2 job offers and need help deciphering how PTO works

If you are in your twenties and have no children then PTO is better for you than vacation time + sick time. Congratulations on your job offers, I'm happy for you!

jamin wrote:

ya..... wrote:

It IS part of salary. Hourly wage when salaried is salary / (2080 - (PTO x 8)) when it comes to PTO so the more you have the higher your hourly wage.

Where is the constant 8 coming from?

From what I understand now, an offer in X-Y-Z form means, in layman's terms,

"The cash we directly pay you for the next year amounts to X. You are allowed to take 8 holidays off and 15 other days off during that period."

Your quote is correct except you need to add in the medical (etc) benefits you will be receiving as well. Medical/Dental/Vision/Life is expensive. If your company is willing to pay 100% of the premiums, you are lucky since that is unusual. You may have to pay part of the premiums for those benefits.

Jamin,

You still havent told us what the offers are??

What are the figures for both

That's really cool Jamin, nice job and good luck.

obviousguy wrote:

Jamin,

You still havent told us what the offers are??

What are the figures for both

So the salaried one is $58,500.00 (including, not apart from, holidays/PTO, as I now understand things), $5,725.56 in Health Benefits, eligibility to participate in its 401(k) retirement savings plan after 3 months, reimbursement if I use public transportation, grant to purchase 250 shares of the company's stock.

Contract one is $35/hr, plain and simple.

Pro-rated the contract job is $68,250 based on 37.5 hrs a week.

from your previous post it sounds like you have already made up your mind for the salaried position - I would say for a programmer that is a very poor choice.

The issue is this type of work is very rewarding if it is project based and you get "in the zone". You could literally do your 37.5 hours in 2 1/2 days on the contract plus be making more money. And quite likely as a first year employee you will be working way more than that at the salaried position AND getting paid less.

exp. you prove your worth with the contract by beating deadlines and grinding out in the zone with late night coffees and billing 40 hours in 3 days. You make $1400 - impress your boss - and gain a client. On top of that more engaging and varied work.

Scenario B is you get paid approx. $1400 for a full week of salaried job having to work 50+ hours and mundane code editing with a bunch of other drones.

I know you are "wooed" by the system and the "benefits" but I plead with you (as a fellow programmer) not to fall into that trap....I wish I hadn't. The one main benefit that people think is true but is entirely false is the lure of moving up the ladder or putting a reputable salaried job on their resume. But our position is not the same as an accountant or lawyer. It is a craft. I guarantee things will work out better for you if you take the contract.

I'm happy to chat more via email and share my experiences with you personally if you like. But I strongly urge you to take the contract (even though I can see you are thinking salary)

Wow yeah that's no contest, the salaried position pays way more.

jamin wrote:

So the salaried one is $58,500.00 (including, not apart from, holidays/PTO, as I now understand things), $5,725.56 in Health Benefits, eligibility to participate in its 401(k) retirement savings plan after 3 months, reimbursement if I use public transportation, grant to purchase 250 shares of the company's stock.

Contract one is $35/hr, plain and simple.

This is why life is so depressing. Let's see how much I could save over 1 year:

Starting money: $58,500

SS/Medicare tax: $3948.75

Income tax: $14,625

1-bdrm apartment, utilities, parking, internet: $15,000 (at the very least)

Car insurance: $1,440 (Progressive, cheapest plan)

Food: Let's say $2,000 -- rice and beans diet, practically

leaves ~$20,000 to be saved. Of course, that means not using any disposable income for vacations, entering races, going out to restaurants with friends once in a while, or really doing anything besides posting on LetsRun. And it doesn't include miscellaneous expenses (I paid about $3000 last year between oil changes, new tires and mechanical repairs on my car).

The government says inflation is 2% per year, but we all know that's a big lie. What $20,000 buys one year will require $25,000 the next year. And when the foreign currency reserves get dumped back on the United States, I can see $20,000 losing nearly half of its purchasing power.

WHAT IS THE POINT OF EVEN TRYING?!?!?!?!?!?! I am going to cry myself to sleep tonight. There is hardly anything worth living for.

No gas, student loans, work clothes, car maintenance, christmas presents for your brother/neice/nephew, everyday household items? You should set your sights realistically so the goal is actually attainable. Also, don't sweat it. How old are you, 22? Your income will increase at a much faster rate than inflation (hopefully) so it's just a starting point.

You gotta move out of Seattle man. I couldn't imagine paying 1250/month for an apartment. I pay half that for mine and my friends make fun of me for paying that much.

jamin wrote:

WHAT IS THE POINT OF EVEN TRYING?!?!?!?!?!?! I am going to cry myself to sleep tonight. There is hardly anything worth living for.

And btw you're going to be just fine. Both offers are pretty good wages for a guy your age. If you invest even $10k a year until your next wage bump you'll be light years ahead of 99% of guys your age.

1001001110 wrote:

I'm happy to chat more via email and share my experiences with you personally if you like. But I strongly urge you to take the contract (even though I can see you are thinking salary)

Ok, you can email me at the value of str after the following lines

std::string str = "moc.liamg@gniktnimaj";

std::reverse(str.begin(), str.end());

TAA wrote:

You gotta move out of Seattle man. I couldn't imagine paying 1250/month for an apartment. I pay half that for mine and my friends make fun of me for paying that much.

Really he's in Seattle?

Can you move somewhere else with lower COL? Those salaries definitely don't seem right for that area....

Are you kidding? The contract pays almost exactly $10,000 more at worst case estimate.

On top of that he would get paid for every single hour he works. I guarantee on salary he is probably working 20% more ATLEAST as a first year guy than the typical 37.5 hours a week I calculated on.

So really the contract job would pay $10,000 + .2(58500) = $21700 more.

ON TOP of all that it allows more flexibility and taking on projects that he has more project management control over.

ON TOP OF ALL THAT it allows him to save even more money if he knows anything about tax law. He can write off all sorts of individual expenses as a contractor like transport, meals (meetings), etc etc.

Umm, no. First off, he's play 7.65% more taxes than a W2, receives no health /dental/vision benefits, receives no days off OR holidays OR sick days, not STD/LTD, no 401(k) matching, no umbrella potential for bonus/raise (it's far more likely they will renew contract at the same rate or bring someone on at the same rate rather than develop internally). That rate is horrible compared to the salary.

You are basically getting paid exactly the same except with none of the inherent benefits of being a W2 that a company cares to invest in. Without knowing the culture of either of the companies, it's really up to jamin, but on paper the contract job pays LESS when you consider all of the above factors.

TAA wrote:

You gotta move out of Seattle man. I couldn't imagine paying 1250/month for an apartment. I pay half that for mine and my friends make fun of me for paying that much.

Don't worry, TAA. If you only have $925 to throw down, there do exist options for you. Here's a 250 sq-ft apt:

jamin wrote:

TAA wrote:

You gotta move out of Seattle man. I couldn't imagine paying 1250/month for an apartment. I pay half that for mine and my friends make fun of me for paying that much.

Don't worry, TAA. If you only have $925 to throw down, there do exist options for you. Here's a 250 sq-ft apt:

http://www.zillow.com/homes/for_rent/condo,apartment_duplex_type/2102922955_zpid/days_sort/47.630838,-122.269292,47.59618,-122.334523_rect/13_zm/?view=map

How much is the closet? 600?

Explain how you are getting paid "exactly the same".

Based on a 37.5 hour work week he is getting EXACTLY 9750 more on contract.

Based on a 40 hour work week he is getting EXACTLY 14300 more!

Also I didn't negate the benefits. Jamin was pretty clear they were around 6000. Still only 1/2 of the extra he would make on contract. It's obvious you are on salary and a champion for your cause so I'm not trying to convince you but simply trying to warn Jamin.

Also you talk about paying more tax? Are you serious? I think you need to seek out a friend or contact who is a tax lawyer. I GUARANTEE you pay less tax as a contractor, substantially less. Anyone who is a tax saavy contractor may be able to show you.

As for 401k etc. it won't meet the match in salary. That is just simple math. If you want to see what is the best option overall I'm sure Jamin can factor in the $ worth of benefits & 401k.

So no. I didn't "factor those out". But one big thing YOU factored out was actual hours of work. You are basing all your assumptions on Jamin working 37.5 hour weeks. Not only will he work substantially more than this, his work will probably be more mundane and niche offering him less opportunity to grow his resume.

Oh, and I didn't even get to the freedom, flexibility and networking factors that are inherent positives of contracting out.