December 30, 2025

Happy Tuesday, everyone! ☀️
Good morning — hope you’re easing into the day feeling steady and ready to wrap up the year strong.

Quick question for you: Have you ever been surprised at tax time — either owing more than expected or getting a refund that made you think, “Wait… how did that happen?”
You’re not alone. A lot of high earners accidentally miss the mark simply because of small withholding mistakes.

That’s exactly what today’s post clears up — how to spot those issues early so your money stays working for you, not stuck in limbo.

— Ryan Rincon, Founder at The Wealth Wagon Inc.

— Peter Drucker

Market Update: Markets leaned red across the major indices today as sentiment softened. The Nasdaq slid 0.50%, the S&P 500 dipped 0.35%, and the Dow Jones followed with a 0.51% pullback—modest declines, but enough to reflect a cautious tone among investors.

Bitcoin also cooled off, slipping 0.83% and giving back some of last week’s momentum. Meanwhile, the metals market quietly strengthened: Gold nudged up 0.12%, and Silver outperformed with a solid 1.60% gain.

On the equity side, a few bright spots emerged. Disney climbed 0.56%, continuing its gradual comeback narrative, while Intel gained 1.33%—a positive move for the chipmaker amid increasing attention on semiconductor competitiveness. The lone standout in the red was JP Morgan, dropping 1.27%, as financials saw light pressure.

Overall, despite broad index weakness, the day included pockets of resilience—especially in metals and select blue-chip names.

China stages military drills near Taiwan after rising US–Japan tensions
China launched a new round of military drills surrounding Taiwan, signaling sharper warnings toward what it calls “external interference.” The exercises come amid tightening coordination between the U.S. and Japan, which Beijing views as a growing security challenge. Officials say the drills are meant to showcase readiness, but they also risk escalating an already delicate regional standoff. Analysts note that the timing suggests Beijing is shaping early geopolitical narratives for 2026.

Grim evidence from Trump’s boat strikes found along Colombian coast
Newly discovered debris and biological traces on Colombia’s coastline appear to confirm a series of deadly incidents linked to U.S. boat strikes during anti-narcotics operations. Local investigators say the evidence adds weight to concerns that enforcement tactics are having unintended humanitarian consequences. The findings are prompting renewed scrutiny of cross-border military cooperation. Communities in the region are calling for greater transparency and accountability.

Why Israel recognized Somaliland as an independent African state
Israel’s decision to formally recognize Somaliland has stunned much of the international diplomatic community. The move opens the door to deeper security and trade partnerships in the Horn of Africa, where competition for strategic influence is rising. Somaliland hopes the recognition will accelerate broader international acceptance after decades of political limbo. Critics argue the decision risks destabilizing regional alliances already under pressure.

Five major economic predictions shaping the outlook for 2026
Economists are outlining bold forecasts for 2026, pointing to a year defined by shifting labor dynamics, evolving technology, and intensifying global trade competition. Many expect productivity growth to hinge on AI integration, while demographic pressures continue to reshape workforce participation. Inflation is projected to moderate but not vanish entirely. The coming year may serve as a reset point after several years of economic turbulence.

Sluggish hiring and sticky inflation likely to persist into 2026
New analyses suggest the U.S. economy is entering the new year with uneven footing—job growth remains soft while certain inflation categories are refusing to cool. Businesses are still navigating high input costs and these pressures may slow expansion plans. Policymakers warn that progress won’t be linear, even if major metrics have improved. The overall message: expect a stop-and-start path rather than a smooth normalization.

China pushes for more efficient fiscal spending to bolster growth in 2026
China is signaling a renewed focus on targeted fiscal support as officials work to prevent a deeper economic slowdown. The government plans to concentrate spending in sectors tied to innovation, infrastructure, and domestic consumption. While the approach marks a shift from earlier broad-scale stimulus, leaders believe precision funding will deliver more sustainable momentum. Analysts say execution will determine whether China can stabilize growth amid global headwinds.

Investor claims Bitcoin could reach $1M by 2033, beating S&P 500 in 2026
A prominent crypto investor is forecasting an explosive long-term Bitcoin rally, projecting it could climb to $1 million by 2033. They argue that institutional adoption and predictable supply dynamics will give Bitcoin a performance edge over traditional indices like the S&P 500 by 2026. While the prediction has generated excitement, it also comes with caution about volatility. Even bullish analysts acknowledge major swings are inevitable on the path upward.

Bearish analyst warns Bitcoin could fall to $10,000 amid market-wide pressure
A well-known bearish strategist has renewed calls that Bitcoin could plunge to $10,000 if broader liquidity tightens. The analyst points to weakening momentum and uncertainty around global rate policies as major risks. Although most traders view such a drop as extreme, the warning highlights sentiment fragility after recent price softness. The debate underscores how split experts remain on crypto’s near-term trajectory.

CEO drops “utility bomb” on XRP as community questions long-term value
A major industry CEO has challenged XRP’s long-term usefulness, suggesting it may not deliver the advantages its supporters expect. The remarks ignited discussion across the crypto community, where concerns about utility have grown louder. XRP holders say the project remains undervalued, but skeptics argue tech competition is intensifying. Markets reacted with choppy trading as investors processed the mixed signals.

This is not about tax loopholes, offshore structures, or complex strategies.

This is about something far more common — and far more costly.

Withholding errors.

They quietly cost professionals, executives, and business owners thousands of dollars every year, either through unnecessary refunds (lost opportunity cost) or surprise tax bills with penalties.

Most people never realize it’s happening.

Withholding is just a prepayment estimate of your taxes.

Your employer (or you, if self-employed) sends money to the IRS throughout the year based on assumptions — not reality.

The problem is that those assumptions are often wrong once you have:

• bonuses
• RSUs or stock options
• side income
• spouse income
• business income
• rental income
• investment gains

The more complex your income becomes, the less accurate standard withholding becomes.

People celebrate refunds. They shouldn’t.

A refund means:
• you overpaid all year
• the government held your money interest-free
• you lost the chance to invest or deploy that cash

A $10,000 refund is not a win.
It’s a forced savings account with a 0% return.

At higher income levels, this opportunity cost becomes massive.

Here are mistakes that show up over and over again among high earners:

1. Bonuses withheld at flat rates that don’t match reality
Bonuses are often withheld at 22% federally.
Many high earners owe 32–37%.

This creates surprise bills later.

2. Stock compensation ignored in withholding planning
RSUs increase taxable income but don’t adjust your base withholding automatically.

You end up under-withheld.

3. Side income not factored into W-4 elections
Your job withholds as if it’s your only income — even when it isn’t.

4. Married couples both under-withhold
Each job withholds assuming the other doesn’t exist.

This is extremely common and extremely expensive.

5. Business owners forgetting quarterly estimates
No withholding + no estimates = penalties, even if you “have the money.”

At lower incomes, mistakes are small.

At higher incomes:
• tax brackets widen
• penalties increase
• cash flow matters more
• volatility increases

A small withholding error at $80k is annoying.
The same error at $300k+ becomes a five-figure problem.

You do NOT need advanced tax knowledge.

You just need to stop relying on default settings.

Here’s the practical approach:

Once per year (or after income changes):
• list all income sources
• estimate total annual income
• estimate total tax owed
• compare to expected withholding

If there’s a gap, you adjust before the year ends.

This can be done with:
• a CPA
• a tax estimator
• payroll adjustments
• quarterly estimated payments

The goal is not perfection.
The goal is not being surprised.

The best tax outcome is:
• no refund
• no big bill
• no penalties

You want to be close to zero.

That means:
• your money stayed with you longer
• your cash flow stayed flexible
• you controlled when money moved

That’s what financially disciplined people aim for.

Fixing withholding does more than optimize taxes.

It improves:
• monthly cash flow
• investment consistency
• stress levels
• planning confidence
• decision-making clarity

When you stop guessing about taxes, everything else becomes easier to manage.

Look at your last pay stub and ask:
• how much has been withheld so far
• what your total income will likely be
• whether that withholding actually matches reality

If you’ve added any income source in the last 12 months, your withholding is almost certainly off.