“Just save 30% of your income for taxes.”
That’s the go-to advice floating around social media and business groups, but it’s not a strategy. It’s a placeholder.
If you’re a high-income coach, consultant, or service-based business owner, you’ve probably been told that 30% is the magic number. But here’s the real question:
How do you know you actually owe 30%?
What if you’re missing out on legitimate deductions?
What if you qualify for tax credits that lower your liability?
What if you’re contributing to retirement or making strategic investments that should reduce your taxable income?
The idea that taxes are a fixed cost you can’t influence is one of the biggest financial myths holding business owners back. And that 30% rule? It assumes you’re not doing any planning at all.
Here’s what I tell my clients:
Don’t just focus on saving for taxes. Focus on reducing them, legally and strategically.
Because here’s the truth, saving 30% without understanding where that number comes from is just guessing with your money. A proactive strategy looks at your unique income streams, deductions, and financial goals to determine what you really owe, not what some blanket rule suggests.
If you’re starting from scratch, sure, putting aside 30% can be a safety net. But once we implement a personalized tax strategy through the Craft Money Map, most clients end up needing to save far less, because they’re actively reducing what they owe.
When we partner with clients, we look at the full financial picture, income, deductions, investments, retirement options, and entity structure, to build a proactive plan. It’s not about fear or guesswork. It’s about precision.
Want to stop using a one-size-fits-all tax tip and start using strategies that work for your business?
Watch my video: The Truth About Saving for Taxes. Let’s make sure you’re not saving too much, or worse, not saving enough. Over-saving can restrict your cash flow and stunt your ability to reinvest in your business, while under-saving can lead to penalties, stress, and surprise tax bills. The key is knowing your real number, and that starts with strategy.