--- title: "Lessons Earned: Focus on Wealth–Not Taxes" description: John Sanderson once helped his uncle save enough to buy a small industrial park by advising him to focus on building wealth rather than mitigating his tax bills. image: https://insights.sandersonllc.com/hubfs/Lessons%20Earned%20Graphics17.jpg --- - [716.566.2420](tel:716-566-2420) - [Client Login](https://www.sandersonllc.com/client-login/) [![Sanderson Wealth Management](https://insights.sandersonllc.com/hubfs/Sanderson_October2019%20Theme/Images/sanderson-logo-stacked@2x.png)](https://www.sandersonllc.com/) - About - [Services](https://www.sandersonllc.com/services/) - [Our Team](https://www.sandersonllc.com/team/) - [John Sanderson](https://www.sandersonllc.com/team/john-sanderson/) - [Justin Sanderson](https://www.sandersonllc.com/team/justin-sanderson/) - [James Warner](https://www.sandersonllc.com/team/james-warner/) - [C. 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He owned a small manufacturing business, which was a perfect fit since he had always been handy. In fact, when he was still in high school and my mom was pregnant with me, Uncle Jim made my crib in his woodshop class. I can only imagine the teasing he got from his friends. When Uncle Jim was running his company, each year his accounting firm would do a projection of his taxable income, and tell him how much was needed in expenses to avoid paying taxes. He would follow their advice and load up on supplies, perform repairs, and spend a significant amount of money. As a result, he ended up owing very little in taxes, or even no taxes at all. But he also wasn’t accumulating any wealth. One day, I was analyzing Uncle Jim’s financial situation, and I explained to him that the winner at the end of the year was the person who ended up with the most worth—not the person who ended up paying the least in taxes. I’m not sure if he had fully realized the concept before, but he certainly did then. If you want to make a profit and build wealth, you need to pay taxes.  Sure, there are certainly ways to minimize your tax burden. But you shouldn’t start by focusing on taxes. With that in mind, Uncle Jim followed my advice and, as I expected, he was able to start saving. Instead of spending all of his money just to avoid taxes, he paid his fair share, then used his profits as capital to take advantage of opportunities. On the last day of 1986, he used his savings to purchase an old steel plant and workshop that was used by one of the region’s largest industrial companies. Uncle Jim redeveloped the property over time, and today it is a small industrial park that continues to be a significant source of wealth for my cousins and my aunt. A lot of people view paying taxes as offensive, and make unwise decisions in an attempt to mitigate their tax bill. Every year, I talk with people who want to use gifting to reduce their tax burden, but fail to adequately prioritize the long-term investment results and goals. Avoiding taxes is almost always a secondary goal. The primary goal is building wealth. Remember that. ## Disclosure Reprinted with permission from "Lessons Earned: Stories from a Lifetime Spent Fully Invested," copyright © 2022 John R. Sanderson. This story reflects the author’s present recollections of people and experiences over time. Some identifying details have been changed and some dialogue has been recreated. While the author has made a concerted effort to provide accurate information, neither the publisher nor the author shall have any liability or responsibility for any adverse effects or loss caused, or alleged to be caused, directly or indirectly, by any information included in this story. ### Let’s talk about your future. 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Schedule a consultation to learn more about our investment services. ## Background Schedule a consultation to learn more about our investment services. - [CONTACT](https://www.sandersonllc.com/contact-us/) - [CAREERS](https://www.sandersonllc.com/careers/) - DISCLOSURE - [COMPLIANCE](https://adviserinfo.sec.gov/firm/summary/118910) © 2022 Sanderson Wealth Management LLC [716.566.2420](tel:716.566.2420) Sanderson Wealth Management, LLC (“Sanderson Wealth”) is an SEC registered investment adviser located in Buffalo, New York. The publication of Sanderson Wealth’s website on the Internet should not be construed by any consumer or prospective client as Sanderson Wealth’s solicitation or attempt to effect transactions in securities, or the rendering of personalized investment advice over the Internet.  The information on this Internet site should not be construed as the provision of personalized individual advice from Sanderson Wealth. 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