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Message
Switching to a 1099 job. Good or bad idea?
Posted on 6/23/22 at 12:11 pm
Posted on 6/23/22 at 12:11 pm
I've been looking for a career change recently, and one of the areas I have pushed really hard to get into was sales. It's been challenging, being as I don't have much of a background in sales.
I recently went on an interview for an outside sales position with a roofing company. It seemed like me and the manager really hit it off well, and I was offered.
I'm a bit nervous because the position is 100% commission (50-50 split on profit) and it's not a W2. That means I'll be losing out on the one good thing about my current job, the benefits. I can jump on my wife's, but that basically means she will be working for the insurance because of how expensive it is.
I'm looking for any and all advice about this, so I figured I'd stop here. Anyone with experience in roofing, and with working 1099.
It would be a big leap for me, and I would have to lay all my chips in to bet on myself here. I'm kind of torn on it.
I recently went on an interview for an outside sales position with a roofing company. It seemed like me and the manager really hit it off well, and I was offered.
I'm a bit nervous because the position is 100% commission (50-50 split on profit) and it's not a W2. That means I'll be losing out on the one good thing about my current job, the benefits. I can jump on my wife's, but that basically means she will be working for the insurance because of how expensive it is.
I'm looking for any and all advice about this, so I figured I'd stop here. Anyone with experience in roofing, and with working 1099.
It would be a big leap for me, and I would have to lay all my chips in to bet on myself here. I'm kind of torn on it.
8
Posted on 6/23/22 at 12:38 pm to Hold That Tiger 10
i did 1099 for years then got a corp and file as an S-corp. you save tons on taxes whether self employment tax AND income taxes on my company distribution side. way more write offs than just plain 1099 where you need above the line deductions to lower self employment tax. write yourself a salary as a W2. get a payroll company to handle it. Just get a checkbook control solo401k. it is the best retirement plan if you work for yourself. your solo401k contributions will lower your income tax on the W2 side and all those deductions will lower or nullify the income taxes on the company distribution side. It really is a win-win.
Posted on 6/23/22 at 12:57 pm to Hold That Tiger 10
quote:
but that basically means she will be working for the insurance because of how expensive it is.
welcome to real world. many wives do that. look, this whole thing depends on how much money you make now and would with 1099. SE tax can hammer you as a 1099. It is why i pay myself through my company. you need to run numbers plus if you do not want wife paying healthcare. Those are all metrics you need to consider.
Posted on 6/23/22 at 1:02 pm to Fat Bastard
Not sure exactly what you are saying.
One suggestion I got was to form my own LLC, and have the roofing company pay that. Is that what you are suggesting as well, or is what you are talking about something different?
One suggestion I got was to form my own LLC, and have the roofing company pay that. Is that what you are suggesting as well, or is what you are talking about something different?
Posted on 6/23/22 at 1:32 pm to Hold That Tiger 10
What types of roofing materials will you be selling residential or commercial? If its commercial I would be extremely cautious as some sales folks cant get product to sell due to raw material constraints and supply chain issues. Which means you don't make any money. I know a bunch of roofing sales folks, some who have spent a long time in the business and are doing well/have done well, I also know quite a few who struggled and flamed out. Good luck to your switch to sales, if you put the time in and make relationships it will be very rewarding.
Posted on 6/23/22 at 1:35 pm to HamCandy
quote:
What types of roofing materials will you be selling residential or commercial?
It's mainly residential.
Posted on 6/23/22 at 1:36 pm to Hold That Tiger 10
Another thing that sort of draws me in is that I know a few people that are in the construction side. I've talked to one already that said he would work with me to send people my way if their customer is also doing roofing work. I have two other potential alleys as well. So I'm thinking once I learn the business a bit I wouldn't have to do as much door to door.
Posted on 6/23/22 at 2:53 pm to Hold That Tiger 10
Where do you live? Roof salesmen can make good money, but a lot of roofs have been replaced in South Louisiana in the last year. Roofing replacement has slowed a good bit.
Posted on 6/23/22 at 3:04 pm to Hold That Tiger 10
No one's going to be able to give you a perfect answer. Ultimately you need to do the due diligence on the roofing company job and see if the numbers work for you and your situation.
And honestly I think it's less about 1099 vs w2 and more of a question of the stability of the new job, new career, in a different field than you're in now. How easy would it be to back track into old career or go into a new career if this one doesn't work out? Can your family and your financial situation handle the potential instability? Can you take that risk? Do you have adequate savings in this situation?
Certainly the biggest change for a 1099 employee can be the fluctuating income, need to do quarterly taxes and pay for self employment tax and possibly lack of employee provided benefits. On the other hand 1099 take advantage of more tax deductions, open solo401k plans for retirement which can offset those costs. Ultimately again just have to crunch the numbers.
And honestly I think it's less about 1099 vs w2 and more of a question of the stability of the new job, new career, in a different field than you're in now. How easy would it be to back track into old career or go into a new career if this one doesn't work out? Can your family and your financial situation handle the potential instability? Can you take that risk? Do you have adequate savings in this situation?
Certainly the biggest change for a 1099 employee can be the fluctuating income, need to do quarterly taxes and pay for self employment tax and possibly lack of employee provided benefits. On the other hand 1099 take advantage of more tax deductions, open solo401k plans for retirement which can offset those costs. Ultimately again just have to crunch the numbers.
Posted on 6/23/22 at 3:17 pm to wickowick
quote:
Where do you live?
Lafayette
Posted on 6/23/22 at 4:30 pm to Hold That Tiger 10
Will you have to pay into social security and medicare?
Posted on 6/23/22 at 4:42 pm to OlGrandad
quote:
Will you have to pay into social security and medicare?
I'm really not sure how any of that works, so I don't know.
Posted on 6/23/22 at 4:59 pm to Hold That Tiger 10
What's the income differential using reasonable assumptions?
Posted on 6/23/22 at 5:37 pm to iknowmorethanyou
quote:
What's the income differential using reasonable assumptions?
According to what management said people typically make in their first year on the absolute low end, it would be 15,000 more per year than I make now.
Posted on 6/23/22 at 10:19 pm to OlGrandad
quote:
Will you have to pay into social security and medicare?
of course he will. what do you think SELF EMPLOYMENT TAX is for a 1099?
it is why i suggested he can do a LLC or corp and be taxed as a S-corp and write himself a salary. he will pay it either way through his own W2 or SE tax being a 1099.
Posted on 6/23/22 at 10:22 pm to Hold That Tiger 10
quote:
One suggestion I got was to form my own LLC, and have the roofing company pay that. Is that what you are suggesting as well,
yes. correct
Posted on 6/23/22 at 10:23 pm to Hold That Tiger 10
quote:
According to what management said people typically make in their first year on the absolute low end, it would be 15,000 more per year than I make now.
So probably less than you make now
Posted on 6/23/22 at 10:29 pm to Hold That Tiger 10
I hate to be the one to break it to you, but the manager “hits it off with everyone”. It’s his job to hire people at no expense because he has nothing to lose.
You can make a quick buck selling roofs if you are at the right place and at the right time, but you have a better chance of that hot strippers phone number actually being hers than you do having a stable career selling roofs…. Well, unless you own the place and have other people out there selling for you at no cost.
If you have contacts… keep your job and sell roofs on the side.
You can make a quick buck selling roofs if you are at the right place and at the right time, but you have a better chance of that hot strippers phone number actually being hers than you do having a stable career selling roofs…. Well, unless you own the place and have other people out there selling for you at no cost.
If you have contacts… keep your job and sell roofs on the side.
This post was edited on 6/23/22 at 10:32 pm
Posted on 6/24/22 at 7:59 am to Hold That Tiger 10
Unfortunately, I know a lot about the roofing business. As someone already said, the manager is going to paint a rosy picture. He want/needs salesman that are no risk, by getting contract employees. I am not saying he’s dishonest , but you need to know how the profit is determined. It can sometimes be manipulated.
Residential sales are heavily dependent on hail and storms. As many policies now make you pay a percentage of your hose value, people decide to not get a roof.
What area are you in North LA is coming off a major hail storm and south LA is finishing up with Ida claims.
Most of home sales are done when people are at home after work. Can you work part time at the roofing company to see if you like it. It will be very little risk for both of you.
If you want to get into sales and like the building materials industry, the roofing distributors are hiring outside sales people. Elite Roofing, Beacon, ABC Supply, and SRS. They will offer a base salary, benefits, and car allowance.
The roofing sales people that make the most money chase hails storms and hurricanes.
Good luck with your decision.
Residential sales are heavily dependent on hail and storms. As many policies now make you pay a percentage of your hose value, people decide to not get a roof.
What area are you in North LA is coming off a major hail storm and south LA is finishing up with Ida claims.
Most of home sales are done when people are at home after work. Can you work part time at the roofing company to see if you like it. It will be very little risk for both of you.
If you want to get into sales and like the building materials industry, the roofing distributors are hiring outside sales people. Elite Roofing, Beacon, ABC Supply, and SRS. They will offer a base salary, benefits, and car allowance.
The roofing sales people that make the most money chase hails storms and hurricanes.
Good luck with your decision.
This post was edited on 6/24/22 at 5:34 pm
Posted on 6/24/22 at 8:28 am to Fat Bastard
quote:
One suggestion I got was to form my own LLC, and have the roofing company pay that. Is that what you are suggesting as well,
yes. correct
I would suggest this as well only to protect myself from lawsuits. One thing goes wrong with a roof and the lawyers will go after everyone involved.
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