Complications...
Jul. 18th, 2004 01:17 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
captain_slinkyCrystal is behind me for the 5-year plan, but some questions/points she has made are pretty dang valid and throw many a monkeywrench in to the works. I plan on going to H&R Block to get some of these answered, but does anybody have any ideas and/or thoughts about anything on the list?
(By the way... can youo tel that I just recently discovered the "list" code in basic html?)
SO! These are things that need to be considered. The bankruptcy may make me have to reconfigure my 5-year plan in to a 7-year plan.
- Crystal is going bankrupt this year. it's all debt that she acquired before we were married.. is this going to keep *me* and/or my business from being able to get any type of credit?
- Having a baby costs A LOT of money. It makes more sense to have the baby while at least one of us has medical coverage through our employer. So should we go ahead and have the baby *before* opening the business? Or should I just keep working at Comcast while trying to run a comic book store during the day?
- I already have a business license, but have not conducted any actual business yet. But al the sort-of business related stuff I have been paying for so far, like the storage unit and the products I am amassing for the eventual store... are those legitimate tax write-offs?
(By the way... can youo tel that I just recently discovered the "list" code in basic html?)
SO! These are things that need to be considered. The bankruptcy may make me have to reconfigure my 5-year plan in to a 7-year plan.
![[identity profile]](https://www.dreamwidth.org/img/silk/identity/openid.png){kind=small}
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Date: 2004-07-18 02:53 pm (UTC)as for children? yeah, it's expensive. childbirth alone and all the check-ups and complications of pregnancy are exorbitantly expensive and it shouldn't even be thoguht of without full health coverage. there's also a loss in income/ability to work for a couple weeks around when the child is born (the week leading up to and at least 2 weeks after). most cmopanies allow this even for fathers. it's the law that they're supposed to... btu sicne most employment is employment at will and corporations have outrageousHR policies i can't guarantee you'll be able to keep your job. :-/
after the child is born expect your monthly expenditures to gu up heavily, insanely so if you don't have good insurance. children need tons of hospital trips for getting various vaccines and other shots as wella s regular check-ups. it's not uncommon for children to require lots of other viists for all kidns of illnesses so expect money to go to hospitals and doctors a lot. if you don't have insurance you better pray the state will cover you.
there's also the costs of formula (if not breastfeeding. even one who REALLY wants to breastfeed can't always do so because of infections like mastitis (sp?)), toys, clothes they grow out of so fast it hurts, diapers, wipes, increased costs for various house-hopld items, costs of child-proofing a house, furniture, and a loss of productivity at work as you'll be tired off and on the first 3-4 months with a fair degree of certainty.
now you'll probably be lucky and get family and friends to buy a handful of items for you going into the child (yay baby showers!) but your monthly expenditures will increase dramatically. :-/
wait until you have a few thousand set aside and are running a ~$200-300 surplus each month if you want to do it practiaclly.
no subject
Date: 2004-07-18 03:07 pm (UTC)Unless Brian declares bankruptcy jointly with Crystal, it won't end up on his credit report. And no debt that he didn't sign for can legally end up there either, as we don't live in Wisconsin or Wyoming or whatever ludicrous state allows debt to be collected from the spouse. Even there, that's not *old* debt - only debt that was accrued while the two were married.
He is fine if she declares; he just can't use her name on anything from there on out. It's *her* business - the medical billing one - that may have a harder time if she has to get a loan or apply for an account with some, I dunno, medical..billing...entity.
no subject
Date: 2004-07-18 05:51 pm (UTC)no subject
Date: 2004-07-18 05:25 pm (UTC)We're running at about $400 surpluss each month right now, just starting to squirrel some of it away each month now. So I guess things are on the right track!
But seriously... *you're* a dad... how old would the kid have to be before you would consider starting up your own business?
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Date: 2004-07-19 02:44 am (UTC)there'll be some time after the child is born that you won't want to be away, let alone make the commitment it takes to getting your own business rolling, even when it is something as comparitively low-key as a comic/game shop. you're simply going to want to spend a fair amount of quality time with your child and bond with it before you dedicate the time it takes to making a business succeed. that could be 4 months, it could be longer. theoreticallt it could be less but i doubt it. it's rpecious time and the child will NEED attention regularly and it's impractical to expect your wife to handle it alone.
from there on it all depends on you. i mean you'll be running a business where you _could_ bring your child into the business without causing too much chaos so you won't be too taken away from your bonding/quality time... in your case it could be much sooner than other lines of work that would take you away more or require a more active, involved role, as opposed to maintaining a presence.
so depending on the nature of your shop possibly as early as 4-6 months... but it could be as long as 2 years, depending on how things go and how you want to run your business. please, please place bonding with your child above making your business succeed. Sophia is infinitely more important to me than my job.
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Date: 2004-07-18 08:52 pm (UTC)At any rate, Bri, if you don't give your dad a grandbaby soon, he may scalp you. ;)
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Date: 2004-07-18 11:23 pm (UTC)no subject
Date: 2004-07-18 02:56 pm (UTC)a) you put her name on the credit applications when you go to get your account at Diamond or wherever (duh)
b) you and she have a debt that you've both signed on for (utility, apartment, etc.) *and she lists it on the bankruptcy and then they come after you and you don't pay it*
Basically, the only things held against you are things you signed your name to. We're not a state in which debts your spouse accumulates can hit you. Sometimes unscrupulous creditors will try to submit derogatory info from her old accounts to your credit report, but if so, you can dispute it and have it removed easily.
2. You should have insurance to have a baby, but you don't have to work @ comcast to get it, you know? Check into buying insurance as a sole proprietor as part of your research. See how much it'll cost to cover you, your spouse, a potential kid, etc. It'll be pricey, but it'll be tax deductible as well. In all cases, you should absolutely not work @ comcast while trying to start your business. The first 6-12 months are the most important time; you can't afford to be spread so thin, IMHO. Think of trying to build an understanding of your customer base, learn what to order & how much, etc. That takes a lot of time crunching data, reading industry stuff, and just absorbing knowledge about how the industry in general and your operation in specific. You're no doubt going to have to put in way more than 8 hours a day at the start of the business.
All that seems like bad news, but it's also the most exciting, frightening, intense and interesting (in the Chinese-proverb sense) time you'll ever have in the business, and you need to be 150% percent there for it. And that seems like more bad news, but it isn't. The first little while with a new business is very kick-ass, even if sometimes it's your ass getting kicked.
Anyway, I recommend you start the business, give it x amount of time to get going (1.5 yrs or whatever number makes sense when plugged into your plan), and then start trying for the baby, making sure you have health insurance.
3. You need to begin actually trying to make money in order to legitimately claim business expense deductions. Otherwise the IRS can declare your business a 'hobby'. This is particularly something they look at if you have schedule C (business) losses but also W-2 wages. They suspect (quite rightly sometimes :P) that you just want to reduce your income from your job by having losses from activities that aren't from a 'real' business.
This means, however, that if you amass items and occasionally do a convention, or if you have a steady stream of income (however small) from ebay stuff, or whatever, then you're trying to make money. Other ways to legitimize the business include getting business cards/letterhead done and getting a PO box or other mail drop type place to have as an interim business address (so the business mail is separate from the other mail). It's likely that you would end up being able to initially write off enough stuff so that you make no profit. If you do a couple conventions a year and make a grand, your storage room along would nearly wipe that out, huh? Then figure in, I dunno, cost of good sold, maybe a home office deduction, etc.
One thing to keep in mind is the "three of five rule." That's an IRS standard that says your business should make money 3 out of 5 years. Again, this goes toward your business being counted as such, not a hobby. Once it's your only source of income (no W-2 job) and you have a storefront, then it's very clear your business isn't a hobby. But for now, you might want to consider trying to make, like, $100 in the first year, then lose a *lot* the next year, then make $100 the next year, etc. Make sense?
One day when you're over I can talk to you about expensing and capitalizing assets. That'll help you play the make money - lose money game better.
Anyway! There you go.
no subject
Date: 2004-07-18 06:11 pm (UTC)