Wealthyist

In this episode of "Wealthyist" podcast, host Brandon Lehman interviews Dale Kooyenga, president of the Metro Milwaukee Association of Commerce, about economic development in the Milwaukee region, specifically the Milwaukee Seven (M7), which represents seven counties in southeast Wisconsin: Milwaukee, Kenosha, Ozaukee, Racine, Walworth, Waukesha, and Washington. The M7 focuses on regional economic development to attract large companies like Microsoft, Eli Lilly, and Hasbro by leveraging the area’s strengths.

Key Points:

• Attracting Companies: Companies choose Milwaukee over other regions like Chicago or Atlanta due to factors like access to water, a reliable energy grid, and a strong talent pool, particularly in advanced manufacturing and food and beverage industries. The region’s livability, with amenities like professional sports, golf courses, and a vibrant downtown, also appeals to companies recruiting talent.
• Cost of Living and Housing: Milwaukee offers relatively affordable housing compared to other metros of its size, though housing costs are rising due to high labor, material costs, and interest rates. The region’s high per capita income and affordability make it attractive, but property taxes are approaching those of Chicago’s suburbs, raising concerns about competitiveness.
• Lifestyle and Amenities: Milwaukee’s appeal includes its lively downtown, proximity to Lake Michigan, professional sports teams (Bucks and Brewers), and short commutes (20 minutes vs. 1-1.5 hours in larger cities), allowing for a balance of family and professional life. The Wall Street Journal recently highlighted Milwaukee as the nation’s hottest housing market.
• Water and Energy: Access to abundant water from Lake Michigan is a major draw for industries like data centers and manufacturing, which require significant water and energy resources. Wisconsin’s reliable energy grid and leadership in nuclear technology (e.g., micro nuclear) position it well for future growth.
• Economic Shifts: Milwaukee’s economy is transitioning from traditional blue-collar manufacturing to high-tech and financial services, with a strong presence of mid-tier manufacturers and private equity firms. Manufacturing output is up despite fewer jobs, reflecting productivity gains.
• Challenges and Opportunities: Kooyenga highlights three priorities for Milwaukee’s growth: (1) establishing a top-tier R1 research university, (2) adopting advanced nuclear technology for sustainable energy, and (3) attracting more immigrants, who are more likely to start businesses and drive economic growth. Milwaukee’s population growth is strong in the Midwest but lags due to lower immigration compared to cities like Chicago.
• Policy Concerns: High income taxes (e.g., 7.65% vs. Illinois’ 5% flat tax) and rising property taxes are barriers to attracting executives and talent. Kooyenga suggests a flatter, lower tax rate (3-4%) to boost competitiveness, warning that overturning reforms like Act 10 could worsen property tax burdens.
• Vision for M7: The ultimate goal is to enhance Milwaukee’s appeal as a top destination by integrating it more closely with Madison (a one-hour commute) to create a powerhouse region combining Milwaukee’s amenities with Madison’s capital and university assets. Reducing the psychological and logistical divide between the two cities could make the region globally competitive.

The podcast emphasizes Milwaukee’s strengths, ongoing challenges, and strategies to elevate its economic and lifestyle appeal, with a focus on attracting businesses, talent, and wealth to the region.

In this episode of the Wealthyist podcast, hosts Brian Lambourne and Alec Durand discuss the common misconception that forming an LLC is primarily for tax benefits. They clarify that the primary purpose of an LLC (Limited Liability Company) or corporation is to limit liability for business owners, not to provide tax advantages. 

Key points include:

1. Purpose of LLCs and Corporations: These entities are designed to protect business owners from personal liability for business-related actions, separating personal and business assets. For example, an LLC can shield owners from liabilities arising from the business, but it does not protect against personal actions (e.g., if the owner causes an accident while driving).
2. Misconceptions About LLCs: Many people mistakenly believe LLCs are mainly for tax benefits. The hosts emphasize that the decision to form an LLC should be based on the need for liability protection, not just tax considerations.
3. Liability Protection: LLCs are effective for businesses with employees or significant assets (e.g., real estate). For instance, if an employee causes an accident, the LLC can limit the owner's personal liability. In contrast, for solo entrepreneurs offering personal services (e.g., consulting or teaching music), an LLC may offer little protection since the individual and business are essentially the same.
4. Corporate Formalities: To maintain liability protection, businesses must observe corporate formalities, such as keeping separate bank accounts and not using business assets for personal expenses. Failure to do so risks "piercing the corporate veil," where courts may hold owners personally liable.
5. Real Estate and LLCs: LLCs are particularly useful for real estate investors. Separate LLCs for each property can isolate liabilities, protecting other assets if an issue arises with one property.
6. Tax Implications: While liability protection is the primary goal, tax considerations also matter. LLCs offer flexibility, defaulting to sole proprietorship taxation for single-member LLCs or partnership taxation for multi-member LLCs. Owners can elect to be taxed as an S corporation or C corporation, each with different tax implications (e.g., C corporations face double taxation, while S corporations and partnerships are pass-through entities).
7. Sophisticated Use of LLCs: High-net-worth individuals and complex businesses often use multiple LLCs to separate liabilities across different business lines or assets. For example, real estate and operational businesses may be held in separate entities.
8. Estate Planning: LLCs can offer estate tax benefits, such as a step-up in basis for assets like real estate upon the owner’s death, which is not typically available with corporations.
9. Importance of Experts: The hosts stress the need for professional guidance from attorneys and accountants to choose the right entity and tax structure, ensuring proper setup and avoiding costly mistakes.

The episode concludes with a reminder to evaluate the need for asset protection first, then consider tax implications, and to consult experts to tailor solutions to specific business goals.

In this episode of the Wealthyist podcast, hosted by Brandon Lehman, Director of Private Client, the focus is on the booming global pet care market, valued at $247 billion in 2023 and projected to reach $425 billion by 2032. Lehman interviews Allen Kline, owner of K9 Resorts of Brookfield, a luxury dog daycare and boarding facility branded as the "Ritz-Carlton of dog hotels." 

Key Points:

• Luxury Pet Care Concept: K9 Resorts was inspired by high-end hospitality, addressing a gap in premium pet care. Founders, two brothers from New Jersey, modeled it after luxury hotels, incorporating features like chandeliers, premium air quality systems to prevent airborne illnesses, and a clean, aesthetically pleasing environment.
• Client Demands: Pet owners, particularly wealthier clients who travel frequently (5–6 times a year, including trips to Europe or Mexico), seek high-quality care, health monitoring, and peace of mind. Services include daily photo/video updates, detailed health reports, and a focus on comfort and safety.
• Staff Training: Employees undergo 8–12 hours of training to recognize health issues in dogs, with the daycare manager leveraging 20 years of experience to identify subtle cues, preventing serious health issues in several cases. All staff are dog CPR and first-aid certified.
• Socialization and Services: Post-COVID, many dogs lack socialization, so K9 Resorts offers private play sessions to ease dogs into group environments. They carefully introduce new dogs to groups, monitoring for stress signals to ensure safe integration. Luxury suites, equipped with dog TVs, antibacterial floors, and tiled walls, are booked 90% of the time, often months in advance for holidays.
• Marketing and Growth: The facility relies on social media (Facebook, Instagram) for daily posts and word-of-mouth referrals, with its high-visibility retail location on Blue Mound driving significant traffic. Grassroots efforts, like farmers' markets, also boost awareness.
• Trends and Future Outlook: Kline predicts dynamic pricing in the pet care industry, similar to hotels, where high demand (e.g., holidays) could increase rates for luxury suites. AI may play a role in pricing and operations. The facility is seeing strong growth, with holidays fully booked and June weekends sold out.
• Clientele and Impact: Wealthier clients, who travel more, treat K9 Resorts as an extension of their family, prioritizing premium care. The facility’s cleanliness, quiet environment, and ability to keep dogs healthy and engaged (with group play and structured nap times) impress clients, setting it apart from competitors in industrial parks.

Takeaway: K9 Resorts  delivers a premium, health-focused, and personalized pet care experience, catering to affluent pet owners seeking peace of mind. Its success reflects the growing demand for luxury pet services, aligning with the expanding pet care market.

For further details, listeners are directed to contact Allen Kline at K9 Resorts of Brookfield.

The podcast "Wealthyist," hosted by Carl Holzem, a client service manager and golf enthusiast, explores the lifestyles and strategies of wealthy individuals, focusing on their affinity for golf. Joined by Rob Jansen, Executive Director of the Wisconsin State Golf Association (WSGA) since 2011, the episode delves into golf's appeal to the affluent and its growth in Wisconsin.

Key Points:

1. WSGA's Role: The WSGA, a nonprofit, promotes golf in Wisconsin by organizing 100 tournaments annually for all skill levels, providing course measurement and rating services, and offering golf handicap indexes to ensure fair play across skill levels.
2. Golf's Boom in Wisconsin: Wisconsin is a top destination for public golf, with 10 of the top 100 U.S. public courses, including Blackwolf Run, Whistling Straits, Erin Hills, and Sand Valley. Major events like the Ryder Cup and upcoming U.S. Women’s Open highlight the state’s prominence. Golf Digest named Wisconsin the #1 state for public golf.
3. Wealthy Golfers' Preferences: Affluent golfers enjoy a mix of private country clubs for personalized service and less crowded courses, alongside high-end public courses like Sand Valley for bucket-list experiences. Private clubs remain a luxury, but public courses attract wealthy players seeking prestigious destinations.
4. Luxury Golf Experiences: Wealthy golfers elevate their experiences with private air travel or helicopters to reach remote courses like Sand Valley. High-end golf communities, common in places like Florida, are emerging in Wisconsin, with vacation homes around courses like Sand Valley enhancing the golfing experience.
5. Equipment and Technology: Advances in golf equipment, like custom-fitted clubs and simulators, are popular among the wealthy. Fitting centers and technologies like Arccos sensors provide detailed performance data. Simulators, now more affordable, allow year-round play, with some wealthy individuals installing them at home.
6. Fashion and Customization: Golf fashion is accessible but allows for personalization, with wealthy golfers customizing bags, clubs (e.g., engraved putters), and even golf carts, which can resemble mini-cars in places like Florida. Private clubs curate trendy, high-end apparel for members.
7. Instruction as Investment: Jansen emphasizes that hiring a skilled golf instructor is the best investment for improving one’s game, more impactful than equipment. PGA sections and word-of-mouth recommendations help find coaches tailored to individual needs.
8. Golf’s Accessibility: While the wealthy enjoy exclusive perks, golf is increasingly accessible to all through public courses and affordable technology, though high-end options cater to those with greater resources.

The episode underscores golf’s unique appeal, blending tradition, luxury, and accessibility, with Wisconsin as a prime example of the sport’s growth and prestige.

This episode of Wealthiest, hosted by Alec Durand and Brian Lamborn, attorneys at Annex Wealth Management, focuses on the importance of "spring cleaning" for corporate records, particularly for small business owners. They emphasize the need to maintain and update corporate paperwork to ensure legal compliance, protect personal assets, and enhance business efficiency. Key points include:

1. Importance of Corporate Records: Corporate records, such as operating agreements, articles of organization, annual meeting minutes, and employee-related documents (e.g., W-4s, payroll taxes, ERISA/401k records), are critical for maintaining the liability shield provided by entities like LLCs or corporations. This shield protects personal assets from business liabilities, such as those arising from an auto repair shop.
2. Legal Formalities: Observing corporate formalities, like holding and documenting annual meetings and filing annual reports (e.g., in Wisconsin), is legally required to maintain an entity’s good standing. Failure to do so can erode liability protection or lead to delinquency, though issues can often be corrected.
3. Record Retention: Businesses must retain records for varying periods—three years for IRS audits, six years for ERISA-related documents. These records support tax filings and track business growth or inefficiencies.
4. Efficiency and Review: Regularly reviewing contracts, leases, vendor agreements, and buy-sell agreements ensures they align with current business needs. Buy-sell agreements, which outline what happens if an owner dies, becomes disabled, or exits, are particularly important for multi-owner businesses to avoid disputes or court involvement.
5. Alignment with Personal Plans: Corporate records should align with estate plans to avoid conflicts, such as restrictions on transferring business interests to heirs.
6. Simplifying the Process: The hosts suggest setting aside time annually (e.g., after tax season) for a review, which doesn’t need to be formal—a dinner meeting can suffice. Creating a checklist, leveraging key personnel (e.g., HR or operations managers), or consulting professionals like attorneys or CPAs can streamline the process.
7. Winding Down Unnecessary Entities: Businesses should dissolve unused LLCs or corporations to avoid liabilities and simplify record-keeping.

The episode underscores that maintaining corporate records is an ongoing, repeatable process that, while initially daunting, becomes manageable with a system in place, allowing business owners to focus on running their operations confidently.

In this episode of Wealthyist, host Brandon Lehman, director of Annex Private Client, interviews Charlie Dixon, president of Schwanke-Kasten Jewelers in Milwaukee, to discuss the luxury watch industry, its evolution, and trends. The conversation covers the following key points:

1. Introduction to Watches:
   • Lehman shares his personal connection to watches, mentioning his Garmin Tactics Delta, a military-inspired fitness tracker gifted by his wife. He uses it to monitor sleep, heart rate, and fitness, reflecting the growing popularity of smartwatches.
   • Dixon explains the historical shift of wristwatches from women’s jewelry (early 1900s “wristlets”) to masculine accessories during World War I, when soldiers strapped pocket watches to their wrists for practicality. This military connection persists in brands like Tudor (Pelagos Marine National) and IWC (Royal Air Force-inspired watches).
2. Impact of Smartwatches and Military Inspiration:
   • Lehman asks how fitness-focused smartwatches like his Garmin affect the luxury watch market. Dixon notes that smartwatches have boosted interest in watches overall, with many luxury brands drawing on military heritage to appeal to consumers.
3. Defining Luxury Watches:
   • Dixon defines luxury watches by their craftsmanship and repairability, citing a Hermes CEO quote that luxury items are worth repairing. A watch’s sentimental value—tied to milestones like promotions, births, or anniversaries—can make it luxurious, regardless of price (e.g., $500 or $200,000).
   • Luxury watches are emotional purchases, often commemorating significant life events, similar to jewelry like anniversary bands.
4. Post-COVID Market Trends:
   • During COVID, demand for luxury watches surged as people, unable to spend on travel or events, invested in watches. The market peaked around 2022 but has since normalized, though demand remains strong.
   • Social media (e.g., Instagram) and shows like Emily in Paris have increased interest, especially among younger generations. The Middle East, particularly the UAE, is noted for vibrant watch collector communities.
   • Trends include a shift toward smaller, more discreet watches for men, moving away from oversized, flashy designs.
5. Service and Maintenance:
   • Luxury watches, described as “300-piece puzzles the size of a quarter,” require periodic servicing due to their intricate mechanical components. Unlike Lehman’s simple Bulova, which needed only a battery, high-end watches are like high-performance engines, with some achieving accuracy of ±2 seconds per day.
   • Servicing ensures longevity, especially for watches with sentimental value, and even quartz watches may need circuit replacements.
6. Brand Dynamics and Social Media:
   • Rolex remains a dominant brand due to exceptional quality, marketing, and controlled supply, which fuels demand. Cartier is the second-largest exporter of luxury watches, with a 13% market share (per Morgan Stanley’s annual watch report found here: https://monochrome-watches.com/morgan-stanleys-top-50-watch-brands-for-2024-rolex-still-by-far-the-leader-overall-market-suffered/).
   • Social media amplifies brand visibility, with collectors showcasing watches online. Emotional connections, like inheriting a grandfather’s watch, also drive brand loyalty.
7. Secondary Market Growth:
   • The certified pre-owned market is expanding due to high demand and limited supply of new watches. Consumers often face waitlists for popular models, similar to ordering a Porsche or Mercedes G-Wagon.
   • Watch production is meticulous, with processes like COSC certification and bracelet testing (e.g., robots simulating years of clasp use) taking over a year, justifying high costs and durability.
8. Advice for Buying a Luxury Watch:
   • Dixon advises first-time buyers to choose a versatile, utilitarian watch that suits their lifestyle, then explore specialized options (e.g., chronographs for car enthusiasts).
   • He recommends visiting a store to try on watches and prioritizing personal taste over trends or influencer opinions. Buyers should follow their “gut and heart” to ensure the watch resonates emotionally.

Conclusion:
The episode highlights the emotional and cultural significance of luxury watches, their evolution from military tools to status symbols, and the impact of smartwatches and social media on the industry. Dixon emphasizes craftsmanship, repairability, and personal connection as hallmarks of luxury, offering practical advice for aspiring buyers. The conversation underscores the enduring appeal of watches as both functional items and sentimental heirlooms.

In this episode of Wealthyist podcast, host Brandon Lehman, director of Annex Private Client, discusses estate planning with a focus on inherited gold and jewelry. He is joined by Charlie Dixon, president of Schwanke Cash and Jewelers. Key points include:

Rising Gold Prices: With gold at $3,400 per ounce (up over $1,000 from last year), estates with gold jewelry or items are increasingly valuable, prompting heirs to consider their options.

Estate Planning Challenges: Inheriting valuable items like gold, watches, or jewelry requires tracking for estate planning, unlike less valuable items that are simply passed down.

Options for Inherited Jewelry:
Melting Gold: If the jewelry lacks sentimental value or isn't wearable, it can be melted for liquidity, especially with high gold prices.

Repurposing: High-quality gemstones (e.g., diamonds, rubies) can be reset into modern designs, preserving sentimental value while creating wearable pieces.

Appraisals: Schwanke Cash and Jewelers appraises inherited items to determine value, helping families decide what to keep, repurpose, or sell.

Thoughtful Process: Dixon emphasizes a strategic approach, encouraging clients to consider sentimental and practical factors rather than immediately melting down inherited gold.

Impact of High Gold Prices: While not aggressively advertising gold-buying services, Dixon notes that high prices may encourage people to liquidate gold from estates. However, it hasn't significantly affected their custom jewelry business, though they may use platinum (cheaper and scarcer) as an alternative.

Technology in Jewelry Design: Modern CAD (computer-aided design) streamlines jewelry creation, allowing faster production of custom pieces while maintaining artistic quality through hand-finishing.

Durability: Platinum is denser and heavier than gold, but both are soft. Eighteen-karat gold or platinum is preferred for jewelry durability over 24-karat gold, which is too soft.

Schwanke’s Role: As a 125-year-old, family-owned jeweler in Milwaukee, they offer in-house appraisals, design, and goldsmith services, assisting with the largest generational wealth transfer by helping families manage inherited jewelry.

The episode highlights the intersection of estate planning and jewelry, emphasizing thoughtful decision-making and modern technology in handling valuable inheritances.

In this episode of "Wealthyist," host Brian Lamborn, Senior Wealth Strategist at Annex Wealth Management, continues his discussion with Ryan Klund from the National Christian Foundation (NCF) about charitable giving, focusing on donor-advised funds (DAFs) and their role in wealth planning. 
The conversation contrasts DAFs with private foundations, particularly for successful business owners who value control. Ryan explains that private foundations offer significant control but come with administrative burdens and IRS rules, sometimes becoming overwhelming for heirs after the founder’s passing, leading some to roll assets into DAFs for simplicity. DAFs, as public charities, allow donors to direct grants while relinquishing legal ownership to NCF, balancing control with tax benefits.

Ryan highlights that many NCF clients, rooted in Christian values, view themselves as stewards of wealth, which tempers their need for absolute control. Beyond DAFs, NCF offers tools like complex asset giving (e.g., real estate, business interests) and impact investing, where charitable capital is invested in for-profit companies aligned with NCF’s mission, with returns recycled into the DAF for further granting. For those new to philanthropy, Ryan suggests starting by identifying passions and getting involved, noting that DAFs help organize giving—streamlining tax receipts for donors supporting multiple nonprofits (averaging 12–15 annually).

The discussion emphasizes generational wealth transfer, with DAFs serving as a tool to teach children about giving. Examples include grandparents involving grandkids in choosing charities or parents making heirs equal participants in DAF decisions to instill values. Ryan also underscores DAFs in estate planning, offering flexibility to adjust beneficiaries (e.g., updating charities without legal revisions) and reduce estate taxes by excluding charitable gifts. 
Creative strategies include naming a DAF as an “additional child” to split inheritances with charity or setting up post-death grants to sustain giving for years. The episode wraps up with Ryan stressing the importance of modeling generosity to leave a legacy of values, not just wealth, and Brian thanking him for the insights. The podcast notes its content is educational, not formal advice, urging listeners to consult professionals.

In this episode of "Wealthyist," host Brian Lamborne interviews Ryan Klund from the National Christian Foundation (NCF). The two met at an Exit Planning Institute event and discovered overlapping interests between Annex Wealth Management, where Brian works, and NCF. Ryan introduces NCF as the largest Christian donor-advised fund, designed to assist Christians serious about generosity with creative giving solutions, though it also serves some non-Christian clients. He describes a donor-advised fund as a hybrid between a charitable checking account and a cost-effective alternative to a private foundation, likening it to a "container ship" where families can manage charitable giving efficiently.

Ryan explains that NCF focuses on Christian values, offering discernment based on biblical principles, such as avoiding grants to organizations whose missions conflict with the Bible, though 99.9% of grant requests are approved. This appeals to clients—Christian or otherwise—who want to avoid supporting certain causes (e.g., tobacco or firearms) while pursuing philanthropy. The discussion touches on why wealthy individuals should consider generosity, with Ryan citing biblical motivations (e.g., John 3:16) and the broader desire to leave a lasting legacy beyond material wealth, a theme historically seen in families like the Rockefellers.

The podcast also explores advanced giving strategies, such as donating a percentage of a business to a donor-advised fund before a sale to maximize tax benefits and create a charitable cash flow. Ryan notes this is growing in popularity, especially as the "great wealth transfer" from boomers to millennials looms, with business ownership being a key asset class in transition. NCF facilitates complex gifts like real estate or closely held business interests, supported by a team of lawyers, offering donors flexibility and control over future distributions—unlike direct gifts to charities.

The episode concludes with a teaser for a follow-up discussion, emphasizing tax-efficient strategies like front-loading multiple years of giving into a donor-advised fund. The podcast aims to educate listeners on wealth strategies, blending financial planning with philanthropy, while noting that the content is for informational purposes and not formal advice.

This episode of Wealthyist, hosted by Brandon Lehman of Annex Wealth Management,is  based on his recent observations from eight weeks of work-related travel.

Central Question: "What’s Next After Retirement?"

1. • Lehman notes a recurring question from successful executives nearing retirement: “What do I do next?” Many have thrived in corporate life, amassed wealth, and are ready to leave the 9-to-5, but they still want to work in some capacity.
   • A common follow-up is whether to follow a friend’s lead into consulting. Lehman suggests “yes” if they want to keep working, as consulting offers flexibility (e.g., walking away when desired) and tax advantages (e.g., 1099 income, solo 401(k)s, write-offs for business expenses like cars or travel). He finds these planning discussions “a blast” as they open up creative tax strategies unavailable with W-2 income.
2. Observation 1: Trend of Registering Vehicles in Montana
   • Lehman observes wealthy individuals increasingly registering high-end cars (e.g., Porsches, Bugattis) and private planes in Montana, despite living far from the state. Reasons include:
     • Privacy: Montana LLCs hide ownership details.
     • Tax Benefits: No sales tax, lower registration fees, no use or property tax for planes, and no emissions testing (e.g., for diesel trucks).
   • He doesn’t condone this but reports it as a trend, noting some states are cracking down on it as a form of tax evasion.
3. Observation 2: Spring Cleaning and Document Retention
   • With tax season wrapping up, Lehman discusses document management:
     • IRS recommends keeping tax returns for 3 years (6 years if income is underreported by 25%, 7 years for bad debt/losses, indefinitely for fraud or non-filing).
     • He scans and encrypts his records digitally, suggesting listeners do the same to go paperless.
     • Post-2011 brokerage statements can be shredded since firms like Schwab retain digital copies.
   • For shredding, he advises using secure services with locked bins, chain-of-custody tracking, and cross-cut/micro-cut shredders (not strip-cut).