Author Topic: Long Commutes of a professional  (Read 6314 times)

CPA CB

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Long Commutes of a professional
« on: June 11, 2014, 07:43:16 AM »
Hello all

I'm a CPA working outside of a major US city in the suburbs. The issue is - keep working in the "big city" for someone else, or start my own firm down the street in Mustachian style.

My current salary is $80k - I have 5 years of accounting experience all told.

Commute time is 3 hours per day - 30 minutes via bike (6 miles) and 2.5 hours riding public transit (costing approximately $350 per month).

The type of work I do is not available in smaller towns, so practice area would need to switch more towards personal/small business tax and away from corporate finance.

What do you think?


MDM

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Re: Long Commutes of a professional
« Reply #1 on: June 11, 2014, 09:36:17 AM »
How much are you likely to make on your own, and how do you know that?

Ottawa

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Re: Long Commutes of a professional
« Reply #2 on: June 11, 2014, 09:43:29 AM »
Hello all

I'm a CPA working outside of a major US city in the suburbs. The issue is - keep working in the "big city" for someone else, or start my own firm down the street in Mustachian style.

My current salary is $80k - I have 5 years of accounting experience all told.

Commute time is 3 hours per day - 30 minutes via bike (6 miles) and 2.5 hours riding public transit (costing approximately $350 per month).

The type of work I do is not available in smaller towns, so practice area would need to switch more towards personal/small business tax and away from corporate finance.

What do you think?

Ouch.  That commute has got to be deleted from your life.  It is costing you a lot more than $350 per month.  It is costing you 2.5 hours in billable hours.  At 2,000 work hours per year on 80K salary..that is $40 per hour ($100 per day lost or $2,000 per month).  Now you are at $2,350 per month lost because of commuting...or over $28,000 per year!!

So, two choices to delete this commute.
1) as you say - work near your house.
2) move into small place near current work.

eyePod

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Re: Long Commutes of a professional
« Reply #3 on: June 11, 2014, 09:47:22 AM »
As someone who is *only* having to commute for an hour and 20 minutes for the upcoming month (long story), I would do anything possible to get out of the situation. About 3 hours of my life every day are ruined. I get up earlier, get home later, and get less done since I have to drive. At least your train commute is usable time, but I've saved an extra 15 minutes of commute time each way at a previous job and my whole outlook on life got better. That extra 15, even if in the office, is still better than driving.

Cpa Cat

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Re: Long Commutes of a professional
« Reply #4 on: June 11, 2014, 09:54:17 AM »
How comfortable are you with personal and small business tax? It's an obvious winner for self-employment, but be careful of going it alone with no one to review your returns if you don't have the experience.

The other option, of course, with 5 years in public accounting experience (maybe I'm assuming here - are you already private?) , is to jump ship to industry. You could shop around for CFO positions and hopefully find something closer to home.

Trirod

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Re: Long Commutes of a professional
« Reply #5 on: June 11, 2014, 10:01:11 AM »
Rather that leaving to hang up your own shingle and try to make a go of it in an area of accounting you are not all that familiar in (based on your comments in your original post), why not move to a smaller firm first as an employee and (a) learn about tax and accounting for small businesses and (b) see if you actually like working in that area.

Not saying you couldn't make a go of it on your own right now, but some really relevant experience would certainly help.

ivyhedge

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Re: Long Commutes of a professional
« Reply #6 on: June 11, 2014, 10:35:36 AM »
Wife is a CPA in the Big Four. I'm in finance.


Another vote for moving closer. With many folks we know moving out of town, we paid more for our location, but now walk/bike to work in less than 30mins/17mins daily. And since we're in town, we have access to metros, RelayRides, Uber, regional rail, buses, etc if the need to commute by other means arises.


Not always easy: understood. But it was a difficult move for us, too: paid off tremendously!

CPA CB

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Re: Long Commutes of a professional
« Reply #7 on: June 11, 2014, 12:24:41 PM »
The move closer - although a great suggestion, just doesn't fit where we are. As nice as the city can be - we're both more comfortable outside of town with family.

I'm pretty familiar with the change in business - worked in Big 4 previously and have filed corporate and personal returns for people. The biggest change wouldn't be so much the practice area as much as it would be in the business model and lifestyle.

I like the self employment idea as the flexibility lends well to itself - but it certainly would be a crunch over the next few years - right when we managed to get ourselves established a bit better. It will take a few years minimum to build up a professional practice that is of a reasonable size (i.e. $100k+ in revenue).

One major issue I didn't raise was that the commuting makes it a challenge to deliver a higher work quality as well, as I'm leaving earlier than most in the office and miss out on some of the action. Working for myself, I can do this work anywhere in the world (within reason).

Thanks for the input!


vagon

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Re: Long Commutes of a professional
« Reply #8 on: June 11, 2014, 10:09:28 PM »
Why not try the lean start-up methodology?

Without quitting (Obviously depending on any non-compete clause or other legal matters) you could start your own LLC and start trying to acquire customers in personal/small biz.
You could start by doing your own analysis and outsourcing its review to more established experts. When you feel your expertise has grown you could reverse this, employing cheaper foreign labor or grads to perform the analysis while you review and sign-off on their work.

This way you:
  • Don't invest in any unnecessary retail space up front
  • Remove the risk of not enjoying tax returns
  • Test if you can actually acquire enough clients to make it work
  • (Potentially) continue to earn money at your current work.

There's obviously a lot of conditions and factors built into the above that could spell success or failure no matter how risk averse you are.

CPA CB

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Re: Long Commutes of a professional
« Reply #9 on: September 29, 2014, 05:11:24 PM »
Hey everyone

So, the update is a move into private practice! Very excited to officially get started, and if any Canadian mustachians need some tax advice feel free to say hello!

Looking forward to a non rat race life. Thanks for the help everyone

chasesfish

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Re: Long Commutes of a professional
« Reply #10 on: September 29, 2014, 06:48:26 PM »
Congrats!  Now start going and developing some business!  Enjoy


Sent from my iPad using Tapatalk

vagon

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Re: Long Commutes of a professional
« Reply #11 on: October 01, 2014, 04:30:21 AM »
Congrats, good luck with the sales!

CPA CB

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Re: Long Commutes of a professional
« Reply #12 on: October 01, 2014, 07:20:14 AM »
Thanks!

I'm so glad I got feedback from the community as I devoted time in the last while lining up business, and now have about $5,000 in business to get started on.

It's a great opportunity to significantly increase income and also enjoy life a fair bit more while saving up for the future. I can't say I'll be longing for the 15 hour days including commute time any time soon, especially since the commute cost 3 hours and $5,000 per year.


 

Wow, a phone plan for fifteen bucks!