![]() What's your budget breakdown? Share your story with us for a chance to be featured in a future installment. "So he gets to take advantage of the tax savings on both sides." "What's great about the Roth is he doesn't get a tax deduction now, but all of the growth is tax-free and what's great about the SEP is he gets a tax deduction now and all of the growth is tax-deferred," Capalad explains. They also offer higher contribution limits: As of 2017, you can contribute up to 25 percent of your income after deductions, or as much as $54,000.įor Klee, having two types of accounts would mean twice the perks. It's great that Klee is already putting money away for retirement through his Roth IRA, Capalad says, but he could save even more on taxes by contributing to a SEP IRA, or simplified employee pension, as well.Ī SEP IRA allows self-employed individuals to make tax-deductible contributions and not have to pay taxes until they retire. He also pays his quarterly taxes out of his savings. He typically pays $350 per month for membership at a coworking space, although that can rise to $1,500 per month during busy seasons when he rents out his own office, and puts $100 to $200 toward marketing and online ads. Klee tries to keep his business costs low. Having a large car becomes important with kids because you. I just charged more and now I make more money." The chart is an example of an imperfectly optimized financial budget. "There are other GMAT or GRE tutors who charge probably like a tenth of what I charge, or at the very least, half of what I charge. "You can get more money a lot of the time if you ask for it," he says. He owes much of his success to his own hustle. He's also started consulting for other tutors on the side, for which he charges a flat fee or a percentage of revenue generated. He charges $160 per hour for GMAT tutoring and $125 per hour for LSAT or GRE help, and he requires a minimum of 10 hours. More than three years later, his monthly income ranges from between $3,000 and $4,000 up to $14,000 during busy periods. That's because "I always think I know better than other people, and sometimes I do and sometimes I don't. ![]() "I'm actually a really terrible employee," he says. He acknowledges that he's not exactly an ideal staff member. Klee didn't want to seek out a different test-prep company, though. "I never really loved school, but I love being on the other side of a classroom." ![]() ![]() While the company provided a good starting point, Klee soon realized he didn't like his employer all that much. "I coach jiu jitsu as a hobby, I love teaching friends … Tutoring was a chance to do teaching for serious."Īfter graduating from college in 2015, Klee moved to Singapore to work for a test-prep company. "I've always loved teaching people," he says. Klee first started tutoring as a student at Princeton University, where he discovered that he could turn his understanding of standardized tests into a way to earn extra cash. ![]()
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