Contents
| Answer | ||
| 1 | Bottom line | the three numbers that decide it |
| Results | ||
| 2 | Net worth over time | percentile bands, both positions |
| 3 | Final net worth distribution | where the outcomes land |
| 4 | How it feels | the odds read the way people feel them |
| 5 | Retirement and risk | when either position can stop working |
| Costs | ||
| 6 | Income breakdown | every wage-cost item, side by side |
| 7 | Cross-border taxes | only when a position crosses a border |
| Appendix | ||
| 8 | Report statistics | percentiles, spread and shape (technical) |
| 9 | Your choices | the fields you changed |
| 10 | All inputs as run | every field as run, defaults included |
| 11 | Assumptions (as run) | the rules, the model, the sources |
Answer
Bottom line
Position A (employee)
Position B (contractor)
Position B (contractor) ends with 1.74x the median net worth of Position A (employee) (154,801 vs 88,869 EUR), retires about 4 years later (age 60 vs 56), and is less likely to reach its target within 40 years (78% vs 89%).
Target 500,000 EUR per position (rule: explicit); medians over 10000 paths, seed 42.
Results
Net worth over time
Final net worth distribution
How it feels
Reference (outcomes below it count as losses) — Position A (employee): your target net worth (500,000 EUR); Position B (contractor): your target net worth (500,000 EUR).
How this works
Losses sting about twice as much as gains feel good, and rare risks feel bigger than they are. This chart scales both positions' income together and re-reads the distributions the way a typical human would (cumulative prospect theory, Tversky & Kahneman 1992) — a decision aid, not financial advice.
Retirement and risk
| Metric | Position A (employee) | Position B (contractor) | vs Position A (employee) |
|---|---|---|---|
| Goal | |||
| Target net worth | 500,000 EUR | 500,000 EUR | 1.00x |
| Target rule | explicit | explicit | |
| Phase rule | preserve | preserve | |
| Timing | |||
| Years to target, P10 | 13.0 | 13.0 | |
| Years to target, median | 21.0 | 25.0 | |
| Years to target, P90 | 37.0 | 42.0 | |
| Retire age, median | 56.0 | 60.0 | |
| P(retire within the horizon) | 89% | 78% | |
| Median wealth at retirement | 550,941 EUR | 551,620 EUR | 1.00x |
| Risk among retired paths | |||
| P(spending unfunded: ruin) | 68% | 64% | |
| Median year of ruin | 37.0 (age 72.0) | 38.0 (age 73.0) | |
| P(real net worth below zero) | 68% | 62% | |
| Median year below zero | 37.0 (age 72.0) | 39.0 (age 74.0) | |
| P(back below the target) | 94% | 93% | |
| Median year back below target | 26.0 (age 61.0) | 30.0 (age 65.0) | |
| P(target restored at the plan age) | 15% | 16% | |
A position stops working once its real net worth reaches its target; the ruin and restoration rows read the retired paths only.
Costs
Income breakdown
| Item | Position A (employee) | Position B (contractor) |
|---|---|---|
| Pay | ||
| Gross salary | 60,000 EUR | 19,594 EUR |
| Bonus paid as cash | 0 EUR | 0 EUR |
| Bonus paid into pension | 0 EUR | 0 EUR |
| Bonus paid as stock | 0 EUR | 0 EUR |
| Bonus paid as options | 0 EUR | 0 EUR |
| Employee pension contribution | 1,200 EUR | 392 EUR |
| Net take-home | 46,963 EUR | 16,581 EUR |
| Employer cost | ||
| Employer contribution | 20,280 EUR | 6,623 EUR |
| Occupational pension | 2,400 EUR | 784 EUR |
| Special payroll tax | 0 EUR | 0 EUR |
| Fixed employer cost | 0 EUR | 0 EUR |
| Total salary cost | 82,680 EUR | 27,000 EUR |
| Company / AB | ||
| Company invoice | 82,680 EUR | 90,000 EUR |
| Intermediary fee | 0 EUR | 0 EUR |
| VAT collected | 0 EUR | 0 EUR |
| Contractor premium vs employer cost | 0% | 9% |
| Retained pre-tax | 0 EUR | 63,000 EUR |
| Corporate tax | 0 EUR | 0 EUR |
| Retained after tax | 0 EUR | 63,000 EUR |
| All-salary gross (stress) | 60,000 EUR | 65,312 EUR |
Every wage-cost item, in EUR per year.
Cross-border taxes
Not applicable — this comparison has no cross-border residence/work/payer/entity assignments.
Appendix
Report statistics
| Metric | Position A (employee) | Position B (contractor) | vs Position A (employee) |
|---|---|---|---|
| End net worth | |||
| P5 (worst 5%) | -647,273 EUR | -551,146 EUR | n/a |
| P25 | -152,055 EUR | -64,151 EUR | n/a |
| Median | 88,869 EUR | 154,801 EUR | 1.74x |
| P75 | 381,721 EUR | 389,956 EUR | 1.02x |
| P95 (best 5%) | 1,246,884 EUR | 1,076,755 EUR | 0.86x |
| Mean | 255,274 EUR | 275,138 EUR | 1.08x |
| Spread | |||
| Std dev | 3,302,543 EUR | 2,858,590 EUR | 0.87x |
| Shape | |||
| Skew | 54.88 | 52.04 | |
| Sharpe | 0.08 | 0.10 | |
| Pension | |||
| State pension (median) | 41,862 EUR | 40,823 EUR | 0.98x |
Sampling precision at 10000 paths — Position A (employee): median ± 80,912 EUR (95% approx.); Position B (contractor): median ± 70,035 EUR (95% approx.); differences smaller than these bands are within noise.
Your choices
| Field | Value |
|---|---|
| Position B | |
| Monthly invoice | 7,500.00 EUR |
| Retirement estimate | |
| Target net worth | 500,000.00 EUR |
The fields you set yourself; every other field sits at its default.
All inputs as run
| Field | Value |
|---|---|
| Position A | |
| Position type | Employee |
| Country | Estonia |
| Enter amounts in | EUR |
| Living expenses / month | 2,800.00 EUR |
| Gross salary / month | 5,000.00 EUR |
| Position A - income growth | |
| Salary growth / year | 3.0% |
| Position A - bonus | |
| Bonus, % of salary / year | 0.0% |
| Bonus, fixed amount / year | 0.00 EUR |
| Share of bonus to pension | 0.0% |
| Bonus paid as stock, % of salary / year | 0.0% |
| Stock bonus, cash-equivalent amount / year | 0.00 EUR |
| Bonus paid as options, % of salary / year | 0.0% |
| Option bonus, cash-equivalent amount / year | 0.00 EUR |
| Vesting period (years) | 0 |
| Forfeit risk / year (unvested) | 0.0% |
| Position A - risk & unemployment | |
| Loss / failure probability / year | 2.5% |
| Severance (months) | 1 |
| Average job search (months) | 12 |
| Unemployment benefit / month | 3,000.00 EUR |
| Benefit duration (months) | 9 |
| Re-employment salary factor | 1 |
| Position A - pension & dividends | |
| Occupational pension rate (flat override) | Tiered default (4.5% / 30%) |
| Position A - holidays | |
| Paid holidays / year | Country default |
| Weekday national holidays / year | Country default |
| Position A - cross-border | |
| Residence country | Domestic |
| Work country | Domestic |
| Employer / client country | Domestic |
| Social security (A1) country | Domestic |
| Physical work share in the work country | - |
| Position A - pension & dividends | |
| Years of pensionable service on your record | 0 |
| Position B | |
| Position type | Contractor |
| How the company is run | - |
| Country | Estonia |
| Enter amounts in | EUR |
| Living expenses / month | 2,800.00 EUR |
| Monthly invoice | 7,500.00 EUR |
| Wage you pay yourself | - |
| Position B - income growth | |
| Invoice growth / year | 3.0% |
| Position B - bonus | |
| Bonus paid as stock, % of salary / year | 0.0% |
| Stock bonus, cash-equivalent amount / year | 0.00 EUR |
| Bonus paid as options, % of salary / year | 0.0% |
| Option bonus, cash-equivalent amount / year | 0.00 EUR |
| Vesting period (years) | 0 |
| Forfeit risk / year (unvested) | 0.0% |
| Position B - risk & unemployment | |
| Loss / failure probability / year | 15.0% |
| Severance (months) | 0 |
| Average job search (months) | 12 |
| Unemployment benefit / month | 0.00 EUR |
| Benefit duration (months) | 0 |
| Position B - pension & dividends | |
| Occupational pension rate (flat override) | Tiered default (4.5% / 30%) |
| Occupational pension | Yes |
| Dividend allowance | 16,304.35 EUR |
| Dividend payouts | Only in unemployed years |
| Position B - holidays | |
| Paid holidays / year | Country default |
| Weekday national holidays / year | Country default |
| Position B - cross-border | |
| Residence country | Domestic |
| Work country | Domestic |
| Employer / client country | Domestic |
| Company (entity) country | Domestic |
| Social security (A1) country | Domestic |
| Physical work share in the work country | - |
| Position B - pension & dividends | |
| Years of pensionable service on your record | 0 |
| Costs & goals | |
| Horizon (years) | 40 |
| Starting net worth | 0.00 EUR |
| Net worth in | EUR |
| Report amounts in | EUR |
| Inflation | 2.0% |
| Retirement estimate | |
| Auto target rule | Plan solve (expected-return funding rate) |
| Target net worth | 500,000.00 EUR |
| Retire at the target | Yes |
| Retirement phase rule | Restore the target by the planning age |
| Retirement model | Capital-sufficiency (wealth covers expenses) |
| Withdrawal rate / year | 3.5% |
| Retirement horizon (years) | 40 |
| Planning age (pension mode) | 90 |
| Target safety margin (plan solve) | 0.5% |
| Report display | |
| Income unit | Per year |
| Work days / year | 260 |
| Work hours / day | 8 |
| Paid holidays / year (all positions) | Country default |
| Weekday national holidays / year (all positions) | Country default |
| Market & risk model | |
| Expected annual return (mu) | 0.05 |
| Annual return volatility | 0.2 |
| Two-regime crisis model | Yes |
| Crisis frequency / year | 0.1 |
| Crisis persistence / year | 0.6 |
| Crisis log-drift shortfall | 0.12 |
| Crisis volatility multiple | 1.8 |
| Student-t degrees of freedom | 5 |
| Parameter uncertainty per path | Yes |
| Loss multiplier in bad years | 3 |
| Declining contractor hazard | Yes |
| Stochastic re-employment | Yes |
| Occasional expense shocks | Yes |
| Company loss on contractor failure | 0.1 |
| Invest savings at market returns | Yes |
| Track state pension separately | Yes |
| Show nominal (not real) amounts | No |
| Taxpayer | |
| Tax ruleset profile | Approximate |
| Tax year (income year) | - |
| Age at the start of the income year | 35 |
| Municipality (official rate file) | national-average |
| Church member (kirkeskat / Kirchensteuer) | No |
| Inward-mobility (expat) tax relief | No |
| Run settings | |
| Monte Carlo paths | 10000 |
| Random seed | 42 |
Every field of the compare form as run, with the form's canonical defaults filled in for the fields left untouched; amounts are shown in the report's display currency.
Assumptions (as run)
| Assumption | Value |
|---|---|
| Comparison | Position A (employee) vs Position B (contractor) |
| Horizon | 40 years |
| Monte Carlo paths | 10000 (seed 42) |
| Starting net worth | 0.00 EUR |
| Target net worth | 500,000.00 EUR (rule: explicit) |
| Position targets (real) | Position A (employee): 500,000 EUR; Position B (contractor): 500,000 EUR |
| Retirement rule | a path stops working once its real net worth reaches its target (the plan solve at the expected real return minus the 0.5% safety margin); the phase must show the target restored at the planning age at age 90 |
| Display currency | EUR |
| Inflation | 2.0% |
| Market model | two-regime Markov switching, Student-t shocks |
| Position A (employee) | Estonia: Gross income 5,000.00 EUR/month, living expenses 2,800.00 EUR/month, loss risk 2.5%/year. |
| Position B (contractor) | Estonia: Gross income 7,500.00 EUR/month, living expenses 2,800.00 EUR/month, wage 30% of the invoice, dividends (allowance 16,304.35 EUR), loss risk 15.0%/year. |
FX snapshot pinned at generation (see footer); tax year and rule sources per scenario country: official statutory sources.
How to read this report
Amounts are absolute in the display currency; the right-hand column shows the second position as a multiple of the first and reads n/a when either amount is zero or negative.
The target is typed; a path stops working once its real net worth reaches its target and then lives off the wealth — the country's net pension income where its payout rules ship, then the liquid wealth, then company withdrawals. The phase rule (preserve, checked at age 90) allows dips into principal on the way and reports them.
Ruin means the spending is not fully funded; below zero means the real net worth turns negative; back below the target counts a dip into principal after the target had been reached. The retirement, ruin and restoration rows read the retired paths only, and P(retire within the horizon) is the share retiring inside the report's horizon.