Read Post
Mon, 14 Oct 2024 15:50:10 -0700
Andy from
private IP
/all
Finishing up my tax return. TheImmigrant was scary-accurate in his takedown of
me in the other thread.
I went over my numbers for 2023 in preparation for doing my tax return, which is
due tomorrow. This time, I added up all my owner's drawings as a cross-check
and to get a sense of my actual profit from the business, separate and apart
from business expenses.
I am trying to strike the right balance here between being optimistic and
pessimistic. On the plus side, I am my own boss and the amount of profit is not
unreasonable in concept. On the minus side, what in the actual hell was I
thinking in 2023? The amount of money seems reasonable at first glance;
however, having a family of three survive in this area on one earner earning
this is pretty crazy. No wonder 2023 was rough. I also will have a large tax
bill...sad!
My 2024 is better, and worse. The fact is, I spend too much money on stupid
stuff, and if I didn't do that, my family would be in a better position. I also
need to be careful when expanding the law firm, because payroll is the single
biggest cost. It's fine when adding attorneys because their time is billable;
the issue is adding admin staff and law interns, whose time is non-billable.
Bottom line, even though I am an ace with tax returns, I am not so great at
financial management itself. I need a financial manager to come in and help,
because this is ridiculous.
TheImmigrant was spot-on in his takedown of me in /all. If 2024 were not going
as well as it is so far, I would be ready to renounce law firm ownership as a
business model and throw in the towel working for myself. Thankfully, things
look better at the moment and we are on a gradual upward trajectory. Assuming I
don't get screwed out of the bills that are pending, one of which is over
$110,000, 2024 will be better than 2023 and I won't be repeating this post in
2025. I guess we'll find out.
#LawFirm
_reply
Mon, 14 Oct 2024 17:25:00 -0700
whiteguyinchina from private IP
/all
Money is not really the end all be all of work. Are you enjoying what you do?
Does your wife and children's respect you? Do you have admiration of your peers
and community member's?
But yea law is a service job. I think about it as a massage parlor. No massage
no money. Either you create a pyramid capitalist structure, where you sit on top
and skim off the bottom, or you need a non service source of income that pays
whether you are there or not.
Curious, what is your profit percentage at the end? I think you should be
personally pocketing 10-15% of net profit. Maybe even 20%. I am not so familiar
with service businesses. After you pay everyone that should be your take home.
_reply
Mon, 14 Oct 2024 19:44:43 -0700
Andy from
private IP
/all
No to the first three questions, lol.
I ran the numbers and my total draws work out to about 20% of the gross,
although that number may be affected by use of my credit line throughout the
year...still need to revise my return to the final numbers.
_reply
Tue, 15 Oct 2024 02:57:05 -0700
whiteguyinchina from private IP
/all
That's too bad. 20% is pretty much what you can expect i think. Now you just
have to start doing less and start having other people to do more. That's your
future. Have you considered hiring law students on student visas or hb1s?
Exploitable
_reply
Tue, 15 Oct 2024 05:54:41 -0700
Andy from
private IP
/all
Yeah, it could be a lot worse. But the crushing burden of stress is ever
present. I had a couple of smart undergrads as Law Interns this past summer and
it worked out well. They were doing really advanced work and have a lot of
potential. Unfortunately, with their work not being billable, it's another W-2
outlay that I have to deal with even though it's super helpful. I would like a
couple more Law Interns and I learned a lot from this last time I had them.
_reply
Sat, 19 Oct 2024 06:43:22 -0700
Wily from
private IP
/all
Should a make turn to Elite Asian Education in California. Overhead is less, no
malpractice insurance, and teachers cost less than associate attorneys (but get
a higher hourly since there's group classes at $80/hour/kid, with like 10 kids
doing 6 hours a day for three weeks, haha). You even have your wife for parent
communications, which can be on WeChat basically, just make the white kids get
the app like I do (if they want the best SAT class of all time, they'll do it).
_reply
Sat, 19 Oct 2024 07:21:38 -0700
Andy from
private IP
/all
That is a genius idea. I'll look into that.
Replies require login.
