Tuesday, April 15, 2008

What do an options trader and a stay-at-home mom have in common?

Hi June,

I ran into a problem while making a high end purchase that I hope you can help me with.

I am unemployed and living off the option trading I do each month in the stock market. If I am right, living off investment income does not mean I am self-employed even though it is my only source of income. If that is the case, and I hope it is, what do I list on a credit application for employer?

Do I still say self-employed since I am making more money than when I worked at a full time job or do I list “none” and get rejected?

I appreciate the help and enjoy your web site even if I am not officially self-employed.


Whitehall, PA

Hello Bob,

Correct. Living off investment income is not the same as being self-employed. It's as different as a jazz musician and a trust fund baby. Take a look at Trading stock options is not self-employment on this blog.

Unemployed is not the same as self-employed, although there may be a few similarities. Let's see ... you determine your work or non work-hours, nobody pays you for sick days, income is never definite.You are not self-employed. You are not employed. You don't have an employer. You have no earned income. Your situation is similar to that of a stay-at-home mom when she tries to get a charge card or other forms of credit in her own name.

You say you make more investing that you did at a regular job. You don't say what is your "high end purchase." If you're trying for a mortgage you may need to request a non-income verification loan. Then the bank will look at your assets rather than your earned income. Or, depending on your asset value, there's always a margin loan.


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