Ok this is my first new thread and I am really confused.
I currently work at as a contractor at a company that I really don't like because they treat their employees poorly, although they recently lost the contract to another company that I don't know anything about, so things could get better, I could lose my job or things could get worse. However, through contacts with another agency I just received a new job offer for a very similar job from a small government contract for about $11,000 more a year. But earlier when negotiating with the agency I told them that I needed more than that and they said it wasn't a problem. Also, I found out these things about the company:
1.) No 401k (ACK!!!)
2.) Only pay 50% of medical (not a huge issue since I am currently covered by DH plan)
3.) Offer dental and vision, but don't contribute any money (again, not at issue at this time, but could be if DH loses job)
4.) They do offer 3 weeks PTO, which is not too bad.
So I ran the numbers:
Current Proposed Proposed w/401k
Base Salary $54,000.00 $65,000.00 $65,000.00
401K contributions $14,000.00 $ 0- $14,000.00
IRA contribution $5,500.00 $5,500.00 $5,500.00
Taxable Salary $34,500.00 $59,500.00 $45,500.00
Personal Exemption $6,300.00 $6,300.00 $6,300.00
Fed Taxable income $28,200.00 $53,200.00 $39,200.00
Fed Tax bracket 15% 25% 25%
Fed Taxes owed* $3,855.00 $9,100.00 $5,600.00
Total compensation $50,145.00 $55,900.00 $59,400.00
Total Retirement $19,500.00 $5,500.00 $19,500.00
Net income $30,645.00 $50,400.00 $39,900.00
Sorry I can't get the columns to line up better. Anyway, I would end up losing $5,245.00 of that raise to taxes and not be able to add to my 401k balance. :(
I do have a taxable account that I could put money in, but the taxes from that if the market makes a good comeback might be substantial. So I am trying to figure out how to be able to put more away in a tax protected account or what else I can do to make this work better financially.
Has anyone had this problem before?
(I am getting ready to go out, but I will answer any questions when I return.)
Thanks!!