I don't know how much people care about the minutiae of other people's financial arrangements... sometimes I like to see how other people are handling things so that I can figure out my own finances better.
Anyway, for the record, here are the minutiae of how we are going to fit our big tax bill into the finance stream.
Federal tax bill $4033
State tax bill $411
Estimated payment for April $1649
Total = $6093
Since we have some savings and money allocated but not yet spent, we have a cushion and can pay the tax bill and estimated taxes and pay ourselves back little by little. YNAB helps with this... I've set up a category called "Estimated Taxes" that will be negative for about 4 months.
This method will allow me to maintain cash flow in my business and to maintain a good balance in our Irish account. Those two things (business profit and Irish house rental profit) are the reasons for the big tax bill.
March - Deposit into our personal account $1000 as a distribution from my business, $300 from the Irish account, $200 from my husband's side business account
balance will now be: $4593
April - We pay the big bill. Already have $1500 allocated. Deposit another $1000 as a distribution from my business, $300 from the Irish account
balance will now be: $3293
May - Deposit another $1000 as a distribution from my business, $300 from the Irish account
balance wil now be: $1993
June - Deposit $1000 as a distribution from my business
balance will now be : $693
We will cover the $693 with underspending in other categories, little by little.
So there you go. That's my creative accounting method, to soften the blow of the Big Tax Bill. We still have to pay it of course.
I feel privileged to have made a profit this year.
Viewing the 'Life among the Self-Employed' Category
I don't know how much people care about the minutiae of other people's financial arrangements... sometimes I like to see how other people are handling things so that I can figure out my own finances better.
I was starting to panic a little bit about not having a lot of work right now. It's the scariest part about having my own business. Yesterday I looked at the legal notices online (nothing) and called a contractor I work with a lot ("I will definitely keep you in mind").
Today... I got an invite to submit a proposal (no guarantee of getting the job, but at least there's work out there!) for a museum renovation and then the contractor called me back to say he had a not-too-huge (but big enough!) project with him. About $15k fee, so that's good. And the fire station addition is starting asap!
This is all good news! I am no longer panicking about next year. If I can do these jobs now and get some more work in the spring I'll be set.
- Just got Stephen King's 11/22/63 from the library on my phone. I love the library.
- My finger is a lot better. I can now type most letters with it (not c or v... ouch).
- Today was the school spelling bee and F.... WON IT!! Wow! Last year she came in second. She and her good friend L (who came in second) will be going to the County Bee. I am so proud! I made carrot cake for her (as requested). She won with two off-list words (after they'd spelled all of the study words correctly): solarium and zamboni (if you get your word right and the other person doesn't, you still have to spell and additional challenge word correctly to win). Other words she spelled correctly: physicists, phrenologists, perpetrator.
I am super lucky that I have my own business and can (generally) set my own hours. Which means I can drop off F at school and pick her up, and hang out with her during the summer.
But I still have to do my work which means at least an hour or two every morning in the summer. And I still have meetings that can't be changed.
I dragged F to the office for an hour (where she ate her lunch) and then with me to a meeting at a jobsite today, which meant that she sat in the corner with a hardhat on reading Harry Potter (not sure which book since she's read them through more than once).
Oh, the guilt.
I just want a nice, fun summer with her. A summer where we have no cares and I don't have to make money, and I don't have to take work calls.
She has camp next week, and I'm so sad. I want to take her to the pool every day after camp! I want to get slushies or snow cones!
Just did my checkbook reconciliation for work, and - yikes! - there was a service charge on there!
I have overdraft protection for my business checking and there is about $26,000 in the savings that the overdraft draws from so I was surprised. I could have just let it go; it's just $5, right? But I called my bank, and they explained that the overdraft draws in increments of $100 and I have to keep a minimum of $300 in my account, so I dipped below the minimum amount.
The woman said there was nothing she could do, so I asked if there was someone that could do something because in my mind this isn't really overdraft protection. She connected me to a supervisor, who said she was increasing my increment to $500 to cover the minimum and then some. And she was returning my $5.
The call was only 5 minutes and I was doing work during some of it (while I was on hold). I realize some people don't think $5 is worth it, but I solved a future problem as well, so I'm pretty happy.
It was a busy day...
First - Meeting at my daughter's school to help them get an idea of square footage for the new building they want to build (Art/Science/Performing Arts). I met with the three teachers, and it was fun! Of course I don't get paid at all, but I feel good donating time to the school I love so much!
Then - A little bit of work, and lots of telephone conferences. Fire station, waste transfer station. Engineer calls.
Then - F's teacher called and asked me and two other people to drive the kids on their field trip next week. I said of course. Hope she gives me an easy group! She is only asking three parents to drive, and the rest of the kids will go in the van that they borrow from the high school.
On my way to the next meeting I stopped by the bank to pay down mortgage principal and I saw my good friend H (the one who is having financial issues). I forgot to tell you that he was fired from the job he wanted to quit. Oh my. I talked to him for about an hour on Saturday. Anyway, he's coming over to my office on Wednesday so we can figure his financial situation out. He gave me a big hug. He looked tired.
Then - Meeting at a subdivision I work for (doing design review). There are two houses under construction that are having problems. I'm so glad I don't do houses.
Now - getting a little work done before soccer practice tonight.
Yesterday for lunch I had free soup! One of the teachers at school made a big batch of a soup we both like (chicken peanut stew... mmm!) and left me a tupperware in the school freezer. So sweet of her! The community aspect is the thing I like best about a small school.
Last night the school basketball team had a game - we lost but F played so well! She was in defense, and the only girl on either team, and prevented them from making a lot baskets. Also had a great assist. So she was happy even though we didn't win.
When we left the gym it was snowing hard. Made our way home and this morning was a snow delay. But it's beautiful and sunny out now (and still snow-covered).
I finished my business taxes yesterday (including state taxes). And today I received a 1099. Which is completely peculiar because corporations aren't supposed to get 1099s. The amount isn't even right; it's lower than what they actually paid me. Since I don't use the 1099s anyway, I don't really want to spend the time untangling their financial mess, however.
Last thing - I think this is the month we will drop into the 39k's on our mortgage. I am pretty excited! But then all I can think of is getting into the 20k's.
Things have ramped up at work, and it has me thinking about work I will take and work I won't take. This is always an issue because I have limited time, and usually projects all seem to come to me at once, then things get quiet for a while. It's pretty much impossible to schedule things in my line of work.
Recent projects that have come my way:
- Existing project - it is going out for a second bid and I needed to update a few drawings for re-issue - No choice on this one because it's an existing project, but I just found out today that I may get paid for the second bid
- Small project - under $3k fee - I usually don't take these, but it's an existing client and not a lot of work
- Fire Station remodel - I got this one ages ago, and it's just about to start up - I am so thankful! The fee is ok (not super high), but it's a good project for someone I know and like.
- Project at the Community College - I am feeling a little doubtful this will go through, but if it does, it'll be great. I'd like to get back into University/School work. And it could open the relationship with the community college which would be great. It's not a huge project, but probably about a $20k fee.
- Project 3.5 hours away - Ugh. This is a hard one. It's a design build for a contractor I like to work with, and it's a fire station (and maybe two of them). It's far away, though. So I told them what the probable construction cost would be and I told them what the fee would be, and I didn't low-ball it, so we'll see if this scares them off.
- Stamping someone else's drawings - I was approached by a firm in Texas to do this for them (I was recommended by someone here that I like and respect). I don't even know the fee, but I said NO; this is not the kind of work I want to take on (not just in terms of liability but also because it's not the direction I want to go).
According to my profit/loss sheet, my business needs to make another $28k this year to make a profit.
And this is where the frugality comes into play. Being frugal in my business has a direct effect on my personal financial situation since my business is an S-Corporation (which is a pass-through entity to my personal taxes).
I set up a budget for my business just like my personal budget. I know I need to make about $79k in the business to pay myself a salary and cover health insurance, all of my licenses, office rent, cellphone, etc.
- business lunch just once a month (these don't generate the real work anyway, but it's good to stay connected)
- I clean the office myself
- avoid all bank charges!
- do free continuing education
- limit office supply purchases (I use paper twice - back side!, find the best deals on ink, don't get sidetracked by "cute" stuff in Office Depot, use what I already have on hand)
If you have your own business (S-corp, schedule C or whatever!) how do you keep the budget in line?
Oh my... knee deep in the taxes for my business. I do it every year, and every year it makes my brain hurt. I am trying to remember that every year I'm glad afterward that I did it myself. But really, my mind is numb right now.
I am trying to do one thing differently - I am making a step by step list of what I do so that I don't have to reinvent the process each year.
Step 1 - compare ibank totals for each category to my annual profit/loss spreadsheet.
And now... I'm stepping away from this for an hour to go to the grocery store (somehow we only went to one store yesterday and I shop at two) and then pick up F from school. She had testing today, and I think she'll be exhausted. But no homework tonight.
Dinner is salmon with roasted cauliflower.
Organizing for the holidays, decluttering the garage, trying to do my work...
1. F's two advent calendars are almost done, and just in time, too! We have a cookie advent calendar (I cut the fancy-schmancy cookies from Trader Joes - four different kinds of dipped oreos - in half, wrap in foil and put them in the pockets of the fabric advent calendar that Grandma embroidered (we use it every year). The second one is a set of "drawers" and I put a note for each day (often with things we may be doing that day). So the total cost is $6.99 for the cookies (although we really just use half the cookies and she gets the rest in January in her lunches!)
2. I bought two large storage bins at Lowe's today. My idea is to eventually have everything in the garage encased in bins! There was a deal, and with each bin, I got a smaller bin for free... so two bins was actually four.
3. I used a $5 gift card at Target today to buy some Hanukkah candles, mechanical pencils for F and some fancy candy canes. Also a couple of ingredients I need for dinner next week and sugar.
4. I picked up a couple of free magazines (New Mexico Kids and Tumbleweeds) to see what is going on during Winter Break so that F and I can plan a few things. There are all sorts of free programs at the museums. I will list of everything we plan to do in a post tomorrow in case it brings something to mind where you live!
5. I only have one more load of laundry from the week away; I'll have to do it tomorrow.
6. I recently wrote a recommendation for a friend who was looking for a job at the community college. He got the job! And he called me today to say there are some projects there that I might be interested in... so we're meeting tomorrow! That is great news for 2016!
7. The tree is up (it's artificial and has been re-used the past ten years)... we are going to start decorating tonight!
8. Almost all presents are purchased. It's really just little things for F...
9. Why did I take the medal for the 5k we did on Thanksgiving Day? F is keeping her medal, of course; it's her first 5k. But mine is just clutter! I'm tossing it!
I have lots to do today because we are going to California for Thanksgiving tomorrow.
- get ingredients for coleslaw for the 5th/6th grade feast tomorrow
- find a sub for spinning class because I have to be at school pretty much right when spinning starts
- return books to the library
- tidy up house (friends coming into town tonight and this is the only night our travel plans connect, so they're coming over!)
- vacuum up dog hair
- make quick clementine cake for all of us to share tonight
- fold and put away yesterday's laundry
- pack for me and F!
- boarding passes
- sandwiches for the plane (we're flying right at dinner time)
- 5th/6th 1 mile turkey trot and feast
- pick up school cookbooks from the printer and take up to school
- a little bit of work (mostly financial stuff to get in order) plus pay renewal on state architecture license
Luckily I don't have a lot of work right now. One project just bid, the other is about to bid. So I may have a nice, quiet holiday season (at least quiet at the office) - wow!
I was just invited by the interior designer that usually does the furniture for my fire station projects to a Purse Party.
I almost trashed the invitation (purses are not really on my radar; I have one small baggallini about 5"x7" that I put my credit cards/phone/fold up brush. into and that pops into my laptop bag; I do not have any other purses).
Here is what the invitation reads:
Sponsored by KI and Pallas Fabrics [note: these are commercial fabric lines for desk chairs and stuff]
Come and view the latest Pallas fabric offerings. Select a bag design with your favorite Pallas fabric(s) and receive your complimentary bag in just a few weeks!
Drinks and hors d'oeuvres will be provided
So it's a free purse, and they're feeding me? Also - this interior designer has daughters, and F went to camp with one of them last summer (they loved each other). I'm going to see if her daughter will be there (I think she will - the interior designer is super sweet and has an afterschool kid area in her office that she's invited F to come to before).
So - what do you think? Should I rsvp yes?
If I go, what should I do with the purse? Keep? Sell on Craigslist (or is that rude?).
I just found out today that my health insurance company is no longer providing individual coverage in our state. So there you go... I need to go back to the insurance company I had in 2013. It is an HMO, and I'd prefer a PPO, but that's just not an option in our state.
I just looked at my previous insurance company, and there are three plans I'd be ok with. So I guess we have to start thinking about switching soon.
My next step is to set up an FSA; I don't use an accountant for normal tax stuff, but I think I need one for this. I called the guy I always call when I need an accountant for various things, so I'm waiting for him to call me back. If I don't have to, I don't want to use a third-party administrator; it'd be great to avoid the cost for administration when I can do it myself.
As long as I was doing some investigative work into our insurance, I verified that our term life policies end in 2027 which is fine for us. F will be in college (gasp!). We each have $500k, and we pay a total of $52.47 a month.
I also decided to get our wedding rings and my pearls appraised. I never wear the pearls; they're just sitting there in the safe deposit box. Do I need to insure them? No idea.
I taught my last weightlifting class at the gym today, at least for a while. A woman moved to town and is paying for the gym to be licensed for a certain branded class. In exchange, the owner gave her my class to teach. I understand it from his perspective - he pays me to teach, but she's paying him essentially. The difficult part is that she is a mom at F's school, but we haven't been introduced yet. Not sure if I should introduce myself; I'm pretty sure she doesn't know whose class she has usurped. I'm not sure if she feels justified or embarrassed. I'd be embarrassed.
Anyway, this was a side job, but it means that I now only teach one class at the gym. I still get a free membership, but I will be making $35 less each month. I was using it to pay down the mortgage.
In other "loss of income" news - I am no longer maintaining the website for a subdivision I work for. This was only about 2 hours a month, and I am actually glad to see this extra project move on. I help run their Architectural Review Committee, and that is actually architecture. I am not a website administrator (at all!!!!). They're getting a new website, and they're going to maintain it themselves. I won't miss the income since this took up two work hours that I really could use.
Since I finished up a project on Monday and had a meeting this morning, I was going to spend the rest of the day tying up loose ends, but the other subdivision that I help with Architectural Review had a brand new problem (someone's window trim is BLUE! Oh no!) that needed to be dealt with immediately (you know, if someone's window trim is BLUE that is not something you can let go until tomorrow!). Sorry about the sarcasm. I actually love working for them; they are really good to me.
After dealing with blue window trim, I did manage to get some dinner in the crockpot and I went to Target to find some clothes for F now that the weather is turning cold and she no longer fits in a 7-8 (she still fits in them but everything is way too short - sleeves, length of tops, length of leggings). I bought four shirts and three leggings and... she liked ALL OF IT! I know her taste - not too girly but bright colors. She likes stripes. She likes henley shirts. She likes leggings and soft, soft jeggings, but not jeans. Total cost was $55.
I think we're all set for winter now.
Tonight: soccer practice now that it's stopped raining. I'll bring my new ebook (the new one by Neal Stephenson) from the library.
I made on purchase today:
a New Mexico Trader Joe's bag for my friend who used to live here and moved away about 10 years ago. I called her to say "hi" and tell her about the bag, and as I suspected she was totally excited. I'll probably pay more for postage than the 99c that I paid for the bag! I miss my friend a lot; she's in California now.
I spent most of the day working on answering contractor questions for a fire station that I designed that is out for bid. There were some seriously stupid questions. "Where is the Project located?" (Um - it's called the Glorieta Fire Station; do you think it might be in GLORIETA?!! Also there's a vicinity map on the Cover Sheet!!!). "What size is the lot?" (In the drawings, on the Survey, where you would expect to find it). "Which way does the drainage run?" (You are kidding, right? We included a Grading and Drainage plan in the plans and it's a little more complicated than just answering a question! Look at the PLANS!!!!). "Is there a benchmark?" (YES! That is why it is labeled benchmark on the survey, which is where surveyors put benchmarks they've set. READ the PLANS!!!).
Can you tell I'm frustrated?
At least I'm paid to answer idiotic questions. (Not enough, though).
These kinds of days make me want to eat chocolate, but we are having a healthy dinner of fish with homemade aoili and roasted cauliflower. That'll probably make me feel better than chocolate anyway.
I have these friends who hired an architect to draw up some plans for their house, paid him a lot of money, and were completely unsatisfied with what he came up with. I stepped in to help even though I don't do houses, mainly because they are friends and also because N has MS, so this project is not just about making their home nicer, it's about making it wheelchair accessible so that N can get around if she ever has to have the wheelchair. Right now it's leg brace and drastically reduced mobility.
They are really funny people, so we've had a lot of fun working together. Also - F is friends with their daughter I. The two of them went to preschool together, and are still friends even though they go to different schools.
The other architect failed to consider things like: existing windows (headers) that could be used for doors or openings, putting N's therapy room where there is LIGHT rather than a wall with no windows (ugh!), existing ceilings and how that would work with new rooms. He even had one scheme where he moved the kitchen to a completely new location (moving water and gas and everything else - this is slab on grade! this would mean a lot of jackhammering and cost). He also didn't give them a floor plan to show which walls come out and which are new, which means that it's impossible for a contractor give any sort of preliminary pricing.
So - I think they are really happy now! They keep emailing me to say thank you. They brought over pizza last night and desserts and we hung out while F and I and D watched the US v. Sweden match.
So I guess the work isn't free... the pizza was really good!
It was the kickoff meeting for my new project today. You'd be proud of me: I stood my ground about our upcoming vacation (which I noted in my proposal to them). I said I wouldn't work on holiday, so that week did not count toward the schedule.
I ended up doing a midweek shop this week, which I never do. I really can't remember the last time. I bought some staples we ran out of (olive oil) and sour cream for tonight's dinner. I would have ended up buying these during the weekend shop anyway, so it is what it is.
While I was there, I picked up a prepared salad for lunch (which I also never do). I will get reimbursed from the office since the reason for the salad is that the kickoff meeting went so long I missed lunch.
Today F went to see the psychologist. She was great, and F came out of there seeming like a weight was off her shoulders. I think it was just the act of letting someone else in on her secret anxiety. So we have an appointment next week, and we've reserved the slot for the near future. The cost was $10 (insurance!!! yay!).
Tomorrow: parent-teacher conference at 8:45, and for the first time I'm dreading it (in the past it's just been "F is a joy to have in class and very bright"). I want to talk about F's schoolwork, but I know the teacher wants to talk about the anxiety (I'm not guessing - she emailed me). I'm just going to tell her that F has just seeing someone so maybe we can check back in a month after she's seen her 4 or 5 times. Her work notebook is sent home every other week and I look at everything and sign off and send it back, so I know the anxiety hasn't affected her work (she's getting all A's).
After the conference I need to go match a stucco color; F said that was fun and she'd help. Then I'm teaching spinning, which F definitely wants to go to. Then we'll have lunch together.
Friday is a no-school day, too, and F has a friend coming over. Maybe I'll get a little bit done while they play.
I just received a check at work (final payment for a project! Yay! It's always good to get the final payment because that basically means they're ok with the project). When I got the check I logged it in as usual, and checked to see if any of it was reimbursable so that I could put it properly in my check register. None of it is reimbursable, but I had a weird moment where I saw two checks from last month and realized those did have reimbursables (a lot) and I just knew I didn't log them correctly.
This would be ok in just about any other state, but in New Mexico (and about six other states) we have gross receipts tax. It's like sales tax, but on everything (not just goods, but also services). I don't charge my clients gross receipts tax on reimbursables, though (things like permits and printing) because I've already paid the tax and they'd be double taxed. So I don't pay the tax to the State either.
Except I logged it wrong and made it all look like it was taxable, and I already paid the state for last month. Ugh.
Panicked call to the Gross Receipts Division, and the woman helped me amend my gross receipts tax return. I just saved myself 177.88! Yay!!! The payment is still going through wrong, but she said call back tomorrow so they could fix that (the system needs 24 hours). And she gave me a direct telephone number to call.
You should be very thankful your state doesn't have gross receipts. It's a pain! Are any of you other states like mine and have experienced this, too?
I've had a project that is just a few hours a month.... four or five. I haven't invoiced it yet (started in August), but I spoke to the client and he said to go ahead and invoice. It all added up to about $3k, so I'm pretty happy! I am very close to my yearly goal, and I have a new (large) project that I just got. Plus one that was put on hold that should be starting up in March. I am going to try to put them off until after spring break.
Because things aren't that busy yet, I am trying to take an hour a day to clean out the office. Like most architects, I have a ton of old files and drawings and spec books and just PAPER! There are legal requirements for how long I need to keep things, but a lot of my stuff is waaaaay older than that. I've had my own business for 11 years, but some of the paperwork is from the previous business.
The storage closet is so clean now!
And I have an old printer that I may have sold on craigslist (need to speak to the buyer tomorrow).
I am getting things in order partly because I have a desk in the office I'd like to rent out to someone. I think things need to be tidied up first and I've been using that desk as a base for my garbage operations. It would mean an extra $100 or so in income when I finally rent it, but I need the right person.
I bought Turbo Tax yesterday and started plugging things in (even though I can't finish our taxes because I haven't gotten all of our tax forms; I still know the amounts).
Now I'm slightly depressed because it appears we didn't withhold enough (Federal Withholding) from our paychecks. At least I think that's what's going on. I put in my W2 info and there was a big refund. Then I put in D's W2 info and we owed money. So I took out my W2 info, and it was a refund again. Then put it back in and we owed. Which says to me: we withheld enough if just one of us was earning, but since we earn very close to the same amount, we need to withhold about $30 more federal and about $12 more state per pay period.
I've adjusted my payroll for February (too lazy to do this for the last half of January). And now I make about $100 less a month. So... that's not good, right? I've also adjusted my monthly business distribution to give ourselves back the $100, but this feels like I'm not really facing the problem.
Next year is going to be more challenging since we will own our house in Dublin outright (although it seems like mortgage interest at this point is a very small deduction off the Dublin house rents received). Also D is making more, but I'm not sure his W2 will reflect that since he 6% of each paycheck will come out before taxes for the employee savings plan (it's matched).
I am definitely going to do a 2015 Trial on Turbo Tax, but I am wondering if I also need to finally have an accountant do our taxes.
I finished my business taxes (1120S for an S-corporation) about ten seconds ago. Obviously had to post to tell you! (I'm very proud).
I met with an accountant yesterday to go over a few things I was having trouble with (conceptually) so that I could finish. He was recommended by a friend/colleague, and when I heard the accountant's name I was pleasantly surprised - it was someone I knew a long time ago. He used to be married to a friend of mine, and I've since lost touch with the friend (I see her around occasionally).
I called him to make an appointment and he remembered me, too (I always think people won't remember me but this is such a small town!). Anyway, I asked him if I could pay him to consult with me for an hour, but at the end of our appointment, he said I didn't need to pay, and to remember him if I have any more complicated accounting issues.
The return is done, and I've learned something (so I shouldn't have trouble next year). And I made a profit.
Have to go now - need to pick F up from school and it's snowing so I'm leaving a little extra time. We had hot chocolate last night, so I guess hot cider after school today. And I have to clean out the car because I'm driving on the school field trip tomorrow, and I want to take D's car (it has the snow tires); his car is, um, how do I say this nicely? Not very tidy inside.
I was supposed to start my business taxes on Monday (I did! I mean that I did start doing them, not that I finished). I wanted to finish on Tuesday (I didn't) and then I wanted to finish on Wednesday (I didn't, but that's excusable because I had a bunch of other work to do) and so I decided to do finish up today (I didn't and my excuse is really lame).
Here is my really lame excuse:
I got distracted. I had a long list of things to do around the house, room by room. It was like a fine-tuning list of things to do... just those little things that you mean to do but never get done. I got a lot done on the list (moved some stuff out of our bedroom and into the closet, decluttered some areas, etc). And on the list was to tidy up F's art area.
As the child of an architect, F has an abnormally large and extensive art area. I thought it was maybe a 15 minute tidying session, but as I got into it, I decided there were things she didn't need anymore (some baby/toddler things, baby scissors) and then I decided that it need a total makeover so that things she uses most are most accessible. Forty-five minutes later and I was still at it, and the taxes weren't touched, and it was time to pick F up from school.
It's still not done, and I very badly need to finish because I have art supplies all over my kitchen now! The worst part is I need F's help to finish because she needs to make some decisions, and she's doing homework, which is obviously a priority (I think).
Here is the thing: it is way more fun to organize the art area than to do business taxes.
I will definitely finish the taxes tomorrow! (ha, ha!) I have to finish the business taxes so that I can do my personal taxes (the business is a pass through entity - an S-corporation).
Do you do your own taxes, too?
Paid by the Gym!
$100 (includes payment for teaching and Christmas extra). We have now paid $4013 extra in 2014. We owe $64,600 (house is worth about $550k, so I am pretty happy!).
Pinecone Surveys, Etc.
Two in the past two days! So that's $6. I have 1206 Swagbucks, too. I think I have some money in Chase (business credit card) so I'll get cash for that, too. Will check tomorrow.
There are two "Letters of Interest" from the County - one is due January 5 and the other should be coming out soon. I have a good shot at either one. This is good timing since I have three projects that just finished up.
One Last Thing: Business Finances
I made a lot more than my goal this year, so I've delayed billing some of my invoices. If people pay promptly my business will start the year with $38,000 in the bank! That is about half of what I hope to make during the year, so I am so happy! I also have guaranteed billings for the remainder of projects. I think my total intake in 2015 (guaranteed) is $60k. So I just need a few projects to take care of 2015! Huge relief given how architecture has been in the past 5 years.
A lot of you probably get your health insurance from your employer... my husband does. But his plan charges a bajillion dollars for spouses and dependents, and the insurance is just so-so.
F and I get our insurance through an individual plan (I am self-employed, and even though I have an S-Corp I would have to have an employee to qualify for business insurance).
Here's how it works: we personally pay for insurance (I put it on the credit card so that I get the 2% cash back). My business reimburses me, and the reimbursement shows up as income, but it isn't subject to withholding, social security or medicare taxes. On our personal 1040 form, this income is part of Line 7 (Wages, Salaries, Tips) but is deducted on Line 29 (self employed health insurance deduction) so that it's not included in our adjusted gross income.
During this enrollment period, I noticed that our premiums were going up 86%!!! So we've switched to a different insurance company. Our rates are still going up 42% (to $602 for the two of us), but now we're on a gold plan instead of silver and dental is included.
Our choices for payment were to set up an automatic draft from our checking account (no cash back!!!) or to receive a paper bill each month which I can pay with our credit card (cash back!!!). It's a little less convenient, but I want the cash back! We're talking $12 each month!
I'm wondering if maybe they'll set up an automatic credit card payment for me in January. But even if they don't, I have a system for paying my bills, so I'm not concerned.
How are you handling your health insurance? Would you give up some convenience for the cash-back option, too?
I have lots of little projects right now, which I guess is ok - it all adds up.
My big project - a building for a local non-profit - will be on hold after this Friday while they work up a contract for me for the rest of the phases. They also want to stop for a month or so to secure some additional financing.
My other big project - a fire station - is also on hold because it's in the permitting process.
This leaves room for the next-largest project which I'll start on Monday. It's some renovations at a hotel.
And then review for two different subdivisions which entails lots of little meetings.
Here is the good news: I've met my earnings goal for the year!!! This means I don't actually want to bill until next year. It also means I can afford the slightly higher health insurance premiums next year so that we can have a PPO rather than an HMO. I am going to lower our deductible, too. The business covers health insurance for both me and F, and D gets his through his job.
I heard about one company that has high deductible policies for its workers, but it covers the deductible. I'm not sure how that would work or if it would be legit for my small S-corp. But that would be a great alternative.
Other work things I'm thinking about: I need to buy the new version of Autocad. I'll do that before the end of the year.
I am also taking a distribution to pay for our solar panels, but that money has already been taxed in previous years (as an S-corp, the tax on any profit is passed through to me). This doesn't affect the profit or my bottom line.
Also before the end of the year I need to work out next year's salary. With the health insurance cost increase, I don't think I'll give myself a raise.
If you have a business, are you dealing with some of this end-of-the-year stuff right now?
It's a long story (and not that interesting), but I have a client which requires me to invoice the people I work with separately. I was dreading doing six little invoices; ugh. I figured it wouldn't add up to much either; it's just an hour or hour and a half for each.
After I dropped F off at school and before I went back up to drive on the class field trip, I decided to challenge myself to get all six of the invoices done and emailed out to people. It only took half an hour, and the invoices add up to $880. That's more than I thought, so I'm happy I just buckled down and got it done.
I don't know about the rest of you who are self-employed, but I don't love doing invoicing. I do it though, monthly, because that's the key to cash flow.
And, I've officially invoiced for almost $13k more than my annual goal. Very excited about this! The past few years have been difficult for architects, and this is definitely an improvement! I worked hard for every penny.
My good friend is in town (she comes back to visit once a year). She's not staying with us, but she always has parties (I'm happy to bring a potluck dish) and wants to go out to eat (I usually skip that, and she's fine with that).
She loves to shop, and I don't shop at all, so I skip that, too. She has other friends to shop with.
The hard part is, she comes in late tonight, and will be staying through the week, but I have a HUGE deadline and no time to hang out with her (we could go on a hike or whatever). But I want to! But I have the deadline! And I don't want to be a whiner and say that I can only see her on the weekend (actually, I'll be working several hours this weekend, too).
It's a firm deadline (a County review meeting) and I had a setback today where I spent the day making a change (ugh; this is why I need to work this weekend).
Oh - did I mention that she wants to have one of the parties at my house? On Sunday night (school night!). I called her and just got voicemail, but I told her that we could maybe do something early, but that people have to clear out by 8:30 pm so F can get ready for bed. I wish I had said I couldn't do it at all because the thought of cleaning the house after a party, with a deadline looming, makes me hyperventilate.
I'm going to go do the dishes and then relax for an hour before I go to sleep; I think I need to rest before I can confront her (and myself) with the reality of self-employment!
Right now I have enough work; in 8 months or so I may not, but here's the thing: the long term future is not a reason to take a project I don't have any time for right now, and it's definitely not a reason to take a project that looks like it could be awful.
I got a call from a woman (who knows a friend of mine) about a possible project. She's talked to some other architects but didn't feel like it was a "fit." She's bought an old house (1940s) that is in a borderline commercial area (zoned for commercial), and already done some demo (like taken out the heaters - something I wouldn't have done right away - winter isn't THAT far away). She wants to turn it into a restaurant.
I told her I'd come look at it, but let her know that I am going on vacation soon and my priority is the projects I'm currently working on. I told her I couldn't really devote more than a site visit until I return.
The house is a maze of rooms, and she wants to "open it all up." (This means replacing structural walls with beams, etc.) I talked to my engineer, and he said she needs to know that the roof load requirement for a commercial space is more than double a residence. And then there's the fire suppression system for a commercial kitchen...
And its an old house, and I'm sure there are lots of surprises in there that she won't even find out about until they start work. Oh - and did I mention that they have fixed up a few houses and want to do some of the work themselves? I honestly have no idea how much she should budget, no idea how much I would charge (given all of the unknowns).
I'm either going to tell her the timing isn't good for me, or give her a price that (if she were to accept it) would make the project definitely worth my time.
I got a weird letter today from my general liability insurance company. They said they made an error calculating my premium, and if I still owed money to pay on the premium, they'd adjust it, and if I'd already paid in full, they would send a check. Really? I hope so. Wonder how much? Are we talking 50 cent or $50?
In other financial news:
- F is not loving this week's camp as much as last week's, but it's from 8:30-3:30 and I'm able to get some significant work done which will allow me to take off some time next week when she doesn't have camp.
- I drove over a screw on a jobsite (this is one of those job hazards!) and had to go to the tire store. But - yay! - the screw was just stuck in between the treads and was super short so it didn't puncture anything. They removed the screw and didn't charge me.
- Because we hosted a coach last week, we have very little grocery budget left for this month (but we do have some dining out budget which I can move into the grocery bucket). Luckily only one more shop for the month. I'll need to be strategic.
- I am making my packing list (one of my favorite parts about traveling!). I will post about this at some point, but you probably guessed that I'm an extremely efficient packer. I do carry-on only. This saves bag fees. And I have a very inexpensive carry-on ($30) and very light; it's the best on out there.
Last year I paid $3236 for professional liability insurance. I wonder what it'll be this year...
It's not optional for me (my clients require an insurance certificate), so I just have to pay it, but it's pretty frustrating given the state of the economy for architects. Our fees go down, but it doesn't seem like the insurance premium ever goes down.
Anyway, you know how I am about tracking things... I track my incoming money (for the business which is an S-corp) and also the percentage of gross billing for different types of projects (fire station, work for homeowner's associations, offices, schools, etc.) and for different types of clients. Turns out in 2013, 88% of my fees were from local governments. Ninety-two percent of my fees were from repeat clients. I need all of this info in order to fill out the renewal application.
And more information... it's a long form. I am going to fill it out tomorrow and scan/send back to my insurance agent on Monday. Hopefully given how much (how little!) I made in 2012 and 2013, the premium won't go up. Fingers crossed.
I discontinued my AIA (that's American Institute of Architecture) membership as of this year. I used to be super involved, but I got tired of the repetitive lectures and unwillingness to do anything meaningful. So I donate my time instead to another organization.
The AIA is nothing more than a professional "club."
You don't need to be AIA to a licensed Architect. You can have AIA membership even if you aren't a licensed Architect. You can only call yourself an architect if you're licensed.
Anyway, one of my friends has put together a meeting (she'd like to meet monthly or every other month) of women who are architects. That is pretty interesting, mostly because it'll be a room full of people who have a lot of the same concerns. I hope there'll be some interesting discussions. I, for one, am interested in work-life balance (or imbalance!). I am also interested in how we can volunteer in the public schools (where a lot of art programs have been cut).
Leaving now to go to the event. She's asking everyone to contribute $20, but I can handle that. Will take it out of the business account.
I'll let you know how it goes!
(BTW, F is at her friend's house today, and the friend is coming to our house next Tue).
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