Originally Posted by
lielec11
TL;DR - Have boring day job in engineering that doesn't require much effort. Have great paying side business I'd like to run full time. Concerned about not having a steady pay check and health insurance. How do you recommend I approach my day job about working part-time, from home, or on contract basis so I can focus on my own company while keeping insurance and bi-weekly pay check.
it's really hard to ride two horses at once. when they take divergent
paths, and they will, the results are not very graceful.
well, you sound in a better position to do this than almost anyone i can
remember who has posted this question here in the last few years.
a couple of guides i use.....
what's your customers payment history? half of mine are compliant at 30
days net, the rest send a check when i call them at 35 days, to ask if i'm
in a payment queue..... 
once in a while, i get someone i have to repeatedly call to get paid. they
go on COD the next time they call, if they call again.
you'll learn an awful lot about human nature the first two years full time.
as with any education, there is a tuition fee. 
a good rule of thumb is this.... is your largest customer more than 15%
of your net taxable income? if yes, you need more customers. if no, you
still need more customers. they come and go. you always need more
customers. some turn out to be less than wonderful, and you'll need to trim.
how much is your monthly nut to live? you should have six months of that
amount unencumbered, accessible, as a prudent reserve. most of us don't,
but it's where you should be aiming. six months living expenses, in a crisis,
can be stretched a ways beyond six months.
as for health care, guess what? a lot of people are kinda wondering about
that lately. it's a crapshoot, and where you live makes enough of a difference
that specific advice from elsewhere doesn't help much. your spouse if she
loses her health care can do cobra for 18 months. that'll give you time to
work something out. expensive, but doable.
the only thing really preventing you from doing this is the fear. there are ways
of walking thru that. send a PM if you wish suggestions on that. most of what
i've used to overcome fear is a pencil and paper, and a simple strategy.
as for quarterlies.... guess what... they suck. if you are on a cash instead of accrual
basis, your accounts receivable don't matter till the check clears. if the check clears,
and you don't have enough money to pay the tax on the money, you have other
problems.
i run my numbers each weekend, building a spreadsheet a week per line. headings are:
gross revenue, total deductibles, net taxable, net taxable after 25% sep ira, amount to
go into sep ira, total fed and state taxes paid in quarterlies, income that week, billing generated
that week, accounts receivable. i used to also list debts, but i review, and pay in full every
credit account at number crunch time weekly, so debt free other than mortgage.
15~20 minutes on a saturday afternoon, and the spouse and i are ready to look at where we
stand. doing it weekly means there are no panics. panics can occur at periods where quarterlies
come due.
the worst one is april 15, if you screwed up the previous year, and didn't withhold enough.
i didn't put enough aside in quarterlies, and had to come up with previous years shortfall,
and the 04~15 quarterly. and the underpayment penalties, all at once.. i'd had a really
good year, and SWAG'd the quarterlies. intuitive bookkeeping sometimes doesn't turn out well.
we run the numbers weekly now. reduces the fear factor. we looked last night, and our federal
impounds are 34% of our net taxable. state is proportionate.
something to consider doing, this year especially, is to file IMMEDIATELY after the first of the year.
even if you don't have the necessary form from employers, customers, and institutions to submit.
submit anyway. show a return due. APPLY THAT RETURN TO THE FOLLOWING YEARS TAXES.
my hunch is, with the equifax data breach, there are going to be a truck ton of returns filed the
first week in january. fake ones, claiming a return. then, when you file your return, you find out
a check has already been disbursed.
if you file on Jan. 01 or 02, electronically, nobody can ping your tax impounds. then, you can file
an AMENDED return on april 15, and settle up your account properly.
if you are reading this, there is an 80% chance enough information of yours disappeared in the
equifax data breach for anyone to file your return ahead of you.
something to consider.
~New signature under construction.~
~~~~Please excuse the mess.~~~~
. It is sad to say but I can use about 30-40% of my talent/effort and still put together jobs that get permitted and can be built to code. At the same time it's allowed me to use some of that extra time to help my side business clients when possible during the day.
) my business is not and will not be in direct competition with theirs. First of all, they bid on 300+ unit apartment buildings worth tens of millions of dollars, I work on projects with maybe 6 units. Their clients are big architectural firms and they provide all MEP services (I only provide electrical). My primary business is short circuit studies, and also small electrical design for a MEP company in another state. There is absolutely zero overlap.
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