In this episode of the Generations of Wealth Podcast, Derek talks with Mike Milligan, CFP and founder of One Oak Financial, about why most people don’t actually have a financial plan — they have a pile of products disguised as one. Mike also opens up about relocating to Puerto Rico for a legal tax structure that’s dropped his effective tax rate to around 2% on exported business income.
Watch the episode here
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📄 Summary
Mike built One Oak Financial (formerly ZGP Financial, then Mike Milligan CFP, then Ideas by Mike) around a simple belief: most “financial plans” are really just products — a 401(k), an IRA, an insurance policy — sold without ever answering why money matters to the client. His process starts by asking “why” repeatedly until clients get past the answer they think he wants to hear and reach the real one, then builds a written philosophy document covering taxes, retirement, investments, healthcare, and legacy before any product gets recommended. He explains that wealth is built primarily through three vehicles — real estate, retirement accounts, and business ownership — and that his firm focuses on optimizing structure and tax treatment across all three, including making sure real estate investors use LLCs and self-employed earners over $100K set up proper payroll to cut self-employment tax. Mike also discusses his move to Puerto Rico, where exporting profit from a US-based business into a Puerto Rico entity can drop the effective tax rate on that income to about 2%, versus 21% as a C-corp or roughly 30% as a pass-through entity in the mainland US. He closes by sharing his own investing regret — passing on Amazon in its early days in favor of $10,000 in eToys.com — and his belief that a financial planner’s own failures matter more than their highlight reel.
⭐ Key Takeaways
- A financial plan should be a written philosophy document — not a 401(k), IRA, or investment account, which are only tools within the plan.
- Ask “why is money important to you” repeatedly (3-4 times) to get past surface answers and find what’s actually driving someone’s financial decisions.
- A good financial plan needs to be revisited and updated annually, not set once and forgotten.
- Wealth is built primarily through three vehicles: real estate, retirement accounts, and business ownership.
- Real estate investors should hold rental property in an LLC, not personally, for liability protection.
- Self-employed earners making over $100K should set up payroll/an S-corp structure to reduce Social Security and Medicare tax exposure.
- Relocating a business’s profit export to Puerto Rico can legally reduce the effective tax rate on that income to roughly 2%, versus 21-30% in the mainland US.
- Before hiring a financial planner, ask if they’ll show you their own net worth and investment track record — refusal is a red flag.
- A planner who openly discusses their failures is more trustworthy than one who only shares wins.
- Even sophisticated investors make costly mistakes — Mike’s own $10,000 bet on eToys.com instead of early Amazon is a reminder that hindsight is unavailable in the moment.
💬 Relevant Topics Discussed
- Financial planning philosophy
- Tax reduction strategies for entrepreneurs
- Puerto Rico tax incentives (Act 60-style export structure)
- Real estate asset protection (LLCs)
- Retirement account optimization
- Business structure & payroll for the self-employed
- Vetting a financial advisor
- Legacy & estate planning
- Investment mistakes & lessons learned
- Building a financial planning firm
🏝️ Why Puerto Rico? The 2% Tax Strategy
One of the episode’s most concrete takeaways is Mike’s breakdown of how he legally reduced his business’s effective tax rate. Because of Puerto Rico’s Jones Act-driven import structure, a mainland US business can export profit into a Puerto Rico entity, where that exported income is taxed at roughly 2% federally, after paying a reasonable salary subject to normal tax treatment. Compared to 21% as a C-corp or around 30% as a pass-through entity on the mainland, Mike estimates this can save six figures annually on income in the hundreds of thousands — while he continues to run his business operations and team from Norfolk, Virginia.
🎧 Why Should You Listen?
If you’ve ever handed a financial advisor your information and immediately started talking about products — insurance, investments, accounts — before anyone asked why money matters to you in the first place, this episode reframes what a financial plan should actually be. It’s also a practical look at two tax strategies that apply directly to Derek’s real estate-investing audience: proper LLC structuring for rental property, and payroll setup for self-employed earners crossing the six-figure mark. And for anyone curious about relocating for tax purposes, Mike’s Puerto Rico breakdown is a rare, specific look at how that actually works.
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About Mike Milligan
“Be One of a Kind.” That’s the mission driving Mike Milligan, Founder of 1.oak Financial, a dynamic virtual financial planning firm. Mike believes most people are unprepared to navigate Wall Street, insurance companies, and financial markets. As a result, they fall into one-size-fits-all solutions that lead to missed opportunities and lost wealth, a pattern he calls the Paralysis Penalty. While corporations profit, individuals are left with less wealth and more confusion. In response, Mike built 1.oak Financial—short for One of a Kind, to prioritize each client’s individuality.
His truly unique approach has earned national attention (featured on CNBC, Fox, ABC, NBC), and it started with a deeply memorable story involving his Granny selling collard sandwiches in small-town America. He later honed his method through a specialized degree (unique in the industry) and sharpened it further during his time inside big banks and insurance firms, where he witnessed firsthand how rigid systems failed real people.