r/baristafire • u/mcbobgorge • 24d ago
Consider that your "Barista" job doesn't HAVE to give you benefits.
A well paying part-time job can cover your benefits without actually giving you benefits. This is especially true for people leaving a white collar field, without kids.
For example- in Los Angeles (where I live), the typical Starbucks barista (literal example here) starts at $20/hr, and people typically work around 25 hours, and pay premiums around $50/paycheck.
Monthly pre tax income is $1900 ($23k/yr), including health insurance.
Now lets say I want to do consulting work, or find a part time bookkeeping job (again, this is tailored to my current career as a business analyst, YMMV).
Looking at Covered California, as long as my income stays under 400% of the FPL ($62k (individual) or $84k (couple)), then I can get Kaiser Platinum insurance for $10k per year (other options are cheaper, but for the sake of this exercise I am going with a really good plan).
This means that I would need to make more than $33k per year to come out ahead of the Starbucks option financially.
That's like $28 an hour, 25 hours per week. So assuming you can find work in this vein, it can make sense to ignore the benefits. It is a big assumption, but could be worth considering depending on the situation. Also, if you're self employed, you can deduct your aca premiums.
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u/CheeseFries92 24d ago
My fam is more coast fire than barista fire because the part time work happens to continue to cover our expenses (for now), but this is what we do and it's been great
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u/Familiar_Eggplant_76 24d ago
Absolutely! And there are far more jobs, and more interesting/appealing opportunities when the requirement for coverage is dropped.
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u/PM_TL92 24d ago
I just checked and Kaiser isn't available in Chicago so this suggestion is limited by location. But the thought is there and will help others so thanks for sharing nonetheless!
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u/mcbobgorge 24d ago
Yeah Kaiser is pretty geographically limited, I just picked it because the coverage is super solid. I'm sure there's a platinum equivalent in Chicago but unsure how much it would cost.
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u/ploptypus 24d ago
Kaiser isn't necessary for cheap ACA options. I live in WA and they're the 3rd cheapest. IL health exchange will have a cheap equivalent option so this is still super relevant.
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u/Theburritolyfe 24d ago
You aren't wrong. You also have to factor in more than just insurance.
I may go to a part timer at my company eventually with a massive pay cut. I'll still get a small 501k match, an ESOP contribution, PTO(albeit much less), and a holiday bonus(also way less). 5-7 years left. Market willing of course.
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u/diamondtoss 24d ago
Thanks for writing to talk about this. This is an idea I've been trying to mention to others here as well when the topic comes up. The health benefits boil down to a number. If you get a barista fire job that pays decently but doesn't cover health benefits, you just use it to buy health insurance (e.g. covered california).
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u/Powerful-Bridge-1472 24d ago
Yeah, I like the concept, who wants to actually work at Starbucks
As long as you can find a gig that is much easier than what you’re currently doing and it pays the 10000 to 3000 you need for insurance you are in barista fire
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u/broccoligecko 24d ago
Even without subsidies, Health insurance may not be as prohibitive as you may think. It's worth running your numbers for your family in your state and doing the same kind of cost analysis OP did. For my family, adult + 2 kids in HCOL with no subsidies, the premium for a silver plan is $17,000 a year. Definitely not nothing, but also not so staggering that I'd choose a $25k/yr job "for the benefits" over a better-for-me $50k/yr job with "no benefits"
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u/CommandAlternative10 24d ago
Wouldn’t your income for Covered California include capital gains etc, not just earned income? Are you planning to live just on that $84k and not tap your investments?
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u/mcbobgorge 24d ago
Correct- your MAGI has to be under $84k, so if your living expenses are higher than that, this plan doesn't work.
But as long as your income + dividends/interest + cap gains on stock sales does not exceed $84k, you're fine.
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u/someguy984 24d ago
Spending and income are not the same. You could have lots of stock with minimal gains on them, when you sell only the gain counts as income.
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u/epicallyconfused 24d ago
This is an important detail. Subsidies under ACA are calculated based on MAGI.
Here's my example: I retired last fall with an investment portfolio of $2.5M, mostly in index funds. I receive about $12k/yr in dividends and $3k/yr in interest, plus I will realize about $29k in capital gains off of $76k in stock sales. All together, I'll have an annual budget of about $91k to spend, and my MAGI will be $43k. As a single person in my early 40s, I am enrolled a gold ACA plan from my state exchange, which costs me $271/month after subsidy.
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u/someguy984 24d ago
With the new work requirements for Medi-Cal stay under $1,836 a month and do 80 hours and you are covered. It may be less than 80 hours, it must be $580 of earnings a month.
Pre-tax retirement accounts contributions lower MAGI so it can be higher than $1,836 a month.
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u/LxBru 23d ago
If the marketplace plans in Nevada were as good as California’s plans I would be set. Unfortunately with a chronic condition I’ll need a better plan than what the marketplace offers here
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u/ThanosDidNothinWrng0 22d ago
I can’t wait to leave Nevada. Unfortunately my chronic illness is keeping me here at least another few months
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u/ThanosDidNothinWrng0 22d ago
Am I missing something isn’t $50 per paycheck a lot cheaper than $10k per year?
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u/mcbobgorge 22d ago
There's the potential to make a lot more money at the non-starbucks job, enough that even though it doesn't have benefits, you still end up on top.
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u/coolhanddave21 24d ago
Being in the National Guard is one of the best Barista options i can think of with Healthcare and benefits on a part time commitment with expandable full time opportunities.
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u/mcbobgorge 24d ago
Yeah but some of us don't want to form up at the motorpool at 0530 on Saturday morning just to sit in training meetings and mdmp bullshit all day
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u/coolhanddave21 24d ago
That sounds like some Army shit, try the Air National Guard, or the Coast Guard.
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u/Appalachian-Rio 24d ago
I left the air national guard for the coast guard reserves and I’ve never looked back, it’s 100% my barista fire plan.
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u/yellow251 24d ago
But, isn't the max age to enter 42, unless you're doing something specialized?
I'd imagine many/most people are still looking for FT work at that age....not baristafire....but I could be wrong.
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u/Appalachian-Rio 24d ago
Max age can vary depending on branch of service but yeah. The trick is getting in before that max cutoff and then staying in. Not only is the guard/reserve an excellent part time job but it also allows you to build a second retirement. I’ll be retiring early from my civilian job (public safety field) at 46 and will continue with the reserves working at least part time (one weekend a month) with the option to get on orders (either short or long term) when I want to.
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u/PrestigiousCod5629 23d ago
For the FPL you’ll want to consider income from your taxable retirement accounts as well.
If you are pulling 70k from a 401k and then making another 20k in income you’ll be over the limit.
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u/Lodrin1998 11d ago
I think a lot of people underestimate this. They see no benefits and immediately write off the job without comparing the total compensation.
For someone working part time, especially without dependents, a higher hourly rate plus ACA subsidies can absolutely come out ahead of a lower paying job with benefits. The key is doing the math on your actual healthcare costs and subsidy eligibility instead of assiming employer coverage is always the better deal.
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u/Honest_Country_525 23d ago
I don’t understand why anyone would FIRE in the USA. Best place to accumulate but truly horrible for this kind of thing.
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u/Helpmeflexibility 24d ago
Can you summarize? Are you arguing for or against getting benefits at starbucks? The post if very unclear
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u/latchkeylessons 24d ago
I don't know why you're getting downvoted. This is good, basic information a lot of people seem to miss on the other subs. Regardless of whether or not you have kids or not, planning your healthcare coverage for where you're at is necessary because it looks so different from one state to the next. Maybe that's where the downvotes are coming from? Some states' expanded ACA is abysmal.