I thought I would get the mustachian perspective on my current dilemma, as lots of people over at OMD have given some insight, but I think the more ER focused people might have different thoughts.
The simple question: Should I take a lower paying job in a more volatile industry?
Life Situation: Single, No dependents, 32 y/o, Oregon
INCOME: ~$69,400 working 3 jobs
Job #1 FT at $50,000 per year (20 days PTO/sick/holiday, 3% employer 401K contribution)
Job #2 is salaried at $14,400 per year for 15 hours a week of work. (4 weeks of PTO, $200 per month health insurance reimbursement, State-run Roth IRA with no match, don’t use it as it has high expense ratio)
Job #3: I run a business that grossed $35,000 last year, but last year I was working on it full-time. Now it’s just a side hustle. This year it will probably gross about ~$15,000, but I will take home only about $5,000 as I am paying a lot of contractors. It does pay for a lot of my expenses, like phone, computer, camera, etc.
Adjusted Gross Income: Well, last year I got it all the way down to $6,743 AGI thanks to a traditional IRA, health care tax credit, saver’s credit, business deductions, and more… so maybe AGI isn’t the best thing to ask here ;)
Taxes: State is around 7.45% effective tax rate. How much my taxes are federally depends on income.
Current expenses: $18,000-$20,000 per year, give or take health care and travel. Full list here:
Household & Insurance – $8,389
• Rent: $7,555 ($615 per month) I have a lease with a locked in rate through the end of November 2020, so this is pretty set.
• Water, Commons, Sewer: $330 ($27.50 per month, level billing)
• Trash: $90 ($7.50 per month, level billing)
• Electricity: $396 ($33 per month average) This includes higher average bill in summer due to portable AC unit.
• Renter’s Insurance: $156 ($13 saved monthly in sinking funds)
• Household Items (detergent, TP, toothpaste, razors, etc): $132 ($11 per month average)
Health Care: $960 - $2,400 depending on federal subsidy, etc.
Food & Coffee for Home – $1,830 ($152 per month) This was only $100 average in 2019, but I traveled for a 1/4 of the year.
Transport: $170 Bike tune up, local transit
Figure Skating: $2,606 I’m a competitive figure skater and this sport is hella expense. But also I’m really good and some people pay $217 per month for a gym membership and even more for therapy so fuck it.
Looking Good: $832 Haircuts, Makeup, Skin Care, Clothing
Food & Drink Out: $300 When I travel, I eat out but that is either covered by the business or in the work travel.
Giving/Gifts: $1,000 Charitable donations, weddings, birthdays
Flotsam: $450 Entertainment, Camping, Spending Money
Travel: $2,115 I go to about 4-13 countries a year, pretty good at travel hacking and budget travel.
Assets: Current NW is $35,000, give or take a market hit, combination of cash and Roth IRA/Traditional IRA/SEP 401K. I am not counting my business as an asset but it does have inventory and resale value.
Liabilities: $0, other than credit cards I pay off each month.
Specific Question(s):
Currently I work three jobs: one in a creative field I enjoy in a small nonprofit (15 hours a week), one in a 20-person company doing database work (full time, billed hours), and I run my own small business related to my creative job (about ~10-15 hours a week).
My nonprofit creative job has asked me to go full-time, flexible on when that would happen, and I infinitely enjoy the work there more than the work at the database job. Should I take it?!?
HOWEVER, the database job is pretty recession-proof, and the work is fine, but not *exciting*. I am allowed to work remote 36 hours a week, though I do have a high billable hours requirement. I get nice things, like a work laptop and free transit (though I don’t really use it since I bike to work).
I love the nonprofit creative job and would love to do it full-time. It’s stressful, but in a way I thrive on. That being said, it’s for a nonprofit and in the media industry. Neither of which are very recession proof or stable.
If I leave the database job and move to the creative job full time, it would represent a $10K pay cut (from $50K to $40K), plus losing access to an employer retirement contribution of 3% ($1,500 per year).
It would also represent an even bigger loss in immediate savings because I'd no longer be working 3 jobs (but also I might get to do fun stuff and see friends again that would be nice.) I am currently saving about 69% of my take-home income as my income is currently very high between the three jobs. I’m working too many hours though (averaging 66-72 a week), and I can’t do this forever.
My big savings goals right now, other than trying to catch up on retirement contributions while the market is down (at least 20% of gross income), is putting about $25,000 in cash away for a possible year-long trip in 2021 - or for doing a masters abroad in London. Essentially, I want a massive cash cushion for ~life choices~.
Not planning on ER, just FI. This significantly slows down my savings timeline and moves me into a more volatile industry. Like the chances that the organization has the budget to up my wages is extremely unlikely, as some staff are currently paid $14/hr. I'd be the second highest paid out of 8 staff.
But I could possibly gain more experience to stepping stone to a better paying position if I was willing to move out of Portland (most of the better paying jobs are in NYC and LA). The job is also, more fun? Like stressful but fun?
Halp?