Interesting opportunity

Got an interesting offer today. I could leave my professional services position which pays me low 6 figures, find my own company, go corp-to-corp with a small company and double my pay (~$2k short, but it's close enough) for about 5 years. Wife works full time at a very stable position, so I can get benefits through her. Not sure if the money's right. Wife understands money better, since she's a CPA. Timing is not quite right professionally.

What say Ye, TE?

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About7Narwhal

Sounds like a big risk. Can you float for a while if things fall through? That would probably be the first thing I would seriously think about. If it goes belly up, could I afford up to a year without pay while trying to make it back to the 6 figure mark or will I need to start flipping burgers right away?

kriscamaro68

That is a hard one. If it where me I would probably take the new position since your wife can get benefits. The money you make from this new gig can help payoff a house/car in a much shorter amount of time and get debt off your back if you have any. If you don't have debt that its a quick way to get your hands on a Nissan GTR in a short amount of time. Either way its a win win. Maybe after some time with the company and them seeing how hard you work you could be made partner and be rolling in the dough. Knowing how far you have come already I can see that happening pretty quick.

Good luck with your decision.

MiikeB

Do it.

Who knows where this could lead. If its Corp to Corp in a year or two you might be able to bring someone on to your corporation to fill the contract and pocket 30% of the rate after employee expenses then do something else since it will be your corporation that has the contract to fulfill services, not you as an individual. This could lead to a lot of good things if you are ambitious.

N2IT

~80,000 increase I think it's completely worth the risk. Obviously I would need more information to make a "true sound" decision, but from what you wrote I think I would do it.

Wife is stable as a CPA making decent coin, I think I would go for it. Remember the most successful people in the world fail the most. AKA not risk averse. You seem like a gambler to me. Roll the dice.

instant000

My only caution is to make sure that you closely study your tax situation.

You need to account for the following:

- If you decide to give yourself retirement savings
- Payroll taxes (these will double)
- Other personal taxes
- Corporate taxes (these will occur also)
- Deductions (any deductions you may be able to take advantage of)
- Stock considerations
- Succession of ownership (how would you pass it down to your wife, legally, at minimal cost, in the event something happened to you?)
- Which state are you incorporating in? (state laws vary on taxes and how they treat businesses)
- Your tax bracket, and whether or not you'll be adversely affected by the marriage penalty

Make sure the CPA runs the numbers. She'll be able to clue you in on if it is a good deal or not.

Hope this helps.

EDIT: What type of corp? Each kind has different rules. A CPA will be well-versed in this.

gorebrush

What is a CPA?

I'm guessing this must be an American thing?

N2IT

Certified Public Accountant

shodown

When you wife provides the benefits it can work out. Make sure to have your wife keep track of everything you are doing and ensure you bill all the hours possible. I've done this and still am. You can deduct your electricity, home office, gas, computer, anything you buy from work, even when you take your wife out to eat and you discuss your business you can charge it to your business. Some of these have varying levels of deductions, but its all worth it if you play your cards right. The other thing is that you are in the DMV if the company went under its not like you can't find anything else out here.

Cons

Lots of paper work,
taxes have to be paid on time
no vacation pay or any type of PTO
IRS audits.

JoJoCal19

If it were me personally, and this is my personal plan that I am working on, I would take the solid and stable six figure income and use that money to pursue other ventures that would lead to an early retirement. Granted this position could net you even more but is it guaranteed? If its something you were sure would last longer term then yes it would allow you to do other things much quicker, but if it goes belly up in a year or two then not so much. Just my opinion.

gorebrush

JoJoCal19 wrote: »

If it were me personally, and this is my personal plan that I am working on, I would take the solid and stable six figure income and use that money to pursue other ventures that would lead to an early retirement. Granted this position could net you even more but is it guaranteed? If its something you were sure would last longer term then yes it would allow you to do other things much quicker, but if it goes belly up in a year or two then not so much. Just my opinion.

Would be my opinion too. With the state of our economies so bad, I'd want to ensure stability. But what is to say that your current role isn't stable either? People can be hemorrhaged out of a company at any point, sadly.

webgeek

N2IT wrote: »

~80,000 increase I think it's completely worth the risk.

+1 Roll the dice. Wife is a CPA and worst case scenario, you will find another six figure job some where else.

N2IT

Making decisions based off of fear rarely work out for the individual. If you go for it and fail oh well it happens. Besides you have the creds and education to easily bounce back. How much cost would it take to turnup this company?

I'm aggressive and have done well because of it. I have also looked like a fool as well.

It comes down to your personality and what risk you are willing to accept and which risk you aren't.

NotHackingYou

What do you mean by find your own company and go corp to corp?

powerfool

Guys.... his wife is a CPA, he has likely got all of the tax advice that he needs (especially including her professional network).

This sounds like a good situation. I am waiting for my wife to get her LPN license then she is going back for her RN. At that point, she will have benefits. If I have an opportunity come up like that then, I would be all over it. How much risk is there really? It can't be much different than the risk in changing your job at any other point... you are talking about serious money. Let's say you work six months and then it falls through... you made almost as much in those six months as you would in a year, so you have to go looking for a new job. How bad is that really? On the upside, everything works out for the most part and you have this contract for five years and make ten years worth of loot... sounds fantastic.

EDIT: You're in NoVa making six figures in a professional services gig, now. Just make sure you leave your employer on good terms. You will easily be able to find another job, I would imagine. Plus, once you have this all working, you could find more "clients" as well... maybe your current employer has work you can continue to do? It is always a possibility.

Master Of Puppets

Take the plunge! Your wife is in a stable position and this might work out perfectly. Like Donald Trump says if you're going to think you might as well think big. The way I see it you shouldn't be scared of taking opportunities. Calculated risk is the way to success!

N2IT

Powerfool been there......

Wife has been an RN for two years now and has held the benefits, it is great I am free to bill for a lot higher bill rate now and take short contracts that most people don't want. I am coming off a contract that normally bills at 28 or so an hour and is paying 32 an hour, due to the duration in nature. My next one lined up (1 year contract to perm) is over 40 an hour around 43 if my math is correct. A lot of this is because of my wife getting those great benefits as an RN. What's really exciting is her acceptance into the nurse practitioner program at Maryville University. Instead of making 50+ a year with benefits she'll be around 85 - 90 with the benefits, that will give me even more additional flexibility. She has been accepted and already knocked out two of the courses via on line University. (Exciting times)

Xyro

dave330i wrote: »

Got an interesting offer today. I could leave my professional services position which pays me low 6 figures, find my own company, go corp-to-corp with a small company and double my pay (~$2k short, but it's close enough) for about 5 years.

Something disturbs my gut about all of this. Proceed with logic & caution.

YFZblu

Just saw the OP lives in NoVA - I don't think you'll have an issue finding another well-paying gig in that area even if your new pursuit doesn't pan out the way you'd like.

MiikeB

Xyro wrote: »

Something disturbs my gut about all of this. Proceed with logic & caution.

I think he meant "found" his own company or "start his own company", not find.

Xyro

MiikeB wrote: »

I think he meant "found" his own company or "start his own company", not find.

This would make quite a differences, yes; however, I then do not understand where any "offer" lies. I think it's that part that's throwing me off more than anything.

dave330i

Wife did some rough calculations and it seems my gross pay will go up $50k (need to subtract PTO, holiday, benefits, SS tax, etc). It's not bad, but the timing of the offer sucks. I wasn't planning on starting my own S corp or LLC until I become a VCDX. The other VMware SME working with me is most likely leaving soon. If I leave as well, it'll put my boss in a pretty bad spot. He's been a good guy, so I'd hate to do that to him. Lastly, I think the new job is an admin position vs. engineering. Also, the money isn't quite right.

With the certs & clearance I have, another chance to go corp-to-corp will present itself, so I think I'll pass on this one (probably).

Essendon

Can you tell more about this "offer" Dave? Was someone offering you a position in a consulting company or was someone discussing starting a company with you, just curious I guess.

MiikeB

dave330i wrote: »

Wife did some rough calculations and it seems my gross pay will go up $50k (need to subtract PTO, holiday, benefits, SS tax, etc). It's not bad, but the timing of the offer sucks. I wasn't planning on starting my own S corp or LLC until I become a VCDX. The other VMware SME working with me is most likely leaving soon. If I leave as well, it'll put my boss in a pretty bad spot. He's been a good guy, so I'd hate to do that to him. Lastly, I think the new job is an admin position vs. engineering. Also, the money isn't quite right.

With the certs & clearance I have, another chance to go corp-to-corp will present itself, so I think I'll pass on this one (probably).

Your gross pay will go up 50k or your net pay will go up 50k? If your gross pay goes up 50k after then I am not sure it is worth it, if you meant your net pay would increase 50k then it sounds great. Also don't forget you will need liability insurance. Shouldn't cost much in this field though.

Xyro

dave330i wrote: »

...I think I'll pass on this one (probably).

Good news, I didn't have good feelings about this.

dave330i

Essendon wrote: »

Can you tell more about this "offer" Dave? Was someone offering you a position in a consulting company or was someone discussing starting a company with you, just curious I guess.

A co-worker has his own company and he has an opportunity to place a Sr. VMware guy at a well funded gov't agency (potentially a 5 year gig). He's offered me an option to sub-contract to his company.

Wife did more detailed numbers and they're interesting. Estimated net pay increase is ~$30k. A good chunk of change. The really interesting bit is retirement fund. I can max it out at ~$50k which is ~3 time more than what I can contribute now.

Never imagined I would turn down a serious $200k offer. When I got out of college way back when, I was wondering if I'd ever break $100k.

YuckTheFankees

I think you are making a good choice. Always go with your gut. Wish you luck in the future!

dave330i

Got a chance to look at the detailed job description. It looks like they're doing some interesting stuff, but it suffers from the same problem as most job description. They want someone who's an expert in everything for a relatively low pay. They're going to have a hard time filling this position. Told my co-worker to hit me up again in the fall. Timing should be much better then.

Interestingly, got an e-mail from a recruiter today who's interested in doing corp to corp for a different position for similar money. Need to make sure I have my LLC setup sooner than later.

Sounds Good

dave330i wrote: »

A co-worker has his own company and he has an opportunity to place a Sr. VMware guy at a well funded gov't agency (potentially a 5 year gig). He's offered me an option to sub-contract to his company.

Wife did more detailed numbers and they're interesting. Estimated net pay increase is ~$30k. A good chunk of change. The really interesting bit is retirement fund. I can max it out at ~$50k which is ~3 time more than what I can contribute now.

Never imagined I would turn down a serious $200k offer. When I got out of college way back when, I was wondering if I'd ever break $100k.

a tad confused. In the original post, you said you were making low 100k, which I assume to be 100-120k MAX. You say that gross increase is about 50k (30k net). Then you go on to say you're turning down a 200k offer. The numbers are off somewhere here. Not trying to nit-pick, but just trying to get some clarity on this as I assume it would better help us assist you in coming to a sound choice.

MiikeB

Sounds Good wrote: »

a tad confused. In the original post, you said you were making low 100k, which I assume to be 100-120k MAX. You say that gross increase is about 50k (30k net). Then you go on to say you're turning down a 200k offer. The numbers are off somewhere here. Not trying to nit-pick, but just trying to get some clarity on this as I assume it would better help us assist you in coming to a sound choice.

It hardly seems relevant now since he passed it up but I think the progression went like this:

"It's 100/hr, sweet 200k a year"

"O wait I won't be making any money on days I take off or holidays, ok ~$170k"

"Well taxes go up, business costs, insurance, looks like its actually a much smaller increase. Pass"