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CU Medallion [55918]
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Ahhite. Serious question for business-minded Lungites.
Jul 28, 2015, 9:23 PM
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I have worked for Uncle Sam for the past 8 years. I'm a health care provider. In addition to working for The Man I have a small private practice and a teaching gig.
Lately some private opportunities have come my way that could be really good. Reliable, relatively lucrative, and with more flexibility to set my own schedule, etc. I am 90% sure I would come close to my current base salary within a year or two and 100% sure I would exceed that level of income as I built my practice, worked out the kinks in job flow, etc. So the upside is more money, at least in the long term.
The downside, as I see it, is Uncle Sam gives me good healthcare benefits and a (for these days) cushy retirement set up (a pension and a fairly generous retirement investment plan - it is managed by BlackRock and has done very well for me). Plus, I could (if I so chose) work only 40ish hours a week. (I never have, but that is my choice). Oh, and BTW, I would have earned my full pension at age 60.
So what say you Lungers? Should I take some reasonable risk and go all entreprenuery up in here, or play it safe and ride it out with Uncle Sam until I hit the big 6-0? (I'm 48 now and have 4 kids, if that helps you think it through).
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Heisman Winner [136828]
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If at least one of the 4 kids has it together enough
Jul 28, 2015, 9:35 PM
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to look after you if it all goes #### up go for it. Otherwise it's a gamble.
Although if somebody like Walker gets in then your fed pension could be gone so who knows?
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All-In [38925]
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there's alot that plays into this decision, lets start with
Jul 28, 2015, 9:36 PM
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the kids.
age? what you expect yourself to provide for them in the future... things will be tight for a while so you already have college money, if its expected of you to pay.
Getting the idea of my questions.
Now on the other hand, if your kids have learn to contribute to you alls life style and they/you expect them to help themselves with their future, then go for it.
48 is young, you could do your time and start a whole new life later.
Yeah, I know.. I'm no help.
I played it safe till the kid was grown and now I play alot of risk. But only part time, I haven't jumped in with both feet yet (I still have my day job)
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CU Medallion [55918]
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yes the kiddos are a big concern in this.
Jul 29, 2015, 8:35 AM
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Ages 13, 11, 8, 7. One with special needs. All with the uses kids stuff of orthodontia, etc.
The health care benefits are a big pull with my current gig. That and a generous leave policy.
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Heisman Winner [135932]
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I want you to consider this third option:
Jul 28, 2015, 9:42 PM
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Sell everything you own, move to Santa Cruz California, live in a vintage VW camper, go on a straight tofu diet, and surf all day, every day.
You. Are. Welcome.
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All-In [38925]
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after the week I've had so far.. that sounds like an idea
Jul 28, 2015, 9:49 PM
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and its only Tuesday.
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CU Medallion [55918]
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All-In [31938]
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Will you be self employed, i.e. have to pay both sides....
Jul 28, 2015, 10:36 PM
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of FICA? If so, have you taken that into account when comparing earning potential?
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CU Medallion [55918]
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as with now, it'd be a mix of both
Jul 29, 2015, 8:40 AM
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My private practice is of course 100% self employed with all related tax obligations. The other income streams I am technically an employee so they do the fica.
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All-In [49309]
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go for the new job.
Jul 28, 2015, 10:40 PM
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my income is mostly commissioned or fee-based, with trailers based on assets under management/advisement. I am grandfathered in to a traditional pension, and have a 401k. I made the leap to more potential/less security at age 40, and never looked back. Well, maybe a few anxious moments in the first year or so.
The federal benefit package is indeed pretty good, but the increase in income is money in your pocket that you have total control over. Is is definitely your plan to retire at 60? If not, how valuable is that option? You can have more flexibility and choice in your retirement planning. And as you already know, self-employed means a lot of deduction opportunities. If you like how Black Rock has done with your savings plan, leave it there. If you can take a lump sum from your pension, you could set up your own guaranteed future income stream if that's important to you.
But the main thing is the satisfaction that comes from being responsible for and achieving your own success, with no cap on the upside. You work hard and do well, you make more money. It's extremely gratifying and validating. Not to mention having more flexibility in every way. Don't like a client? Don't work with them. Set your own hours as you like. Spend what you want or need for your business.
This all assumes you're right in your description of the opportunity. Call me if you want to talk it over.
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CU Medallion [55918]
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Thanks for the encouragement
Jul 29, 2015, 8:43 AM
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There is no doubt I have more spring in my step when I am doing my own thing. That counts for a lot bc it bleeds over into how good I am to my family (or not good to my family when I'm frustrated by Uncle Sams bureaucracy). I might just call you soon.
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Lot o points [181400]
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Follow your dreams.***
Jul 28, 2015, 10:44 PM
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CU Medallion [50635]
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are some shakeups gonna affect you
Jul 28, 2015, 11:56 PM
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would you have to move for uncle private gig here? where do you want to be
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CU Medallion [55918]
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as you have likely heard from your missus, there have been
Jul 30, 2015, 7:00 AM
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lots of shakeups over the past few years and with our current director there is no end in sight. It gets old but is NOT the reason I'm considering leaving.
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110%er [9771]
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stop suckling on the genpop's teet and fend for yourself
Jul 29, 2015, 12:46 AM
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you leech!
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CU Medallion [55918]
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inorite? Ward of the State..***
Jul 29, 2015, 8:44 AM
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Orange Blooded [3148]
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Seems like you have the best of both worlds right now
Jul 29, 2015, 7:38 AM
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guaranteed money and great benefits/retirement from Uncle Sam
opportunity to supplement your income as you want to
IMO, unless your future TAKE HOME (after payroll taxes and buying your own benefits) would be more than double your current take home, I'd keep the gov't benny's.
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CU Medallion [55918]
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income would not be double to start
Jul 29, 2015, 8:37 AM
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But the upside potential is there.
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Hall of Famer [21349]
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I am heavily leaning towards entrepreneur.
Jul 29, 2015, 8:58 AM
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My motto is the cliche 'go big or go home.'
Or as my wife says it... the larger fruit is at the end of the branches. Only the brave risk falling to get the much larger reward.
In other words, I would go for your own gig in a heart beat. That is what I am going to do as soon as I get my PE license. I have already started two businesses... one that the PE is needed for, but I was able to do a little work with it, the other is flipping/rental houses. My first flip went real well... payday is tomorrow! WOHOO!
Go for it.
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CU Medallion [55918]
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I hear ya. Love the attitude and passion.
Jul 29, 2015, 10:02 AM
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??????
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Orange Blooded [3590]
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Stay where you are. You are within 12 years of
Jul 29, 2015, 9:11 AM
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old age security. If you were just starting out, it may be worth the risk. At your age, you will not have enough time to recover from a large loss. Opportunities will still be available 12 years from now.
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CU Medallion [55918]
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good point, but I have a decent nest egg
Jul 29, 2015, 9:59 AM
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I'm not relying on my pension or social security in retirement. And I will likely never fully retire, given the nature of my profession. So although there are no guarantees in life, I'm expecting to remain in business through most of my lifespan.
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Orange Blooded [4356]
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I've left two Fortune 50 companies to start
Jul 29, 2015, 11:37 AM
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businesses, leaving pensions in both cases. Both were successful, but not without sacrifice, which came in no small amount on the part of my family. The second time, my kids were 7 and 4, and my wife stayed at home, so it was all on me. In both cases, I found myself in about 18 months strongly considering going back to the corporate world, and in both cases, opportunities presented themselves that I could not pass up. This last go around, I'm back with the company I had most recently left.
You will have time and costs associated with ramp-up and building your clientele. During that phase, you will likely work quite a bit, have a different kind of stress than you are used to, and likely tighten the purse strings, cutting out extras.
Once you get established, you will have to make determinations as to what you do yourself vs. outsource (invoicing, book keeping, collections, tax administration... FICA, Medicare, insurance, SUTA, FUTA, work comp if you go down the employee route).
Everything is a trade-off as well. Take a week of vacation? That is a week of lost revenue. There is also a tremendous amount of security that comes from having, but not needing, a pension.
On the plus side, it is great to not have to answer to anyone other than your family and your clientele, and if you can balance it and not think about opportunity costs, the flexibility is great.
A couple things I would strongly consider would be in 12 years, you will only be 60, be eligible for full retirement (with benefits to 65 I presume?). You sound like you will always "work" in some form or fashion. Why not start the business then, and work as much or as little as you want then?
Another key consideration might be your ability to either come back to your current employer, or find similar work in the event your independent path is not everything you thought it would be. If you can come back, particularly if you can pick your pension back up, then you have a back-up plan that may encourage you to take the leap.
All that said, when I reach my financial goals, I have every intention of being self-employed at some point in the future as well. Hopefully in the next 10-15 years (46 now).
It's a big decision, but I've never regretted the steps I've made. I think whatever choice you make, faith and attitude have a way of making them turn out as positive.
Good luck!
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Orange Blooded [4356]
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One other very important thing. You can never predict what
Jul 29, 2015, 11:41 AM
[ in reply to good point, but I have a decent nest egg ] |
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will happen with your health. Well in advance of starting your new gig, be sure you take out a disability policy. Otherwise, you will be in limbo until you get your business is established, and this will likely be the biggest "life stressor" you undertake. These things have a way of affecting your health, so you want to get that taken care of in advance.
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CU Medallion [55918]
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Excellent points all around.
Jul 29, 2015, 12:02 PM
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Thanks.
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All-TigerNet [12269]
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Re: good point, but I have a decent nest egg
Jul 29, 2015, 11:44 AM
[ in reply to good point, but I have a decent nest egg ] |
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The net present value of your pension and retirement benefits in a low interest rate environment is huge, How badly do you wish to change your work situation?
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CU Medallion [55918]
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I think I'll regret not going for it if I don't
Jul 29, 2015, 12:05 PM
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Take the risk.
One factor no one has mentioned but is a concern of mine is Obamacares long term effects on private practice.
4 of the big insurance companies have already merged. Eventually reimbursements to providers will decrease.
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Hall of Famer [21349]
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Where are you located? I know some people you could possibl
Jul 29, 2015, 1:10 PM
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ly talk. They own their own private practice. I know all 5 doctors their and the office manager. The office manager would prolly be happy to talk to you about things. Used to know 6 of them until my FIL retired.
I am guessing you live in Atlanta.
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CU Medallion [55918]
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Haven't lived in the ATL since '02. I'm now in SW Virginia.***
Jul 30, 2015, 7:04 AM
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All-TigerNet [12269]
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CU Medallion [55918]
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Thanks. And I think I am wise enough to know that happiness
Jul 30, 2015, 7:03 AM
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is not the direct result of any employment - you can be a happy ditch digger or a miserable millionaire.
Just trying to make the most of what I opportunities I have been given.
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All-In [31938]
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If you want to do it, do it....
Jul 30, 2015, 7:55 AM
[ in reply to I think I'll regret not going for it if I don't ] |
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yes, there may be long-term impact from obamacare...and there also may be a completely new system in place in 10 yrs. Who knows?
In situations like this my advise is to analyse the things you can now, trust your gut, and don't get paralysis by analysis.
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CU Medallion [55918]
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good advice
Jul 30, 2015, 2:07 PM
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"go for it" has always worked well for me.
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Replies: 32
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