My original “plan” did not work. It will take an additional one to two years to transition from my current job to my private practice. What went wrong?
I planned to walk out of my job the year I turned 55. However, I am now married. Things Change. Marriage is compromise.
My husband thought I’d lost my mind. “People don’t quit jobs for no reason.” he said. To keep peace in the household, I agreed to wait one year to better plan my retirement.
It is a good thing I listened to my husband.
During my retirement, I plan to run a part-time Private Therapy Practice out of my home. The sunroom in the rear of our home has a private entrance and parking for four cars. I even obtained approval from my day job to start my therapy practice. What I did not determine were the extra costs to run my business.
I realize the practice may not produce much income for the first year or two. I also found a transition job that will allow me to bring in an additional $2000 if needed. However, I can not count on this job now.
I have money in my retirement accounts that will cover my personal expenses once I turn 59 1/2. How am I going to make a suitable income from age 56 to 59 1/2? I can’t see reducing my costs. My husband is retired, on a fixed income and carries a Medicare and a Medicare Supplement Plan. I pay our mortgage and my husband pays our bills. No wiggle room there.
Sources of Monthly Income:
Private Practice – current estimate of $2,000 – $2,500
Personal Expenses of $2,000. I can cover my expenses with my private practice income.
Monthly business expenses will include taxes at $533, health insurance at $500, and phone/internet business expenses at $200. This is $1233.00 per month! Who knew being in private practice cost this much? This was my error!
1. I didn’t save enough cash and was unprepared for a “hiccup”. I need to have money saved for hiccups. My plan did not have room for hiccups.
2. Depended on something/someone besides myself in my planning. In this case, I depended on my transition job.
3. Next time, factor in health insurance, cell phone, house fax/dsl line, business income taxes and malpractice insurance as fixed business costs.
4. Be realistic about Cost Estimates. Take off my Rose 🌹 Colored Glasses!
What can I do right to fix my wrongs?
1. Save 12 months worth of business expenses in my business account before jumping to private practice: $15,000. Business Savings. I have $3,000. Need $12,000.
2. Depend on myself for my transition. Save $ 2,000 Monthly Costs for 6 months is 12,000 Personal savings. I have $12,000.😎
3. Emergency Fund balance of $6,000. Right now this is at $1600 due to house repairs over the last five years. Need $4,400.
Total Savings Needed: $16,400.
3. Pray and Meditate. Visualize myself as transitioning to Private Practice. See it happening.
This day 262 out of 362. Chin up and forward March!