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Income: March 2018

My gross income for March 2018 was $13,099. This is gross, pre-taxed income and I’ll break it down below.

I’m retired so why the hell am I still working? I ask myself that a lot but I’ll discuss that below as well because it’s relevant to the topic of my monthly income reports on this blog.

 

Gross Income $13,099

Fortunately all my income is now 1099 income which means it’s income that I earn as a sole proprietor. This allows me the optimum tax deductions.

Why not incorporate and create a pass-through deduction? Because it’s too complicated. It’s far more efficient to simplify one’s finances – it’s incredibly easy to complicate things for a measly couple of thousand dollars.

Taxes

I have a tax-category in my YNAB budget so as soon as I get income deposited into my account I set aside 25% for taxes.

In fact, 2018’s first estimated taxes are due April 15th and that’s when I’ll be sending in however much I already have accumulated in my tax-category.

This makes paying estimated taxes incredibly simple and avoids the headache of underpayment penalties.

Example: I get a deposit of $2,500 from Teladoc and immediately I set aside $625 (25%) until it’s time to send in estimated taxes to the IRS and to state. I then go online and submit 20% to the IRS on their payment website and the other 5% to my state through their own website.

Deductions

I renewed 2 medical licenses this month – WA and CA. This cost me around $1,500 which is a direct deduction against my income from doing telemedicine work.

I am consulting for a medical group whom I approached with the idea of having them cover my medical licenses – they declined. However, they are open to revisiting the topic again in the future should we still continue to work together.

Always try to have your expenses covered by an employer or anyone you consult for. This removes one more headache from having to claim the deductions or keep track of them.

 

Telemedicine Income – $11,711

The majority of my income came from one particular telemedicine company whose name I can’t mention because they asked me to remove their name. However, it’s important to not put all those eggs in one basket – I still earned some income from other medical groups.

Income diversification is critical as I learned the hard way. Even though I may not dedicate an equal amount of time to each medical group, I am still diversifying my income sources and thereby directly decreasing risk – keeping a foot in the door.

I didn’t keep track of the hours I worked in March for Teladoc but I am averaging an hourly rate of $250 – so perhaps 45 hours for the month.

 

JustAnswer Income – $520

Because there is still a good amount of cold/flu cases going around it’s more efficient for me to be on Teladoc instead of JA.

I earned $520 for the month of March with JA and my goal is to use JA more for income if I’m overseas or possibly do some non-clinical work for them in the future.

I have built up some ‘clientele’ it seems. Without having to snag cases I get emailed a few times a week by different patients that they would like me answer their question.

I then hop online without having to prove myself to them. Without having to chit-chat. I simply address the question they posted and I earn an easy $15-20.

 

Telemedicine Income – $228

I did a quick 2-hour shift for another telemedicine company (they asked me to remove their name from this blog) just to keep that foot in the door. It actually was a moderately busy shift but I didn’t care to go fast and snag every patient that sprung up.

The goal is to do a few hours every month for each of these telemedicine companies.

This company is the only company which has offered me a part-time or full-time position. I’m appreciative but don’t care to have a set schedule with anyone.

 

Why Earned Income?

So, why earned income instead of living off passive income?

The screenshot from my net worth spreadsheet shows me that I could quite easily $2,800/month if I wanted to live off of my investments. Though I have used 4% as a safe amount to take off the top of my investments, I believe I can take out quite a bit more since I have the ability to earn an income.

The reasons why I continue to work instead of living off investments are as follows:

  1. budgeting
  2. greed
  3. headache
  4. opportunity
  5. fear
  6. judgement
1. Budgeting

I don’t feel like budgeting anymore. I’ll soon post my expenses for March 2018 and I think I spent around $6k. This is the first month where I’m like, meh, fuck it, I’ll spend however much I want.

Budgeting takes energy, it takes focus and effort.

I’m not a frugal person by nature. I love spending money. I love luxury and comfort.

I can get my expenses down to $1k/month but why the fuck would I want to do that? I already have proven to myself that I am able to do so if need be – but I don’t have to.

2. Greed

I’m also quite greedy and selfish by nature – what a catch; shocked that I’m still single.

I want my investments to keep growing and I want to be able to spend more money now so that I can have more experiences and more goodies.

$250/hr telling people that they have a cold and to drink some tea – that’s so hard to pass up as telemedicine is an incredibly easy source of income without having to leave my house.

3. Headache

Trying to build a Roth IRA ladder, a CD ladder, or mobilize a 72t distribution all sound like a financial headache.

I just got done dealing with the piece of shit medical board – I have zero desire to sit down to figure out the numbers and stick to a budget.

4. Opportunities

There are a lot of things which I am still interested in doing and by exposing myself to these different telemedicine companies and work environments I get offered new opportunities.

That’s how I found my consulting gigs. That’s how I found my teaching gig which I’ll hopefully love (I start this week). These are the things I would do for free and without putting in the effort they wouldn’t be possible.

5. Fear

I’m petrified of not having income coming in from work.

I understand fully that it’s purely numbers and that numbers have no emotions but shit man, I am a scared little kitten when it comes to not working.

If I leave medicine now and want to return later, what if I can’t?

If I left medicine I really don’t see myself wanting to come back. Circling back to greed – $250/hr?!! Please! How can I pass that up?

6. Judgement

If I stop generating income from work then I am worried that I’ll feel like a bum. I worry more about judging myself than others judging me.

I’m more than happy to get out of medicine but I’m working up to that. It’s going to take some time.

 

Downside to Earning Income

There are plenty of downsides to earning an income when it’s traded for my time and expertise.

Risk

That expertise costs money to maintain and is associated with a ton of risk. What profession can you think of that gets sued for doing what they are trained to do other than medicine?

Taxes

Taxes are a downside but if you’re paying taxes then you’re pocketing money so it’s hard to complain. However, there is a sweet-spot for paying taxes. I could earn just enough to pay for my overhead in order to end up in a very low tax bracket which would help me lower my taxes on my capital gains.

Lower taxes also means that I can do Roth IRA conversions without paying a dime; pre-tax money into a Traditional IRA and tax-free money out of a Roth IRA.

Dependency

Our culture has learned to rely on our government excessively which is why I pay for the social Security Income and the Medicare coverage for older individuals.

This dependency, this reliance on external governing bodies leads to excess empowering of politicians and that leads to more intrusion. Seatbelt laws and mandatory health insurance are a great example – no doubt that they are both really intelligent things to have/do but we have become a nation where the government has to force us to do them.

 

 

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