Husband wants to take a huge paycut to join a startup

[Anonymous]

Lol this sounds like something my DH would do, OP, so I am sympathetic. He also doesn't worry about money too much/is very risk averse/puts a lot into the side business he started.

I think you should definitely make a strong effort to have a heart-to-heart about spending habits and how it will need to change. You actually sound supportive which I am sure he appreciates!

[Anonymous]

How much is your mortgage?

[Anonymous]

Anonymous wrote:He well earned that shot. Let him or he will regret it.
Even if it fails, that's life. With your assets you don't have to live in fear. I guess as a SAHM you don't feel powerful enough to dig yourself out of a hole. Maybe work on that.

What does this mean? Not being snarky, I just honestly don't know what you're saying here.

[Anonymous]

Anonymous wrote:How much is your mortgage?

we don't have one (he paid it off a few years ago, I guess this was part of his plan too) but we do have a property tax bill that works out to be ~ 1k a month.

[Anonymous]

I have a spouse who works in tech startups and has for 15 years+. Some things to think about.

-He will have insane hours. It's the culture. Most others in the company will be in their 20s and this won't be a problem for them. No one will care that he has a wife and kids.
-Zero job security. Zero. Could get fired on a Tuesday.
-A lot of startups fail. The percentage that end up getting sold and making equity partners a good deal of money is pretty slim. 10 percent of anything but a fairly big number isn't much.
-What is the health insurance situation? Health insurance for a family of 5 isn't cheap and if I was you, one of my biggest concerns would be stable health insurance for your family. Depending on the size of the startup and where they are as a company, they might not offer great family plans. They're probably dealing with a lot of singles, which is a different market.

My advice is plan out the worst case scenario with him and make sure you can live with it. The worst case is you spend down all your savings and in 3 years he has a 100k salary and you have no savings. What happens then? What happens if he gets let go? Just work out your contingency scenarios and maybe you'll feel better.

Good luck. If they've got the bug to go this route, not much you can do about it. I only have 2 kids, but the way I sleep at night is I have a very stable job and I am the stable and steady presence in our family income and carry our health insurance. But I understand that might not be possible for everyone.

[Anonymous]

Fwiw, if we didn't have children, or even if we only had one, I would be 110% on board. We have three little ones that I'd like to send to college though. Plus what about the money we spend on their activities, summer camps, etc. Thank god we don't have them in private school.

[Anonymous]

Anonymous wrote:

Am I allowed to tell him that if he does this, he needs to drastically cut his spending? Am I allowed to voice concerns re: money? I have to stand by and let him try this right? The worst thing would be if I said no and then he has to watch their company take off.

I'm thinking about going back to work but there are some problems with that. 1. for various reasons that I can't go into on here, I can't go back to my old field (burned my bridges big time). Fwiw, it was my husband's idea that I SAHM and he's always said he doesn't think I should go back to work back when it would have been easier to do so. 2. I don't think I'm qualified to do anything else except the most basic office work. I haven't worked in 8 years. Maybe I could get a waitressing job at night or something for the spending money? 3.) our youngest won't be in full time school for another 2 years.

ugh. I have such a bad feeling about this. What would you do? Just sit back and watch?

I am actually curious about your mental fitness to handle the stress. What do you mean by you burned bridges in last career?

And working as a waitress or office admin won't cover the cost of childcare: Your DH is working at a startup; he isn't going to be home at night taking care of the kids. He will work eat and maybe sleep. I mean how much does he get home now, the home is your thing and any job you take at this juncture should pay for childcare to be worthwhile. If you want a career that is a different negotiation but not too waitress.

[Anonymous]

Anonymous wrote:

Anonymous wrote:How much is your mortgage?

we don't have one (he paid it off a few years ago, I guess this was part of his plan too) but we do have a property tax bill that works out to be ~ 1k a month.

He sounds really fiscally conservative, op. I genuinely don't understand where your fears are coming from.

[Anonymous]

Joining a startup with a 6 figure salary is actually pretty good. A lot of people have to join at 0. Maybe he can negotiate a slightly higher salary? Even an extra 25k would help.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much is your mortgage?

we don't have one (he paid it off a few years ago, I guess this was part of his plan too) but we do have a property tax bill that works out to be ~ 1k a month.

He sounds really fiscally conservative, op. I genuinely don't understand where your fears are coming from.

I am really risk adverse. We have a really nice life right now. Aside from the equity thing, he actually really likes current job and the people he works with a lot. So I just never thought he'd seriously do this. He always talked about it in a "if things were different" kind of way. But things are not different. We have three little kids.

[Anonymous]

Anonymous wrote:

Anonymous wrote:He well earned that shot. Let him or he will regret it.
Even if it fails, that's life. With your assets you don't have to live in fear. I guess as a SAHM you don't feel powerful enough to dig yourself out of a hole. Maybe work on that.

What does this mean? Not being snarky, I just honestly don't know what you're saying here.

NP. It probably means the for OP the man was her plan, and she has no means to support herself by her own admission.

And honestly a man like this who makes half a million and saved up millions and still isn't satisfied may have ambitions for improvements outside of his career, not sure if OP is worried about their marriage too. Hence be supportive and weather this phase, OP seems vulnerable

[Anonymous]

Anonymous wrote:Fwiw, if we didn't have children, or even if we only had one, I would be 110% on board. We have three little ones that I'd like to send to college though. Plus what about the money we spend on their activities, summer camps, etc. Thank god we don't have them in private school.

At $100k with no mortgage, you'll be able to pay for kid activities just fine. It sounds like thus far you've been fairly detached from your family finances? Do you know how much you guys really spend each month?

[Anonymous]

Just write down your current budget for this year. See how much you actually spend annually. With a $100k salary, his take home is probably about $5k/month, give or take. So his annual net income would be $60k/year. Assuming that your household expense is $160k/year. The difference is about $100k/year for the next 3 year which is $300k. With your cash reserve of over 1 mil, I think you guys will be OK.

[Anonymous]

Anonymous wrote:Joining a startup with a 6 figure salary is actually pretty good. A lot of people have to join at 0. Maybe he can negotiate a slightly higher salary? Even an extra 25k would help.

If op is panicking with no mortgage and $2.7 million saved up, another $25k a year won't assuage her fears.

[Anonymous]

Anonymous wrote:Fwiw, if we didn't have children, or even if we only had one, I would be 110% on board. We have three little ones that I'd like to send to college though. Plus what about the money we spend on their activities, summer camps, etc. Thank god we don't have them in private school.

Well you already know how much the camps/etc cost. So you know what your outlay per year will be on household expenses. My guess if your non-investment money will cover that for at least the next 4 years. Then your investements are more than enough to fund their college, and pretty close on retirement also.