If you or your spouse switched from salary to commission - tell me about it

[Anonymous]

DH is about to switch from a salary based job to a sales/commission position. He will be salaried for the first 6-12 months to give him a chance to build up a portfolio of clients. I have a very steady gov job and the potential for income from the commissions is at least double what he is making now, but there's always the possibility that he wont get as many sales as we'd hope for, especially in the beginning.

Its in the finance industry and there are a lot of companies hiring for this position so it seems there is market demand. He has also been offered a this type of position with multiple companies, so it seems like they see in him what it would take to succeed. He's been working in this field as a number cruncher for a while, but getting clients is the next logical step (however scary it is for his risk-averse wife).

Anyone want to share their stories that will (hopefully) make me feel better?

[Anonymous]

Anyone?

[Anonymous]

He might do well, he might not. It depends on if he has a "sales" personality. It is not about how smart or talented you are- it is about whether or not you can close.

Sorry I am not mre help. Good luck.

[Anonymous]

My DH earns on commission, or as he says "I eat what I kill." It causes me stress. My advice is only do it if you can arrange your family budget so your family can live on your salary alone. And as the salary earner in the family, you must never stop working. So if you daydream of staying home with the kids, you gotta let that go. My kids are older now so I'm OK with working and I feel more and more at peace with my DH's commission job. There will be delays, and ups and downs, in his pay, making it difficult to plan your finances, or applying for a mortgage. Only do it if you and he are big savers because you need to keep a big cushion in the bank. Let's say he does well in the new position and increases his earnings. My advice is to save it all, do not increase your spending. Don't think that the big pay days are the new norm. They will fade at times. You want to be able to weather those times and hang in there for the next wave of big commissions. Each wave means that some people quit commission work and if your DH sticks with it, he will be in a position to make bigger bucks because he has the clients already lined up and he's learned from watching others' mistakes.

[Anonymous]

PP - does your DH work on a draw?

It seems that my DH will get a minimum draw per month - half he has to make on commissions and half is a small salary - but with the commissions side, he can go negative if he had a slow month. Anything above the draw goes into an account at the company and he can take it out when he needs it or up the monthly draw when he has some extra.

I guess this is good bc we cant overspend just bc he had a good month unless we specifically withdraw additional money over the draw.

[Anonymous]

The only main issue is that if you are refinancing or buying a home they will only take the average of commissions for the last 2 years. So you would need to wait 2 years.

[Anonymous]

I am the spouse that switched. The start up time really is 12 months before good money rolls in. After that it can be easier in some ways and harder in others. I did it for the flexibility and I love the position. If he has reservations after 6-12 mos then he certainly can look for more stable positions. It's a risk that can have rewards.

[Anonymous]

My DH was laid off from his job where he was on a 70% salary 30% commission 2 summers ago. He found a new job fast, but the new position was flip flopped, so 70 commission 30 salary. I worked very part time as a music teacher. They gave him a 3 month guarantee, which in hindsight was not long enough to really get things going. What made things ok for us was that he was still getting severance for awhile. It is overall much harder. Now, at 1.5 year point, the commissions are really starting to roll in. I had started to wonder if it was really going to pan out the way they painted it though. His prospects for income now are so much higher than at his last job though. I will say, we are learning that we really need to budget differently, it is hard to plan as things come in windfalls. One month, 13K commission, the next, nada.

What will make this manageable for us though, and less stressful is that I am returning to full time work next Fall. I just got an early hire contract yesterday for FCPS. Having one stable, regular income will really help us feel really comfortable with the ups and downs of his pay. We could never live on my salary, but it is stable, and will be that buffer we need for when we only get his piddly salary checks.