17| Small Business Secrets: Stress Management, Debt, Tax Savings & More

Speakers:Dr. Michelle Hagel ND, Rick Tiedemann, Mark Kalinowski,Curtis Gabinet, Shane Wallace

How can you lower your taxes, reduce your stress levels, and get better sleep… All in 30 minutes?


We’ve rounded up the “must-know” moments from the podcast to create a jam-packed episode that is guaranteed to get you thinking about small business in a different way.

About the Host

Morgan Berna is the host of Olympia Benefits’ podcast, The Small Business Mastermind. Her background is in marketing, journalism, and broadcasting. Passionate about small business, she aims to create content that inspires and educates listeners.




Morgan Berna: You are listening to the Small Business Mastermind, a podcast created to help small businesses juggle business, finance, health, and wellness. I am your host, Morgan Berna.


The Small Business Mastermind is brought to you by Olympia Benefits. Olympia Benefits is a leading provider of health spending accounts. If you are looking to reduce your health and dental costs, visit olympiabenefits.com.


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Morgan: Hello, everyone, and thank you for tuning in to this episode of the Small Business Mastermind. Today, we are going to be doing something a little bit different for the podcast, but I think you are going to enjoy it. It is going to be a great way to take away a ton of information in a shorter time.


The other day, a colleague of mine asked me from the 16+ episodes we have done so far, what are the biggest takeaways I think business owners and their teams should know? My mind immediately started jumping through a few pivotal episodes that we have done.


I have gone through and taken a look at our most popular clips, our most listened to episodes, and the feedback we have gotten from you, listeners. From looking at all of that, I have put together what I believe to be the biggest takeaways The Small Business Mastermind has for small business owners and their teams. As I pulled these clips together for you, the overall theme started to emerge about how to perform your best in the workplace - it starts with how you are taking care of yourself and your team. Whether you have listened to our full episodes or not, this episode will be a chance to remind yourself of these key behaviors and actions that help make a business of any size to the next level.


But, this episode is not intended to be a one-way conversation. I want to hear what you found to be the most important concepts you have gotten from the podcast as well. Send me an email at podcast@olympiabenefits.com with your answer. And if you would like to include any feedback about the podcast or topic suggestions, that would be perfect as well. Be sure to include your business name and website in that email and I will be shouting out a few businesses in our next coming episodes. So with that, let us start diving into these clips.


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Morgan: We all know that small business owners work hard. That has never been more true than in 2020. But, it is good to remember that working too hard without giving ourselves a chance to breathe is the best way to take yourself out of the game altogether. From our episode about burnout, here is what we learned happens when we suffer from an abundance of stress.


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Morgan: Is it dangerous?

Dr. Michelle Hagel ND: Absolutely. It was interesting. A couple of years ago, I read a study. It showed that burnout in women can be as dangerous or have as dramatic an impact as obesity and smoking.

Morgan: Wow.

Dr. Hagel: There was one study that kind of shocked me and has still stuck with me. Some other areas linked with sleep deprivation. When we are not getting that seven to nine hours of sleep, there are shown studies that our prefrontal cortex will start shrinking. This is an area of the brain that is very important in executing and planning our personality. Those areas that I talked about in their symptoms, it is having a physical manifestation on our brain. Another significant fact is those stress hormones that I mentioned earlier, they are one of the most potent immune suppressors. When we are constantly releasing those stress hormones, our immune system is going to be depleted. We are not going to be able to fight off things. Oftentimes, people are complaining after Christmas time or significantly stressful time, they get sick after. Well, it is because the immune system has been suppressed. And whatever viruses, bacteria, anything that we have been exposed to, we can not fight it off any longer.

Morgan: So, our nice vacation trip down to the beach might not be so fun.

Dr. Hagel: Exactly. That is when it is just finally going to hit us. And then, actually, even more so, now, this is pretty extreme. But in the long run, over a long time, we have even seen a link with a lot of autoimmune conditions. And that is the same thing, right? Just something affecting the immune system for so long.

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Morgan: From this clip with Dr. Michelle Hagel, we learned that there are serious consequences of overworking. But how can we get all of our work done when we have so much on our plate while doing it in a sustainable way for our bodies? Rick Tiedemann explained to us how to use the executive interval.


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Rick Tiedemann: What we need our business owners, business leaders, and executives to be doing is to start doing executive intervals. Now, that is where being a corporate athlete ties into the wellness, and allows us to perform at our highest level on a sustained basis.

Morgan: And what would those intervals look like?

Rick: Well, really, the intervals — You can have micro intervals throughout the day. You can have much larger intervals. An interval during the day may look like doing a 50-minute hour. So, I stay on task, mono task, not multitask. I mono task for 50 minutes. And then, I take a 10-minute break. There might do a little bit of exercise at my desk. I might do a little bit of mindfulness. I just recharge. Because I have had 50 minutes of exertion. I am going to take 10 minutes of recovery. So, I can have micro intervals throughout the day. But we need bigger intervals, that ultimately, is where vacations and weekends come in. Now, when I talk about a weekend or vacation, a vacation is just "I do not go and work from some other place." Too many business owners and business leaders can not get away. They are working all the time. When they are on vacation, I often hear families complain that the saying "You are always on your phone. You are always on your computer.” You are not getting true recovery. You are just working from a different location. You are not giving your mind and your body the break that it needs to come back and perform at a high level on a sustained basis. When we talk about intervals, these are true intervals where we step back from the business. And by that, we recover.

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Morgan: While we are talking about burnout and leadership well-being, this led us into an interview we did down the road with Rick Tiedemann again about sleep and the importance of sleep. Dr. Michelle Hagel did mention that in her burnout clip that this is one of the biggest ways to fight burnout. But unfortunately, so many people are getting inadequate sleep and fragmented sleep. So again, we turn to Rick Tiedemann here for some advice on how we can get a better night's sleep. This is what he had to say.


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Rick: Let us get a couple of things on the table right now as we talk about what great sleep looks like. Because what we should be doing on average and, of course, depending on your age anywhere from a baby to a senior individual it is going to vary a little bit. If we look at kind of the working group, in that 25 to 65 group on average, people should be looking for about seven and a half hours of undisrupted sleep. That undisrupted dimension is really important, Morgan. Okay? There is going to be some variation in there. But let us strive for seven and a half hours of undisrupted sleep. I think a couple of things that I want to get on the table right now before we talk about what good sleep architecture looks like is that we need to understand, Morgan, the problems do not start when you put your head on the pillow at night. They start when you take your head off the pillow in the morning. So all the goofy stuff that we do all day long, and all these unhealthy therapeutic lifestyle choices that we make that culminate in us not being able to sleep when we put our head on the pillow at night. We need to kind of engineer our day to get great sleep. The other thing, Morgan, is really important that we understand that there is a couple of dimensions to sleep. There are many more. But, generally speaking, number one is sleep onset, can I fall asleep? And number two is sleep maintenance, can I stay asleep? And different things that we do throughout the day, may impact on one of those two core dimensions of sleep.

Now, when we look at great sleep, and if we strive for that seven and a half hours give or take, we need to understand a couple of fundamental things, Morgan. Number one, we do not just fall asleep, go into deep-sleep and stay there until we wake up. What we do, Morgan, is we are awake. Then, we drop into REM sleep. And then, we go through non REM stage one, stage two, stage three, and stage four until we are down into deep sleep there. Non REM stages three and four are the deep or slow-wave sleep. Generally speaking, give or take, and so that each cycle will go through five cycles where we will drop down into non REM stages three and four. Then, we will pop back up into REM. And then, we will drop back down into non REM. Pop back up into REM. We will go through five cycles, that give or take, will last about an hour and a half, Morgan. So five times an hour and a half to seven and a half. The interesting part about these cycles is that not all cycles are created equal. Different things are happening during different cycles. For example, in the first three cycles, we tend to get more non REM than REM. In the last two cycles, we tend to get more REM than non REM. And if [inaudible] design, because different reparative and restorative things are taking place during each of these different cycles. That is why we emphasize the undisrupted component? We need to look after both dimensions, can we fall asleep? And just as importantly, can we stay asleep?


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Morgan: Another topic we have been exploring on the podcast is how our finances are impacting our health. It is great to be getting that good sleep, to be watching our stress levels, and all that. But a big component of — If we are sleeping and how stressed we are is how our money is doing. We talked to a debt expert, Mark Kalinowski, about if there is such a thing as good debt. Have a listen.


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Morgan: Is there a difference between good debt and bad debt?

Mark Kalinowski: Very much. Debt is like a great tool. When we are using debt as a tool, the whole idea is that it is going to enrich our lives. I do a lot of presentations at schools. Many students have student loan debt which can be a great thing as long as it is going to help you prosper in the future. I have a history degree. Honestly, they are not calling out for a lot of historians right now. I do not know if going back 20 years, I would be so eager to get a history degree. But if I am going to be an engineer or someone in communications, a doctor, that, of course, will make your life better. Sometimes, houses are the same way. I often look at houses as forced savings accounts. They are really hard to get the money out of. And you put money in for a long time.

But at some point, you own a hard asset that you can sell for cash. Sometimes, businesses, small businesses can be a great way to use debt to grow and build a great life. Were you using debt for consumerism? I do not know what is going on holidays and not being able to pay them off. When I see people buy a hundred thousand dollar pickup trucks. I know they are advertised for $29,999 or whatever in the newspaper. But you walk out with a $100,000 car loan, I am concerned that they are buying into a lifestyle that can not afford. When we do not pay the debt, it becomes stressful. Bank of Montreal put out a study not too long ago where we saw that people that are not paying their debt and feel tremendous amounts of stress are about 40% more likely to have migraine, headaches, or headaches regularly. They have stomach issues. They are about 30% more likely to have an anxiety issue and about 25% more likely to be depressed. They are overall will not feeling — They are not doing well. They are not mentally well. They are not physically well. So, there is a tremendous burden on it.

To the individual, it is life-changing. Because it makes it hard to manage everything that you do. You fight with your wife, more yell at kids — You are a less productive person at work. That is a big factor. The second factor, of course, is when you do not pay your debt. The only person that ever cares more about the money you borrow than you is the guy that needs to get it back. There is the stress that the banks are going to punish you in some way or the other or the credit card companies. When they punish you, it is not like it is a physical thing, except that it does affect you physically and emotionally. They are going to call you all the time. They are going to send you off to collections. There is the possibility of getting sued. Having done the credit counseling job, two things people seem to fear are taxman and courts. No one wants to go to court. No one wants to deal with the government. There are lots of things that can happen. Whether or not they happen, it depends on the situation.

In Alberta, I think they can go to small claims court for $50,000 and under which makes it an attractive option to take someone that owes a sizable amount of money through courts to collect the cash. If that happens, well, there are steps you can take to remedy it.

Morgan: At the extreme bankruptcy, is it as bad as people say it is?

Mark: I think it comes down to that sense of obligation. When people go bankrupt, they feel like they have not morally met their obligations. But as I mentioned earlier, a lot of their time, people are in trouble. Because something has swiped them out of the blue like job loss, death . . .

Morgan: Yes, something out of their control.

Mark: It is not a moral issue. I have been a banker. I have been a credit counselor. I know lots of bankruptcy trustees. From our perspective, it is money. It is not you as a person. This money needs to be dealt with. No, it is not the end of the world. Where it stresses people out as the thought that they may have to give up a house. They may lose all their RSPs. All their dreams fall apart and may never come to happen. That is not true. In Alberta, we are kind of a safer place than other places to go bankrupt. RSPs, Registered Retirement Savings, and Registered Education Savings Plans, things like whole life insurance and pensions are generally exempt from bankruptcy if you are not drawing on them. In terms of houses, if you have a house, this might be many of us as house prices have dropped tremendously. But if you only have $40,000 of equity in your house, you get to keep that. And if you can make your mortgage payments, well, the trustee might let you keep your house.

If you think that is the way you need to go, you should probably seek more information on bankruptcy or maybe a consumer proposal from someone that has information on it, a great place to go. Bankruptcy trustees are overseen by the government. You can go talk to them, it is free to go in and talk to a trustee. You do not have to sign on. I tell people to go into trustees. Do not sign on if you talk to someone else. So, you can explain exactly what the process is. Nonprofit credit counseling agencies are a great place to go. The Credit Counseling Society, the place I work, or Money Mentors in Alberta is a good place to go talk to. They are all nice people. They are going to give you the straight scoop. But no, bankruptcy is not the end of anything. Having been a lender, I have given someone a loan that is been bankrupt three times. You just go into the penalty box for a while.


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Morgan: That is great news for Mark, that debt is always as bad as it sounds like it is going to be. But of course, we are looking to help small businesses avoid debt altogether. And maximize revenue from your small business. That is why we have brought on our friends from True North Accounting for three different episodes, talking all about tips for small business, accounting, and bookkeeping. Here are our favorite clips with Chartered Professional Accountants, Curtis Gabinet and Matthew Peterson. First up, should business owners be taking dividends or wages?

Curtis Gabinet: This is something we explain to people constantly. Whether they are brand new, or whether they have been in business for 10 years. A lot of people just do not know. Maybe they just have not adequately been explained what it means or what the differences are, or they do not care. But, it is good to have a general understanding. Because ultimately, there are two ways as an owner to get money out of your corporation into your pocket. You can pay yourself a dividend. You can pay yourself a wage. Those are ultimately the two ways you are getting it out. There are pros and cons to each dividend, ultimately, dividends you are just extracting cash from the company.

Morgan: Okay.

Curtis: You are just taking it out as you please. You do not need to do anything. There are different ways you can structure it. But, more often than not, you are seeing someone just month to month and week to week just pulling cash out of the company. At the end of the year, you kind of tally that up. There is your dividend is showing up on a T5. Without that, there are tax planning opportunities in between. But, it is simply straightforward and really easy. But, there is also, I guess, cons to it. A dividend is not a write off to the company. So, the company does not see any tax savings. Because on the opposite side a wage is a write off to the company. Because it is not a write off to the company, you get taxed a little more favorably in your own hands personally. So, you get this T5. You use that when filing your taxes. You will owe a chunk of tax depending wherever you fall on the tax system. You are not paying into CPP. Nobody is withholding income tax for you like a T4, a regular employee.

Morgan: Okay.

Curtis: You are just taxed on the gross amount at the end. Sometimes, it is simple. Everyone has a different view on what CPP is going to look like when they retire. But, I have seen the circumstances of people coming to us as a new client. They have been in business forever. They are heading into retirement. They are like, "Well, I do not have any — I am not going to get CPP. What do I do?" It is like you have been paying yourself dividends the entire last 30 years. Nobody ever explained this to you. You have not contributed to CPP.

Morgan: Can you still contribute to CPP with dividends? Or do you need to do your own planning at that point?

Curtis: You need to take extra precautions, I guess. Ultimately, you do not want to just rely on CPP as your retirement income, right?

Morgan: Yes.

Curtis: But, you want to focus more on alternate methods. There are other things like other forms of investment. There is still — Service Canada has different options to go out of your way to contribute yourself to still contribute to it. But, it is not quite as simple and straightforward as just having it come right off your wage. Another thing that is usually unknown to people or we commonly see it as a shock is dividend income, personally, is not considered earned income. I am putting air quotes around that. But, the tax system says it is not earned income. Whereas, a wage is earned income.

Morgan: Okay.

Curtis: The key to that is earned income is what increases your RSP contribution limit. If you only draw dividends your whole life, you start a company right out of high school. You only draw a dividend. You can not put anything in your RSPs. You do not have any RSP room. Because you have never had earned income. These are other qualitative factors that more than just the taxes you are paying. On the flip-side of wages, there are more involved. You have to withhold especially from your employees and from yourself that can be handled a little differently if you are the owner. But, realistically, withholding income tax and CPP, if you are the owner, not EI. Because you are likely going to be EI exempt. But you are remitting this every single month. So, you have got another task. There are deadlines for payroll to keep in mind, to dodge interest, and penalties from CRA. Then, you are getting a T4 from your own company. The wage that you are paying yourself in a very simplistic scenario, it is a write-off to the company. You have just brought your company's net income down. You have saved the tax in the company. You file your tax return with your T4. You have already withheld your income tax in CPP. You are contributing to CPP or increasing the RSP contribution limit. In most cases, there are always variables in every scenario. Everything is different. But, in a very cut and dry scenario, the overall tax between yourself and the corporation combined, whether you choose dividends or wage, is usually really close.

Morgan: Okay.

Curtis: If there was a clear cut winner, everyone would do it. Sometimes, it is more understanding of what each means and what fits your lifestyle. Your goal is going forward.


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Morgan: And of course, we had to take this opportunity to ask what is on most of our minds, how can we minimize our taxes?


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Curtis: Minimizing taxes is what you are after at the end of the day no matter what. If you are incorporated or not, you want to pay less tax or just capitalize on every chance to get a write-off you can. So again, you got to start the building blocks of "Okay, what can I write off? What does that mean? What should I look for?" If you can boil it down to pulling out the right card at the point of purchase, you simplify what happens after the fact. But first, you got to know what — Because if you are going to pay with your card and if it is a business you pay with your company card, that the CRA has — It is a very gray general description. But, a write off is any cost you incur in an attempt to earn income. It is very broad, right?

Morgan: Okay, yes.

Curtis: What you have that — Oftentimes, I will tell someone "If you are sitting across from CRA agent. And you have got that write off in your hand. Whether it is a meal receipt or a parking receipt. Can you explain to the CRA auditor why it was a business expense?" And if you can and it is very easy. "Oh, I drove to this podcast interview right now. And I want to get paid for parking. So, to do with our business, I am going to include this parking receipt as a write-off." From there, I justified it. Sometimes, some people want to push things. Some people want to remain on the low-risk end. If it is questionable, you go out for dinner with a few friends and colleagues and you could make the argument, you talk business. It was like you were taking people out and it did benefit your business. You could justify it if you wanted to argue that. But some people choose "No, I do not even want the risk. I am just going to pay for this one personally." But any cost to anything you are paying during operating your business is a write-off. Most of the time, it is very straightforward. It is just 100%, it is directly for the business.

Yes, it is so clear and concise. Then, you get into — There is a bunch of different gray areas where it is your home office expense. Most people that do a small business operate out of their home office. Then, you are looking at a split between personal and business. You have to think of CRA uses the word reasonability all the time. So, what is reasonable? And a home office, the classic example CRA says, "Use your square-footage of your home office compared to your house." You will get a percentage, maybe 10%. You apply that against all of your different home costs, your mortgage interest, utilities, and you get to claim a portion. That is like saying, "Okay, 10% of the cost of my house is my business."

Vehicles are similar, where, again, tracking mileage back to what now I was saying before. Tracking your mileage and every business owner has, at some point, been tracking mileage or been hounded by an accountant to track their mileage. Finding out what portion of using your vehicle is business versus personal. In that percentage, you can claim or write-off for as well. Things like home internet and cellphone, most people do not have a second cell phone if they have a business. If they are their business, or if it is a small business, you are just using your phone, right? You are probably paying for that personally. Maybe you are paying it for the business. Because it is so heavily leaning towards the business side. But, sometimes, you just do what is reasonable, 50/50 split between myself in the business. Just understanding what is the write-off. Make sure you can start trying to capitalize on claiming them all and dropping your taxes.


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Morgan: But, ultimately, when it comes down to it, even if we alter our behaviors and we follow all the best tips for our business, if we have fundamental issues with our communication and our culture, we are going to have a very difficult time staying in business. To close out this episode, here are a couple of clips from our guest, Shane Wallace, from our episode about emotional intelligence.


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Shane Wallace: Emotional intelligence has five dimensions to it. These are self-awareness, self-regulation, empathy, motivation, and social skills.

Morgan: Okay.

Shane: Within the workplace, we focus on the first two dimensions, the self-awareness, and self-regulation. Self-awareness is essentially how well do you know what triggers you? And self-regulation is are you in control of those triggers or those triggers control you?

Morgan: Okay.

Shane: So, specifically, within the workplace, we look at the common areas where those triggers occur. In trying to address its equal parts treatment and prevention. From a treatment standpoint, the more we can grow someone's self-awareness, the better their ability to self regulate when those triggers happen. They can bounce back faster. Then, our company Culture Smith, the word 'culture smithing' comes from building the type of culture that prevents those triggers from happening as often. It is a fairly holistic approach to trying to bring more workplace emotional intelligence to the forefront. EQ is like a muscle in that you can develop. It is the only element of human personality that you can learn, grow, and develop. But, no different than a muscle. You can grow your muscle to be stronger. You can grow stronger EQ. But it can also become fatigued. There is a concept known as Ego depletion which states that we have this reservoir of mental energy to draw from a daily basis. When it is gone, it is gone. If you spend a tremendous amount of time leveraging willpower to go through, try, and make it through your day. By the time your day is over, you are just a burnout shell of yourself. When we start and your ability to then be aware and self regulate diminishes. We started looking at okay, well, if we can control these environmental factors, and if we can start building a healthier culture that does not tax people as much. When we are asking them to show compassion to their fellow employee by respecting the different behavioral types and practicing emotional intelligence. It is almost disingenuous for us to ask them to do that if we are not creating the type of environment that allows them to do it.


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Morgan: Alright, so that is our episode for today. I hope you enjoyed taking a listen to these clips. If you had not heard them before, I hope they inspired you to maybe go check out some of those full episodes. If you heard them before, I hope this was a fun and interesting way to round up some of these key takeaway points.


As a reminder, I am looking for your thoughts, your favorite episodes, and any feedback you have on the podcast so far. Please send that to podcast@olympiabenefits.com. As a reminder, if you include your business name and your website, I will be doing shoutouts on the next couple of episodes. I would appreciate it if you shared this podcast with a colleague, friend, or family member. If you have a moment to rate and review the podcast on whichever app you are using, that helps us get the word out as well. All right, that is going to be it for today. Thank you so much for tuning in. I will be talking to you again, very soon.