Mathematicians of TTR, How Much.......

I was thinking about this today. My 1 year experience is coming up in several months. Deciding what to do moving forward.

LTL linehaul looks like great money. BUT, I'm also single with no dependents ( no kids no wife).

OTR I get $63 per diem per day, or $441 per diem per week. As a tax filing single person, this helps me out a LOT.

When thinking of LTL jobs or salaries, I have to remind myself that gross pay is irrelevant. I don't care about earning more money to give to the government. Net going into my bank each week is what matters.

So I was thinking, let's say I NET after taxes $45,000 per year doing OTR. That'll probably be around the most I'll ever net in a year doing regular OTR reefer or dry van, I think, no matter what my experience is.

What GROSS income would i need doing LTL linehaul, that DID NOT PAY PER DIEM every week, to reach the $45,000 per year NET number?

Again, I'm single and live in the state of NC for tax purposes.

 

I think if you net like 1k a week it works out to like 80 something thousand a year.

shoot for the 80k mark.

 

If you can get on with a good LTL company you absolutely should. You will make more right now and in the long term. If you find that taxes are killing you then put more into your company matched 401k and start a small Roth IRA to lower your tax burden. You will never make more doing OTR unless you specialize.

 

Another thing to consider is that it costs more to live in the road than at home. Everyone's story is different but I know that I struggled financially until I got out of the OTR business.

 

Ok I just ran the numbers. According to paycheck city calculator website:

$441 X 52 = $22,932 tax free money per year

$538 X 52 = $27,976, which equals $426.78 after taxes per week

$27,976 + 22,932 = $50,908 gross per year

$426.78 (weekly net on $50,908 gross/52 weeks) X 52 = $22,192 net per year

$22,192 (net after gross taxes)+ 22,932 (per diem untaxed money) = $45,124

So with OTR per diem of $63 per day, I would need to work 52 weeks per year 365 days to gross $50,908 and net $45,124.

With regular no per diem job, I would need to gross $62,400 per year, or $1,200 per week, to net $46,067 per year or $885.92 per week.

So, in conclusion:

OTR per diem job: $50,908 gross = $45124 net

Regular no per diem job: $62,400 gross ($1,200 per week) = $46,067 per year net ($885.92 per week)

This post is so I can reference it later. Of course the OTR calcs are assuming no days off. Which isn't going to happen obviously. And the regular job assumes I get at least 34 hours off per week, maybe even 48.

Still, roughly speaking, I have to make $11,000 more gross per year to net the same amount of money with OTR per diem.

I agree with what another poster said. Maxing out 401k. With a Roth IRA, they are going to tax that anyways so it wouldn't be a tax savings account for the present, but would perhaps be in the future.

Question - How much do LTL companies let you contribute to their 401K plans? I'm thinking actually that I could make up for the tax difference of per diem versus no per diem by maxing out my 401K every single paycheck. Actually then I would be coming out way ahead as I would offset the tax difference by investing that tax difference.

 

more important is, which will you enjoy long term?

I did OTR and regional for 35 yrs, with a little local mixed in. was offered some high paying local jobs, but didn't want to drive city traffic all day every day.

 

You say you get $441 Dollars a week, is that what your company is reimbursing you per week? Because the only way to get per-Diem as a company driver is to get it through your company. It sounds like your trying to just take the deduction when you file taxes and you can't do that.

 

If you're only grossing 50k otr then you're doing otr wrong.

 

i am getting this per diem through my company.

I am not trying to take the deduction when filing taxes, I know that I can't do that anymore as a company driver.

 

well I have less than a year experience right now. I am open to suggestions on how to make more though.