Be Practical When Working at Home
December 15, 2008 by admin
Filed under Business Success, Home Business
Before you make the giant leap to quit your job—or your job search—to work from home, you have to take a few practical things into consideration. Don’t let your enthusiasm for the thought of working from home cloud the realities of your decision. During this exciting time, you must still realize that the bills you pay now will still have to be paid—and you can expect to pay a few more, as well.
Here are a few things you must consider before making working from home your primary source of income.
Health care. Even if you think you pay a hefty amount of your health care costs at your current company, you must investigate the cost of insuring yourself and your family completely out of pocket. The majority of health care policies for family coverage had premiums between $3,400 and $4,650. Women tend to pay as much as 18 percent more than men. For individuals, the costs are significantly less, averaging around $1,900, according to a survey conducted by The Cost And Benefits Of Individual And Family Health Insurance Plans, a commissioned evaluation of eHealth Inc.’s data conducted by Forrester Consulting.
Long-term catastrophic health insurance, also known as “critical illness assistance” is less expensive than health insurance and is considered a supplement to health insurance. It doesn’t cover regular visits to your doctor, and instead covers longer, drawn-out illness. Claims are typically rejected if there are pre-existing conditions, or if the person dies within thirty days of diagnosis. The average payout in 2007 was under $100,000 with an average age just under 50 years old, according to investopedia.com.
Many companies also offer death benefits to their employees, also seen as a supplement to what the individual already has. The average cost of life insurance is $500. Most people, especially those who are younger, don’t think about life insurance, but if you’re in business for yourself, it is an expense you should consider.
You’ve made your decision to quit your job. You can pay for health insurance and death benefits and you plan to transfer the 401K you had from your old job into an Individual Retirement Account. Good move, but you must also continue to invest into your retirement. Chances are your income, at least in the beginning, will drop. Be certain in your planning, you have enough in your budget to continue putting some money toward retirement. Because, really, do you want to be ninety years old and still working from your home office?
Yes, you will likely earn less money, at least initially, when you begin working from home. Statistics show that people working from home earn less money, but the savings of working from home tends to offset that. Make sure you have a nest egg put away so that if your earnings are far off your projections, you can still pay basic bills.
Working from home can be a great adventure, but it takes planning and a big dose of reality. By planning properly and keeping your goals based on reality, working from home could improve your lifestyle…and your life.
