TechWhirl (TECHWR-L) is a resource for technical writing and technical communications professionals of all experience levels and in all industries to share their experiences and acquire information.
For two decades, technical communicators have turned to TechWhirl to ask and answer questions about the always-changing world of technical communications, such as tools, skills, career paths, methodologies, and emerging industries. The TechWhirl Archives and magazine, created for, by and about technical writers, offer a wealth of knowledge to everyone with an interest in any aspect of technical communications.
Subject:Re: Outsourcing, Layoffs, Contractors and Unions From:Bonni Graham <bonnig -at- IX -dot- NETCOM -dot- COM> Date:Mon, 10 Jul 1995 09:34:33 -0700
Vince Putnam wrote:
>This subject is huge and without major changes in the laws, it will become
>critical. Specially when many of us can no longer work and have insufficient
>funds to retire on. Remember the change in the law which made companies liable
>for any taxes a Contractor did not pay? I think it went into effect in 1990.
>This stupid action deprives contractors of the 501K plan since most personnel
>agencies that the companies use to protect them against the tax liability, do
>not offer 501K. So we end up without enough retirement funds.
Without going into whether outsourcing is a good thing or not (as an independent
contrator, who's working on a lucrative outsource project right now for a
company that didn't HAVE a TW dept before, I feel that I may be somewhat biased
-- although I also realize that YMMV), there are more ways to fund retirement
than a 401K program.
Even if your job shop or temp agency provides one (mine does), you may still be
better off managing your own retirement funding. I have a SEP (available to any
contractor) that I created by rolling over funds I had in an IRA (founded when I
was working for a regular EMPLOYER who did not have a 401K -- and IRAs are
available to everybody; they're just not as tax-deductible as SEPs). The funds
used by my SEP have consistently outperformed the funds that I would have been
investing in through the job shop; and yes, I track them daily. I contribute
monthly to my SEP, just as I would if I used a payroll deduction -- and I get
the same tax benefits. In addition, I invest in a tax-deferred life
I don't think anyone, contracting OR employed regularly, can really count on the
employer to provide retirement anymore. With more people moving jobs more ofen,
the gold-watch days are over. Even if an employer offers a 401K, fewer of them
are offering matching funds -- so it's your money (and often only your money)
going in there anyway, whether you're talking about a 401K or SEP/KEOGH or IRA.
Especially if you're contracting, you have to expect to cover yourself for
retirement -- and it's not like there aren't ways to do it. Some of them are
more tax deductible than others, but it's only fairly recently (on a broad
historical scale) that anyone other than the very rich could afford to retire as
early as many of us can anyway. Plan for yourself; don't expect anyone else to
do it for you.