Financial Tips for Federal Prisoners
This blog is for the white collar professional who finds himself heading to a federal prison camp or is already in a federal prison camp. As my partners, Michael Santos & Shon Hopwood, prove just because you are in federal prison does not mean massive opportunities do not exist. To prove my point, watch the March 4th edition of 60 Minutes. 60 Minutes will be profiling Shon’s remarkable story of redemption.
I understand going to federal prison is not easy, and it can be difficult to see light at the end of the tunnel. I must stress that just because you are down on your luck at this moment doe not mean you will stay there. As I wrote in Lessons From Prison, you must use your time away as a sabbatical to prepare for richer and more fulfilling experiences upon your release from federal prison. Perhaps one of those experiences is starting your own business. I did it. Many clients have done it. So can you!
To help you get started, allow me to offer some financial tips for federal prisoners.
#1 First and foremost is managing cash flow. It is essential:
You may be thinking, “Justin you nuts, what cash flow, the lawyers got it all!” I get it. Still, most of my clients summon the resources to live comfortably in prison. Do you need $500 a month or will $300 do? If you can manage to get by on $300, then save that extra $200 for your release, or invest it. Do something! Further, many of our clients use their time to create a business before they surrender to federal prison. Then by creating a business, the business provides essential revenues which of course helps you better manage cash flow. If you are reading this and have yet to go to federal prison, you have time. Use your skills and expertise to create a new business that can help sustain you. We have had clients successfully start merchant processing, online marketing, retail, construction and many other businesses before they surrendered.
#2 financial tip for federal prisoners, limit your fixed expenses:
I made mistakes here. I could have easily canceled some fixed expenses, but I did not. I reasoned I might as well keep them because I would be home soon enough. Those fixed costs included keeping my health insurance, country club (so dumb), cell phone and more. Had I limited my expenses, I would have saved at least $1,000 a month. To the extent you can, scale back. Do you still need a Tesla or BMW? Not really. Cars do not make us happy. Embrace scaling back and limiting your expenses. Use those resources to invest in your new business.
#3 With start-up costs and your time, you may lose money your first year. Have a back up financial plan:
Upon my release from federal prison, I wanted to work as a federal prison consultant and ethics speaker. Despite writing a blog each day in federal prison to build traction and releasing from prison with a well-received book, succees did not happen overnight. I had to build it and it took time. I did many corporate events for free. I did not know to properly price my prison consulting practice. In time, I realized I was doing too much work for very little money. While I was figuring out the ethics speaking and prison consulting, I took on social media projects for a fee. I wrote blogs for real estate agents looking to grow their brand online. Those projects, while cumbersome, allowed me to bring in enough resources to help overcome some of the inevitable ups and downs of my new career.
#4 Set up your business with the correct tax structure.
No, I am not an accountant. I can refer you to one though! It is in your interest to know the differences between S, C, LLC, and LP business structures and how taxes are treated in each one.
#5: Focus on organic traffic, versus paid traffic.
It would be nice to spend thousands on Facebook and Google Ads, but the truth is you may not have the budget. I certainly did not. In lieu of spending money on ads, I invested the time write blogs, film videos, create free courses and writing books. In time, traffic, and income, flew from the value I delivered. Follow my lead. Take the time to create real value for others and business will come.
Whether you are already in federal prison or are planning to go soo, use these 5 quick financial tips to get started on the next phase of your life. If I did it I assure you, so can you.
P.S. If you want to emerge from prison as successfully as Michael Santos, text “QUICKLY” to 44222.