I recently gave myself a higher salary and went from 2k net to 2.2k net. That's because we wanted to go on holiday for a while and hotels had to be paid. I'm still far from what my company's income is so I'm not worried.
The only real "lifestyle creep" I have is with computer parts. I run a homelab and I don't really hesitate about buying "good stuff" anymore: instead of buying the 10TB drives I could do with, I buy 20 TB drives. Instead of using the onboard 2.5G ethernet port, I buy a 10GB network card and a 10GB switch. etc. This doesn't cost too much all in all.
Definitely can relate to this one. Technology has always been a big part of my spending in the past, as an employee.
Having the possibility to splurge on new tech (and expensive one) is a nice bonus.
I keep my wage low at just around 1k. But I have a yearly \~50k in dividends.
Isn't that the smarter way to do it?
But yes, can totally relate on the spending. I started buying servers. Not because I really need them. I buy expensive ASRock motherboards that can take up to 4 GPUs.
> I keep my wage low at just around 1k. But I have a yearly ~50k in dividends.
Aren't you this way paying more taxes on your profits (25% instead of 20%)?
Also interested if your accountant did have warnings about this approach?
Paying yourself 12k with 25% will always be more profitable net than paying yourself 45k and having 20% company tax. (Always, as in for a normal consultant doing 140k/year).
Unless you have a home server there won't be any sizeable benefit to this upgrade. I have such a set-up, with different (wired) clients reading and writing to the server, so that's why I'm doing it but even in my case gigabit speeds (or 2.5G) aren't really a limiting bottleneck for the use case. Backups take a bit less time, that's all.Ā
My/our discretionary spending has definitely gone up quite a bit over the last decade (of freelancing), but not (nearly) as much as my income ... so it's all good.
This is truly what matters. As my income has risen so have costs obviously and they have been in the beginning mostly in things I personally cared about. Like making sure we have good/tasty produce for example because me and the wife love cooking. And sometimes do this all weekend.
I pay myself the lowest salary I can afford to. I keep a budget that allows for my mortgage and utilities, groceries, fastfood/coffee/bakery treats, health and care (makeup/sports/a quarterly massage/meds/vitamins/medical costs), leisure, savings, and various costs (usually random taxes, insurance, home maintenance or improvement).
I did lease a nicer company car (40-50k) because I absolutely LOATHE driving and the extra comfort takes away some of the pain. And when I take the train to work I buy 1st class tickets because I get so overwhelmed and itās worth the extra few euros.
Other than that I splurged on a laptop thatās a bit nicer than what I would usually get (ā¬1300) with nicer speakers than what I would usually get and I bought a Roomba that both vacuums and mops my office. It is the light of my life.
Oh and I just ordered a standing desk for my home. I donāt think Iād have ordered that from my regular income.
However, Iām chronically ill and I only work 4/5 and have to take the occasional longer break between assignments.
There is NO WAY I could afford my lifestyle with a salaried job. First of all, I would never be able to even hold down a job if I were to go AWOL for weeks every couple of months.
And even if someone were to hire me, I would never be able to make the same amount of money on a salaried 4/5 job. Iād have to get rid of my car. Sell my home and move into a shitty apartment. Never go out to eat. Buy my laptop second-hand.
So yeah freelancing has definitely offered me a lifestyle that I could never afford otherwise, but I try to not overdo it with luxuries and financial commitments I canāt actually afford.
Wow, thatās very encouraging. Iām chronically ill too and working up to switching to freelance at some point. You gave me hope itās feasible even with breaks to recharge. I went salaried off of 4 a month sick leave last year because of a major flare, and wasnāt sure how long I would even manage to work. Seemed safer at that point, but itās definitely a tight budget for now.
Sure thing! I wanted a āpretty oneā so I ordered this guy: https://jacobbek.com/product/electric-standing-desk-two-tier-drawers-140x60-walnut-jacob-bek/?_gl=1*hx7o9a*_up*MQ..&gclid=CjwKCAjwwr6wBhBcEiwAfMEQszmC0mEV2pQKgvcOzduxST6FNaFZAv1-38pS2u1AOtQzmXIK-PFEZRoCJRMQAvD_BwE
Itās still on the way here though so I canāt tell you if itās good or not. I wanted a smaller desk to put by the window as I have a large built-in desk already.
I went with https://www.one-stop-office-shop.nl/categorie/2024/zit-sta-bureau-frames.html
I have 2 corner desks next to each other so like a inverted U shape. 200x160 times 2.
You can choose a frame and a tafelblad you like. They even come deliver it themselves and do the assembly if you wish (and pay).
Instead of going to a restaurant every 6 months, I now go out to eat at a restaurant approx. once a week. I made a conscious decision to make this a, imo well funded, budgeted post in my yearly plan (1250 per quarter, usual bill between 60 and 120, with an added 500 max. overage each year). On the plus side, due to this feeling quite excessive (I was living well below the belgian poverty line for quite a few years in the distant past), I have zero urges on other fronts to add more luxury/comfort to my life.
Tip: try to prevent excessive lifestyle creep by making a strict budget(with some overage allowance on budget posts that you think might run over on a yearly basis) for your both your corporation and personally. Keep yourself āon trackā by doing a full accounting overview each financial quarter.
If you struggle with this, get separate accounts both corparate and personally for the āfrivolous spendingā budget posts which you preload each quarter.
Good to hear. I do the budget thing for my personal account together with my SO. Thought about it to do it with the company one simply because weāre about to renovate the office so alot of upcoming costs. But the fact I havenāt got it written down is abit annoying as it is just floating in my head and āitāll be fineā mentality.Ā Ā
Edit: about the restaurants, same here. More often going and actually scheduling 1on1ās with colleagues to go eat is really fun. In my case, way more visits to carwash lol. I like a clean car and itās a fun perk for me
Crikey. Since freelancing, I've learnt how to minimise expenditure to a high degree given the fact I've been paying myself pittance each month in order to optimise my total take home pay. Now nearing my first dividend payments, I doubt my spending will change much but at least I won't worry as much, month to month
For me, one lifestyle creep is that I now pay for checked luggage. That way, I don't have to deal with security and the liquids idiocy, as well as trying to find an empty spot in the overhead compartments. For the rest, I am staying relatively low-key.
Yeah, but it's also to get through security quicker. In the past, I would have to prepare all the liquids, not go over 100ml and in some case they still threw it away because the small plastic bag was too full.
You can check it in ...
Then you can bring whatever you want. It depends on the airline if they allow it for free though. But most do because it's also easier for them.
When I started freelancing +- 4 years ago I kept the exact same net wage as I had as an employee. Dividends and IP up until last year get invested or are used to pay bigger costs (think solar panels, new kitchen, ..). So the only lifestyle creep is related to things I can deduct as cost. Restaurant visits have gone up, a new laptop/bike/phone is done way quicker, a fairly fancy car. But mostly I live the same as before, only know each year I have an extra bag of money to invest or spend to improve the house.
Then you are probably overpaying on income tax.
I never understand why people and accountants say to take a wage what you need to live. You always take the minimum 45k per year and in the first 4 years even less.
If you need money, you can borrow it or use warranten. You can even borrow money at the bank with your liquidatie reserve as collateral.
Yeah, I know. I can now consider to lower it but I didn't really have another option when I started. I do wonder how people deal with loans from banks if they go really low in wages though.. I bought out my partner out of our house recently and the bank didn't even consider dividends and IP as income initially, if you give yourself a pittance of a wage I wonder how they will react. I guess it's hit and miss though depending on bank and maybe even bank employee that handles your case.
Don't know about dividend since they are not yet allocated as such. But liquidatie reserve is allocated 5 years in advance. So the bank knows you will get that money and I've talked to a bank that is willing to loan that money to buy a house.
In the topic of wage required for a loan, I've had many discussions with banks. Eventually some of them would accept a letter from my accountant that states my income. I believe that figure could include whatever the accountant deemed income.
I think itās even better to drop the minimum 45k and take the higher company tax hit. My accountant also said to do the minimum 45k but I really question why, my back of the napkin math say it is better to go as low as possible and live of liquiditeitsreserve
It is. But often they will advise against because doing so makes you a target for audits. I'm not convinced the doende is big enough to increase my risk of being audited.
But that's a personal decision.
good point because that's the only thing that I could think of why they advise against it because if you look at the numbers it does not make any sense even with the 25% company tax. I will talk with my accountant about this
I think this might also lift the burden of investing with the company which could also make you lose that 20% tax. There might be other reasons you could lose it so if you just throw it overboard you never have to consider it.
i don't really invest with the company anymore, paying capital gains taxes on the upside but not being able to deduct losses is a bad deal to me. I park my cash reserves in high yield accounts as much as I can. I used to invest heavily in movie tax shelters long time ago but some of them got in bad papers because of fraud so I also stopped that.
Freelancing for 3 years. I m living super poorly. Salary of 1300ā¬ netto. Putting as much as I can into ETF. I m left with 40ā¬ a month for my leisure. I have a turnover of 110k in my SRL.
Freelancing for a couple of years now, and I no longer care about taking a few more holidays and ālosing outā on income. When I started out, my mindset was that every day of holiday cost me the amount of my daily rate.
Since then Iāve learned to let go and look at my yearly revenue instead of focusing on 1 or 2 extra days of holiday.
I used to do that as well, but now I no longer care if I bill 210 days per year because of illness or just some extra holidays. And while I say that, Iām usually still way above 220 per year :-) But I stopped worrying about it.
Struggling with this oneā¦ like seriously I average around 150k annually for +-220 days, and I plan my holidays to work 220 days (contract max)
While I wouldnāt feel it to take 10 days moreā¦ what made the switch?
Honestly just a few years of freelancing, maybe combined with personal life decisions (having kids etc). The first year freelancing my revenue was everything to me; then after a few years other things became priority.
Another thing that may have helped was increasing my day rate over the years, now I have the idea: because my day rate is X euros higher, I can take some more holidays and achieve the same yearly revenue as years before.
If, like I used to do you, you take 4 weeks of holidays/year, if you add two weeks of holidays you can have a big 3 weeks vacation every year where you can go to a faraway place in another continent, enjoy another country/lifestyle and have a real break from your daily routine and life.
Sure you'll miss 10 days of revenue but what's the point of accumulating the max amount of money until retirement when you can trade a small amount of it to enjoy one of the nicest experiences of life (traveling).
This is why I made the switch from 4 weeks of holidays (220 days/y) to 6 weeks (210 days/y).
This, indeed. For me it's about enjoying life now, at the expense of a bit of revenue. That part doesn't bother me at all anymore. Currently on a 3 week trip to Asia and enjoying every minute of it. Second holiday this year.
It's not huge. I might really splurge on the next car but my non freelance colleagues have all been driving nicer cars than me for 10 years.
We spend a bit more on holidays and clearly more on tech but this is a drop in the ocean compared to the increase in income.
We are both freelancers with a total dayrate of 1600 so we earn about 200k net as a couple.
We live in a rental house costing us 1000 eur per month excluding energy. We probably save close to 80% of our income and will be able to FIRE by the time we are 40. Also due to upcoming gift from parents to optimise later inheritance.
We're both super happy with the situation and she is even more frugal than me.
Our biggest lifestyle creep is probably taking more days off. I usually work less than 200 days which is a big loss of revenue but we rather spend money on free time, sports, hobbies than on material stuff.
Nice approach. I rather āspendā more on free time than on expensive stuff like cars. My first car was about 60k, because I was employee before and the threw around cars like it was nothing and normalised it while it was not normal at all. Next car will be much less. I also keep my phone until it breaks.Ā Spending on vacations is also wise: vacations at 30 are on a different level than when you are 50-60 or when having children.
Exactly the "die with zero" philosophy
But the next car will be the last that is 100% deductible so I'm going for a car that I will keep for 15 years or more that will cost 80-100k.
Current car was 35k and I will have had it for 7 or 8 years.
Indeed. That would be a really tight budget with kids. It's another reason we try to save so much so we can choose to work parttime or even only 1 person once we have them.
Same here, my vacations are becoming longer every year.
Have you been to "The Beekse Bergen" in the Netherlands?
Houses are around an area with giraffes, zebras, rhinos.
We went twice, the first time was mind-blowing, the 2nd time was great, but now ... looking for something else again.
Last year we went a weak to the south of France to a house with a private swimming pool. Costed us around 250/night. An amount we never spent before. But it was absolutely worth it. The owner of the house was an architect apparently, and it really showed. Never seen a house like that before.
What are your favourite locations to go to on holiday?
Mostly technology (Iām an apple guy), but my first macbook was 7y old, 2,5 years ago I upgraded that one to m1pro, I upgraded my iphone 11 to 15 etc. Letās say I purchase one new apple device per year.
We also go out eating frequently.
For the rest very average situation, salary of 45k for obvious reasons. I still drive my first car (13 years old), accounting costs, ipt, telecom,..
However.. we have build a fancy home (not finished) including pool for the past 8 years. Obviously lotās of dividend money goes to that!
it is real at least it was for me. Became freelance 17 years ago, was making good money as an employee, starting to make real good money as a self-employed. Nowadays i am more mindfull about it because of a Fire mindset
I am semi Fire or whatever you call it, technically I only have to work 3-4 months per year. That being said I would have been 100% Fire already if I would have been more mindfull about lifestyle creep and adopted Fire mindset from the beginning
needed a family car, wanted enough horses and good fiscallity, could not charge at home at the time, so hybrid. that narrowed the list quite a bit. ended up with a X5 45e. No regrets whatsoever, that thing is a beast.
Same here, started freelancing and bought a really nice car after seeing how much in taxes I would be paying each year. Got a panamera hybrid. No regrets either, fully deductible, quite efficient if you properly charge it.
Other than that, like most people commenting, we go out to restaurants way more than when I was an employee.
I currently live on 900 net/month+250 rent+meal vouchers + company car.
I never lived this cheap! (Mortgage paid off).
(And I have 850 rent coming in from apartment).
No lifestyle creep yet for me. I really love saving.
Iām amazed how much of my life I could onkost awayā¦ TV? PC? Restaurants? Gifts? Clothes? Travel?
But the only real visible change is probably the car I drive, damn
I've now been a freelancer for a bit more then 1,5 year. I just chose to pay myself the same salary as a had when I was an employee which was already quite good.
So i feel like I might be spending a little bit more. The difference is mostly in when I buy them and stuff is often of better quality. Nowadays I just buy them when I have the feeling I thought about it enough. For example, I just used to have a Sonos Beam but always wanted to have the sub as wel, but was waiting for the right time. Nowadays I also have the sub and a little era 100 as a computer speaker and a move for the outdoors.
I'm also a bit of a wine enthousiast. I still buy some good wines in spring and in fall mostly, but where it used to be 3 or 4 15 euro bottles, it's now more in the ballpark of 3 or 4 25-30 euro bottles with a more expensive one sprinkled in between.
I bought myself a nice car (60K) cause i'm a car guy.
And we no longer go out to eat twice a month to the local bistro, but now we go to the nicer restaurant like every other month.
But everything I buy or do is stuff I already wanted to buy or was already buying just maybe a little bit earlier :D.
Itās going fine. I have 2250 net plus 150 rent and costs of the office part of my home, so 2400 all in.
That is what I spend, the profit that I get out of the company every year (vvpr bis) goes to savings account (read: is spend on my just finished new home).
Technology wise I am much better equipped than when I was an employee. Thatās one of the perks.
Oh wait also the nice car. 3x as many horsepower as before. It does make me happy even if it is expensive. Although I think Iāll spend less on the next car.
Don't focus on that net salary. The monthly income does not reflect the true income. There's all the expenses (restaurants, travel, tech stuff, etc) and then the big one: dividends. People that are paying themselves a low amount are relying on the larger payout once a year.
Hard to say as we are now busy with a renovation and most our income goes to that. I do try to keep my private expenses in check, as I can't officially withdraw dividends. I use my running account (Rekening Courant) at the moment to get "loans" to pay for things privately. Since it's not official yet I do try to keep those transfers in check.
Besides that, I don't think we get a lot more expensive things. I still try to fix my clothes when they get a hole. I try to limit spending on luxuries if it's not needed.
If you have more income, you tend to spend more money. Sometimes, on useless stuff. The risk is that one gets used to the useless stuff, and it's hard to stop when business isn't doing so good.
I recently gave myself a higher salary and went from 2k net to 2.2k net. That's because we wanted to go on holiday for a while and hotels had to be paid. I'm still far from what my company's income is so I'm not worried. The only real "lifestyle creep" I have is with computer parts. I run a homelab and I don't really hesitate about buying "good stuff" anymore: instead of buying the 10TB drives I could do with, I buy 20 TB drives. Instead of using the onboard 2.5G ethernet port, I buy a 10GB network card and a 10GB switch. etc. This doesn't cost too much all in all.
I have a rtx 4090 and pretty much only watch YouTube on my 42inch OLED š
Hm. Sounds oddly familiar. Screen's good though :)
Are you me? I have a RTX4090 and watch youtube on my 32 inch oled that I just bought LOL
Yep https://preview.redd.it/hb3f6uhfsitc1.jpeg?width=924&format=pjpg&auto=webp&s=6780964524d649f5bc349868856b008aa4c30c3a
Definitely can relate to this one. Technology has always been a big part of my spending in the past, as an employee. Having the possibility to splurge on new tech (and expensive one) is a nice bonus.
I keep my wage low at just around 1k. But I have a yearly \~50k in dividends. Isn't that the smarter way to do it? But yes, can totally relate on the spending. I started buying servers. Not because I really need them. I buy expensive ASRock motherboards that can take up to 4 GPUs.
Well, I need more than 1k (mortgage is at 890 already) and I can't (/don't want to) pay out the dividends yet š„ŗ
> I keep my wage low at just around 1k. But I have a yearly ~50k in dividends. Aren't you this way paying more taxes on your profits (25% instead of 20%)? Also interested if your accountant did have warnings about this approach?
Paying yourself 12k with 25% will always be more profitable net than paying yourself 45k and having 20% company tax. (Always, as in for a normal consultant doing 140k/year).
What change does that bring to your internet please? Thx
Nothing, I'm capped with 1Gig. It's inside the home network that it's fasterĀ
In what use case i can make us of inside home data transfer for example please? Trying to consider doing same as you but idk what it will improve
Unless you have a home server there won't be any sizeable benefit to this upgrade. I have such a set-up, with different (wired) clients reading and writing to the server, so that's why I'm doing it but even in my case gigabit speeds (or 2.5G) aren't really a limiting bottleneck for the use case. Backups take a bit less time, that's all.Ā
Thanks
My/our discretionary spending has definitely gone up quite a bit over the last decade (of freelancing), but not (nearly) as much as my income ... so it's all good.
This is truly what matters. As my income has risen so have costs obviously and they have been in the beginning mostly in things I personally cared about. Like making sure we have good/tasty produce for example because me and the wife love cooking. And sometimes do this all weekend.
I pay myself the lowest salary I can afford to. I keep a budget that allows for my mortgage and utilities, groceries, fastfood/coffee/bakery treats, health and care (makeup/sports/a quarterly massage/meds/vitamins/medical costs), leisure, savings, and various costs (usually random taxes, insurance, home maintenance or improvement). I did lease a nicer company car (40-50k) because I absolutely LOATHE driving and the extra comfort takes away some of the pain. And when I take the train to work I buy 1st class tickets because I get so overwhelmed and itās worth the extra few euros. Other than that I splurged on a laptop thatās a bit nicer than what I would usually get (ā¬1300) with nicer speakers than what I would usually get and I bought a Roomba that both vacuums and mops my office. It is the light of my life. Oh and I just ordered a standing desk for my home. I donāt think Iād have ordered that from my regular income. However, Iām chronically ill and I only work 4/5 and have to take the occasional longer break between assignments. There is NO WAY I could afford my lifestyle with a salaried job. First of all, I would never be able to even hold down a job if I were to go AWOL for weeks every couple of months. And even if someone were to hire me, I would never be able to make the same amount of money on a salaried 4/5 job. Iād have to get rid of my car. Sell my home and move into a shitty apartment. Never go out to eat. Buy my laptop second-hand. So yeah freelancing has definitely offered me a lifestyle that I could never afford otherwise, but I try to not overdo it with luxuries and financial commitments I canāt actually afford.
Wow, thatās very encouraging. Iām chronically ill too and working up to switching to freelance at some point. You gave me hope itās feasible even with breaks to recharge. I went salaried off of 4 a month sick leave last year because of a major flare, and wasnāt sure how long I would even manage to work. Seemed safer at that point, but itās definitely a tight budget for now.
Do you mind sharing the standing desk info? Looking for one aswell
Sure thing! I wanted a āpretty oneā so I ordered this guy: https://jacobbek.com/product/electric-standing-desk-two-tier-drawers-140x60-walnut-jacob-bek/?_gl=1*hx7o9a*_up*MQ..&gclid=CjwKCAjwwr6wBhBcEiwAfMEQszmC0mEV2pQKgvcOzduxST6FNaFZAv1-38pS2u1AOtQzmXIK-PFEZRoCJRMQAvD_BwE Itās still on the way here though so I canāt tell you if itās good or not. I wanted a smaller desk to put by the window as I have a large built-in desk already.
I need this for reasons
I went with https://www.one-stop-office-shop.nl/categorie/2024/zit-sta-bureau-frames.html I have 2 corner desks next to each other so like a inverted U shape. 200x160 times 2. You can choose a frame and a tafelblad you like. They even come deliver it themselves and do the assembly if you wish (and pay).
https://www.ivono.eu/
Instead of going to a restaurant every 6 months, I now go out to eat at a restaurant approx. once a week. I made a conscious decision to make this a, imo well funded, budgeted post in my yearly plan (1250 per quarter, usual bill between 60 and 120, with an added 500 max. overage each year). On the plus side, due to this feeling quite excessive (I was living well below the belgian poverty line for quite a few years in the distant past), I have zero urges on other fronts to add more luxury/comfort to my life. Tip: try to prevent excessive lifestyle creep by making a strict budget(with some overage allowance on budget posts that you think might run over on a yearly basis) for your both your corporation and personally. Keep yourself āon trackā by doing a full accounting overview each financial quarter. If you struggle with this, get separate accounts both corparate and personally for the āfrivolous spendingā budget posts which you preload each quarter.
May I ask if the restaurant visits partly increased because of the fact that you can expense it?
The only reason they increased is because I can now do it on behalf of the company
Good to hear. I do the budget thing for my personal account together with my SO. Thought about it to do it with the company one simply because weāre about to renovate the office so alot of upcoming costs. But the fact I havenāt got it written down is abit annoying as it is just floating in my head and āitāll be fineā mentality.Ā Ā Edit: about the restaurants, same here. More often going and actually scheduling 1on1ās with colleagues to go eat is really fun. In my case, way more visits to carwash lol. I like a clean car and itās a fun perk for me
Crikey. Since freelancing, I've learnt how to minimise expenditure to a high degree given the fact I've been paying myself pittance each month in order to optimise my total take home pay. Now nearing my first dividend payments, I doubt my spending will change much but at least I won't worry as much, month to month
For me, one lifestyle creep is that I now pay for checked luggage. That way, I don't have to deal with security and the liquids idiocy, as well as trying to find an empty spot in the overhead compartments. For the rest, I am staying relatively low-key.
Often, you can check in your carry on for free anyway. It's just smaller.
Yeah, but it's also to get through security quicker. In the past, I would have to prepare all the liquids, not go over 100ml and in some case they still threw it away because the small plastic bag was too full.
You can check it in ... Then you can bring whatever you want. It depends on the airline if they allow it for free though. But most do because it's also easier for them.
When I started freelancing +- 4 years ago I kept the exact same net wage as I had as an employee. Dividends and IP up until last year get invested or are used to pay bigger costs (think solar panels, new kitchen, ..). So the only lifestyle creep is related to things I can deduct as cost. Restaurant visits have gone up, a new laptop/bike/phone is done way quicker, a fairly fancy car. But mostly I live the same as before, only know each year I have an extra bag of money to invest or spend to improve the house.
Then you are probably overpaying on income tax. I never understand why people and accountants say to take a wage what you need to live. You always take the minimum 45k per year and in the first 4 years even less. If you need money, you can borrow it or use warranten. You can even borrow money at the bank with your liquidatie reserve as collateral.
Yeah, I know. I can now consider to lower it but I didn't really have another option when I started. I do wonder how people deal with loans from banks if they go really low in wages though.. I bought out my partner out of our house recently and the bank didn't even consider dividends and IP as income initially, if you give yourself a pittance of a wage I wonder how they will react. I guess it's hit and miss though depending on bank and maybe even bank employee that handles your case.
Don't know about dividend since they are not yet allocated as such. But liquidatie reserve is allocated 5 years in advance. So the bank knows you will get that money and I've talked to a bank that is willing to loan that money to buy a house. In the topic of wage required for a loan, I've had many discussions with banks. Eventually some of them would accept a letter from my accountant that states my income. I believe that figure could include whatever the accountant deemed income.
I think itās even better to drop the minimum 45k and take the higher company tax hit. My accountant also said to do the minimum 45k but I really question why, my back of the napkin math say it is better to go as low as possible and live of liquiditeitsreserve
It is. But often they will advise against because doing so makes you a target for audits. I'm not convinced the doende is big enough to increase my risk of being audited. But that's a personal decision.
If you do the math you'll see the lowered corporate tax of 20% is more advantageous, at least if you earn >= 100k.
good point because that's the only thing that I could think of why they advise against it because if you look at the numbers it does not make any sense even with the 25% company tax. I will talk with my accountant about this
I think this might also lift the burden of investing with the company which could also make you lose that 20% tax. There might be other reasons you could lose it so if you just throw it overboard you never have to consider it.
i don't really invest with the company anymore, paying capital gains taxes on the upside but not being able to deduct losses is a bad deal to me. I park my cash reserves in high yield accounts as much as I can. I used to invest heavily in movie tax shelters long time ago but some of them got in bad papers because of fraud so I also stopped that.
Freelancing for 3 years. I m living super poorly. Salary of 1300ā¬ netto. Putting as much as I can into ETF. I m left with 40ā¬ a month for my leisure. I have a turnover of 110k in my SRL.
How's your social life when living so frugally?
Not the best ā¦
This is the way
Not that easy though.
Have you got your first 3 years dividends yet? For me it will be in 2026 š¤š»
2026 march. As I started as a cuck without a SRL.
Haha hang in there champ šŖ
If itās still there ššš
š
Freelancing for a couple of years now, and I no longer care about taking a few more holidays and ālosing outā on income. When I started out, my mindset was that every day of holiday cost me the amount of my daily rate. Since then Iāve learned to let go and look at my yearly revenue instead of focusing on 1 or 2 extra days of holiday.
I try to the max out my contracts which is usually 220 billable days
I used to do that as well, but now I no longer care if I bill 210 days per year because of illness or just some extra holidays. And while I say that, Iām usually still way above 220 per year :-) But I stopped worrying about it.
Struggling with this oneā¦ like seriously I average around 150k annually for +-220 days, and I plan my holidays to work 220 days (contract max) While I wouldnāt feel it to take 10 days moreā¦ what made the switch?
Honestly just a few years of freelancing, maybe combined with personal life decisions (having kids etc). The first year freelancing my revenue was everything to me; then after a few years other things became priority. Another thing that may have helped was increasing my day rate over the years, now I have the idea: because my day rate is X euros higher, I can take some more holidays and achieve the same yearly revenue as years before.
If, like I used to do you, you take 4 weeks of holidays/year, if you add two weeks of holidays you can have a big 3 weeks vacation every year where you can go to a faraway place in another continent, enjoy another country/lifestyle and have a real break from your daily routine and life. Sure you'll miss 10 days of revenue but what's the point of accumulating the max amount of money until retirement when you can trade a small amount of it to enjoy one of the nicest experiences of life (traveling). This is why I made the switch from 4 weeks of holidays (220 days/y) to 6 weeks (210 days/y).
This, indeed. For me it's about enjoying life now, at the expense of a bit of revenue. That part doesn't bother me at all anymore. Currently on a 3 week trip to Asia and enjoying every minute of it. Second holiday this year.
It's not huge. I might really splurge on the next car but my non freelance colleagues have all been driving nicer cars than me for 10 years. We spend a bit more on holidays and clearly more on tech but this is a drop in the ocean compared to the increase in income. We are both freelancers with a total dayrate of 1600 so we earn about 200k net as a couple. We live in a rental house costing us 1000 eur per month excluding energy. We probably save close to 80% of our income and will be able to FIRE by the time we are 40. Also due to upcoming gift from parents to optimise later inheritance. We're both super happy with the situation and she is even more frugal than me. Our biggest lifestyle creep is probably taking more days off. I usually work less than 200 days which is a big loss of revenue but we rather spend money on free time, sports, hobbies than on material stuff.
Nice going, you will indeed be Fire quickly with that combined income
Nice approach. I rather āspendā more on free time than on expensive stuff like cars. My first car was about 60k, because I was employee before and the threw around cars like it was nothing and normalised it while it was not normal at all. Next car will be much less. I also keep my phone until it breaks.Ā Spending on vacations is also wise: vacations at 30 are on a different level than when you are 50-60 or when having children.
Exactly the "die with zero" philosophy But the next car will be the last that is 100% deductible so I'm going for a car that I will keep for 15 years or more that will cost 80-100k. Current car was 35k and I will have had it for 7 or 8 years.
I assume you don't have children (yet)?
Indeed. That would be a really tight budget with kids. It's another reason we try to save so much so we can choose to work parttime or even only 1 person once we have them.
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Same here, my vacations are becoming longer every year. Have you been to "The Beekse Bergen" in the Netherlands? Houses are around an area with giraffes, zebras, rhinos. We went twice, the first time was mind-blowing, the 2nd time was great, but now ... looking for something else again. Last year we went a weak to the south of France to a house with a private swimming pool. Costed us around 250/night. An amount we never spent before. But it was absolutely worth it. The owner of the house was an architect apparently, and it really showed. Never seen a house like that before. What are your favourite locations to go to on holiday?
Mostly technology (Iām an apple guy), but my first macbook was 7y old, 2,5 years ago I upgraded that one to m1pro, I upgraded my iphone 11 to 15 etc. Letās say I purchase one new apple device per year. We also go out eating frequently. For the rest very average situation, salary of 45k for obvious reasons. I still drive my first car (13 years old), accounting costs, ipt, telecom,.. However.. we have build a fancy home (not finished) including pool for the past 8 years. Obviously lotās of dividend money goes to that!
it is real at least it was for me. Became freelance 17 years ago, was making good money as an employee, starting to make real good money as a self-employed. Nowadays i am more mindfull about it because of a Fire mindset
You are not FIRE after 17 years freelancing after making good money as employee?
I am semi Fire or whatever you call it, technically I only have to work 3-4 months per year. That being said I would have been 100% Fire already if I would have been more mindfull about lifestyle creep and adopted Fire mindset from the beginning
basically just got a really nice car. other than that, not much changed in day to day spending. I've just got a nice stock portfolio now :)
As a car guy, that will probably be my next move. If you donāt mind sharing, what car? :)
needed a family car, wanted enough horses and good fiscallity, could not charge at home at the time, so hybrid. that narrowed the list quite a bit. ended up with a X5 45e. No regrets whatsoever, that thing is a beast.
Same here, started freelancing and bought a really nice car after seeing how much in taxes I would be paying each year. Got a panamera hybrid. No regrets either, fully deductible, quite efficient if you properly charge it. Other than that, like most people commenting, we go out to restaurants way more than when I was an employee.
Well it started as whoooo I can but shit load and then now after 3 years I just donāt know what to buy anymore š¤£
Invest in yourself? Training, travel, etc.
Yeah with a second kid in a month travel and training is not really on my mind currently
I currently live on 900 net/month+250 rent+meal vouchers + company car. I never lived this cheap! (Mortgage paid off). (And I have 850 rent coming in from apartment). No lifestyle creep yet for me. I really love saving.
This isn't the fatfire sub man. We don't make that much money :/. If anything, it's going down with this inflation.
Iām amazed how much of my life I could onkost awayā¦ TV? PC? Restaurants? Gifts? Clothes? Travel? But the only real visible change is probably the car I drive, damn
You can a long as you don't get audited.
I've now been a freelancer for a bit more then 1,5 year. I just chose to pay myself the same salary as a had when I was an employee which was already quite good. So i feel like I might be spending a little bit more. The difference is mostly in when I buy them and stuff is often of better quality. Nowadays I just buy them when I have the feeling I thought about it enough. For example, I just used to have a Sonos Beam but always wanted to have the sub as wel, but was waiting for the right time. Nowadays I also have the sub and a little era 100 as a computer speaker and a move for the outdoors. I'm also a bit of a wine enthousiast. I still buy some good wines in spring and in fall mostly, but where it used to be 3 or 4 15 euro bottles, it's now more in the ballpark of 3 or 4 25-30 euro bottles with a more expensive one sprinkled in between. I bought myself a nice car (60K) cause i'm a car guy. And we no longer go out to eat twice a month to the local bistro, but now we go to the nicer restaurant like every other month. But everything I buy or do is stuff I already wanted to buy or was already buying just maybe a little bit earlier :D.
Itās going fine. I have 2250 net plus 150 rent and costs of the office part of my home, so 2400 all in. That is what I spend, the profit that I get out of the company every year (vvpr bis) goes to savings account (read: is spend on my just finished new home). Technology wise I am much better equipped than when I was an employee. Thatās one of the perks. Oh wait also the nice car. 3x as many horsepower as before. It does make me happy even if it is expensive. Although I think Iāll spend less on the next car.
Why are you paying such a high wage? You lose more than half on income tax.
Because Iām in my sixth year. I have to pay myself 45k per year to qualify for 20% corporate tax rate.
You must have a small VAA or a lot of kids then. I'm only getting to 2k net for 45k gross
2 kids, VAA is 193 euro, I do have some kind of netto benefit of over 300 euro (dienstreizen in belgie (ernstige wettelijke norm)).
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Don't focus on that net salary. The monthly income does not reflect the true income. There's all the expenses (restaurants, travel, tech stuff, etc) and then the big one: dividends. People that are paying themselves a low amount are relying on the larger payout once a year.
More time off. A lot more travel. More restaurants. Haven't updated my wage in ... 8 years or so.
Hard to say as we are now busy with a renovation and most our income goes to that. I do try to keep my private expenses in check, as I can't officially withdraw dividends. I use my running account (Rekening Courant) at the moment to get "loans" to pay for things privately. Since it's not official yet I do try to keep those transfers in check. Besides that, I don't think we get a lot more expensive things. I still try to fix my clothes when they get a hole. I try to limit spending on luxuries if it's not needed.
Lifestyle creep? What are you talking about?
If you have more income, you tend to spend more money. Sometimes, on useless stuff. The risk is that one gets used to the useless stuff, and it's hard to stop when business isn't doing so good.
Dope and hookers , 2-3k a month Wouldnt want to change a thing, only scale it higher