Entrepreneurship http://www.wisebread.com/taxonomy/term/4815/all en-US 3 Online Businesses You Can Launch In No Time http://www.wisebread.com/3-online-businesses-you-can-launch-in-no-time <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/3-online-businesses-you-can-launch-in-no-time" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/staying_online_up_to_date_and_productive_0.jpg" alt="Staying online, up to date and productive" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The opportunities for making money online are endless in this digital age. I'm not talking about creating the next Google or Facebook, and I'm definitely not suggesting that there are any get rich quick schemes that will land you thousands for just a few hours of work. But there are plenty of full-time businesses, as well as lucrative side hustles, that can be set up relatively quickly with little to no upfront investment.</p> <p>It takes a lot of hard work and dedication to get a business off the ground. There are lots of things to consider before even launching, such as what the business will provide, who the customers will be, what your pricing structure is, and what you're going to call it.</p> <p>Stuck for ideas? These business ideas will enable you to get set up and ready to go in 24 hours or so. Here are three online businesses you can jump-start in no time. (See also: <a href="http://www.wisebread.com/11-ways-anyone-can-make-money-online?ref=seealso" target="_blank">11 Ways Anyone Can Make Money Online</a>)</p> <h2>Virtual assistant</h2> <p>The role of the virtual assistant is completely open-ended, and the tasks can vary wildly depending on whom you're assisting. Assignments could be anything from replying to emails and updating social media, to editing spreadsheets and coordinating your client's schedule. If you're organized and are happy taking on smaller tasks for other people, then you can make money from anywhere in the world by being a virtual assistant.</p> <p>Timothy Ferriss's <em>The Four-Hour Work Week</em> helped to create an emerging market for virtual assistants with individuals and small companies looking to outsource the menial tasks that take up the majority of their time. This allows them to focus on growing their businesses. Once you've decided on the skillset you're going to offer, there are several ways of kick-starting your new business online.</p> <p>You can apply for a job with a virtual assistant agency and once you're hired, you'll already have a client or list of clients waiting to be connected with an assistant. This is how many VAs start, but you may also find jobs through word of mouth or from former employers. Social media is a free and easy way to advertise your services, too, and just a few posts to your professional profiles, particularly LinkedIn, can get the ball rolling. (See also: <a href="http://www.wisebread.com/how-to-find-a-legit-virtual-assistant-job?ref=seealso" target="_blank">How to Find a Legit Virtual Assistant Job</a>)</p> <h2>Social media manager</h2> <p>Social media management has become so crucial to the success of businesses that for most companies, it pays to have someone in charge of their accounts who really understands the ins and outs of all the social media platforms. Though most people have personal accounts on at least a couple of the big platforms, social media for businesses is an entirely different animal. That said, in order to prove you have what it takes to help a business with their accounts, you'll undoubtedly need to have built a significant presence of your own online.</p> <p>Social media management involves building thriving communities for your clients, which ultimately generates extra revenue for them. It can involve writing and scheduling engaging content, running advertising campaigns, and replying to queries or complaints. You're probably also going to be in charge of a budget dedicated to social media growth, and therefore should know how best to spend it for the highest returns.</p> <p>Similarly to virtual assistant positions, there are online agencies where you can find social media management jobs. However, once you have some experience under your belt, it may be worth pitching clients directly. Though it can be scary at first, it's an invaluable skill to learn and gives you much greater control over your rates and schedule. It's easy to assess whether you think you can help a client by simply looking at their social media content and engagement. Then you can put a plan together for how you will quickly improve it. (See also: <a href="http://www.wisebread.com/6-ways-to-make-extra-money-using-social-media?ref=seealso" target="_blank">6 Ways to Make Extra Money Using Social Media</a>)</p> <h2>Online tutor</h2> <p>If you enjoy teaching and have in-depth knowledge of a particular subject, then online tutoring could be a reliable moneymaker for you. Where previously, tutoring was all done face-to-face and relied on finding students in your local area, the internet has made it global. Thanks to video calls and online teaching programs, you can tutor anyone anywhere in the world, <em>from</em> anywhere in the world, with just a laptop and a decent internet connection.</p> <p>Languages are a fantastic starting place, as you don't necessarily need qualifications. Often, you don&rsquo;t even need to speak the student&rsquo;s native tongue, as you&rsquo;re encouraged to teach only in the language being learned.</p> <p>But tutoring is not limited to language instruction. The most open sector in tutoring is for school-aged children, and math and science tend to be subjects that children require help with. Around exam times when many parents want to give their kids a boost, tutors can be extremely busy, and you can adjust your rates accordingly to meet that demand.</p> <p>More often than not, tutoring positions are relatively short-term, so you'll likely have to continually be looking for new gigs. There are many online platforms that connect tutors to students, such as Tutor.com and Chegg.com. Apply online and set up a profile to begin finding jobs. You can also market yourself online using social media platforms, free classified ads on sites like Craigslist, online teaching directories, and even your own website or blog. Once you've successfully tutored some students, the best way to get new business is to ask for referrals, as it's likely that they know other people looking for similar help. (See also: <a href="http://www.wisebread.com/how-to-earn-1000-a-month-or-more-as-an-online-tutor?ref=seealso" target="_blank">How to Earn $1,000 a Month or More as an Online Tutor</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F3-online-businesses-you-can-launch-in-no-time&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F3%2520Online%2520Businesses%2520You%2520Can%2520Launch%2520In%2520No%2520Time.jpg&amp;description=3%20Online%20Businesses%20You%20Can%20Launch%20In%20No%20Time"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;">&nbsp;<img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/3%20Online%20Businesses%20You%20Can%20Launch%20In%20No%20Time.jpg" alt="3 Online Businesses You Can Launch In No Time" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/nick-wharton">Nick Wharton</a> of <a href="http://www.wisebread.com/3-online-businesses-you-can-launch-in-no-time">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-9"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/16-ways-to-get-money-for-your-business">16 Ways To Get Money For Your Business</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/13-ways-to-use-social-media-in-business">13 Ways to Use Social Media in Business</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-three-f-rule-can-lead-you-to-happiness">The Three F Rule Can Lead You to Happiness</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-fun-and-unexpected-ways-to-get-out-of-a-business-rut">5 Fun and Unexpected Ways to Get Out of a Business Rut</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-things-i-learned-about-money-after-i-went-freelance">7 Things I Learned About Money After I Went Freelance</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Career Building Entrepreneurship Wed, 09 May 2018 08:30:20 +0000 Nick Wharton 2139675 at http://www.wisebread.com 5 Ways Freelancers Can Promote Their Work Without Social Media http://www.wisebread.com/5-ways-freelancers-can-promote-their-work-without-social-media <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-ways-freelancers-can-promote-their-work-without-social-media" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/casual_woman_working_at_a_cafe.jpg" alt="Casual woman working at a cafe" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>While social media is a wonderful resource for freelancers to promote their work, it can be exhausting to constantly stay plugged in and try to stand out in such a noisy world. Plus, in light of Facebook's privacy issues, many social media users are jumping ship &mdash; afraid of how the platforms are misusing their personal data.</p> <p>How is a freelancer supposed to get the word out and attract clients without social media? Here are a few ways.</p> <h2>1. Your own website</h2> <p>Your website should be the premiere place where you professionally showcase your work and let people know what you do. Of course, creating an amazing website will not instantly attract clients or visitors. You have to put in a little work to reel them in.</p> <p>Having targeted keywords on your site and in blog posts will allow your website to pop up higher in search engine results. It takes time to build up strong SEO &mdash; search engine optimization &mdash; especially in competitive fields, like freelance copywriting. But when done correctly, traffic will follow. In addition to SEO, your site should be cleanly designed, easy to read, and have a contact page readily available. And don't let it just lie stagnant. Search engines favor sites that have frequent updates and new content on a regular basis. (See also: <a href="http://www.wisebread.com/8-surprising-ways-a-personal-website-can-improve-your-life?ref=seealso" target="_blank">8 Surprising Ways a Personal Website Can Improve Your Life</a>)</p> <h2>2. Forums and portfolio sites</h2> <p>Popular online platforms like Reddit, Quora, and Flickr can help you promote your freelance work. Reddit even has subreddit lists where freelancers can post that they are for hire. For freelancers who provide services like editing, legal advice, accounting advice, and more, answering questions in forums and on Quora can help you direct more potential clients to your website. Images or artwork shared on sites like Flickr should also provide links back to your site.</p> <h2>3. Guest posts</h2> <p>Guest posting on popular sites and blogs is popular with freelance writers, but any freelancer can use this idea to promote their work and get more business. Whatever your freelance business is &mdash; whether it be web designer, voice-over work, or accounting &mdash; find out where your target client is going on the internet to find help and advice, and offer specific guest posts for these publications.</p> <p>For example, new bloggers might be looking for advice on how to save on web design, so a guest post on a popular site titled, &quot;Why DIY Web Design Is Going to Cost You 35% More Than Hiring a Pro,&quot; will not only grab their attention, but also might convince them that they do need to hire out for this task. Since you gave them the advice in the article, they may also be more inclined to reach out and hire you. (See also: <a href="http://www.wisebread.com/11-freelance-jobs-that-pay-surprisingly-well?ref=seealso" target="_blank">11 Freelance Jobs That Pay Surprisingly Well</a>)</p> <h2>4. Write an ebook</h2> <p>Similar to the idea of guest posting, you can write a short ebook and offer it for 99 cents with free promotions on Amazon. Again, this idea can work for any freelance business if you angle the topic directly at your target client. Writing something like, &quot;Why You Need to Hire a Voice Actor&quot; or, &quot;Why You Need a Copywriter and How to Afford One&quot; is too generic. Instead, really hone in on your ideal client and write specifically to them.</p> <p>If you are a freelance writer who only writes copy for lawyers, you could offer something like, &quot;How to Build a Law Firm Website That Attracts More Clients.&quot; Writing a book will take more time than a guest post, but you can build a name for yourself while offering valuable advice to readers and directing them back to your business. (See also: <a href="http://www.wisebread.com/can-you-really-make-a-living-as-an-ebook-writer?ref=seealso" target="_blank">Can You Really Make a Living as an Ebook Writer?</a>)</p> <h2>5. HARO</h2> <p>HARO, which is short for <a href="https://www.helpareporter.com/" target="_blank">Help a Reporter Out</a>, can be useful to establish yourself as an expert and get your name cited in publications. Reporters post notices on the site when they're looking for sources to interview for their stories. Many times, the reporter will link back to your website when the story is published, but other times they will only quote you. Either way, it's helpful to get your name in front of more readers and it gives you bragging rights on your website and portfolio.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-ways-freelancers-can-promote-their-work-without-social-media&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Ways%2520Freelancers%2520Can%2520Promote%2520Their%2520Work%2520Without%2520Social%2520Media.jpg&amp;description=5%20Ways%20Freelancers%20Can%20Promote%20Their%20Work%20Without%20Social%20Media"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/5%20Ways%20Freelancers%20Can%20Promote%20Their%20Work%20Without%20Social%20Media.jpg" alt="5 Ways Freelancers Can Promote Their Work Without Social Media" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-eneriz">Ashley Eneriz</a> of <a href="http://www.wisebread.com/5-ways-freelancers-can-promote-their-work-without-social-media">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-13"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-land-more-freelance-clients-in-a-snap">How to Land More Freelance Clients in a Snap</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-the-self-employed-can-cut-health-care-costs">How the Self Employed Can Cut Health Care Costs</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-authenticity-could-make-or-break-your-small-business">How Authenticity Could Make or Break Your Small Business</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-strategies-for-paying-off-debt-when-living-on-a-variable-income">7 Strategies for Paying Off Debt When Living on a Variable Income</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/13-ways-to-make-money-teaching-your-skills-to-others">13 Ways to Make Money Teaching Your Skills to Others</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship blogging clients eBooks forums freelancers HARO marketing portfolios PR promotions self employed social media websites Tue, 08 May 2018 08:30:27 +0000 Ashley Eneriz 2133938 at http://www.wisebread.com 5 Characteristics of the World's Youngest Billionaires http://www.wisebread.com/5-characteristics-of-the-worlds-youngest-billionaires <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-characteristics-of-the-worlds-youngest-billionaires" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/mark_zuckerberg_at_g8_in_deauville_france.jpg" alt="Mark Zuckerberg at G8 in Deauville, France" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>According to Forbes, there are 2,208 billionaires in the world today. And just 63 members of this elite group are under the age of 40.</p> <p>Though the 63 youngest billionaires are a diverse group of individuals with different claims to fame, they do have quite a few things in common. Here are a few characteristics shared by some of the world's youngest billionaires.</p> <h2>1. More than half are entrepreneurs</h2> <p>Over half the billionaires on the under-40 list are self-made, with a majority being in the tech industry. Of course, people like Mark Zuckerberg of Facebook and Evan Spiegel of Snapchat made the list. So did the founders of Airbnb, Stripe, Uber, among others. But tech isn't the only profitable industry. Several of the billionaires on the list are from manufacturing, design, and medical industries.</p> <h2>2. Inheritance is prevalent</h2> <p>Not all of the world's most wealthy pulled themselves up by their bootstraps. While many of the world's youngest billionaires were self-made, there are also many who inherited their wealth.</p> <p>Twenty-four-year-old Gustav Magnar Witzøe, heir of Norwegian fish farming company Salmar, amassed a net worth of $1.9 billion after inheriting nearly half the company from his father. Heiress Yang Huiyan is worth over $21.9 billion at only 36 years old after inheriting her father's real estate development company in China. And Norwegian sisters Alexandra and Katharina Andresen &mdash; just 21 and 22 years old, respectively &mdash; each inherited 42 percent of their family-owned investment company, Ferd, for a net worth of $1.4 billion a piece.</p> <h2>3. Many of them left school to pursue their businesses</h2> <p>School was not the end game for many of the world's youngest billionaires; their business was.</p> <p>While enrolled in a product design class at Stanford, Evan Spiegel came up with the idea of Snapchat. In 2012, he officially dropped out of Stanford to focus on his growing app. Mark Zuckerberg dropped out of Harvard in 2005 to manage the ever-growing Facebook. Even some of the world's more established billionaires, such as Steve Jobs and Bill Gates, all dropped out of school before they graduated.</p> <p>This isn't to say dropping out of school to pursue a business is the secret to their success: Many billionaires on the list hold at least a bachelor's degree. (See also: <a href="http://www.wisebread.com/5-jobs-that-pay-over-50k-and-dont-require-a-bachelors-degree?ref=seealso" target="_blank">5 Jobs That Pay Over $50K and Don't Require a Bachelor's Degree</a>)</p> <h2>4. They have multiple successful businesses</h2> <p>The world's wealthiest often have more than one claim to fame. In fact, many of the youngest billionaires have worked on several notable and profitable projects on their rise to success.</p> <p>Garrett Camp, mostly known as the billionaire founder of Uber, was well on the tech scene before he even started the rideshare company. He actually was the founder of StumbleUpon, which he sold to eBay in 2007 for $75 million.</p> <p>Facebook's third employee, Dustin Moskovitz, worked with Zuckerberg to launch Facebook out of their dorm room at Harvard. After they both dropped out of college, Moskovitz moved to California with Zuckerberg to focus on further developing Facebook. In 2008, Moskovitz left Facebook to start Asana, a project management software &mdash; though most of his $12.4 billion net worth comes from his small remaining stake in Facebook. (See also: <a href="http://www.wisebread.com/what-small-business-owners-can-learn-from-top-forbes-entrepreneurs?ref=seealso" target="_blank">What Small Business Owners Can Learn From Top Forbes Entrepreneurs</a>)</p> <h2>5. They prioritize hobbies</h2> <p>Norwegian heiresses Alexandra and Katharina Andresen spend most of their time riding horses competitively. Airbnb billionaire Brian Chesky was a former bodybuilder, and 27-year-old Stripe founder Jack Collison prefers to spend his spare time running &mdash; a hobby we can all afford.</p> <p>While many of these billionaires spend a majority of their time overseeing extravagant business operations, they still value taking time for their own interests and hobbies. That's something we should all take to heart.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-characteristics-of-the-worlds-youngest-billionaires&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Characteristics%2520of%2520the%2520World%2527s%2520Youngest%2520Billionaires.jpg&amp;description=5%20Characteristics%20of%20the%20World's%20Youngest%20Billionaires"></a></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/5%20Characteristics%20of%20the%20World%27s%20Youngest%20Billionaires.jpg" alt="5 Characteristics of the World's Youngest Billionaires" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/rachel-slifka">Rachel Slifka</a> of <a href="http://www.wisebread.com/5-characteristics-of-the-worlds-youngest-billionaires">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-everyday-routines-of-wealthy-people">5 Everyday Routines of Wealthy People</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-think-like-a-billionaire-when-you-re-broke">How to Think Like a Billionaire When You’re Broke</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/if-you-won-the-lottery-you-would">If You Won The Lottery, You Would...</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/47-simple-ways-to-waste-money">47 Simple Ways To Waste Money</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-end-of-life-cost-savings-your-survivors-will-thank-you-for">9 End-of-Life Cost Savings Your Survivors Will Thank You For</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Entrepreneurship Lifestyle billionaires characteristics Facebook forbes inheritance snapchat technology wealthy youngest Wed, 18 Apr 2018 09:00:07 +0000 Rachel Slifka 2129346 at http://www.wisebread.com How Authenticity Could Make or Break Your Small Business http://www.wisebread.com/how-authenticity-could-make-or-break-your-small-business <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-authenticity-could-make-or-break-your-small-business" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/smiling_girl_making_fashion.jpg" alt="Smiling girl making fashion" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Owning a small business is no small feat. There are hundreds of articles written on how to effectively market yourself, attract customers, and drive traffic to your website. With so many gimmicks and tricks out there, it can feel impossible to determine what you should actually do in order to be successful.</p> <p>The best piece of advice I have found that works for all successful small businesses is: Just be you.</p> <p>Be authentic. Be genuine. Be true to who you are and work to ensure your business embodies and reflects this. Authenticity is <em>the</em> thing that can make or break your business.</p> <h2>Don't be obsessed with making a profit</h2> <p>I love supporting small businesses &mdash; and not just because I own one. I love the personal touch and the intimacy that comes with working with small business owners. As you think about your business, especially while your business is in its infancy, you've got to take your focus off the bottom line. Turning a profit has to come second behind establishing good business practices and customer rapport. Remember, people come to you for a product or service, but the experience is what brings them back.</p> <p>As a &quot;for profit&quot; entity, making money is on the mind of every business owner, as it should be. But for the truly successful small businesses that have stood the test of time, profit is never the number one goal. If you operate with integrity, put the customer first, do a decent job, and stay true to who you are, the profits will come.</p> <p>This also means that there will be times when your profits may suffer. If you make a mistake, refund the customer's money, and do the job again &mdash; for free. This shows that you genuinely care about the customer and about the product/service you provide. (See also: <a href="http://www.wisebread.com/what-small-business-owners-can-learn-from-top-forbes-entrepreneurs?ref=seealso" target="_blank">What Small Business Owners Can Learn From Top Forbes Entrepreneurs</a>)</p> <h2>Let your love for your craft show</h2> <p>If you're in business just for the money, it'll show. And you won't be in business long. Pause for a second and think about a business or service you've sworn off. Think about that horrible restaurant server, drive-thru attendant, or cabdriver that made you swear you would never use that business again.</p> <p>Now, consider what made you so angry. For most of us, it all comes down to how we were treated and how we were made to feel during the experience. Some waitstaff aren't in love with what they do. But the really good ones love people and want to ensure that you have a pleasant experience while you are at the restaurant.</p> <p>Passion translates. You can see it. You can feel it. You can sense it whenever you are around someone who has it. As a business owner, if you don't love what you are doing, you may want to consider alternate employment. Allow your passion for your craft to show. Take extra time and care to show your customers that you're not just out for a quick buck. The service you provide is also a labor of love.</p> <h2>Surround yourself with authentic people</h2> <p>Who you hire, your business associates, and even your friends affect your ability to remain true to who you are. Think back to the era of the stereotypical &quot;used car salesmen.&quot; They were categorized by their willingness to do and say anything to separate you from your cash. They were despised, ridiculed, and became a caricature for the disingenuous.</p> <p>If you surround yourself with people who are constantly following the trends, doing what is in, and live life by an ever-changing set of rules, that is what you will do. As a business owner, your word truly is your bond. We no longer do business in a &quot;handshake&quot; environment, but you should operate as if you do. Your word should be solid. Everything you say (website, correspondence, contracts, marketing, etc.) should be the clear and simple truth.</p> <p>It is also important to be true to who you are because you attract people who are similar. If you make a habit of being shifty and sly, you'll attract shifty and sly people. And this is dangerous for a small-business owner. (See also: <a href="http://www.wisebread.com/how-to-hire-your-first-employee?ref=seealso" target="_blank">How to Hire Your First Employee</a>)</p> <h2>Establish core values and stick to them</h2> <p>Your mission and vision should articulate who you are and what you believe. They don't need to be catchy, erudite, or full of words that have no real meaning. Sounding good and being good are two different things. People are smart enough to quickly spot the difference.</p> <p>Establish who you are as a business. Determine what you believe, how you will operate, and say exactly that. No fluff, no sleazy catchphrases. Just open, honest, and direct communication. Cute and corny may attract customers, but it won't keep them. Trends will come and go, but who you are at your core shouldn't change.</p> <p>As your business grows, you may find yourself drifting in a direction that isn't you. When this happens (and it will), stop, regroup, and rechart your course. The key that underpins your success in business and in life is to be genuine and remain authentic.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fhow-authenticity-could-make-or-break-your-small-business&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520Authenticity%2520Could%2520Make%2520or%2520Break%2520Your%2520Small%2520Business.jpg&amp;description=How%20Authenticity%20Could%20Make%20or%20Break%20Your%20Small%20Business"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/How%20Authenticity%20Could%20Make%20or%20Break%20Your%20Small%20Business.jpg" alt="How Authenticity Could Make or Break Your Small Business" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/denise-hill">Denise Hill</a> of <a href="http://www.wisebread.com/how-authenticity-could-make-or-break-your-small-business">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-freelancers-can-promote-their-work-without-social-media">5 Ways Freelancers Can Promote Their Work Without Social Media</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-top-7-blogs-for-entrepreneurs">The Top 7 Blogs for Entrepreneurs</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-fundamentals-of-naming-a-small-business">10 Fundamentals of Naming a Small Business</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-5-biggest-mistakes-freelancers-make">The 5 Biggest Mistakes Freelancers Make</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-things-every-small-business-owner-needs-to-know-about-employee-retirement-accounts">5 Things Every Small Business Owner Needs to Know About Employee Retirement Accounts</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship authenticity customer service genuinel marketing owning a business small businesses values Mon, 16 Apr 2018 08:30:10 +0000 Denise Hill 2128971 at http://www.wisebread.com Can't Get Business Credit? Consider Alternative Financing http://www.wisebread.com/cant-get-business-credit-consider-alternative-financing <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/cant-get-business-credit-consider-alternative-financing" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/at_my_garden_store.jpg" alt="At my garden store" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>In an ideal world, you'd be able to turn to your banker or business credit card to borrow money any time you needed it for your business. But not everyone has a long enough credit history or a high enough credit score.</p> <p>If you're losing sleep because you need cash quickly and traditional sources are not working out for you, it may be worth considering alternative financing. The interest rates and fees can be significantly higher than for a traditional bank loan or on a great <a href="http://www.wisebread.com/the-5-best-credit-cards-for-small-businesses?ref=internal" target="_blank">business credit card</a> deal, but they can come in handy in a cash crunch.</p> <p>Here's a quick crib sheet to help you determine the right type for you. (See also: <a href="http://www.wisebread.com/10-smart-ways-to-get-a-small-business-loan?ref=seealso" target="_blank">10 Smart Ways to Get a Small-Business Loan</a>)</p> <h2>Take stock of industry-specific options</h2> <p>If you work in a field such as ecommerce, look into lending programs tailored to your industry or the platforms where you sell your products or services. One example is the Amazon Lending program, an invitation-only program for merchants who run Amazon stores, which helps them finance inventory.</p> <p>Often programs like this are tailored to the cash-flow quirks of particular industries. If you're not aware of lending programs specific to your industry, ask your trade association for ideas.</p> <h2>Consider factoring</h2> <p>In factoring &mdash; a type of financing that is often used by companies that sell merchandise through big retailers &mdash; you sell your accounts receivable to a company called a &quot;factor&quot; at a discount. In one common type of factoring, the factor buys your invoices and purchases the right to collect the money owed from your customers. Once your customers pay their invoices, you get the face value of the invoice, with a small discount subtracted, often in the neighborhood of 2 to 6 percent. The factor will give you 70-90 percent of the value of the invoice up front, and the rest when the customer pays it.</p> <p>One reason some small-business owners like this type of financing is the factor bases the decision to buy the invoices on their customer's credit, not the business owner's. For instance, if you make a household gadget that a big retailer has stocked on its shelves, the factoring company would decide whether or not to buy the invoice based on the retailer's credit, not yours. That could be a plus if your credit profile is not strong.</p> <h2>Borrow against your receivables</h2> <p>Another type of financing that may come in handy is borrowing against your receivables, particularly if you run a professional services firm. If you use popular accounting software programs such as QuickBooks, Freshbooks, or Xero Accounting, you may be able to borrow against your receivables through Fundbox.</p> <p>Fundbox will let you borrow up to $100,000 against your receivables and repay the loan over 12 or 24 weeks. You can figure out what it will cost you using the <a href="https://fundbox.com/pricing/" target="_blank">calculator</a> on the site. You must pay back the loan each week in a preset amount (part of the amount owed, plus a fee) for the duration of the repayment period.</p> <p>You don't need a credit check or personal guarantee, approvals can happen in a matter of hours, and you can get the loan as soon as the next business day once approved.</p> <p>The challenge with this type of financing is that Fundbox automatically deducts the money you owe from your business bank account. If money is flowing into the business slowly, you could end up in a period where you have very little cash on hand until you repay the loan.</p> <p>If you're going to go this route and aren't sure if you'll have enough free cash to run the business during the repayment period, do a cash-flow projection with your accountant to be sure. As in all financial matters, it's important to understand what you're taking on. (See also: <a href="http://www.wisebread.com/how-to-pull-your-small-business-out-of-a-cash-crunch?ref=seealso" target="_blank">How to Pull Your Small Business Out of a Cash Crunch</a>)</p> <h2>Try an alternative loan</h2> <p>A working capital line of credit from an alternative lender is another option that might help you in a pinch. At <a href="http://www.kqzyfj.com/click-2822544-11145625">Kabbage</a>, one fast-growing provider, small business owners can apply for a credit line of up to $250,000. Kabbage offers six-month and 12-month repayment terms. Each month, you'll pay a fee of 1.5 percent to 10 percent, based on your business's performance. For example, if you borrowed $10,000 for six months with a 4 percent monthly fee, you would pay $1,667 each month for the loan repayment, plus $400 a month in fees.</p> <p>Peer-to-peer lending (aka, P2P lending) is also an option. You can borrow money from investors, who may be institutional funds or private individuals, instead of going to a bank. Among the providers are <a href="https://lending-club-smb.sjv.io/c/27771/343774/5120">Lending Club</a>, Prosper, Upstart, and Funding Circle. Generally with peer-to-peer lenders, your interest rate will be based on your credit profile, so the stronger your credit, the better your options.</p> <h2>Get an advance</h2> <p>In the past few years, more companies have been offering small businesses advances on the money they expect to receive in a given month from certain sources of business. They can be helpful when you're in a jam, but make sure you understand what you're actually paying for the money, because some providers charge quite a bit for this type of financing.</p> <p>One example of a service in this space is PayPal Working Capital. This service offers loans based on your PayPal sales history, up to a maximum of 30 percent of your annual PayPal sales (and up to $97,000 for your first loan). Fees depend on the amount you borrow, your annual PayPal sales, and the percentage of your receipts that are deducted to pay back your loan. For example, if you borrow $5,000, you have $20,000 in annual PayPal sales, and you repay 30 percent of your PayPal receipts every month, you'll pay a one-time fixed fee of $615. Pay back less every month and your fixed fee will go up.</p> <p>As in the case of Fundbox financing, repayments of advances are typically deducted automatically from your business bank account at regular intervals.</p> <p>Once you're out of your cash crunch, turn some attention to doing what you can to add to your revenue and profits. Your business will be a lot healthier if you can finance most of your growth out of cash flow. And the stronger it is, the easier it will be to find financing at great rates in the future.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fcant-get-business-credit-consider-alternative-financing&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FCan%2527t%2520Get%2520Business%2520Credit_%2520Consider%2520Alternative%2520Financing.jpg&amp;description=Can't%20Get%20Business%20Credit%3F%20Consider%20Alternative%20Financing"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/Can%27t%20Get%20Business%20Credit_%20Consider%20Alternative%20Financing.jpg" alt="Can't Get Business Credit? Consider Alternative Financing" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/elaine-pofeldt">Elaine Pofeldt</a> of <a href="http://www.wisebread.com/cant-get-business-credit-consider-alternative-financing">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/need-business-credit-build-your-personal-credit-first">Need Business Credit? Build Your Personal Credit First</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-smart-ways-to-get-a-small-business-loan">10 Smart Ways to Get a Small Business Loan</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-pull-your-small-business-out-of-a-cash-crunch">How to Pull Your Small Business Out of a Cash Crunch</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-signs-you-should-sell-your-small-business">4 Signs You Should Sell Your Small Business</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-your-small-business-targeting-the-wrong-customer">Is Your Small Business Targeting the Wrong Customer?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Banking Entrepreneurship alternative financing business credit small business owner small business tips Thu, 12 Apr 2018 08:30:09 +0000 Elaine Pofeldt 2128964 at http://www.wisebread.com Need Business Credit? Build Your Personal Credit First http://www.wisebread.com/need-business-credit-build-your-personal-credit-first <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/need-business-credit-build-your-personal-credit-first" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/minded_woman_holding_bank_card_and_doing_shopping.jpg" alt="Minded woman holding bank card and doing shopping" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The most exciting opportunities in a small business often arrive unexpectedly. And sometimes, taking advantage of them requires money &mdash; more than you may have at the moment. Whether you need to fill a big retail order or hire contractors to complete a professional services contract, you'll be able to act a lot more quickly if you have business credit lined up.</p> <p>Many small business owners don't realize that their personal credit plays a big role in obtaining the business credit they need until they actually apply for it. Entrepreneurs are often surprised to discover that for both <a href="http://www.wisebread.com/10-smart-ways-to-get-a-small-business-loan?ref=internal" target="_blank">small-business loans</a> and <a href="http://www.wisebread.com/the-5-best-credit-cards-for-small-businesses?ref=internal" target="_blank">business credit cards</a>, lenders typically require a <a href="http://www.wisebread.com/what-does-your-personal-guarantee-on-a-business-credit-card-mean?ref=internal" target="_blank">personal guarantee</a>.</p> <p>It's very difficult to get credit based solely on the business's credit profile unless you run a very substantial-sized business. So how can you get business credit if you have a limited personal credit history or made mistakes with your personal credit in the past? There's really only one answer if you want to borrow at attractive interest rates. It's buffing up your personal credit.</p> <p>Fortunately, you can make a difference in your credit profile quickly if you start doing the right things today. Here are some strategies to put into action ASAP.</p> <h2>Create a wall between your business and personal finances</h2> <p>If you've been using your personal checking account to deposit payments from clients, make this the week you get serious about your finances and open a separate business checking account. To do so, your bank will probably require you to have an employer identification number (EIN), so make getting one your first step, if you don't have one already. You can <a href="https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online" target="_blank">apply online for an EIN</a> from the IRS.</p> <p>Keeping a separate business bank account will help you to maintain the protections that come with your <a href="http://www.wisebread.com/llcs-and-s-corps-and-c-corps-oh-my?ref=internal" target="_blank">business entity</a>, if you have set one up, safeguarding you from financial liability. It will also force you to bring valuable discipline to how you manage your business and personal finances. If you are constantly raiding your business bank account to pay personal bills or vice versa, you probably don't really know where you stand in either area. Getting clear will help you to make better financial decisions in both arenas, which should ultimately lead to better credit.</p> <h2>Know your personal credit score</h2> <p>If you have poor personal credit, it will be hard to get a business loan. Many people don't know their score, so take a few minutes to find out what yours is this week. You can buy your personal credit scores from each of the three major credit bureaus (Experian, TransUnion, and Equifax), and at MyFICO.com. It usually costs less than $20.</p> <p>Many <a href="http://www.wisebread.com/the-5-best-credit-cards-that-offer-free-credit-scores?ref=internal" target="_blank">credit cards also offer free credit scores</a> for cardholders. While each paid and free credit score will be slightly different from the one ultimately used by your business lender, they can give you a good estimate of what that score will be. (See also: <a href="http://www.wisebread.com/fico-or-fako-are-free-credit-scores-from-credit-cards-the-real-thing?ref=seealso" target="_blank">Are Free Credit Scores from Credit Cards the Real Thing?</a>)</p> <p>Your FICO credit scores &mdash; the ones used most often by lenders &mdash; reflect <a href="http://www.wisebread.com/the-5-things-with-the-biggest-impact-on-your-credit-score?ref=internal" target="_blank">five factors</a>, including your payment history, the amounts owed, the length of your credit history, your credit mix, and new credit (opening a lot of new cards can be considered risky behavior).</p> <p>FICO scores range from 300 to 850. If you're going after a small-business loan, most lenders want to see a FICO score of 700 or better. If yours is below that, take the time to <a href="http://www.wisebread.com/how-to-rebuild-your-credit-in-8-simple-steps?ref=internal" target="_blank">rebuild your credit</a> before applying for business credit.</p> <h2>Take charge of your personal debt</h2> <p>Pay down any balances on your personal credit cards as quickly as you can. It will be hard to get business credit if you are maxed out personally.</p> <p>Focus on the cards with the highest interest rates and highest credit utilization to improve your situation most quickly. (With revolving credit, lenders look at the ratio of your current balance to your available credit to come up with a <a href="http://www.wisebread.com/this-one-ratio-is-the-key-to-a-good-credit-score?ref=internal" target="_blank">credit utilization ratio</a>. The lower your credit utilization, the better.)</p> <p>If you have maxed out one personal card but other cards are empty, consider spreading the debt among those other cards by doing a balance transfer. Ideally, look for a <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards?ref=internal" target="_blank">0% APR balance transfer deal</a>.</p> <h2>Limit use of your personal cards</h2> <p>If you know you'll need business credit in the next three to six months, do all you can to limit your current spending on personal credit cards, unless you're paying off the balance each month. Make sure to pay all of your credit card bills on time, as well.</p> <p>Running a business inevitably comes with financial surprises. The more work you do to keep your personal credit in shape, the easier it will be to handle the unexpected &mdash; and the more peaceful your life will be.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fneed-business-credit-build-your-personal-credit-first&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FNeed%2520Business%2520Credit_%2520Build%2520Your%2520Personal%2520Credit%2520First.jpg&amp;description=Need%20Business%20Credit%3F%20Build%20Your%20Personal%20Credit%20First"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/Need%20Business%20Credit_%20Build%20Your%20Personal%20Credit%20First.jpg" alt="Need Business Credit? Build Your Personal Credit First" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/elaine-pofeldt">Elaine Pofeldt</a> of <a href="http://www.wisebread.com/need-business-credit-build-your-personal-credit-first">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-6"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-smart-ways-to-get-a-small-business-loan">10 Smart Ways to Get a Small Business Loan</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/cant-get-business-credit-consider-alternative-financing">Can&#039;t Get Business Credit? Consider Alternative Financing</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-small-business-credit-cards-affect-your-personal-credit">How Small Business Credit Cards Affect Your Personal Credit</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-to-build-business-credit-when-youre-self-employed">5 Ways to Build Business Credit When You&#039;re Self-Employed</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-5-best-credit-cards-for-small-businesses">Best Credit Cards for Small Businesses</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Banking Entrepreneurship business credit credit score debt management personal credit small business small business tips Wed, 04 Apr 2018 08:30:09 +0000 Elaine Pofeldt 2124241 at http://www.wisebread.com 4 Signs You Should Sell Your Small Business http://www.wisebread.com/4-signs-you-should-sell-your-small-business <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/4-signs-you-should-sell-your-small-business" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/young_african_female_juice_bar_owner.jpg" alt="Young female juice bar owner" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Owning a small business is a labor of love. In addition to investing your money, resources, blood, sweat and tears, you also invest a small part of your soul. You love it. It's your baby &mdash; you've nurtured it from nothing to the success it is now. But every now and then, a thought flashes through your mind: Should I sell?</p> <p>Or, maybe someone else has seen, appreciates, and is willing to pay for what you've done. They offer to buy you out. Should you accept?</p> <p>Selling your business is a tricky endeavor. It's tough to know when you should take the money and run. Here are a few telltale signs that it's time to cash in your chips and call it quits. (See also: <a href="http://www.wisebread.com/8-common-myths-about-starting-a-small-business?ref=seealso" target="_blank">8 Common Myths About Starting a Small Business</a>)</p> <h2>You've become more risk averse</h2> <p>One of the biggest differences between a business owner and an entrepreneur is risk aversion. Business owners like to keep things steady and solid. As the business grows, business owners can grow more conservative &mdash; sometimes to a fault &mdash; to protect and preserve the value the business has gained.</p> <p>However, taking chances is essential to continued growth. Once you get to the point that new opportunities invoke more fear than excitement, you may want to think about calling it quits.</p> <p>When you become too conservative, you lose your edge and stunt your business's growth. Stagnation leads to death. Before you drag your business into the ground by standing still, consider capitalizing on all your hard work by selling it for a profit.</p> <h2>You're tired</h2> <p>Owning and running a business is not for the faint of heart. It sounds sexy, but behind the curtain of success is a ton of backbreaking work. And as much as you love what you do, no one wants to work that hard all of the time.</p> <p>When you start to feel tired &mdash; I mean deep down in your soul tired &mdash; that's a sign it's time to exit stage left. Being successful brings with it a satisfaction in beating the odds and accomplishing something notable. But there is a hidden side of success that is brutal and exhausting. Running a successful business can drain your energy and sap your strength. At some point, you have to know when you have had enough and allow someone else to take over.</p> <p>Exhaustion is dangerous. You don't make the good, hard choices you used to make. You find yourself doing what's easy, and nothing will bring your business down quicker than taking the easy way just because it's easy. It's better to sell and capitalize on your success, rather than lose what you worked so hard to build.</p> <h2>You've lost your drive and your passion</h2> <p>Running a business takes a sense of commitment and grit that is driven by passion. When you first launch a business, you are hungry for success and work day and night to achieve it. That hunger and love of what you do sustains you during lean years and propels you forward during turbulent times.</p> <p>When you lose motivation and the enthusiasm just isn't there anymore, that is a sign that it may be time for you to try something else. When you are no longer intrigued by and &quot;into&quot; your business, that's the time to begin thinking more like an entrepreneur than a small-business owner. Use your energy, talent, and creativity to figure how to leverage what you've built and the knowledge you've gained.</p> <p>This may be the time to groom an up-and-coming business owner and show him or her the ropes. You may not be ready to sell the business entirely, but you can allow others to buy controlling interest in the business and you can direct the choir from the back row. And when you're ready, sell your share and move to next challenge.</p> <h2>You need a change or you want to do something else</h2> <p>Remaining committed and passionate about the same thing your entire life is difficult. As a successful business owner, your experiences will undoubtedly cause you to evolve as a person. And sometimes that change whets your appetite for something new.</p> <p>If you feel the urge to strike out and do something different, go for it! Don't allow your business &mdash; which once was your inspiration &mdash; to become your prison. Allow yourself the freedom to do something different and explore other interests. Understanding when you've outgrown something takes a wisdom and insight that some people lack. Trust your instincts. If you feel it's time for a new challenge and a change of scenery, it is.</p> <h2>Making your decision</h2> <p>Deciding to sell your business is a tough call. And per the experts, the best time to sell is at the height of profitability, which is what makes the decision so much more difficult. Choosing to sell while business is good is paradoxical. On one hand, it makes sense because a prosperous business is more attractive and marketable. But on the other hand, who wants to sell when things are going great?</p> <p>The easiest way to solve this dilemma is to begin with the end in mind. Start thinking about when you'll be ready to give it up and plan for it. You may not be able to sell during your most profitable years, but you can ensure that you are in an uptick when you do put it on the market. Selling your business isn't the end of something good. It's the start of something better.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F4-signs-you-should-sell-your-small-business&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F4%2520Signs%2520You%2520Should%2520Sell%2520Your%2520Small%2520Business.jpg&amp;description=4%20Signs%20You%20Should%20Sell%20Your%20Small%20Business"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/4%20Signs%20You%20Should%20Sell%20Your%20Small%20Business.jpg" alt="4 Signs You Should Sell Your Small Business" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/denise-hill">Denise Hill</a> of <a href="http://www.wisebread.com/4-signs-you-should-sell-your-small-business">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/cant-get-business-credit-consider-alternative-financing">Can&#039;t Get Business Credit? Consider Alternative Financing</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-pull-your-small-business-out-of-a-cash-crunch">How to Pull Your Small Business Out of a Cash Crunch</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-your-small-business-targeting-the-wrong-customer">Is Your Small Business Targeting the Wrong Customer?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-questions-to-ask-before-you-sell-a-stock-or-a-fund">10 Questions to Ask Before You Sell a Stock or a Fund</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-business-of-ebay">The Business of eBay</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship ambition losing interest moving on passion profit risk selling small business owner Thu, 08 Mar 2018 09:30:09 +0000 Denise Hill 2111740 at http://www.wisebread.com What Small Business Owners Can Learn From Top Forbes Entrepreneurs http://www.wisebread.com/what-small-business-owners-can-learn-from-top-forbes-entrepreneurs <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/what-small-business-owners-can-learn-from-top-forbes-entrepreneurs" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_fashion_designer.jpg" alt="Woman fashion designer" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Successful entrepreneurs come from a variety of backgrounds, and their journeys start at different stages of life. But nearly all have lessons about how to create success that we can learn from.</p> <p>Forbes is continually shining the spotlight on individuals who have managed to overcome hardships and wind up on top. Whether you're starting out on your own entrepreneurial journey or just keen to know what goes into building a winning company, here are four lessons you can learn from top Forbes entrepreneurs.</p> <h2>Get your brand story right</h2> <p>Chris Pfaff, probably better known to MTV reality TV fans as &quot;Drama&quot; from his stints on two shows, followed an unusual path to entrepreneurial success. With no college education, no background in business, and no real idea of how to run a company, he started the streetwear clothing label called Young &amp; Reckless. Launched on the TV show <em>Rob Dyrdek's Fantasy Factory</em> (Dyrdek is a professional skateboarder and Pfaff's second cousin), the line of T-shirts, tank tops, and accessories became profitable right away. (See also: <a href="http://www.wisebread.com/4-best-states-to-start-a-new-business-in?ref=seealso" target="_blank">4 Best States to Start a New Business In</a>)</p> <p>Despite its rapid success, the company later experienced setbacks as Pfaff experimented with different marketing techniques. Customers had come to associate the Y&amp;R name with the lifestyles of many of its early ambassadors: rappers, skateboarders, and BMX bike riders. But the company flubbed when it hired a celebrity who didn't have a story that fit the brand's carefree, &quot;reckless&quot; image. &quot;There was nothing reckless to tell,&quot; Pfaff told Forbes. It taught Pfaff that the most important thing about marketing is making sure it embodies the spirit of the brand. (See also: <a href="http://www.wisebread.com/starting-your-dream-business-is-easier-than-you-think-heres-how?ref=seealso" target="_blank">How to Start Your Dream Business</a>)</p> <p><strong>The take-away: </strong>Your customers buy into your story as much as the product or service you're offering. If a marketing idea doesn't embody the brand, don't do it.</p> <h2>Failure is part of the game</h2> <p>Adam Pisoni is a great example of someone who has picked himself up after stumbling. Pisoni, a high school dropout, says naive optimism led him to launch a web design firm called Cnation in 1995, when he was just 19 years old. That optimism, plus hard work &mdash; Pisoni put in 100-hour work weeks &mdash; paid off as the company grew to 30 employees and over $2 million in sales. Cnation made its name by designing websites for large brands like CBS MarketWatch, Fox Interactive, Nissan of Japan, and Honda, earning the latter a Clio award for interactive design in 1997.</p> <p>But everything changed for Pisoni after the dot-com crash of the late '90s. As clients tightened their purse strings, he had to close Cnation &mdash; a devastating blow. But he used what he learned years later to co-found Yammer, a social networking service for enterprises. He helped grow the company, and in 2012 it was acquired by Microsoft for $1.2 billion. (See also: <a href="http://www.wisebread.com/8-common-myths-about-starting-a-small-business?ref=seealso" target="_blank">8 Common Myths About Starting a Small Business</a>)</p> <p>Since then, Pisoni has continued to &quot;bounce back,&quot; founding Abl Schools in 2015, a company that creates time and resource management software for secondary schools (and soon elementary schools). The young company has just raised $7.5 million in series A funding and has grown to 12 employees.</p> <p><strong>The take-away:</strong> Business and entrepreneurship comes with failures, but it's how you digest them that matters. Instead of allowing losses to consume you, take what you learn and implement your findings in future ventures. (See also: <a href="http://www.wisebread.com/the-top-7-blogs-for-entrepreneurs?ref=seealso" target="_blank">Top 7 Blogs for Entrepreneurs</a>)</p> <h2>Generous, fair benefits policies help retain workers</h2> <p>While it's become common for tech companies to provide perks such as Ping-Pong tables, free food, and errand-running services to coders and engineers, few extend those benefits to the low-paid employees who work in their warehouses and fulfillment centers. One notable exception: Boxed, an e-commerce company that offers mobile ordering and bulk delivery of products such as toilet paper, pet food, and toothpaste.</p> <p>Founder and CEO Chieh Huang treats all his workers the same. Not only do they get company shares and unlimited parental leave, Boxed also pays for employees' weddings and college tuition for workers' children. (See also: <a href="http://www.wisebread.com/how-to-hire-your-first-employee?ref=seealso" target="_blank">How to Hire Your First Employee</a>)</p> <p>Those unique benefits cost tens of thousands of dollars a pop. But they're important to Huang. His immigrant parents worked menial jobs when he was growing up, and he always promised that if he started a business, he would treat his employees well. There's a business reason for this largesse, too. Turnover is costly and common among warehouse workers. It can cost up to $28,000 to recruit and train one, according to Bloomberg.</p> <p>The tactic may be working. Huang told CNBC that only 10 of Boxed's full-time employees have quit since the company was founded in 2013. That loyalty has helped build Boxed into a company worth over $100 million in revenue as of 2016. (See also: <a href="http://www.wisebread.com/the-5-best-credit-cards-for-small-businesses?ref=seealso" target="_blank">Best Small Business Credit Cards</a>)</p> <p><strong>The take-away: </strong>Treating your employees well breeds loyalty that builds success for the whole company.</p> <h2>Bootstrapping is sometimes the best way to build a business</h2> <p>When starting a business, many entrepreneurs try to follow a familiar blueprint that they see as necessary for success. Come up with a unique idea, raise millions in venture capital funding, use that money to get the business on the map and, voilà, an initial public offering is just around the corner. But there are other ways to achieve this end goal, and not securing venture backing doesn't mean all hope is lost. (See also: <a href="http://www.wisebread.com/10-smart-ways-to-get-a-small-business-loan?ref=seealso" target="_blank">10 Smart Ways to Get a Small Business Loan</a>)</p> <p>Take Little Passports, the educational subscription service that delivers activity kits to kids. Founders Amy Norman and Stella Ma failed to secure any venture capital when they started the business back in 2009, yet they persevered. They bootstrapped the company with their own savings and contributions from angel investors. (See also: <a href="http://www.wisebread.com/35-resources-for-female-entrepreneurs?ref=seealso" target="_blank">35 Resources for Female Entrepreneurs</a>)</p> <p>Without generous venture backing, they were forced to be very disciplined about hiring, marketing, and facilities decisions. Now they believe this path was a blessing, as it allowed them to grow the business organically at a sustainable pace that wouldn't have been possible with millions of dollars in venture capital. Today, with millions of loyal subscribers and a revenue of $30 million, they've proved all of their doubters wrong.</p> <p><strong>The take-away: </strong>Disappointments can be blessings in disguise. Using your own resources and hard work gives you a scrappiness that can pay off as your business grows. (See also: <a href="http://www.wisebread.com/5-business-lessons-from-these-child-entrepreneurs?ref=seealso" target="_blank">5 Business Lessons From Child Entrepreneurs</a>)</p> <p>&nbsp;</p> <h2 style="text-align: center;">Like this post? Pin it!</h2> <div align="center"><a data-pin-do="buttonBookmark" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <div><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/What%20Small%20Business%20Owners%20Can%20Learn%20From%20Top%20Forbes%20Entrepreneurs.jpg" style="float: left; width: 30%; margin-right: 3%; margin-bottom: 0.5em;" alt="" /></p> <p><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/TOP%20TIPS%20FOR%20SMALL%20BUSINESS%20OWNERS%20FROM%20TOP%20FORBES%20ENTREPRENEURS.jpg" style="float: left; width: 30%; margin-right: 3%; margin-bottom: 0.5em;" alt="" /> <img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/Small%20Business%20Owner%20advice%20from%20Top%20Forbes%20Entrepreneurs.jpg" style="float: left; width: 30%; margin-right: 0%; margin-bottom: 0.5em;" alt="" /></p> </div> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/nick-wharton">Nick Wharton</a> of <a href="http://www.wisebread.com/what-small-business-owners-can-learn-from-top-forbes-entrepreneurs">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-bedtime-routines-of-famous-financial-gurus">5 Bedtime Routines of Famous Financial Gurus</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-characteristics-of-the-worlds-youngest-billionaires">5 Characteristics of the World&#039;s Youngest Billionaires</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-land-more-freelance-clients-in-a-snap">How to Land More Freelance Clients in a Snap</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-questions-retirees-should-ask-before-starting-a-small-business">5 Questions Retirees Should Ask Before Starting a Small Business</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-the-self-employed-can-cut-health-care-costs">How the Self Employed Can Cut Health Care Costs</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship business owners business tips entrepreneurs forbes how to be successful small business owners success Wed, 07 Feb 2018 09:31:07 +0000 Nick Wharton 2098611 at http://www.wisebread.com 5 Tax Mistakes Freelancers Need to Stop Making http://www.wisebread.com/5-tax-mistakes-freelancers-need-to-stop-making <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-tax-mistakes-freelancers-need-to-stop-making" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/modern_business_lady_at_paperwork.jpg" alt="Modern business lady at paperwork" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>No doubt about it, being a freelancer is hard. From serving clients to staying on top of your money game, there's no shortage of work to do. Sometimes, things may be overlooked or set on the back burner while you tackle pressing business matters. However, there is one major thing that just can't be ignored &mdash; taxes.</p> <p>As your own chief financial officer you'll need to be aware of major tax missteps that could ultimately ruin your business. Ideally, you'll engage the help of an experienced small business accountant who knows the ins and outs of tax strategies for freelance business owners. However, you've got to have your ducks in a row to double and triple check their suggestions and advice, too. (See also: <a href="http://www.wisebread.com/what-freelancers-and-side-giggers-need-to-know-about-income-taxes?ref=seealso" target="_blank">What Freelancers and Side Giggers Need to Know About Income Taxes</a>)</p> <p>These are the top tax mistakes freelancers really need to stop making.</p> <h2>1. Not paying self-employment tax</h2> <p>As a freelancer, you probably have a number of clients that pay you without deducting any taxes. Because you are a contractor, you are responsible for any and all taxes on your income.</p> <p>Self-employment tax is a term that covers two main taxes: Social Security and Medicare. As an employee of a company, your employer would cover part of this tax. However, lucky you, since you are your own employer, you get to pick up the tab on the entire tax bill.</p> <p>On the other side of paying all these taxes, you do get some reprieve by deducting a portion of these payments from your gross income, which can reduce the amount of taxes you owe overall.</p> <p>Just know that it's very important to pay self-employment taxes on your freelance income. If your client issues you a 1099 form, it's also transmitted to the IRS. The IRS becomes aware of this income and can demand you to make an accounting for that money if they suspect you owe taxes on it.</p> <h2>2. Not having an accounting system</h2> <p>Making a lot of money as a freelancer can also increase your tax liability. If you don't have a good system in place to track all of your income and expenses, you could end up paying more (or less) taxes than you're supposed to.</p> <p>Charleen Fariselli is a CPA who has worked with small businesses for over 10 years. She says that freelancers who don't accurately track income and expenses are at a disadvantage. &quot;This affects their taxes because they don't have a good accounting system and are often losing deductions so they pay more in tax,&quot; she says.</p> <p>Charleen also adds that a lack of a good accounting system can have an impact on making timely, accurate tax payments: &quot;These freelancers can't calculate what their taxable income is each quarter for making tax payments, so they over or underpay, if they pay at all.&quot;</p> <p>The good news is that there are many accounting software options out there to help you organize your books, including QuickBooks, Xero, Wave, and Freshbooks. You can also use a simple Google Sheets document. (See also: <a href="http://www.wisebread.com/5-free-accounting-tools-for-freelancers?ref=seealso" target="_blank">5 Free Accounting Tools for Freelancers</a>)</p> <h2>3. Mixing business with pleasure</h2> <p>One of the worst things a freelancer can do is allow their business expenses and income to spill over into their personal finances. For example, a business owner may use a business credit or debit card to cover a personal expense like purchasing groceries for their family.</p> <p>The biggest problem with this behavior is how it affects record keeping for tax filing purposes. Joshua Zimmelman of Westwood Tax &amp; Consulting says that bad record keeping can cause confusion for freelancers at tax time. &quot;Too many freelancers miss out on deductions because their finances are not organized,&quot; he says. &quot;Separating your expenses from the start makes filing your tax return so much easier.&quot;</p> <p>If you need help keeping your personal and business finances separate, you can opt for a business checking account or credit card. You could also use both.</p> <p>If you do have to use money from your business dealings to cover personal expenses or vice versa, make sure you keep a record of such transfers. A small business CPA can help you categorize (loan, owner draw, paycheck, etc.) the transactions so that you don't run into problems with record keeping or tax liabilities. (See also: <a href="http://www.wisebread.com/the-5-biggest-mistakes-freelancers-make?ref=seealso" target="_blank">The 5 Biggest Mistakes Freelancers Make</a>)</p> <h2>4. Neglecting retirement savings</h2> <p>The freelance life can be a roller-coaster ride of feast or famine, but it's still important to keep savings in the equation &mdash; especially retirement savings. Saving for retirement is not only critical for your golden years, but can also help you save on taxes.</p> <p>When you put money away for retirement, it reduces the amount of your income tax withholding. Joanna Zarach is a consultant who helps freelancers plan for retirement. She says, &quot;Solo retirement plans are the most effective way to lower your tax bill now and to build tax-free growth in your investment accounts.&quot;</p> <p>There are different options to save for retirement. Some smart options include:</p> <ul> <li> <p>Individual 401(k): This type of account is ideal for solopreneurs who want higher contribution limits. You can save with pretax dollars while receiving tax deductions for employer contributions (you are the employer) as well.</p> </li> <li> <p>SEP IRA: Tax-deductible contributions are made by the employer (in this case, you). Growth is tax-deferred until withdrawal.</p> </li> <li> <p>ROTH IRA: With this type of retirement account, you save after-tax income that grows tax-free forever.</p> </li> </ul> <h2>5. Neglecting health care contributions</h2> <p>Paul Jacobs is a CPA, EA, and officer at Palisades Hudson Financial Group. He says he often sees freelancers, &quot;Forgetting to deduct health insurance premiums. A great tax break that is available to the self-employed is the ability to deduct this expense.&quot;</p> <p>As a small-business owner, there are tax benefits when you pay insurance premiums for yourself and family members. Premiums for medical, dental and, in some cases, long-term health insurance qualify.</p> <p>Reporting these premiums on your taxes can reduce your adjusted gross income (AGI) which can make you eligible for certain tax breaks. The only caveat here is that you may now have to itemize deductions in order to take advantage of this deduction come tax time due to the recent Tax Cuts and Jobs Acts of 2017.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-tax-mistakes-freelancers-need-to-stop-making&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Tax%2520Mistakes%2520Freelancers%2520Need%2520to%2520Stop%2520Making.jpg&amp;description=5%20Tax%20Mistakes%20Freelancers%20Need%20to%20Stop%20Making"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/5%20Tax%20Mistakes%20Freelancers%20Need%20to%20Stop%20Making.jpg" alt="5 Tax Mistakes Freelancers Need to Stop Making" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/aja-mcclanahan">Aja McClanahan</a> of <a href="http://www.wisebread.com/5-tax-mistakes-freelancers-need-to-stop-making">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-how-your-taxes-will-change-after-you-start-a-small-business">Here&#039;s How Your Taxes Will Change After You Start a Small Business</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-myths-about-money-in-retirement">5 Myths About Money in Retirement</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/101-tax-deductions-for-bloggers-and-freelancers">101 Tax deductions for bloggers and freelancers</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/self-employed-heres-how-to-get-your-apartment-application-approved">Self-Employed? Here&#039;s How to Get Your Apartment Application Approved</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-common-medicare-myths-debunked">5 Common Medicare Myths, Debunked</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship Taxes accounting bookkeeping deductions freelance health care medicare retirement savings self employment social security tax mistakes Wed, 07 Feb 2018 09:00:06 +0000 Aja McClanahan 2095995 at http://www.wisebread.com How to Build a Side Business While Keeping Your Day Job http://www.wisebread.com/how-to-build-a-side-business-while-keeping-your-day-job <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-build-a-side-business-while-keeping-your-day-job" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/businesswoman_with_smiling_face_talking_on_mobile.jpg" alt="Businesswoman with smiling face talking on mobile" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The saying, &quot;Don't quit your day job,&quot; has become all but obsolete. We live in an era of entrepreneurship. Being your own boss is the chic new trend. But while throwing caution to the wind and only having a Plan A is tempting, keeping your day job while turning a side gig into a business is a great way to mitigate risk, learn your market niche, and test ideas and business models.</p> <p>However, building a business and a brand while working a nine-to-five is tough. Below are a few tips to help you ease your way into doing both. (See also: <a href="http://www.wisebread.com/15-ways-to-make-money-outside-your-day-job?ref=seealso" target="_blank">15 Ways to Make Money Outside Your Day Job</a>)</p> <h2>1. Consider getting a business partner or co-founder</h2> <p>Taking on a business partner is an excellent way to hedge risks, gain access to additional resources, and split the workload. It is also the quickest way to ruin a friendship and drag your business down before it gets off the ground. Before jumping into bed with your bestie, here are a few things you should consider:</p> <h3>What type of partner do you need?</h3> <p>The first step in getting a partner is to determine the type of partner you need and the role he or she will play. Do you need help with ideas, branding, marketing, balancing the books, procuring finances or additional resources? Or, do you need a silent partner &mdash; someone who helps financially and that's it?</p> <h3>How much of the business does your partner own?</h3> <p>Drawing lines in the sand early is essential. The longer you wait, the murkier things become and the harder it will be to determine who owns what. It is critical that you state upfront who is in charge or if everything will be split 50/50. Draw up a contract that reflects this decision. A contract between friends, you ask? Absolutely.</p> <h3>How do you make decisions?</h3> <p>Who has the final say? Establishing how decisions are made during the infancy stages of the partnership is beyond important. If you are the sole owner, should your partner make decisions on your behalf? If so, which decisions? Or should they run all decisions by you? A great way to work through this is by establishing roles and areas of responsibility. Your partner will clearly know his or her sphere and the boundaries will be better defined.</p> <h2>2. Respect your nine-to-five</h2> <p>Understand and respect the fact that your nine-to-five is your main, primary, and most important job. Your side gig has to be done outside of business hours. Until you are ready to divorce your employer and make your side gig your new bride, you must prioritize your day job as such &mdash; even if you hate it.</p> <p>Just remind yourself that your day job is paying the bills and providing you with the means and motivation to launch out on your own. Here are a few ground rules when it comes to respecting your nine-to-five:</p> <h3>Work while you are at work</h3> <p>Do your best to <em>be</em> the best at your current job. Work to be fully present and to always do a good job. This will translate to your business as well.</p> <h3>Beware of conflicts of interest</h3> <p>If your side business is in the same market or area as your current employment, you need to tread lightly. Your employer's clients, business procedures, and intellectual property should not be used for personal gain.</p> <h3>Check what contracts you've signed</h3> <p>If you signed a nondisclosure or noncompete agreement, then you may be prevented from working for a competitor or against your employer for a specific amount of time. Find out exactly what your rights are and what you can and cannot do.</p> <h2>3. Do the hard, boring, and expensive stuff</h2> <p>While you are gainfully employed, it's a good idea to do as much foundational work as possible. Draft your business plan, secure any licenses or certifications you may need, and establish your business as an LLC or sole proprietorship.</p> <p>It's also a good idea to begin buying equipment and paying any legal fees associated with your business niche. It may feel like a waste of money to shell out this type of cash upfront before you begin earning revenue, but it's worth it. The more you can take care of before launching the business, the more profits you keep and the less capital you'll need down the road.</p> <p>This is also a great time to work on branding and developing a solid marketing strategy. It's easier to nail these things down before you begin doing business versus winging it after you're officially open. (See also: <a href="http://www.wisebread.com/6-simple-ways-to-market-your-side-business?ref=seealso" target="_blank">6 Simple Ways to Market Your Side Business</a>)</p> <h2>4. Start generating revenue</h2> <p>If it is in any way feasible, start generating revenue while you are still employed. Test out your prototype. See how much of your product you can sell or which services you can provide on a smaller scale before you go all in.</p> <p>This allows you to test the market, make better financial projections, and properly scale your business before you open. You can tweak processes, find new vendors, and get a sense of your business's flow. It will also help you answer these questions:</p> <ul> <li> <p>What adjustments do I need to make?</p> </li> <li> <p>How are people responding to my marketing campaign?</p> </li> <li> <p>Am I properly branded?</p> </li> <li> <p>Are my prices too high or too low?</p> </li> <li> <p>Do customers pay on time?</p> </li> <li> <p>How much business can I handle alone? At what point should I hire additional staff?</p> </li> <li> <p>Is my service or product in demand? How can I increase demand?</p> </li> </ul> <p>Generating revenue before you officially dive into business ownership is also crucial if you need investors. You need to demonstrate the profit potential of your business in order to entice people to invest. And the best way to show that you can make money is by actually making money. (See also: <a href="http://www.wisebread.com/10-fundamentals-of-naming-a-small-business?ref=seealso" target="_blank">10 Fundamentals of Naming a Small Business</a>)</p> <h2>5. Use downtime efficiently</h2> <p>The biggest myth concerning entrepreneurship is that you get to set your own hours. As a business owner, your time is no longer truly your own &mdash; your customers, the market, and the need to get work done are your new bosses, at least at first. You work when you need to work &mdash; or you go out of business.</p> <p>You've got to learn to use downtime efficiently. Days off from your nine-to-five become full workdays for the business. And yes, you will have to work on holidays.</p> <p>It also means getting up an hour or two earlier to reconcile the books, answer emails, or order more inventory. You lunch hour is now time for you to nibble on a sandwich while you update your website, post on social media, and generate new marketing ideas (on your own computer). And the evenings &mdash; which used to be a time for socializing with friends and vegging out with Netflix &mdash; are now devoted to doing whatever needs to be done to keep the business running.</p> <p>The schedule may sound brutal, and it is. But hopefully, it's only temporary. Success comes at a cost, and in order to make it in business, you have to initially pay up. (See also: <a href="http://www.wisebread.com/8-common-myths-about-starting-a-small-business?ref=seealso" target="_blank">8 Common Myths About Starting a Small Business</a>)</p> <h2>6. Set a date</h2> <p>Make your business Plan A and your current job Plan B. Set a firm date for quitting your day job and work diligently toward that goal. Structure your life around achieving that goal. Restructure your personal finances to help you reach that quit date. Cut back, reduce your overhead, downsize, and save as much money as possible to help stabilize your income while you shift business gears. See if your employer will allow you to work part-time for a while before quitting.</p> <p>Quitting your job and going into business full time must be your end game. If not, your business will become and forever remain a hobby. With a good idea, proper planning, and a bit of luck, your business will eventually be able to provide you a full-time income, and then some. (See also: <a href="http://www.wisebread.com/starting-your-dream-business-is-easier-than-you-think-heres-how?ref=seealso" target="_blank">Starting Your Dream Business Is Easier Than You Think &mdash; Here's How</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fhow-to-build-a-side-business-while-keeping-your-day-job&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520to%2520Build%2520a%2520Side%2520Business%2520While%2520Keeping%2520Your%2520Day%2520Job.jpg&amp;description=How%20to%20Build%20a%20Side%20Business%20While%20Keeping%20Your%20Day%20Job"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/How%20to%20Build%20a%20Side%20Business%20While%20Keeping%20Your%20Day%20Job.jpg" alt="How to Build a Side Business While Keeping Your Day Job" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/denise-hill">Denise Hill</a> of <a href="http://www.wisebread.com/how-to-build-a-side-business-while-keeping-your-day-job">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-7"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/101-tax-deductions-for-bloggers-and-freelancers">101 Tax deductions for bloggers and freelancers</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/your-small-business-needs-an-emergency-fund-too">Your Small Business Needs an Emergency Fund, Too</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-common-myths-about-starting-a-small-business">8 Common Myths About Starting a Small Business</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-simple-negotiating-trick-puts-money-in-your-pocket">This Simple Negotiating Trick Puts Money in Your Pocket</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-new-years-goals-every-freelancer-should-make">8 New Year&#039;s Goals Every Freelancer Should Make</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship business ownership business partners day jobs goals income investors productivity revenue Mon, 29 Jan 2018 09:30:09 +0000 Denise Hill 2086770 at http://www.wisebread.com 5 Questions Retirees Should Ask Before Starting a Small Business http://www.wisebread.com/5-questions-retirees-should-ask-before-starting-a-small-business <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-questions-retirees-should-ask-before-starting-a-small-business" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_working_in_florist_shop.jpg" alt="Woman working in florist shop" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Retirement is a time to kick back, slow down, and do all of the things you didn't have time to do during your &quot;clock-punching&quot; years. But for an increasing number of retirees, becoming an entrepreneur is the new thing to do after leaving the workforce.</p> <p>In fact, the Bureau of Labor Statistics reported in 2015 that the self-employment rate among retirement-aged workers (65 and older) was the highest of any age group, at just over 15 percent.</p> <p>However, before diving headfirst into the pool of startups, here are a few questions you need to ask yourself before starting a small business in retirement.</p> <h2>1. What do you have to lose?</h2> <p>Unfortunately, in business, failure is a very real option. According to the Bureau of Labor Statistics, 50 percent of new businesses don't survive past five years. And if your business fails, you need to be able to survive. You must count the costs before you begin.</p> <p>Answering the question, &quot;What do I have to lose?&quot; will help you assess and determine your risk tolerance and accurately scale your business. It will help you develop a business model that works for your lifestyle, interests, financial status, and physical health.</p> <p>If you retired and are looking forward to leaving the world of nine-to-five, it makes no sense to start a business that operates primarily during these hours. If your health is beginning to deteriorate, doing work that is physically demanding with lots of heavy lifting or repetitive motions may not be the way to go. Be sure you keep your needs and limitations in mind before you begin. (See also: <a href="http://www.wisebread.com/8-common-myths-about-starting-a-small-business?ref=seealso" target="_blank">8 Common Myths About Starting a Small Business</a>)</p> <h2>2. How will you finance the business?</h2> <p>The adage, &quot;It takes money to make money&quot; is the truth when it comes to starting a business. You must understand that you may have to shell out &mdash; depending on the industry &mdash; large sums of money up front. Taking on huge amounts of debt, or any debt for that matter, during retirement is a tremendous risk and should be avoided if possible.</p> <p>If your business requires a large amount of upfront capital, you need a plan for getting your hands on funds. Dipping into your retirement stash to pay business expenses is not recommended by most financial advisers. You may need to scale back your business plan, take on a partner, or allow others to become investors. You may even need to delay starting the business for a year or two and reduce your living expenses to help set aside funds to get the business going.</p> <p>Another financial surprise that comes with new ventures is the hidden costs associated with starting a business. Again, these costs are contingent on the business type, size, and the area in which you live. Things like insurance, professional fees, permits, licenses, attorneys &mdash; and everyone's worse nightmare, taxes &mdash; can derail the business before it gets off the ground, and significantly impact your retirement nest egg. Do your homework to see which fees apply to your business in your area and plan accordingly.</p> <h2>3. How much time and energy will it take?</h2> <p>Nurturing a business in its infancy requires, time, energy, and a ton of diligence. Starting a single proprietorship with no staff, no outside financing, no products, and no facility will take a couple of months. If you factor in hiring staff, securing a bank loan, and purchasing product, the time it takes for your business to be up and running could be six months or more. And while you do have more time now that you are retired, you must understand that time affects your bottom line.</p> <p>Counting the cost of becoming an entrepreneur doesn't just mean finances, it also includes sweat equity. Retirement is a different season of life and, depending on your particular circumstances and the industry you enter, you could be making a bigger time commitment than you expected.</p> <p>Be sure you understand the marketplace and all of the &quot;small&quot; jobs that go into running a business &mdash; especially if you are doing it alone or with minimal staff. What will you do if your computer crashes or your printer breaks down right before an important meeting? Figure out what can you afford to outsource and what you can you do yourself. And most importantly, be sure you can commit the time and energy it takes to make your business successful.</p> <h2>4. What can you do before you retire?</h2> <p>If starting a business is something you know you want to do before you retire, you should do as much ground work as possible before giving up your income. It's even advisable to launch the business <em>before </em>you retire.</p> <p>Starting a business while working a full-time job is tough (speaking from experience here), but it does have its advantages. It makes you budget your time and start small. You have to go at a slower pace, which is a good thing. You are able to learn the intricacies of the business, establish relationships, and make mistakes within a controlled environment.</p> <p>If starting a business while working your regular gig is too much, see if you can shadow, intern, volunteer, or work part-time for a similar business. You can also establish your small business framework &mdash; write your business plan, become an LLC, and get any necessary licenses, permits, or certifications &mdash; so you are ready to go as soon as you retire. It is also advisable that you save, save, save to help offset startup costs, minimize debt, and to keep from disturbing your retirement funds. (See also: <a href="http://www.wisebread.com/6-ways-you-can-cut-costs-right-before-you-retire-0?ref=seealso" target="_blank">6 Ways You Can Cut Costs Right Before You Retire</a>)</p> <h2>5. What am I giving up?</h2> <p>Becoming an entrepreneur in retirement is a great way to indulge in your passion, spend your time and energy meaningfully, and earn some extra cash. But being your own boss comes at a cost. The biggest expense that comes with starting a business in your sunset years is opportunity cost.</p> <p>Opportunity cost is the cost of what you're giving up while choosing to do something else. Things like spending time with the grandkids, taking tropical vacations, or even establishing a college fund for the grands or giving your kids the down payment on their dream home are all things you may have to forgo, at least for a time. (See also: <a href="http://www.wisebread.com/how-to-find-your-new-identity-after-retirement?ref=seealso" target="_blank">How to Find Your New Identity After Retirement</a>)</p> <p>Before you make your decision, be sure you thoroughly count all of the costs. Pay a visit to your financial adviser, and discuss your options and sketch out a solid financial plan. Hold yourself accountable, know when to scale back, and know when to walk away.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-questions-retirees-should-ask-before-starting-a-small-business&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Questions%2520Retirees%2520Should%2520Ask%2520Before%2520Starting%2520a%2520Small%2520Business.jpg&amp;description=5%20Questions%20Retirees%20Should%20Ask%20Before%20Starting%20a%20Small%20Business"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/5%20Questions%20Retirees%20Should%20Ask%20Before%20Starting%20a%20Small%20Business.jpg" alt="5 Questions Retirees Should Ask Before Starting a Small Business" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/denise-hill">Denise Hill</a> of <a href="http://www.wisebread.com/5-questions-retirees-should-ask-before-starting-a-small-business">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-common-myths-about-starting-a-small-business">8 Common Myths About Starting a Small Business</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-fundamentals-of-naming-a-small-business">10 Fundamentals of Naming a Small Business</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-budget-consistently-without-a-steady-paycheck">How to Budget Consistently Without a Steady Paycheck</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-despair-over-small-retirement-savings">Don&#039;t Despair Over Small Retirement Savings</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-myths-about-money-in-retirement">5 Myths About Money in Retirement</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship Retirement capital expenses pros and cons questions self employment small business owners startups Wed, 17 Jan 2018 09:30:08 +0000 Denise Hill 2085768 at http://www.wisebread.com Your Small Business Needs an Emergency Fund, Too http://www.wisebread.com/your-small-business-needs-an-emergency-fund-too <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/your-small-business-needs-an-emergency-fund-too" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_working_at_a_restaurant.jpg" alt="Woman working at a restaurant" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The U.S. Bureau of Labor Statistics reports that approximately one-third of all businesses fail within the first two years. Half fold within five years. And of the businesses that fail, a banking survey showed that 82 percent do so because of cash flow issues.</p> <p>These numbers are not meant to keep small-business owners up at night or deter new entrepreneurs. They're simply a statement of fact and should serve as a reality check for all small business owners: Having an emergency fund is not optional. (See also: <a href="http://www.wisebread.com/8-common-myths-about-starting-a-small-business?ref=seealso" target="_blank">8 Common Myths About Starting a Small Business</a>)</p> <h2>Three reasons your small business needs an emergency fund</h2> <p>In business, the term used to describe emergency or rainy day funds is &quot;retained earnings.&quot; Retained earnings are cash supplies that are kept on hand to enable your business to continue operating in lean times or in an emergency. These funds allow your business to keep providing services while making payroll, paying bills, and purchasing supplies, and they allow you &mdash; the owner &mdash; to continue sustaining your family's income. (See also: <a href="http://www.wisebread.com/how-to-pull-your-small-business-out-of-a-cash-crunch?ref=seealso" target="_blank">How to Pull Your Small Business Out of a Cash Crunch</a>)</p> <p>Most businesses fail due to a lack of preparation for the inevitable. Below are three major reasons your small business needs an emergency fund.</p> <h3>Emergencies</h3> <p>The most important thing an emergency fund does is it provides immediate access to funds during critical times. And while you may be insured against product loss, property damage, and equipment repairs, the time it takes to process those claims and get your hands on the necessary cash could be detrimental. And insurance may not cover every eventuality.</p> <p>An emergency fund allows you to continue operating and immediately begin making repairs and replacing any lost, damaged, or stolen products. The saying, &quot;Time is money&quot; applies in business, and having extra funds on hand could be the one thing that keeps you on the favorable side of those business statistics.</p> <h3>Cash flow issues</h3> <p>A staggering 82 percent of businesses that fail do so because of issues with cash flow. Cash flow doesn't just mean the flow of money that is coming in and out. It also encompasses timing and liquidity.</p> <p>For example, if your business operates on an invoicing system and invoices aren't paid or are paid late &mdash; after your loans and other payments are due &mdash; you could run into a cash flow problem. This is extremely important if you operate a seasonal or cyclical business.</p> <p>Having funds that are available and easily accessible is the life raft that can keep your business afloat while you wait for payments to be made. It will also protect you from incurring unnecessary debt since you won't have to borrow money to make ends meet. Accumulating debt through lines of credit to cover problems and shortfalls is a prime reason that so many startups fail within the first few years. (See also: <a href="http://www.wisebread.com/the-5-best-credit-cards-for-small-businesses?ref=seealso" target="_blank">Best Credit Cards for Small Business</a>)</p> <h3>Capitalize on opportunities</h3> <p>Another extremely important purpose of having cash on hand for emergencies is to capitalize on business opportunities. Liquidity supports agility.</p> <p>It can allow you to expand the business and strategically launch a new product line. It allows you the freedom to capitalize on opportunities in the marketplace, meaning you could buy out a competitor or purchase extra inventory at rock bottom prices. Your retained earnings give you the ability to move with speed. (See also: <a href="http://www.wisebread.com/10-smart-ways-to-get-a-small-business-loan?ref=seealso" target="_blank">10 Smart Ways to Get a Small Business Loan</a>)</p> <h2>Establishing your small business emergency fund</h2> <p>The idea of stashing thousands of dollars in a savings account for the off chance that it may come in handy at some point in the future may seem a bit impractical. Yet there is one guarantee in business &mdash; it is going to rain. And the storm is going to impact your cash flow. While the thought of amassing thousands of dollars can be stressful, you can't let it stop you. Having an emergency fund is nonnegotiable.</p> <p>Establishing your retained earnings or emergency fund is very similar to the personal finance process. You set your goal, and throw every extra dollar at it until you reach it. It's a good idea to set up an automated savings plan so that your emergency fund contributions are made before you have a chance to count them as profit. It should be a regular line item in your budget.</p> <p>It's also important to regularly prepare and analyze cash flow statements to ensure you have a clear picture of where you are at all times. Hiring a bookkeeper, using cloud-based software such as QuickBooks, or staffing a Certified Public Accountant (CPA) are great ways to help keep a handle on your cash flow.</p> <h3>How much should you save?</h3> <p>Much like a personal emergency fund, businesses should have anywhere between three months' and a year's worth of expenses set aside for emergencies. The specific amount your business needs will depend on your unique circumstances such as your expenses and the reliability of your income sources.</p> <p>You also must consider other aspects of your company that could affect cash flow, such as the type of business and that industry's culture. Some industries are more susceptible to lawsuits and legal actions. If you operate a medical practice or a financial consulting firm for example, you will probably need a larger emergency fund than someone who runs a graphic design business.</p> <h3>Where should you put the money?</h3> <p>Once you've decided how much you'd like to save, you need a place to put it. These funds are not meant to ride the stock market or earn very much in interest. The goal is for the money to be there, liquid, and available when you need it.</p> <p>Experts suggest that you consider things like money market funds, savings accounts, and short-term certificates of deposit (CDs). Shop around online for the highest-paying interest rate, or if you have a good relationship with your bank, you may be able to negotiate a better rate. (See also: <a href="http://www.wisebread.com/7-easy-ways-to-build-an-emergency-fund-from-0?ref=seealso" target="_blank">7 Easy Ways to Build an Emergency Fund From $0</a>)</p> <p>As you embark on your journey of grounding and fortifying your business by establishing a solid emergency fund, remember to start off small. Set short, realistic goals and remain steadfast. Look for ways to lower expenses and save more during high volume seasons. Be frugal and stay away from risky deals until you have reached your emergency fund goal.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fyour-small-business-needs-an-emergency-fund-too&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FYour%2520Small%2520Business%2520Needs%2520an%2520Emergency%2520Fund%252C%2520Too%2520%25281%2529.jpg&amp;description=Your%20Small%20Business%20Needs%20an%20Emergency%20Fund%2C%20Too"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/Your%20Small%20Business%20Needs%20an%20Emergency%20Fund%2C%20Too%20%281%29.jpg" alt="Your Small Business Needs an Emergency Fund, Too" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/denise-hill">Denise Hill</a> of <a href="http://www.wisebread.com/your-small-business-needs-an-emergency-fund-too">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/15-smart-things-you-can-do-with-your-finances-even-if-youre-broke">15 Smart Things You Can Do With Your Finances, Even if You&#039;re Broke</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-emergency-fund-myths-you-should-stop-believing">6 Emergency Fund Myths You Should Stop Believing</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-self-employed-persons-guide-to-getting-credit">The Self-Employed Person&#039;s Guide to Getting Credit</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-your-emergency-fund-big-enough-to-keep-you-afloat">Is Your Emergency Fund Big Enough to Keep You Afloat?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-money-moves-every-new-college-student-should-make">7 Money Moves Every New College Student Should Make</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Entrepreneurship business opportunities business ownership cash flow emergency funds retained earnings savings Mon, 15 Jan 2018 09:30:06 +0000 Denise Hill 2086413 at http://www.wisebread.com 7 Signs It's Time to Quit Freelancing http://www.wisebread.com/7-signs-its-time-to-quit-freelancing <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-signs-its-time-to-quit-freelancing" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/tired_girl_with_hands_on_her_face.jpg" alt="Tired girl with hands on her face" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Tell someone you're a freelancer, and you'll usually be treated with a mix of envy and admiration. Freelancing brings with it a perception of freedom and flexibility that is a definite plus, but much harder to sustain than many people might realize.</p> <p>As a freelancer, chances are you put in more hours and are on the go more than regular full-time employees. You don't get subsidized health care, a 401(k) match, or paid vacation. It can be tough &mdash; sometimes, too tough. And when the following red flags appear, it may be time to throw in the towel. (See also: <a href="http://www.wisebread.com/day-job-or-freelance-which-is-right-for-you?ref=seealso" target="_blank">Day Job or Freelance: Which Is Right for You?</a>)</p> <h2>1. You don't enjoy it anymore</h2> <p>Let's start with the most obvious reason. If it's just not something you like doing anymore, maybe it's time to start thinking about a different career path. Remember when you first decided to jump into the freelancing pool? The buzz you felt going it alone. Hustling for clients. Being your own boss. It all felt like the world was your oyster. If you now get up every day wishing you'd made a different choice, that's life telling you you're wasting time.</p> <p>Our job takes up the majority of our waking hours, so to be doing something that makes every one of them painful is just not worth it. What do you daydream about doing instead? What would reinvigorate those passions you once felt for freelancing? Listen to your gut and make a move in that direction. (See also: <a href="http://www.wisebread.com/8-signs-the-9-to-5-is-right-for-you?ref=seealso" target="_blank">8 Signs the 9-to-5 IS Right for You</a>)</p> <h2>2. It's getting harder and harder to find work</h2> <p>When you first dipped your toe into the freelance pool, you had to hustle to get those initial clients. But, after some hard work, you built up a nice client roster and had enough regular work to make freelancing a financial success. However, things change. Markets change. Freelance industries can become flooded with new and cheaper talent. And, of course, there are those sites like Fiverr and Guru that are crammed with people all over the world charging rates that you cannot even begin to compete with.</p> <p>That mix of more competition, lower freelance rates, and even corporate downsizing can have a serious impact on the time you spend trying to find work. And if you spend more time looking for it than working on it, you could be in real trouble. (See also: <a href="http://www.wisebread.com/how-to-land-more-freelance-clients-in-a-snap?ref=seealso" target="_blank">How to Land More Freelance Clients</a>)</p> <h2>3. You can no longer afford to pay for your own health care</h2> <p>This is a big reason freelancers are returning to the workforce, and it's a sad sign of the times. Corporations and small businesses have the clout to negotiate excellent rates for their employees. Not only that, but the company pays the majority of the monthly premium, with some companies even offering completely free HMO coverage for an employee and family.</p> <p>As a freelancer, you don't have that kind of power. According to data gathered by eHealth, the average individual health insurance premium for 2017 was $393 a month. It skyrockets to $1,021 a month for families. That's not taking into account deductibles, which you have to meet before the insurance kicks in. It's a huge burden for a freelancer to take on, and coming back into the fold can be a relief. (See also: <a href="http://www.wisebread.com/10-work-perks-you-cant-get-as-a-freelancer?ref=seealso" target="_blank">10 Work Perks You Can't Get as a Freelancer</a>)</p> <h2>4. You miss the interaction with other employees</h2> <p>Freelancing can be a lonely business. Many people take daily human interaction for granted. In fact, some people tire of it all, and it becomes a major reason for freelancing and going solo. But over time, you can go days without talking to anyone except the checkout cashier and the dog.</p> <p>Humans, for the most part, are social creatures; it's only natural to start longing to be around other people again &mdash; for those water cooler talks about last night's killer season finale, or the latest and greatest music you've discovered. And while texting and calling people can help with the loneliness, it can become depressing. If it's starting to weigh on you every day, and you are making excuses to leave the house, it's time to think about returning to the workforce. (See also: <a href="http://www.wisebread.com/11-ways-freelancers-and-telecommuters-can-make-friends-and-network?ref=seealso" target="_blank">11 Ways Freelancers and Telecommuters Can Make Friends and Network</a>)</p> <h2>5. You're bored and you're coasting</h2> <p>Has the freelance life lost its spark because you are simply not being challenged anymore? It's possible that your daily work routine is filled with the same projects, for the same clients, over and over again.</p> <p>Some freelance writers get stuck penning annual reports and company brochures week in, week out, and it becomes monotonous work. Some freelance photographers get stuck doing weddings and graduations, and although it's special for the people being photographed, it can be tedious taking the same shots every time. Whatever your freelance gig, if you are dreading getting out of bed in the morning because you have &quot;those projects,&quot; you have lost your passion. Dive back into something more challenging, for your own mental wellbeing.</p> <h2>6. You can't make ends meet</h2> <p>Freelancing is a constant hustle. It can be exhausting to find work for yourself. What's worse is when the jobs start paying less, or you lose a few clients. Some clients will be tempted by younger freelancers offering lower rates. Others may just be retiring, or going in another direction. And while it's important not to panic if you do lose some regular monthly income, you have to be prudent about how long you ride it out.</p> <p>Can you find something that will make up for that income loss before it really starts to eat away at your emergency fund? Do you even have an emergency fund? What can you cut out to keep going? Examine the budget carefully, and if things are looking bleak, you may need to cut and run to a regular, full-time salary. (See also: <a href="http://www.wisebread.com/the-smart-way-to-budget-on-a-freelance-income?ref=seealso" target="_blank">The Smart Way to Budget on a Freelance Income</a>)</p> <h2>7. The work-life balance is no longer acceptable</h2> <p>When you first started freelancing, you knew you'd have to put in extra hours to get the business off the ground. After that, it should have been more like a day job, with regular hours that you work, regular time to relax, and hopefully, a week or two of vacation. However, some freelancers swear by the saying, &quot;Never turn down work &mdash; they may never ask again.&quot;</p> <p>That can be a huge problem. You don't want to turn work away and risk an income stream drying up. But you're tired. You've been putting in 60-hour weeks and you need a break. If you have reached that stage where you are living to work, and not working to live, you should consider quitting and finding a full-time job with an employer. (See also: <a href="http://www.wisebread.com/9-signs-your-work-life-balance-is-off?ref=seealso" target="_blank">9 Signs Your Work-Life Balance Is Off</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F7-signs-its-time-to-quit-freelancing&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F7%2520Signs%2520It%2527s%2520Time%2520to%2520Quit%2520Freelancing.jpg&amp;description=7%20Signs%20It's%20Time%20to%20Quit%20Freelancing"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/7%20Signs%20It%27s%20Time%20to%20Quit%20Freelancing.jpg" alt="7 Signs It's Time to Quit Freelancing" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/paul-michael">Paul Michael</a> of <a href="http://www.wisebread.com/7-signs-its-time-to-quit-freelancing">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-tax-mistakes-freelancers-need-to-stop-making">5 Tax Mistakes Freelancers Need to Stop Making</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-ways-freelancers-can-make-sure-they-get-paid-on-time">8 Ways Freelancers Can Make Sure They Get Paid on Time</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/self-employed-heres-how-to-get-your-apartment-application-approved">Self-Employed? Here&#039;s How to Get Your Apartment Application Approved</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/12-red-flags-to-watch-for-in-a-job-interview">12 Red Flags to Watch for in a Job Interview</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-retirement-planning-changes-when-youre-single">7 Ways Retirement Planning Changes When You&#039;re Single</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship cons freelancing health care insurance loneliness losing clients loss of income red flags self employment warning signs Mon, 15 Jan 2018 09:00:07 +0000 Paul Michael 2086410 at http://www.wisebread.com What Does Your Personal Guarantee On a Business Credit Card Mean? http://www.wisebread.com/what-does-your-personal-guarantee-on-a-business-credit-card-mean <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/what-does-your-personal-guarantee-on-a-business-credit-card-mean" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_talking_on_smart_phone_and_holding_credit_card.jpg" alt="Woman talking on smartphone and holding credit card" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Millions of Americans own their own businesses, and each one of them can potentially qualify for a small business credit card. Small business credit card holders need to be aware that they are personally liable for repayment of their charges, but what does this mean?</p> <h2>What your personal guarantee means</h2> <p>Your small business may be incorporated in different ways, or it may just be a sole proprietorship. But regardless of your company's legal structure, you will almost always be personally liable for the charges on your business credit card. (See also: <a href="http://www.wisebread.com/when-you-should-get-a-business-credit-card-over-a-consumer-card?ref=seealso" target="_blank">When You Should Get a Business Credit Card Over a Consumer Card</a>)</p> <p>Wording in the card's terms and conditions will usually state that both the business and whoever signed for the account are liable for all transactions made with all cards (including those of authorized users) and convenience checks on the account. It may also say that if you leave your company, you will continue to be responsible for outstanding balances on the account. (See also: <a href="http://www.wisebread.com/how-small-business-credit-cards-affect-your-personal-credit?ref=seealso" target="_blank">How Small-Business Credit Cards Affect Your Personal Credit</a>)</p> <p>These personal guarantees mean that you will always have to pay the charges on your business credit card account. You can't claim that you aren't responsible for paying the charges of your business partner or your employees. You can't say that the debt is part of &quot;the company&quot; and that you no longer work there. In short, you are just as responsible for all of the charges to your small-business credit card account as you would be if they were made by you on your personal credit card. (See also: <a href="http://www.wisebread.com/the-5-best-credit-cards-for-small-businesses?ref=seealso" target="_blank">Best Credit Cards for Small Businesses</a>)</p> <p>There is a type of business card that doesn't require a personal guarantee, but that's a corporate card designed for larger companies, nonprofits, and government organizations.</p> <h2>Can you get a business credit card without a personal guarantee?</h2> <p>It's possible to get a small business credit card without a personal guarantee, but it's not easy and it takes time and patience. It helps if you keep your personal credit record pristine, while building your business credit scores. FICO, Equifax, and Experian all have their own business credit scores, but the Dun and Bradstreet score known as Paydex is one of the most widely used. To get a Paydex number, you have to file for a DUNS number through the D&amp;B website, and the bureau must have payment records from at least four vendors.</p> <p>You build your business scores over time, by using small business credit cards responsibly, keeping your credit utilization ratio low, and paying on time every month. But not all small business credit cards report activity to the credit bureaus. Some only report negative activity such as delinquencies, and others don't report at all. Check with any credit card you're considering applying for to see if and how they report to the credit bureaus.</p> <p>If you get a small-business loan, line of credit, or trade line from a vendor who reports to the business credit bureaus, that also helps build your business credit. Loans backed by the Small Business Administration are guaranteed by the SBA and are therefore very attractive, but they're also hard to get.</p> <p>Once you have built a solid business credit score, you can ask your credit card issuer if they will remove the guarantor from the account. The bank will conduct a review of the account, and may check both your personal and business credit reports. The bank wants to see that losing the personal guarantee won't increase the risk of nonpayment. If they agree, great, you're on your way to a guarantee-free account. But some banks never remove guarantors as a matter of policy. (See also: <a href="http://www.wisebread.com/5-ways-to-build-business-credit-when-youre-self-employed?ref=seealso" target="_blank">5 Ways to Build Business Credit When You're Self-Employed</a>)</p> <p>Another way to get credit without a personal guarantee is to grow the business to the point where it meets the revenue and size requirements of some creditors. For example, one major retailer offers a business card that doesn't require a personal guarantee for businesses with at least $5 million in revenue. Others may also require collateral such as business equipment.</p> <p>Getting business credit without a personal guarantee is not a quick process. Count on needing a personal guarantee for the first three to five years of your business. In the meantime, focus on growing your company, building your business credit score, and making all payments on time.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fwhat-does-your-personal-guarantee-on-a-business-credit-card-mean&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FWhat%2520Does%2520Your%2520Personal%2520Guarantee%2520On%2520a%2520Business%2520Credit%2520Card%2520Mean_.jpg&amp;description=What%20Does%20Your%20Personal%20Guarantee%20On%20a%20Business%20Credit%20Card%20Mean%3F"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/What%20Does%20Your%20Personal%20Guarantee%20On%20a%20Business%20Credit%20Card%20Mean_.jpg" alt="What Does Your Personal Guarantee On a Business Credit Card Mean?" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/jason-steele">Jason Steele</a> of <a href="http://www.wisebread.com/what-does-your-personal-guarantee-on-a-business-credit-card-mean">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-5-best-credit-cards-for-small-businesses">Best Credit Cards for Small Businesses</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-smart-ways-to-get-a-small-business-loan">10 Smart Ways to Get a Small Business Loan</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-small-business-credit-cards-affect-your-personal-credit">How Small Business Credit Cards Affect Your Personal Credit</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-it-pays-to-wait-before-applying-for-a-new-rewards-card">Why It Pays to Wait Before Applying for a New Rewards Card</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/does-your-teenager-really-need-a-credit-card">Does Your Teenager Really Need a Credit Card?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards Entrepreneurship business credit card tips business credit cards credit card tips line of credit personal guarantee small business Fri, 12 Jan 2018 09:30:05 +0000 Jason Steele 2085316 at http://www.wisebread.com 5 Things Every Small Business Owner Needs to Know About Employee Retirement Accounts http://www.wisebread.com/5-things-every-small-business-owner-needs-to-know-about-employee-retirement-accounts <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-things-every-small-business-owner-needs-to-know-about-employee-retirement-accounts" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_hanging_open_sign_on_door.jpg" alt="Woman hanging open sign on door" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Among small businesses, employer sponsored 401(k) plans seem to have gotten a bad rap. According to the United States Government Accountability Office, between 51 and 71 percent of small business employees don't have access to a workplace retirement savings plan.</p> <p>There is a misconception that retirement plans are just for huge companies. However, this isn't true, and offering a retirement savings plan is the biggest step that a small business can take to increase workers' retirement savings. Let's review some of the many reasons why offering an employer-sponsored retirement account is a great idea for small businesses of all types. (See also: <a href="http://www.wisebread.com/8-common-myths-about-starting-a-small-business?ref=seealso" target="_blank">8 Common Myths About Starting a Small Business</a>)</p> <h2>1. Employees may prefer a retirement plan over a salary increase</h2> <p>According to a 2015 Glassdoor survey, 31 percent of workers valued a workplace retirement account, such as a 401(k) or pension plan, over an increase in pay. This makes sense; several studies have shown that workers benefit from automatic paycheck deductions to contribute to a workplace retirement plan. The Employment Benefit Research Institute found that two-thirds of employed workers not currently saving for retirement say they would be likely to start if automatic paycheck deductions ranging from 3 to 6 percent were used by their employer. By offering a retirement plan, small businesses may be able to attract more talent.</p> <h2>2. There are low-cost options available</h2> <p>Many small-business owners have the misconception that their only option to set up a workplace retirement plan for their employees is to pay an annual 1.5 to 2 percent fee to a provider. But nowadays, business owners have access to many lower cost options. Here are three examples of 401(k) providers for small businesses and their schedule of fees for employers:</p> <ul> <li> <p><a href="https://captain401.com/pricing/" target="_blank">Captain 401</a>: $499 setup fee; monthly cost starting at $120 plus $4 per employee.</p> </li> <li> <p><a href="https://www.employeefiduciary.com/401k-plan-pricing" target="_blank">Employee Fiduciary</a>: $500 setup fee for new plans; $1,500 annual fee plus a custody fee of 0.08 percent of plan assets.</p> </li> <li> <p><a href="https://www.myubiquity.com/retirement/plans/expressk/" target="_blank">Ubiquity</a>: $495 setup fee; monthly cost starting at $115 plus other transaction service charges.</p> </li> </ul> <p>Besides providing lower costs, choosing a third-party plan provider allows you to delegate certain plan responsibilities, such as implementing nondiscrimination testing for retirement plans (in layman's terms, making sure that a company isn't favoring specific employees when making contributions). This lets you focus more on core activities of your business.</p> <h2>3. Eligible small businesses can claim tax credits</h2> <p>Those fees to set up and run a retirement plan may be tax deductible. If your small business employed 100 or fewer individuals who were compensated at least $5,000 in the preceding year, and your business hasn't offered a workplace retirement plan in the past three years, it may be eligible for the Credit for Small Employer Pension Plan Startup Costs.</p> <p>Using Form 881, eligible small-business owners can claim a credit of up to $500 for qualified setup and administration fees, and costs to educate employees about the plan for each of the first three years of the plan. You can start claiming the credit in the tax year before the tax year in which the plan becomes effective, and you may carry it back or forward to other tax years if you can't use it in the current year.</p> <p>Just remember that whatever plan expenses you use toward this credit, you can't use as business expense deductions.</p> <h2>4. Employer contributions are tax-deductible</h2> <p>In 2017, the Employee Benefit Research Institute found that nearly 73 percent of workers not currently saving for retirement would be at least somewhat likely to start if contributions were matched by their employer. The good news for employers is that the IRS usually allows them to deduct these matches, subject to contribution limits on qualified employee plans (including the employer's own plan).</p> <ul> <li> <p>Defined contribution plan: An employer can deduct contributions to an employee retirement plan, up to 25 percent of the employee's annual salary. In 2017, no more than $270,000 of an employee's annual salary could be used when calculating that 25 percent.</p> </li> <li> <p>Defined benefit plans: The IRS recommends hiring an actuary to figure out your deduction limit based on the rules of your defined benefit plan.</p> </li> </ul> <p>Remember that all deferred employer contributions, including earnings and gains, are tax-free for employees until distributed by the small-business plan. This is why an employer contribution is so valuable.</p> <p>Let's assume that an employee and your small business have a 20 percent and a 10 percent tax rate, respectively. If you were to give that employee a $4,000 raise, he would only actually see $3,200 of that and your small business would pay $400 in taxes. On the other hand, with a $4,000 employer contribution to the employee's plan, the employee gets the full $4,000 now and the employer gets to deduct the $4,000 as a business expense.</p> <h2>5. Some states provide their own retirement plans</h2> <p>Across the nation, many states have launched, or are preparing to launch, state-sponsored plans to help workers save for retirement. Here are a few examples:</p> <ul> <li> <p>California: The <a href="http://www.treasurer.ca.gov/scib/" target="_blank">California Secure Choice</a> program (scheduled for soft launch in late 2018) will offer a retirement savings option to millions of workers employed by small businesses (under 100 employees) who don't have access to a retirement plan.</p> </li> <li> <p>Connecticut: Nearly 600,000 workers lack access to a workplace retirement plan in the state of Connecticut. The <a href="http://www.ctdol.state.ct.us/retirement%20authority/" target="_blank">Connecticut Retirement Security Program</a> (currently in planning stages) will aim to offer retirement plans to private sector workers without a retirement option through their employer.</p> </li> <li> <p>Oregon: <a href="https://www.oregonsaves.com" target="_blank">OregonSaves</a> launched in November 2017 and aims to offer workers employed by small businesses of less than 100 people a retirement savings plan. The program is expanding in &quot;waves,&quot; with the next wave planned for spring 2018.</p> </li> </ul> <p>Depending on the state that your small business operates in, you may have to address whether or not your small business will offer a workplace retirement plan soon.</p> <p>For example, let's say you have a small business in Oregon. OregonSaves is planning its next registration &quot;wave&quot; for spring 2018 for small businesses with 50 to 99 employees. If your business is<em> not </em>offering a retirement plan, you'll have to start enrolling employees in the state program (unless the employees opt out) on May 15, 2018. Following suit, small businesses that employ 20 to 49 workers will have to enroll on December 15, 2018.</p> <h2>The bottom line: Take action today</h2> <p>As a small-business owner, it makes sense to take a look at offering a retirement savings plan to your employees. This is a perk that employees value, is available through lower cost options, and provides tax breaks to both employees and employers.</p> <p>In the near future, your employees may have to enroll in a state-sponsored retirement plan depending on whether or not you offer a workplace retirement plan. Offering an employer-sponsored retirement plan is an effective way to attract and retain the best talent and demonstrate that you have your employees' best interest in mind.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-things-every-small-business-owner-needs-to-know-about-employee-retirement-accounts&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Things%2520Every%2520Small%2520Business%2520Owner%2520Needs%2520to%2520Know%2520About%2520Employee%2520Retirement%2520Accounts.jpg&amp;description=5%20Things%20Every%20Small%20Business%20Owner%20Needs%20to%20Know%20About%20Employee%20Retirement%20Accounts"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/5%20Things%20Every%20Small%20Business%20Owner%20Needs%20to%20Know%20About%20Employee%20Retirement%20Accounts.jpg" alt="5 Things Every Small Business Owner Needs to Know About Employee Retirement Accounts" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/damian-davila">Damian Davila</a> of <a href="http://www.wisebread.com/5-things-every-small-business-owner-needs-to-know-about-employee-retirement-accounts">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-easiest-ways-to-catch-up-on-retirement-savings-later-in-life">7 Easiest Ways to Catch Up on Retirement Savings Later in Life</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/3-ways-more-money-in-retirement-might-cost-you">3 Ways More Money in Retirement Might Cost You</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/where-to-invest-your-money-after-youve-maxed-out-your-retirement-account">Where to Invest Your Money After You&#039;ve Maxed Out Your Retirement Account</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-things-you-should-know-about-your-401k-match">7 Things You Should Know About Your 401(k) Match</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-critical-401k-questions-you-need-to-ask-your-employer">8 Critical 401(k) Questions You Need to Ask Your Employer</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship Retirement 401(k) benefits business expenses contributions employees small businesses tax deductions Thu, 11 Jan 2018 09:30:10 +0000 Damian Davila 2085310 at http://www.wisebread.com