deleted

[B52slinger]

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question answered on other forum

 

[forchinet121]

I'm pretty new to finances and am learning about cash/defined benefits plans.

Say I am a single 30 year-old attending making 500k/year as a 1099 contractor doing full-time locums.

Would I be able to invest 66k (max limit) to my solo 401k and 70k into my cash balance plan pre-tax and thus easily save 320k/year while spending 60k/year in a medium COL zero state tax state? And 500k would actually be conservative considering I have received multiple locums messages on Linkedin for >300/hour thus allowing for 400k+/year savings?

This sounds too good to be true and would allow for a ridiculously fast path to retirement (5M net worth in my late 30s)...

American Funds

Where are you getting the 320k from if you’re doing 66 and 70?

 

[ObsequiousAplomb]

Where are you getting the 320k from if you’re doing 66 and 70?

I think they're saying

500k gross
- 70 k cash benefit = 430k
- 60k spending = 370k
- 66k = 304k
- forgetting about all the federal taxes
- add more hours because he hasn't thought through it nearly enough
- mess around with the numbers some more
- somehow come to 320k instead of 120-180k

 

[jbomba]

I'm pretty new to finances and am learning about cash/defined benefits plans.

Say I am a single 30 year-old attending making 500k/year as a 1099 contractor doing full-time locums.

Would I be able to invest 66k (max limit) to my solo 401k and 70k into my cash balance plan pre-tax and thus easily save 320k/year while spending 60k/year in a medium COL zero state tax state? And 500k would actually be conservative considering I have received multiple locums messages on Linkedin for >300/hour thus allowing for 400k+/year savings?

This sounds too good to be true and would allow for a ridiculously fast path to retirement (5M net worth in my late 30s)...

American Funds

I would start an scorp. Take modest but reasonable salary and the rest in distribution. Then do that defined benefits plan mentioned in the other thread. I would also throw some money into a rental condo or the like. Loads of tax deductions with real estate.

 

[B52slinger]

it's 70k + 66k + 304k - 120k taxes = 320k invested annually

Even in CA with some of the highest taxes in the country, looks like 304k taxable income -> 115k of total state + federal taxes as a single person (though this is for W2)
Low or no state tax region should make up for the additional 1099 taxes

https://assets.futureplan.com/futureplan-assets/FPContributionLimitsTable.pdf

being able to invest 151k annually pre-tax reduces taxes by a ton

 

[Sushirolls]

Forget the numbers.

Focus on the corner stone of this plan:
Full time locums and for years.

Work a year doing full time locums, before laying out a plan of retirement that hinges on any numbers.

 

[B52slinger]

Forget the numbers.

Focus on the corner stone of this plan:
Full time locums and for years.

Work a year doing full time locums, before laying out a plan of retirement that hinges on any numbers.

that's fair, and I understand that these positions are unstable by nature
this was more of a hypothetical "what-if"

 

[Trismegistus4]

Why do people think that once their question is answered, they should delete it?