach you as needed.  The peace of mind you’ll experience knowing that if you go, things are taken care of will be far more valuable than you will know.  Speaking of personal experience, after we got our estate plan established, I stopped having nightmares…that is worth more than any attorney bill.

Yours in service,

Jason Deshayes, CPA

Butler and Company CPAs PC

Posted in Estate Planning

To the Cloud!

April 30, 2014
By Butler and Company

To The Cloud!

When you’re a small business, you have to keep your accounting records somewhere.  I’ve seen the gamut of “systems” – handcrafted ledgers, giant file boxes of receipts sorted in folders, computerized financial records and oh, don’t forget recreation by bank statement.  While there are obvious efficiencies to using certain systems over others, not any one system is a perfect fit for everyone.  It is critically important to have a discussion with someone in the know (perhaps, your friendly neighborhood CPA) about which system makes the most sense for you.   Today, we wanted to cover a relatively new system that is becoming far more commonplace – the cloud!

Internet based, readily accessible data is where we are seeing technology head.  You have probably heard about DropBox or OneDrive, which are cloud-based file storage systems.  Evernote and OneNote are the big players for cloud note taking/document systems.  There are a number of accounting systems available – QuickBooks Online, Xero, FreshBooks and Wave are some of the key players in this market.  They all have different interfaces, features and support…so if you were looking to move your accounting system into the cloud…what do you need to be looking at?

  •  Features – This doesn’t mean the one with the most bells and whistles wins.  You may have a need to process 50 invoices a month through your accounting system.  Does the system allow that?  Does your inventory system sync with the cloud accounting system?  How many users can you have and how many of them can be simultaneously in the system?   Each system will have its unique features that may or may not be a good fit for you.
  •  Be careful who you get answers from – Salespeople for these programs will often tell you that not only will their system do your accounting, but it’ll also make you breakfast and do your laundry.  See if your salesperson will give you a few current customers who you could contact and ask questions to.  Someone else using the system is likely not profiting from you getting that specific program.  Also, check with your CPA to see what you really need.  I have seen too many people buy a huge, robust system because it CAN do a lot of stuff, only to find the client using 5% of the functionality (at 100% of the cost).
  • Speaking of cost….Cloud systems are almost all “lease” arrangements.  You have a month to month fee based on certain system features, number of users, storage space and more.  Typically, there is no penalty to convert up or down – so if your business scales up, then you can upgrade to the next level.  If things have slowed down, then go down a level and save some cost.  Certain programs will feature add-ons for inventory, payroll, customer management and more – it’ll just cost a little bit more for each added function.  Keep in mind that comparing the cost of a desktop program and a cloud program isn’t really comparing apples to apples.
  • Security – Now, most IT security protocol is beyond my pay grade.  I can tell you that what some of these large companies spend on IT and security is probably 1000x more than what you or I would spend on our own IT security “stuff”.  If you are concerned about the data security, then have your IT person call the cloud provider to understand the security environment.
  • Backup – One of the key benefits of being in the cloud is the fact that your data is redundantly backed up in a variety of locations.  This means, if one of the servers that holds your data explodes, then all is well because there are duplicate versions in 4 other places.  Our office used to have a server that had a tape backup system (yes…tapes).  We used to have to have our admin run a backup of the system daily – which took their time and wasn’t a quick process.  Lots of wasted time for a not great solution.  Now, we have a cloud based tax and accounting system that backs up all of the time.  If something happens, then we just call them and they restore from their system.  Easy peasy.
  • Other time savings – We have been using desktop versions of QuickBooks for years.  It has a been a great workhorse, but as of late, we’re noticing some inefficiencies.  When we need to do work, we have to get either a backup copy or Accountant’s copy to work on the data.  Depending on what version you give us, you may not be able to work on that file at the same time.  Oh, and then when we’re done, you need to restore our changes.  If you have a large data file, go get yourself a cup of coffee before you start the backup.  A cloud based platform allows your CPA or bookkeeper have instant access to the live data file – this means if you are struggling with something, they can look at it with you with no time lag or file sharing necessary.  The time savings for you, your CPA and your bookkeeper will add up quickly.

There are a lot of options out there – if you are interested in moving to the cloud, give us a call and we can help you analyze what option is good for you and your business.

Posted in Business

Do you ever just sit down and talk about where you are?

May 22, 2013
By Butler and Company

Last weekend, I spent probably 20 hours with three extraordinary individuals talking about where Active 20-30 Club US and Canada stood. We talked about basic logistics, high level goals, day-to-day successes (and troubles) and more. Previous to this discussion, I was so focused on my role as National President that I had forgotten some of the successes that were staring me right in the face. I had spent so much time running through the forest that I forgot to step back and see the big picture….where we had been and where we were going.

If you don’t like the forest analogy, then think of it this way – you’ve been driving for 3 days…do you know where the heck you are, how far you’ve been and where you are heading?

I see this a lot with clients (both individuals and businesses) who get laser focused on some topic and, in the process, have lost track of how that topic fits into the big picture. They want to pay down debt, but never celebrate milestones along the way. A business wants to raise their revenue significantly, but have lost touch with other aspects of the business in the process.

When was the last time you sat down, took a breath and figured out where you were at? This can be when you and your spouse sit down (at home; at your favorite restaurant, in a park…whatever) and talk about whether your financial plans worked the way you thought. Perhaps you wanted to be debt free by the end of the year – are you 50% there? 80%? Did you start and then got derailed quickly, but never found a way back on track? A business owner can meet with a trusted advisor and have a gut check of how the business has done and whether a course correction is necessary.

With the limited amount of time we always run out of, it’s hard to carve out the time necessary to make these discussions/contemplative self-reflections happen. You don’t need to use a 2-3 day retreat somewhere remote – think about taking 2-4 hours where you shut off the phone/iPad/etc… and just talk/think. Get up early on a Saturday, grab your coffee and have some quiet time on the porch if that is what it takes. Even the smallest amount of time will garner huge dividends on seeing where you stand.

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