(Biglaw associate here) If I could guarantee the income then yes, I'd do it. But the main thing that you don't get when not employed by someone else is the guarantee of income I think I'd need an assurance of business sufficient that I'd take home 150-200% of my current income for the next few years to account for the possibility of things falling through and lean times.

Anonymous wrote:I think the benefits piece depends a lot on what kind of earnings you are talking about. Benefits costs generally max out at a certain comp level (cap on 401k contribs, health care is health care, etc). So for me the benefits were not that big a piece of my overall comp package, but for someone at say $75-100k the benefits would be a much higher proportion.

I agree that one benefits package does not equal another.

I am at a higher earnings rate than you cite, but my benefits are also greater -- 401k match is only 5% and is capped, but a pension of 1.9 per year (and I have 15 years in), plus 100% medical, dental, and vision benefits for me/family, and flexible work schedule/telecommute -- so the amount I would have to earn to make up for that is far greater than benefits at a less generous employer.

I'm not the OP, but I would absolutely consider this and am working towards trying to make this exit. I'm not a lawyer, but also in professional services like a PP mentioned. I have about a three year plan until I can fully leave my current employer.
I'd love to hear from other women who have done this successfully and what kind of advice/mentoring you could offer.

I would NEVER be a solo. Trying to collect from jerky clients is for the birds. There is no way of getting around that.

I think the benefits piece depends a lot on what kind of earnings you are talking about. Benefits costs generally max out at a certain comp level (cap on 401k contribs, health care is health care, etc). So for me the benefits were not that big a piece of my overall comp package, but for someone at say $75-100k the benefits would be a much higher proportion. My old company only covered about 50% of health insurance so picking up the other 50%, even for a private plan, was not that big a deal. I set up my own retirement plan and while there is no match I can set aside more on my own on a tax deferred basis so it evens out. I didn't get a pension plan so no loss there. So far (it's been a couple of years) I am more than covering the extra cost of benefits. As a PP noted it helped to have an existing client base.

No way. We have tried it, only once successfully - and that was NOT a huge difference, especially compared to the work and time/money expense involved. Not to mention benefits for small companies are extremely expensive. (For example, insurance companies do far better from bigger companies, and charge smaller companies much, much higher premiums - which most people do not understand.) It would be a bad move all around to sacrifice the known for the unknown.

My husband did it three years ago and makes double what he did working for his company. No, he doesn't have employer benefits but he worked for a small company before so the benefits were expensive. Now he is on my benefits so it works out fine. He works about the same number of hours and if he is working more hours, its because he chose to take on a big project (he bills hourly so the more hours, the better vs. being on a set salary without overtime pay).

The trick is, you need to make sure that you have an existing client base from which to start. If you can take a few clients with you and bulid from there, it is way less risky. He had no plans to start his own business but when his company folded, he was able to bring a lot of his clients with him on a freelance basis and it just snowballed from there. Also, having a spouse (me) with a regular income helps--although it definitely does make me feel stuck in my job sometimes since I carry the benefits for the entire family. On the other hand, its really nice to have someone who can be at home when repairs need to be made, the baby is sick or I just want someone to start dinner.....so there are benefits for me as well.

If you are married, I would definitely have this discussion with your spouse and make sure that both of you are ok with the decision.

If I was truly working for myself with no need for employees, additional real estate and the like, maybe. If not then no. My father owned his own businesses and he was never off duty. Vacations were extremely rare, and even when we were on them, he would get tons of phone calls throughout the day. Being an employer is hard. Lots of stress.

Well, I guess it depends on if you could live on what you would make. Personally, once I subtract health insurance costs, the extra FICA, and my employer's retirement contribution from what I currently make, I wouldn't be able to pay my mortgage.

Not right now. I'm 36 and haven't reached my career peak yet. I have been very lucky to have had great mentors and work for and with people I respect and can learn from. I'm not ready to work for myself yet, and I enjoy being in an office right now.

In 8-10 years, absolutely I could see doing something like that. Probably would want to do something related to freelance writing or consulting in my field. I would also like to do something like work with families having problems with things like meal planning, making time for healthy meals and eating, fitting in exercise, etc. I think I'm great at doing that in my life and I think it would be fun to sweep in and help other families set up a routine. Would probably involve getting my personal training certification but that sounds fun. May not be all that lucrative, but I imagine very fulfilling!

No way. That would be much more stressful.

No. I would pay myself way more than what I do now.

Anonymous wrote:

Anonymous wrote:No - the benefits I get on top of my current income are too great.

What do you get? I added that up and found it was only about $20k, not including FICA tax. So my baseline for revenue i needed to generate was my comp plus value of bens plus self employment taxes plus business expenses. So far has been easy to generate. But I worked for a company that had cut benefits so much that maybe my number is much lower than other people.

I get a pension and a 401(k), plus health, vision, and dental insurance for myself and family. I also get a fair amount of paid time off, plus a flexible schedule and telecommute option.

Op is a lawyer PP. assuming she is planning to continue to practice then it's about current income. You can't sell a law firm. And having been in a professional svcs firm that got sold my experience was that through earn outs you basically earn the purchase price. You don't sell it and walk away because there is no value without the people doing the work.

That being said the money in professional services is pretty good so I'm okay with maximizing my income and not worrying about equity.

Selling a business? In today's economy? Are people that stupid? Do they think they are AOL? How ridiculous.

OP, never, ever, ever go into business with the intent to sell the business. EVER. Ask anyone who has hoped to do it, ask any professional financial advisor worth their weight, ask anyone actually in the know. Anyone who goes into business for themselves with the intent/hope/whatever to sell the business is just plain ridiculous. This is not what the market was just ten years ago. Wow.