Making aliyah is a big life shift, and one of the biggest decisions you’ll face is how to keep your income flowing. Should you stick with your American job, or take the plunge and start your own Israeli business? Both paths have perks and pitfalls—here’s a breakdown to help you decide.
Advantages of keeping your American job
- An easier transition to life in Israel – Moving is stressful enough without having to job hunt or start a new venture from scratch. Keeping your American job provides stability as you settle in and adjust to your new surroundings.
- Keep your current job perks – Many US employers offer great benefits like 401(k) contributions and paid leave that aren’t as common in Israel. If you stay on the payroll, you get to keep these sweet perks while enjoying your new life abroad.
- Steady salary – A consistent paycheck has a lot going for it. Reliable income means that you can plan your finances in Israel more effectively and live comfortably while you navigate all the ins and outs of moving to a new country.
Disadvantages of keeping your American job
- Becoming a freelancer or using an EOR – To legally work remotely for an American company while living in Israel, you’ll likely need to register as a freelancer or use an Employer of Record (EOR) service. Being a freelancer comes with extra expenses like self-employment taxes and accounting. Becoming an employee of an EOR means that you are paying their fees. In both cases, it is possible that your employer will not cover these expenses and they will come out of your pocket.
- Time zone challenges – Depending on your job, you may need to work US hours, which often means late nights or evenings in Israel. This can put a damper on your family time, social life, or even your ability to relax after a long day.
Advantages of Opening an Israeli Firm
- Ability to scale – Starting your own business in Israel gives you the freedom to grow. Want to hire employees or expand your offerings? You’re in charge. The sky’s the limit.
- Flexibility in work hours – Forget staying up until midnight for a Zoom call. Running your own business means setting your own schedule and working when it’s best for you.
- Say goodbye to bosses and choose your clients – Hate micromanagers? Love picking your own projects? As your own boss, you call the shots and work with clients you actually like.
Disadvantages of Opening an Israeli Firm
- No steady salary – Income from your business may vary from month to month, which can be stressful, especially when expenses pile up. Financial planning after aliyah can be difficult even when your income is predictable and it will be more complex with this added uncertainty.
- Accounting can be expensive – In Israel, the paperwork for running a business isn’t simple. Between VAT filings, income tax, and Bituach Leumi, hiring an accountant becomes almost mandatory—and their services don’t come cheap. If you’re planning on going beyond freelancing and opening a Chevra Ba’am, accounting expenses will rise exponentially.
- Extra admin work – Running your own firm means wearing all the hats: marketing, client relations, and payment collection. It’s rewarding but time-consuming, and not everyone thrives in this environment.
Which path is right for you?
The decision ultimately depends on your personality, career goals, and risk tolerance. If you value stability and don’t want the headache of starting something new, sticking with your American job could be the way to go. On the other hand, if you dream of building something from the ground up and want total control over your schedule, starting an Israeli business might be your best bet.
Either way, don’t forget to consult with both US and Israeli accountants to make sure you’re compliant on both sides of the ocean, and take the time to weigh your priorities before making the leap.