Adjusting to a new lifestyle

April 3, 2008

This is week number two of my mini retirement.  It wasn’t easy at first, but I am learning to adjust.  Actually, I think I could get used to this.

Yesterday I woke up around 8:30, read the WSJ and drank coffee until 9:00.  Then I worked on a partnership tax return until 12:30.  For a good chunk of time, I reached the “zone” while working – a highly focused state where I lose track of time and do my best work.  I listened to Patsy Cline on a whim and discovered her music is amazing.

In the early afternoon I had lunch with a friend downtown and then a meeting nearby with my law firm client.  At 4:30 I went to my new gym, Crunch in SOHO.  I love that gym – it feels like a nightclub, the music is so loud.  After lifting weights for twice as long as usual, I was headed for the locker room when a dance remix of Madonna’s “Hollywood” came on.  I stayed for an 8 minute ab workout that has me feeling very sore today.  Can’t wait to go back today! 

In the evening I had dinner with my friend Chris, who will be my roommate at Duke next Fall.  We schemed about bschool while drinking Coors Light and eating bbq.

Can’t wait for summer!!

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Be Careful What You Wish For

March 22, 2008

NYT: You Say Recession, I Say ‘Reservations!’ 

For many of the city’s middle class, especially those in the creative class, who have felt sidelined as the city seemed to become a high-priced playground for Wall Street bankers, the implosion of the brokerage house Bear Stearns raises a tantalizing possibility: participation in an economy they have been largely shut out of.

“The environment right now is definitely more favorable to people who don’t make those Wall Street bonuses,” Mr. Cox said.  

On Web sites devoted to New York, there was a healthy dose of schadenfreude.

It’s true:  those of us not making huge bonuses over the past couple years are bitter.  Problem is, the city relies heavily on hefty taxes on Wall Street bonuses to pay for all the things that make NYC such a great place to live.  NYC is already cutting back on cops because of budget cuts


Getting Used to Spending Time Alone

February 19, 2008

I’m not sure if it’s a function of my personality or just circumstances, but I am almost never alone. I wake up in the morning at the same time as my roommate. We drink coffee and chat about the news for an hour or so. At work, I’m surrounded by people. At lunch I go to the gym and workout with a partner. Most every day after work I have some kind of social event — dinner, party, happy hour, date, meeting, etc.

I almost never sit at home and watch TV and when I do, it’s usually with my roommate. When I’m by myself I have a hard time sitting and just watching TV. Yesterday, for example, I was by myself in the apartment. I wasn’t sure what to do so I sat down and turned on the TV. Instead of just watching the show, I was also flipping through Barron’s and reading emails on my cell phone. Obviously, you can’t do three things at once so this was largely a waste of time. I eventually managed to get some work done, but it took me a long time to get started and to get focused.

There was another time in my life where I experienced a similar issue. It was the summer of 2003 and I had just gotten back from a semester abroad in Hong Kong. With an internship at Citigroup, classes, living in close quarters with everyone and SARS, the trip was hugely stimulating and social. I arrived back home and decided to take a summer internship working for Clear Channel in Raleigh, NC. I sublet a huge apartment near the Duke campus – I had the whole place to myself and there was hardly anybody else in the building because it was summer.

I knew a few people there, but aside from work, I was by myself A LOT. At first, I went nuts. I would get home from work at 5 or so and have no idea what to do… I was wasting a ton of time on Instant Messenger and aimlessly browsing the Internet. After a few days of this I started going for long runs through the campus every day when I got home from work. I think running can be a very meditative and even spiritual thing. I’m not sure how many miles I would run, but I remember how hot and muggy it was. I really enjoyed breathing the thick air and sweating profusely in the 90+ degree heat. The last stretch of my route was a 200 yard straight path of well worn dirt and gravel road. I would run as fast as I could for that stretch until I crossed over the imaginary line set by a pillar on the rock wall which runs along the border of the campus. After the sprint my heart would be beating so fast… it felt like it would pop out of my chest. It was great.

After the run, I would come back to the apartment, drink a Coors Light and fix dinner. At night I would watch TV, talk on the phone or read. In about three weeks, I had adjusted well and ended up having a great summer.

The reason I’m thinking about all this now is because I may soon have lots of free time on my hands until school starts in the fall. I hope to have lots of client work to do, but there won’t be anybody hanging over my shoulder, yelling at me if I don’t do it on time. It’s going to be very hard to adjust to spending time alone and working from home.


Filing Requirements for New York City S Corporations

February 18, 2008

Here is an overview of the filing requirements for New York City S Corporations:

Federal

The S Corporation must file Form 1120S by March 15th of the year following the year covered in the return (unless the corporation operates on a fiscal year other than calendar year).  Form 1120S also includes Schedule K1 , which lists each shareholders’ share of income and losses.  Schedule K1 is provided to the IRS, and to the shareholder.

** Since the S Corporation is a flow-through entity, the corporation itself pays no Federal income tax.   Thus, the 1120S is an “information-only” return —  all items of profit and loss are flowed through to the shareholders’ individual income tax returns.

 

New York State

For a New York State S Corporation, you must file Form CT-3-S  by March 15th.  S Corporations must pay a franchise tax which is based on size of payrolls.

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New York City

New York City does not recognize S corporation status, even though New York State and the IRS do.  Instead, the net income of an S Corporation is taxed as if it were a C Corp at a flat rate of 8.85%.  The minimum tax is $300.

Forms:  File one of the following forms (depending on your situation): NYC-3A, NYC 3-L, NYC-4S, NYC-4SEZ

** What makes this tax particularly obnoxious is that as a New York City resident, you receive no deduction for the tax paid by your S-Corporation.**


The Scientists Speak: money and “stuff” do not make us happy

January 28, 2008

Check out this review of a new book: “The How of Happiness: A Scientific Approach to Getting the Life You Want” by Sonja Lyubomirsky. The message of the book seems to be similar to the popular “Stumbling on Happiness” by Daniel Gilbert, which I recommend.

The research and conclusions from these books is very compelling and more constructive, I think, than many of these self-help books that constantly make the bestseller lists. In this book, Lyubomirsky shows that a lot of our happiness is genetic — we are genetically predisposed to be happy or to be gloomy. But, there’s still hope for those predisposed to gloominess – we can affect at least 50% of our happiness through our own actions.

When it comes to money, beyond a certain level of income and material comfort, additional money does not make us happy. Many people actually become less happy as they climb the income ladder because they are more inclined to compare their success to that of other people. Have you ever found out that one of your colleagues, someone who does essentially the same work you do, makes more money than you? This happened to me shortly after I started my job at the bank about a year and a half ago. I found an offer letter sitting on the fax machine. The person was hired at the same level as I was and would be doing essentially the same thing – but her offer was 11% higher than mine. I was angry and depressed for the rest of the day; mad at myself for not negotiating better, resentful of my colleague, etc., etc. It’s ridiculous that seeing this letter would take me down from my good feelings about my new job but it did all the same.

As I see it, one great irony of our culture is that so many of the things we strive for actually make us unhappy. We run up lots of credit card debt buying stuff. The fancy new TV probably makes us less happy… we would be better off if we didn’t watch so much and instead spent the time doing activities with people we like. Many people work jobs they hate just so they can afford to consume a lot of junk they don’t need and doesn’t make them happy anyway. In my opinion, you shouldn’t spend the majority of your life doing something that isn’t fulfilling or working with people you can’t stand.

I think it actually takes conscientious effort to live by the lessons of these books. Living in NYC, it can be tough not to constantly compare your economic situation with everyone else’s. I have stayed sane – and actually prospered – in this environment by choosing to live below my means and save money. To accomplish this on a modest income in NYC is challenging. I know many people who make more money than I do but actually save less. These people often have huge credit card debt that they are unwilling to pay down. It might work for them, but that lifestyle would make me anxious and miserable.


Home Office Update

January 19, 2008

I put together my new computer today. Got the whole thing up and running in less than an hour! Don’t want to jinx it but I remember how years ago setting up a new computer was an exercise in frustration — nothing worked and it was impossible to connect to the internet.  Props to Dell for what has been a great experience so far!

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In my usual style, I basically just threw this together — there are wires running everywhere, especially under the desk. But one of the goals of this home office project is to get organized. Good organization is an absolute necessity for my CPA business. But it’s also important for everything else. First thing for this computer:  make sure my anti-virus software is working and  sign up for online automatic hard drive backup.


New Year’s Project #2: Organize Home Office

January 11, 2008

For a long time now, I have been unable to do any work at home. My desk was a disorganized mess and my chair was extremely cheap and uncomfortable:

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My roommate Dave has generously agreed to go along with a major overhaul of the apartment. Here is a before picture of his old office area (across the room from mine):

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We have since switched places. I have put in a big table/desk and bookshelf in the space that used to have his desk and wall-mounted storage system. Here’s an after picture:

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Already this is a HUGE improvement! It’s great to sit in my comfortable new chair, drink coffee and read the Journal in the morning. Over the next couple of weeks I will keep going with the overhaul. This weekend I plan to buy a fast new computer with double monitors and a small filing cabinet. I’ll post pictures when it’s all done.