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Financial Independence Via Self-Employment: How Do We Do It?
Submitted by Charles Hugh-Smith of OfTwoMinds blog,
Financial independence via self-employemnt is still possible, and there are a number of pathways to that goal.
The conventional financial industry touts gaining financial independence by playing Wall Street's game: working a conventional job for decades to accumulate a chunk of money in retirement funds that Wall Street wizards magically squeeze for hefty annual returns in a zero-yield world--in a completely risk-free manner that keeps your nest egg intact, of course.
This annual yield on the large sum squirreled away over the decades then (supposedly) enables a spacious retirement home on the golf course, luxury cruises, etc. (Uh, right. Unless stocks and bonds crater, Wall Street's hedges crumble and the global economy slides into recession--y'know, everything that's happening now.)
(And never mind many households can't possibly save enough to accumulate a big nest egg due to stagnating wages and soaring costs of big-ticket expenses like healthcare and college.)
The other pathway to high-income retirement is to manage your career to earn multiple government pensions: in areas with large Department of Defense (DoD) installations, (military and civilian), this often means 20 years in military or civil-service that comes with a pension and healthcare benefits, followed by a second career in another government agency that secures another pension and maybe Social Security, too: this is the classic Triple-Dipper retirement plan.
A similar pathway is to have two workers in the household each retire with a government pension and Social Security, so the household income includes four secure pensions.
The third avenue to financial independence is not so much about retirement--it's about financial independence during your career/working life as well as retirement. The ideal retirement scenario for the self-employed is simply a reduction in the work you don't much like and a continuation of the work you enjoy until the end of your life.
My credo is: Focus not on retiring comfortably, but on working comfortably.
Self-employment is a core mythology of the American Dream--working for yourself as the ideal form of work. Self-employment's place in the pantheon of American ideals did not prepare me for startling reality that a mere 5% of the workforce (about 7.4 million out of 145 million) earn a middle class living as self-employed (i.e. sole proprietors or partnerships/S-corporations with no employees).
I laid out the statistics in Endangered Species: The Self-Employed Middle Class. According to the source, there are roughly 6 million small businesses with employees. While running a small business with employees is certainly working for yourself, the requirements in terms of management, experience and capital are far more daunting than sole proprietorship, which is why I'm focusing only on the 7.4 million sole proprietors who make $50,000 or more annually.
This picture isn't entirely complete, however; unearned income, for example, from rental properties or family trusts, is not recorded as self-employed income (Schedule C); rental income is reported on Schedule E, and these earnings are not subject to self-employment payroll taxes (15.3%, as the self-employed pay both the employee and the employer portions of the payroll taxes).
So someone who owns rental properties could be financially independent and not be officially considered self-employed, even though they actively manage their properties.
There are a number of other interesting statistics in the IRS spreadsheet Table 1.4, All Returns: Adjusted Gross Income, Exemptions, Deductions, and Tax Items for tax year 2012 that help us understand how the self-employed earn their income.
This data tells us how many people are earning middle-class incomes from rental properties, royalties and earned income.
The IRS reports that 18.7 million taxpayers paid self-employment taxes, and 7.4 million of them earned $50,000 or more annually.
8,214 of these self-employed raked in $10 million or more annually. (I presume this includes athletes, film stars, etc.)
4.8 million people reported positive rental income, of which 2.95 million reported earning $50,000 or more in rental income annually.
1.25 million taxpayers reported earning $50,000 or more in royalties annually. (7,585 reported earning $10 million or more in royalties--subtracting Steven King and a few musicians, who else earns these princely sums? I suspect most are patent royalties.)
As I noted before, only 2.4 million earners deducted healthcare insurance payments. This suggests that many of the self-employed are in households where someone is getting healthcare coverage for the household from their employer. Alternatively, millions of self-employed don't have any healthcare insurance. This seems unlikely.
For this reason, I consider this the most accurate guide to the truly self-employed earning a middle-class income: 2.4 million people out of a work force of 145 million.
So what does all this say about self-employment? I think we can draw a few conclusions:
1. Establishing a profession is one tried-and-true way to be self-employed. Obtaining the diploma and license does not guarantee an income, of course, as competition can be plentiful in certain professions and regions.
2. Owning rental properties is a path to financial independence that works for almost 3 million people/households.
3. Owning the rights to creative content or patents that generate royalties is a ticket to financial independence for 1.25 million people.
4. There are many other sole proprietorships (about 3 million based on the IRS data) that manage to net $50,000 or more annually. Presumably some qualify as Mobile Creatives who cobble together several income streams to generate enough to live independently.
5. Over 10 million people are earning meaningful sums from small (less than $50K/yr) enterprises, rentals and royalties. These don't generate $50,000 a year, but they still make an important contribution to financial independence, income and capital/wealth.
6. Businesses that eventually earn $50,000 or more typically start small, so many of the people currently earning less than $10K/year could over time increase their income or add another modest income stream.
Financial independence via self-employment is still possible, and there are a number of pathways to that goal. The path I consider the most flexible and thus the most attainable by non-professionals is the Mobile Creative idea of generating multiple income streams, preferably from sources that are not all tied to the same industry so that a downturn in one sector won't wipe out the entire household income.
The Mobile Creative credo is simple: trust your network, not the corporation or the state.
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Someone should send this column to the remaining New York Daily News employees. It seems only a matter of time before that paper folds.
--
Amid a growing crisis at the Daily News, CEO William Holiber called about 20 top editors to a secret meeting at India House, the former headquarters of the Cotton Exchange at 1 Hanover St. on Monday night.
The meeting was intended to boost morale and explain the mission going forward — which Holiber insisted will still include seven days of a print edition.
But while Holiber wanted the editors to trust him, he did not seem to have much trust in the editors, sources told Page Six’s Emily Smith.
Holiber asked for everyone’s cell phone at the start of the secret meeting, and each was put in an envelope with the employee’s name on it and returned at the end of the 90-minute session, sources said.
Holiber, one source said, feared that some of the 20 or so top brass might be tempted to secretly record the session and leak it to the press [read The Post].
A Daily News spokeswoman confirmed that there was a meeting but declined to disclose details.
http://nypost.com/2015/09/22/top-daily-news-editors-huddle-in-secret-to-...
The problem for 'news', be it papers or online, is they have no audience. Literally!
Half of all people want to be told WHAT THEY WANT TO HEAR, so the truth is out of the question, and unlikely to be considered plausible by these people in the first place.
The other 50% (or lets be honest, 15%) want to hear the truth, but know that they aren't going to get it from any newspaper or web site! You would think there would be a 'market' for the truth, but there isn't. Who would advertise in such a
The propaganda campaign has been wildly successful. "We'll know our Disinformation Campaign is complete when everything the American public believes, is false" William Colby
Including, but not limited to, that famous propaganda campaign, know to history as "The Apollo Moon landing". Sorry, folks, the 'Golden Age' was a gigantic, and fantastically well-done lie. (the rockets went up alright, but they did not land men on the Moon)
Even today, 2015, we are more than 8 years from landing a man on the Moon 'again'.
"Kubrick and... The Moon Landing"
http://www.reactorbreach.com/showthread.php?tid=4891
In the words of 17th century heretic, Giordano Bruno, "If it is not true, it is a good story." And that goes for both the official story, and the 'hoax theory'!
The trick is to own rental properties in other countries. 0.0 in tax.
Then here in the USSA. "Oh my knee hurts, I need disability".
Thats what to joos do. If it's good for them....
There is no money in the truth, thusthence, no market.
you are out of date....the rentiers are already all over this .... for example, Congress passed new laws quite a long time ago which will capture up to 90% of a double-dipper/s social security check ... the local govenrments are moving more slowly against property manager/owners, but they are inventing an amazing plethora of new license requirements, building requirements, list registrations such as lead paint registries, and other non-tax taxes ...
Financial independence via self-employment is still possible, and there are a number of pathways to that goal.
Based on a sample of one ... my personal experience ... self employment is very difficult to survive in a society that is driven by collectives. Everything that benefits the collective inhibits the independent.
Crucial to self-employment is protection of your wealth. That means risking it at every step because otherwise it will be stolen from you by taxation and inflation.
On average I'm sure it's easy to illustrate that just plopping down on some collective's feather bed and staying there without making waves will bring you a better outcome ... the survival of the collective itself being your only real risk.
My experience is different. I went independent (scientific consulting & instrument design) nearly 10 years ago...took a lot of guts to quit my job, but results were more lucrative, more enjoyable, and I wish I had done it 10 years earlier. My observations:
- you have to be really good at what you do, if you can't rely on repeat business from a small number of customers, you will spend much more overhead time trying to round up new ones.
- you have to be willing to do all the dirty work. if you farm out your accounting, inventory, taxes, payroll, assembly, floor-sweeping to others, your margin whittles away to zero.
- you have to be comfortable with fluctuations in business.
On the fluctuations, you will see busy times and sparse times. Vacation during the latter, and for the busy times, spread the work out. I don't like to raise rates to discourage pile-up, since then you have customers priced to the point of annoyance. Better to quote a good rate and tell them that you can't get to it for XX calendar time. This makes them really consider their own (usually bogus) deadlines and if they bite, then you have cushion.
My experience is different.
Doesn't look different to me. Wait until you get to the end where the collective pensions kick in but you have your self accumulated retirement provisions. Those provisions are very difficult to protect. Further, the collectives (e.g. governments and banks) don't treat independents nearly as well as they do collective annuitants. You find qualifying for the conventional is vastly different.
ok, but the risk of confiscation/taxation of accumulated wealth is independent of whether that wealth was accumulated as a worker or as an independent, right? agreed that retirement wealth is difficult to protect, but that is a universal problem (unless you don't have any). And as far as gov'ts and banks treating independents....who cares? My business doesn't ask the bank for loans, so I don't care what they think of my business....as long as I can keep a checking account. Gov't doesn't care as long as tax forms are filed, and as S-corp, it is all pass-thru anyhow.
Terrific comments guys, very closely mirrors my experience with business and working for myself. The longer I did it the worse I got treated by government. Bureaucracies seem to resent small business people going on their own way and doing it themselves, and banks just want to turn you into a donkey for their cart.
The days of the cheque account are almost over here, all digital banking these days. Not so bad, just harder to track ins and outs, and bills and profits with the automated payment transfers.
ok, but the risk of confiscation/taxation of accumulated wealth is independent of whether that wealth was accumulated as a worker or as an independent, right?
Not in my experience. In my career, "vesting" with my first employer's stock and annuity plan was 10 years. I consciously left in 9yrs 8mos because I saw people once vested could no longer afford to leave. They hated their work but the alternative was worse. The employer matched stock purchases. The employer promised to fund retirement. The employer paid medical benefits. I would have had 5 weeks paid time off annually. Of course I didn't keep 90+ % of my annuity. I received no annuity. 401Ks and IRAs didn't exist then. I made it through my entire career devoting my energies to Fortune 50 companies and obtained zero pension from them. The system rewarded the collectives far better than the independents ... unless you count liking your work as a reward.
wealth is difficult to protect, but that is a universal problem (unless you don't have any).
Too big to fail doesn't apply to independents. Work stoppages don't work for independents. There is no unemployment benefit to independents.
My business doesn't ask the bank for loans, so I don't care what they think of my business....as long as I can keep a checking account.
It's not your business that's affected. Buying a house or a car takes more money down and is harder to qualify for. Medical insurance must be purchased ... and rates aren't good. Keeping a checking account is irrelevant.
Gov't doesn't care as long as tax forms are filed, and as S-corp, it is all pass-thru anyhow.
Pay 33% more on SS. Pay unemployment insurance for your help. Fill out endless forms. Do almost everything yourself (e.g. promotion, contract negotiation, transportation, bonds, insurance, maintenance, etc. etc. etc.). You don't do all that if you just rest on the feather bed of the collective.
When it really got bad is when some independent contractor sued one of these Fortune 50 companies for severance after a 10 year stint and won. That brought in the "contracting companies". They did nothing but protect the companies and took 1/2 the pay. You could no longer independently contract directly to these companies. You had to sign on with a contracting company. I kind of lost enthusiasm at that point.
"pay 33% more on SS"
yes and no. I (corp) pay myself (person) on W-2, not as self-employed, so no self-employment tax. Still need to cover the employer's share of SS, but that is why corps charge a higher rate than an employee.
"too big to fail doesn't apply..."
you have to be awfully big for this....prior to going independent, I worked for universities and corps with <500 people. no difference here.
"med insurance"
gotta admit, i have an out here...wife is employed as univ professor, so i'm on her family benefits.
The other benefit I forgot to mention is that in these lean times, my customers are cutting fixed costs. I've seen several rounds of layoffs where my equiv colleagues who are employees get cut, and then my workload as a consultant doubles. Not necessarily fair, but that is the business cycle. Also, with several customers, I average out their ups and downs, and tend to have more stable business stream than any one of them.
"Based on a sample of one ... my personal experience ... self employment is very difficult to survive in a society that is driven by collectives. Everything that benefits the collective inhibits the independent."
From my experience, Just the opposite. I've Been Self-employeed since 1999, and I doubled my income within the first two years. The risks of working for a employeer is that your skill set can stagnate as Employers usually do not provide the means to expand your skill sets. Rarely do worker employees have an influence in the business, You are at the mercy of the Boss to make the right long term decisions. Boss almost always look out for whats best for them, not their employees. Most will screw you over, if they are in a bind. As a self-employeed business you have more control over your own career development and skill sets. This allows you to adopt to ever fast evolving economy and switch directions as the economy changes.
FWIW: I see employers are beginning to switch how they address labor needs. Instead of hiring employees that are looking to contract their labor needs. For instance as companies implement new projects the are looking to hire contract workers to perform the project implemetion. When the project is completed the no longer need to retain the contractors. More and more business will be switching to automation systems, which means thet will hire contractors to implement the new system, and perhaps retain one or two people to manage/operating the new system (replacing 20 to 100 workers using a new automated system). Then when then need upgrades, they hire contractors to do the upgrade (and probably lay off the workers operating the old system). Other office jobs are also likely to be outsourced overseas to escape regulations, and rising labor costs (mostly attributed to increased gov't regulation). There is zero job security working as an employee.
"On average I'm sure it's easy to illustrate that just plopping down on some collective's feather bed and staying there without making waves "
That's a good way to get yourself in long term, permanent unemployment. If you stagnate, you end up getting replaced. This is why there are a lot of people that can't find jobs. They let thier skill sets stagnate and no companies want to hire them. Once you been out of the workforce for a year or more you become blackballed. Of course when Gov't wealth fare assistance comes close to matching a full time job, then its probably better to just quit and collect the gov't check, and wait for the system to collapse. However, you better be self-reliant and away from any big population regions unless you want to end up in a living hell.
"Crucial to self-employment is protection of your wealth. That means risking it at every step because otherwise it will be stolen from you by taxation and inflation."
Same is true if your an employee. As an employee your subject to taxation too. However as a self-employee, you have more ways to save on taxes, since you can write off your expenses: commuting costs, lunch, phone, internet, home-office rent, utilities, etc. As an employee you can't write any of that off, thus your tax liability is higher as a non self-employeed worker.
The biggest hurdle to becoming self-employeed is finding customers. On top of providing goods or services, you must also be the sales men. A lot of people struggle to do both. Either they are great at services or production, but lousy at sales/product promotion or they are great salesman, but have trouble delivering. You also need find a service or product that is in demand and has offers a good margin. A lot of people try resturants, which is probably the most difficult, since it requires a lot of work and has low margins. You also need to keep an eye on changes, for instance, Video stores have largely disappeared, having been replaced by tech. On last recommendation is to avoid retail, since consumers are difficult and there is excessive competition. In my opinion, Business to business is the best way to go. Selling services or goods to business, is far easier and less aggravating then dealing with whiny retail consumers.
The biggest hurdle to becoming self-employed is finding customers.
Many people who are self employed have been early retired or RIFed by their companies. Their companies then hire them back as consultants at often twice what they were paying them as employees. But usually they are just training their cheaper replacement. Kind of like digging their own grave while still employed.
If de Rothschild Bank would hurry up and fork over my $30 Trillion in physical gold bullion I could get back to work being self-employed.
Pay up, m o t h e r f u c k e r s .
Looking closely at developments in New York and DC these last few years it appears stealing is a growth industry. So what I'm saying to the young is 'keep the faith,' there's opportunities for those with courage, imagination, spunk and initiative -- don't be afraid to love yourself.
"Crime doesn't pay"
"If you can't beat 'em, join 'em"
Slightly conflicting messages there, wouldn't you say? We were all raised (by TV, Bugs Bunny specifically) as defeatists.
Hey, I catch villains all the time.
People working until they die is the new expectation.
The rest of what CHS offers here sounds silly. No way TPTB will allow it. Though that being said everyone being self-employed will be the norm once we've returned to a sustainable economic system based on daily solar inputs. Of course we'll be hungry a lot of the time, but it least our former bosses will be working the fields too. If that's any comfort.
Alternatively, millions of self-employed don't have any healthcare insurance. This seems unlikely.
I don't have or want health insurance. Maybe more likely than he thinks.
Ah, and this explains the ACA, doesn't it?
That has been the trend...more people deciding they cannot afford to buy health insurance at the same time employers are cutting back on offering it. Leading to...a growing group choosing to 'wing it', and pay cash if needed for this and that...
If THAT trend continued, then market forces would drive prices DOWN to what a cash-payer could afford. Oh, the weeping and gnashing of teeth would be deafening! "What do you mean, you can't afford 20,000 for an MRI? Your insurance company always paid us that...It's not FAIR! Whaaaaaaaaa!"
So they HAD to find a new way to artificially prop those prices up...Health insurance for ALL! Not health CARE, mind you...health care INSURANCE.
ACA was NOT to provide citizens with health care. It was designed to preserve the pricing models of the current system, in defiance of market forces that were driving it down.
Butt the human beans who BELIEVED the rhetoric and the mnemonic "ACA" (that "C" is the achilles heal, and the fraud in the nomenclature) bought it that they were getting free health CARE.
In the mindless minds of the great unwashed, "Care" is synonomous with "Insurance".
Good catch but those republicans and democrats who passed this thing knew that. As did the vast majority of ZHers and other thinkers. The 'feelers' are now caught with an albatross around their necks.
Unemployed and homeless is the only sane approach to being an American citizen. That trend is growing in popularity but stay the fuck out of my doghouse. OK?
+1 If you like Scooby's comments. The green arrow.
"Good catch but those republicans and democrats who passed this thing knew that."
Pont of order: Precisely zero Republicans passed this thing. (One of the few smart plays that party has ever made.)
"If THAT trend continued, then market forces would drive prices DOWN to what a cash-payer could afford. Oh, the weeping and gnashing of teeth would be deafening! "What do you mean, you can't afford 20,000 for an MRI? Your insurance company always paid us that...It's not FAIR! Whaaaaaaaaa!""
The Hospital probably has loans on that MRI equipment as well as large operating costs.Its likely if they can't get sufficient income from it, they will simply discontinue MRI service.
The issue is that without health insurance, you may get turned away from getting help, unless you walk in with a stash of cash. Patients without insurance is a liablity, and since they are getting sweeze from falling Medicare payments and manage care re-imbursments, they probably won't take the risk that you beable to pay, unless you pay up front.
"It was designed to preserve the pricing models of the current system, in defiance of market forces that were driving it down."
Not really, Prices doctors and hospitals recieve for services has declined. The increase health-insurance cost are going to gov't cronies. The ACA was about getting voters, and that's about it. They lied to get votes. and they are about to repeat it again with the DNC proposes for Single payer system. They blame the healthcare industry for their lies and continue to do it untill thier is no more healthcare in America. Its like when Hilter invaded Poland. Blaming Poland for causing an anti-Nazi radio station from getting blown up.
There are two major reasons why healthcare had become expensive. Lots of obese people and other people living unhealthy lifestyles, and increased gov't regulation. Gov't creates more regulation, which cause higher employment more expensive goods/services. Then blames companies for higher employement higher living costs. So the gov't implements even more regulation to make the problems even worse!
They do sell airline tickets to places where prices are affordable. Despite the rhetoric 'merica is not healthcare nirvana.
And the growing trend of people being smart and taking advantage of this reality is one of the best examples out there that the days of the "myth of the U.S." are very near their end. The United States image is going from 'hyperpower' to 'just a particularly large collectivist shithole' faster than I have ever seen any society do this. We're number 1!
I'll take situational awareness over "education" any day. Who writes the textbooks anyway?
Scooby - Speaking of overseas for medical procedures, I should have for my colonoscopy. It woud have been $2,600 for flight and five day all inclusive hotel in Cancun plus the colonoscopy.
So here in Ft. Myers it was $2,100. So after signing a proposal for $2100 and guaranteed no extra costs a couple months later get a bill from a lab for $1,500. The gastro docs office admitted to get labs done on polops would require a release form which they didnt have from me. Called my attorney and she said just dont pay it. But that of course nicks my credit which they cant get sued for.
$2100? Did you have Obama care or what?
So wait a minute. The total cost was $3600 out of pocket? That was your co-pay?
Ft. Myers is the 15th most dangerous small city in America. Looks like your doctor is in on the action.
I just re-read your comment. You use credit bro? And you admit it here on http://www.zerohedge.com?
.
I wouldn't include rental or patent income as self-employment. Or employment at all. You are just living off a revenue-stream generated by others, which is the problem with our economy...too many are living off of others! You are still at the mercy of forces outside your control, and still part of the problem of entitlement. What happens to your "income" when rules and laws change? Patents aren't granted by God...they are subject to the whims of people, and depend on enforcement. What if they stop enforcing them, or are too busy with 'other things' to put much effort into it? Or if your patents were drastically cut back to a few years at most? What if your rental properties become subject to rent-controls?
Better to develop a skill, or skills, that people around you need. Plumbing, electric, small appliance repair...anything that YOU yourself can do for someone else for a consideration that doesn't depend on things beyond your control.
It's only self-employment if YOU control it.
We all should strive to become rentiers because production is hard work.
Did you know if you register a large dump truck at the DMV you must also file an IRS notification.
+1 If you like Scooby's comments. The green arrow.
Rental income can be a lot of work. If you are a landlord who gives a shit, you're always fixing things.
Residential rentals can be an absolute nightmare in more ways than most can imagine.
I learned that Commercial is the way to go. No problem tenents with an at will agreement. Small businesses are usually very diligent at meeting their obligations to your property if you meet yours to your tenant.
Everyone wins with a good arrangement.
The returns are small based on total investment. You have to be a debt slave if you want quality location and then you risk getting jammed up by the joo.
+1 If you like Scooby's comments. The green arrow.
What if you appliance repair shop gets confiscated by tranny midgets? God damn son!!
Not that rents maintain my business but buying an asset, buying a shit box, repairing all the neglect and damage from leech fucks and renting it to stable individuals is not living off the backs of others no more than taking money to fix some whores electric dildo. I'm sure as a renter you "feel" that way.
Plowing you time money and talent into something you are good at is pretty rewarding in spite of .gov and I will bet money that self employment will outlast the current government no matter what they do.
Yeah,
No licensing or permiting problems subject to whim there...
The issue with operating rental properites is property taxes and gov't regulation. It can be a PITA to evict a deadbeat renter. Renters can also trash the property. Also most property is grossly over valued. I think a lot of landlords will loose their shirts in the long term.
We portly gents prefer loose shirts.
Preferably covered with loud colored Hawaiian flowers on them.
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Hey CHS, there are also a million or six people who are effectively "self-employed" but are paid and report and pay taxes as W-2 employees, via contracts with the parasite "recruiters" and "employment agencies", especially in IT and high tech. It's a great way to get the worst of both worlds, but it's a big and important chunk of the economy these days.
I've been mostly doing that the last few years, and can't deduct health care from it, bastids.
Self employment is grand. Except for the fact that my state has a fucking self employment tax.
Fucking cocksuckers.
I am self-employed. To make it work in this economy be prepared to learn new skills. For my publishing business had to learn PHP and SQL which saves about $60k a year. Next month learning CSS/HTML for better branding and marketing.
Side note but important: As we enter the second crash phse of the long depession that started in 2008, you must watch out for smaller rampant fraud from all vendors.
Had a hotel for a conference attempt to process payment now at full rate vs. the conference rate. The difference was $60.
Had former subcontractor ship me a server from Missouri to office. UPS delivered it to UPS store instead costing me an hour to find out where it went and the time to pick it up plus $5 pick up fee.
Comcast added a business line I cancelled four months ago on the bill. My motherin law that owns an interior design service had the same exact problem.
Things are bad when one of my credit cards calls me ten days ago on a $16 bill not due until October 6th. There was an $11 'convenience fee' to pay them over the phone that was there scam.
All these things take many hours to sort out which detracts from revenue generation.
That's what happens in a growth based economy when the only route to growth is fraud and you let bureaucrats run EVERYTHING. You want accountability? If you're a bureaucrat, that means making sure that all of the paperwork that you're never going to review is in order.
That's the truth too. I am planning on taking Vivint to small claims court soon and I am hoping to be able to use recorded phone calls as evidence of their lying and theivery. I have been screwed over so many times now that any time I am entering a contract with a company I record the conversation. I have also caught both of my banks and my utility company screwing me over and this is just in the last year. You have to go over everything with a fine toothed comb and it is bullshit.
I also love the new corporate ploy of making a person go through complicated and misleading web pages to cancel a service after contract expiration that they will never notify you of. It's all predatory and most likely the elderly are getting screwed most of all.
Underground economy, getting bigger every minute, not even mentioned here. Likely 1/3 of these numbers.
+1. And another reason the suvelliance net is being thrown over the country so quickly.
And there is the mainstream rise in popularity of libertarian ideals.
Financial independence for the average person is being wiped out. And most small businesses can't weather storms very well unless they have adequate cash reserves or credit.
Nice thought CHS - but it gets harder every day to make it happen. The odds are stacked against the very thing the politicians tout as critical... small business. The regulations and reporting requirements alone are punative.
Centerline - Yes, you need cash for large, internittant storms. I have made out OK because I hedged and learned new skills.
I have to say no to some deals. Big corporations want continued champaign services but now offering beer budget. If you have no cash you get desperate and take these and they eat up a lot of time just to pay the bills.
That was one of the reasons why you were supposed to hedge. I am meeting investors and bootstrapping. They seem surprised I can do this. I dont tell them it took me a decade of eating nails to make it look like I got it all under control and am a superstar. It hasnt been easy but it can be done but if you have no cash to.operate for a least 4-6 months forget it.
Yeah, I have seen it happen. Cash flow is a bitch. Especially when people are using credit from a position of negative equity just to keep things rolling. Projects don't have to even lock up. They just have to fall short. The sudden stop is pretty amazing. I have seen family and friends faceplant like this. I even got burned once to the tune $10K trying to help out right into the jaws of 2008.
Most people just don't have the financial savvy and even more... the resolve, to save $ for a rainy day. Instead, they live feast to famine. Paycheck to paycheck.
Oh yeah watch out small business guys for a new phone phishing scam. This group in Washington claims to be the IRS and say there.is fraudulent activity on your tax return. Then asks for your social security number to pull up the account. When I asked them why they didnt notify me in writing the guy said it would be a police investigation. He was a chink.
They are piggybacking off of a legitimate IRS fraud problem that is going around. The IRS always notifies in writing. They dont call.
But, you know what is fucked up? When you get the IRS letter the phone number they give you to call is not listed on the IRS website so as for someone like me to verify who the hell I am calling. When I did call, it sounded like the IRS (it is actually... but how the fuck do I know for sure... right?) and they asked right out of the chutes for SS# and other stuff. I asked for them to prove they were the IRS somehow and the guy on the phone got all pissy. I told him his attitude sucks and I need to know how to verify he is legit as much as he has the right to do the same with me. Regular mexican standoff. I wound up telling him to piss off and hung up. I then called the IRS main number and it took me over 2 hours to find one jackass who could just tell me that the number in fact does come from a bonified unit of the IRS. Typical government bullshit and hours of my life wasted just trying to do the right thing (not get jacked for fraud which is what they wanted me to call in about in the first damn place - how ironic). In my case, somebody somewhere else tried to file a fraudulent claim for a refund under my name. IRS is so stupid apparently that they offer refunds in the form of debit cards that get mailed wherever is indicated on a return. WTF? Really?
Hmmm that is interesting Centerline. As for me I never get a return I always owe. I wont waste hours trying to sort this out. They can send an agent over if it is legit they are trying to stop a scam. My fear of the IRS ended years ago.
"Financial independence via self-employemnt is still possible..."
Nonsense, not as long as there is a slave tax.
I still don't understand why so many people are blaming high rent on people who own rentals. The artificially high rents are a result of monetary policy and bubbling. Nobody can afford the housing market right now so everyone is getting pushed into rentals which is inflating those prices as well.
Saving money to buy an extra home down the line (preferably after the market collapses and housing is dirt cheap) so that you can supplement your income is not an evil endeavor. Not everybody is a slum lord, you yourself can be a fair landlord if you choose to be and can afford it. The way I see it the more assets that end up in the hands of good people the better. If people want to be angry at someone be pissed at the bastards that charge you interest on your currency and tax your wages and income into insignificance.
The crybabies are the ones that won't save now to earn later.
They never learned that being poor is not based on what you make but what you spend. They put in their 40, spend it all and then complain how someone else is a rentier if they work 60 hours and save the difference to invest for a later return.
Screw em.
employee = tax slave
Sorry - I owned a few businesses, it was nothing but 60+ hours a week, including weekends, late nights and early mornings with very little time left over for a social life whatsoever - for someone who has a family, forget it. I eaked out a menial life while being self employed, first rule of owning a business, the owner gets paid last. I doubt I ever made more than 50k a year being self employed, oh sure I was the boss and I got to make all the decisions, but you also find out that you are the one carrying all the responsibility and liability for the same amount of money you could make standing at the front door of Wallmart welcoming guests (with ZERO responsibility and absolutely ZERO liability)
Don't believe for one second that owning a business or being self employed is a great thing - it could be a good thing after putting in 10+ years of blood sweat and tears, banging your head against the same wall while living in poverty, or 15 or 20 or....
Today I am a happy employee at a defense contractor making 6 figures, 8 hours a day, no overtime, no weekends, paid medical, dental, vision (for my family also) - no liability, no responsibility and very little stress worrying about trying to sell that next order just to keep the lights on at the shop.
Anyone who tells you otherwise is damn liar.
You scored a bulls-eye with your post - 100% accurate.
The only qualification I would offer is that being an entrepreneur is worth the nearly infinite sacrifice and struggle ONLY if you can earn far more money far more quickly than you could as an employee, eg make a very high profit product or service, OR sell your business for a big cash out.
If you can accomplish this, the you can achieve financial security and even retire before you die of old age.
Righto. If you have the opportunity to work in the Military-Industrial Complex, there is very little in the work world to compare with the compensation or conditions. And government work in general is FAR superior to what you're likely to make on your own unless you invent the Next Big Thing in software. And manage not to have it stolen by your roomate, who's a better "networker".
This article should have been written 20 years ago. Because it certainly does not apply to the present. This OP is as clueless as most recruiters are today about the real job scene. The problem is globally systemic and there must be RESET! No other ways about it. 20 years ago, one could do well as an independent contractor on a 1099 [I'm against W2 withholding) [1]. Not so today. In the last 20 years (minimum) the middle class has been progressively and systematically -- destroyed ..
https://app.box.com/s/hfgvcqg7gqh7i27at6sv53ywu87lwarp
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[1] I'm against the PR (Puerto Rico) private corporation aka the IRS. Bring on the flat tax, or at the very least Friedman's NIT ('62). The NIT would have saved me from foreclosure and repossessions. NIRP is just plain stupid. The NIT is quite brilliant. Not perfect. Nothing is.
Online SAT tutoring is my gig - across the street or across the globe. It's a lot of work, 7 days a week but I absolutely love it so it's not really WORK-WORK and the commute is about 10 sec. and I don't have to put up with megalomaniacal bosses...AMEN! SAT prep is a ten billion dollar a year industry...
Interesting. When I was in school formal "prep" was well-known to be a scam, and it's been fairly well demonstrated in studies that it adds little more than a few points to overall scores.
Of course, I scored 1550 without any prep at all, back in the days when you took the test with pencil and paper. I'm sure the "tricks" have changed since 1976!
I make $7,000 a week working at home, part time.
Wait a minute - no I don't.
tell that to the IRS. they be lookin for ya ass-backward neoslaves.
\$ gatca#
in the future the status of "employee" will be recognized as the euphemism for unknowing tax slave.
I feel a movement commin...
ahhhh ....... it was just a little gasssss=======@
@ ...... damn who died!
old #7 will clean it up
Networking your way to success is all well and good for social butterflies, but it decidedly does NOT work for those of us who are shy, silent, and solitary. Especially if we happen to have scruples, as 90% of self-employment is self-advertising, much of which depends on earnestly convincing people you barely know that it is good for them to spend their hard-earned money hiring YOU to do things for them that they could do themselves if they had half a brain or the patience of a bored kitten.
Unless, of course, you pay for the "education" (i.e., Official Government Stamp Of Approval) to practice a government-regulated profession, where it is mostly illegal for anyone to compete with you who hasn't paid the same dues, fees, and tuition (graft and bribes). Which requires either capital (Mommy & Daddy with Money) or loans. And we all know what is happening with student loans these days.
No, starting a business for the non-wealthy consists mostly of two possibilities: contracting & yard work (females need not apply) and home daycare (you'll be lucky if you stay in business for a decade before you take your eye off of a child for more than three minutes and Child Protective Services shuts you down). And the only way to make a profit is to either cheat your customers or cheat on your taxes.
Business is no place for people with scruples. Since you have to compete with pondscum, you can either BE pondscum and rise to the top, or sink gracefully to the bottom under the weight of your antiquated moral sense.
i would never be an "employee"
pew-eeehhh! ....
I contract.
Got off the Wall Street wheel in 2010, started a biz, then another in 2013, and a third this year. All 3 contributing meaningfully to household income, and early indications suggest the businesses have multi-generation potential. I have not yet hit the home run, but I grind, and I grind, and I grind. I'm sure not the brightest out there, but I can outlast, outwill, and outside-the-box overcome a lot of business hurdles. I focus on businesses where I can bend the cost curve down on a product or service while upgrading the quality. There's an immigrant mindset (not today's 'gimmiedat free shit' mindset) that I've tried to channel. Work hard all day long, watch how every nickel gets spent, know my clients and their changing needs, relentlessly improve my products, and fix problems from a customer-centric viewpoint. I'm living deliberately and willfully, doing what I choose to do every minute of every day. Sure, .gov is a hindrance, but remember, they ultimately need most of us to succeed, since that means more tax dollars for their agenda. So dont hesitate to tip the Devil as you proceed relentlessly toward your goals. If there is one human-behavior-describing superlative I could use to distill the essence of start-up success, it would be 'relentless'.
http://dupress.com/articles/on-demand-workforce-human-capital-trends-2015/
Workforce on demand Are you ready?Deloitte University Press (sic) says maybe 1/3 of the US economy is already on-demand workers. Peons, in other words.