Entrepreneurship http://www.wisebread.com/taxonomy/term/4815/all en-US 10 Fundamentals of Naming a Small Business http://www.wisebread.com/10-fundamentals-of-naming-a-small-business <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/10-fundamentals-of-naming-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/female_business_owner_holding_tablet_computer.jpg" alt="Female business owner holding tablet computer" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>What's in a name? When it comes to a small business, quite a lot, actually. While it may seem like a fun side project, the name you choose for your business could have a long-lasting impact on the success (or failure) of your startup. However, if you follow these guidelines, you should come up with something that makes a great first impression for your new business venture.</p> <h2>1. Do not name it after yourself</h2> <p>The biggest mistake people make when choosing a business name is to go straight for the ego option: &quot;Well, it's my business, I should use my name.&quot; You see it with law firms, handymen, auto garages, and so on. While it may be nice to see your name on a big sign and a business card, it doesn't tell anyone anything about what you do or provide. Therefore, you have to add a second line to spell it out: &quot;The Smith Brothers: Plumbing and Heating Experts.&quot; That's not catchy.</p> <h2>2. Be smart, but not too clever</h2> <p>It's tempting to have fun with your business name. However, keep in mind that when people see the name of your company for the first time, they do not have the background that you do. They know nothing about your business, how long you've been dreaming of it, and what kind of thought process you went through.</p> <p>For example, imagine someone passionate about great hot dogs opens an eatery called The Top Dog. To that person it's a great name, but they know it's a reference to hot dogs. To someone else, it's more likely something to do with actual dogs; perhaps a dog grooming service, products for pooches, or a place to buy a dog. The business is going to have to work harder to identify itself as a restaurant. If instead they'd chose a name like Hot Dog Heaven, or The Tasty Wiener, there wouldn't be any confusion.</p> <h2>3. Keep your sights set on expansion</h2> <p>Small businesses sometimes become big businesses. When that happens, and the company grows to include new locations, your company name might suddenly become very confusing. For instance, if you base the name on your current location (maybe something like Delaware Dinners), you may have people scratching their heads when you move to a different state, or even a different country.</p> <p>Similarly, think about not just physical expansion, but product line growth. You may start out as a T-shirt company, and call yourself something like Top Shelf Tees. But what happens when you decide to make branded caps, bags, and sneakers? Your original product name limits the expectations of customers, and you may have to rebrand to Top Shelf Apparel. So, think about the future.</p> <h2>4. Cutesy spellings aren't for everyone</h2> <p>The rise of the internet, and the need for a unique dot-com address, has brought about a glut of misspelled words. Carz instead of cars. Kabbage instead of cabbage. Wzrd instead of wizard. All in the name of getting a name that sounds memorable.</p> <p>But consider the additional steps you will have to take to inform your customers of the odd spelling. For example, if you choose to do radio promotions, you'll have to say something like, &quot;Remember, that's carz with a Z.&quot; And when potential customers hear a little buzz, and search for you on the web, will they be searching for the right company? Chances are, they'll use the typical spelling, and it could end up taking them to a major competitor.</p> <h2>5. Completely made-up words make life difficult</h2> <p>There are hundreds of companies out there that have names that either mean nothing, or were based on a real word from any number of languages. You already know some very well, including Verizon, Google (although it was based on Googol), Etsy, Skype, Hulu, Zillow, and eBay.</p> <p>Now, the reason you know these words so well is because the companies are huge, and spent major branding and advertising dollars to get their name to be recognized. Plus, as word of mouth has spread, the familiarity of these names has grown. Let's be honest, have you ever considered what Google means over the many years you have used the service? Because the brand is so dominant, it hasn't really mattered to most people.</p> <p>However, you're the owner of a small business right now, not a major corporation. You have limited funds. Unless you think your company will scale to the size of these giants, you are better off avoiding completely nonsensical words.</p> <h2>6. Make sure your name conjures positive imagery</h2> <p>To this day, it baffles many marketing and branding experts that the company The Athlete's Foot was named something so horrendous. Athlete's foot is described as &quot;a contagious fungal infection that causes itching, blisters, cracking, and scaling, especially between the toes.&quot; And yet for some reason, a boardroom full of people said &quot;Yeah &hellip; we want our footwear store to be associated with that.&quot;</p> <p>Bizarrely, it worked; the store is still going. But you <em>really</em> do not want to take that chance with your own company. If the first thing people conjure up in their heads is negative, you have a tough image mountain to climb. If you are a mobile hairdresser, Curl Up &amp; Dye might sound funny for a second &mdash; but what kind of image are you putting in your customers' heads? Keep it positive, unless it really does fit the bill (like Vinyl Resting Place, a store that sells old vinyl records and has a sense of humor about it).</p> <h2>7. Don't pick a name out of a hat</h2> <p>The hat comes in many forms. It can be a dictionary or thesaurus. It can be a random word generator online. Or, it could in fact be a bunch of words you put into an actual hat. These methods are just not going to work out for you. There has to be a logical reason as to why you went with the name you did.</p> <p>What's the background? How does it tie to your business? Does it accurately describe what you do, or at least invoke some part of it? For example, Pinkberry is not an accidental or random name. While it sounds fun and trendy, it also relates directly to the fresh fruit cut daily for its frozen yogurts and ice creams. If the company had simply pulled a word out of thin air, it would not have been as successful.</p> <h2>8. Think alphabetically</h2> <p>There's a reason there are so many AAA Plumbers, and AAAA Lawyers; they were looking to be first in the phone directory. While that is not always the case anymore when it comes to search engines, alphabetical listings are still a way to organize companies. If your company is called something like Zoomfood or Yogalicious, you're going to be stuck at the back of the line.</p> <p>Consider a name that will bump you up without compromising the fun and originality of your name. For example, Foodzoom is just as fun, but vaults you way higher up the list. While it may not be the most important consideration, it's worth thinking about.</p> <h2>9. Combining words can produce great results</h2> <p>One of the easiest ways to come up with a good business name is to combine two (or more) words to create a new word that's both eye-catching and memorable. Start by writing down a list of all the traits of your company. Don't worry about coming up with actual names just yet, this is a brain dump. Your company mission statement will include a lot of these words. When you have that list, start making connections.</p> <p>Which words fit well together? For example, if you're a meal prep company, you may have a list that includes food, easy, preparation, timesaving, meals, dinners, fresh, delicious, organic, diet, delivery, and simple. Now, which of those words can you combine to make something new? It could be as simple as FreshPrep, or EasyMeals. You could also do it another way, like Dinner 'N Delivery, or Meals On Time. These are just quick examples, but it's a great way to brainstorm a name that includes essential aspects of your company.</p> <h2>10. Test out a few names before you commit</h2> <p>When you have a list of business names that you're happy with, it's time to put them to the test. Narrow the list to the top three, and set up a simple survey through a site like Survey Monkey. Ask questions like, &quot;What did the name instantly make you think of?&quot; or, &quot;Does this business sound professional?&quot; You want a good variety of questions and possible answers. Send the survey to people you may already be working with, online forums, a subreddit devoted to your industry, and anyone else that could be of help. However, don't send it to immediate family and friends; they know too much and won't give you an unbiased opinion.</p> <p>One last note: When you have picked the winning name, think about how you will turn that into a memorable and noticeable logo or brand mark. Work with a freelance designer to get some options, and use the same survey system to help you select the best one. This will be your logo for the foreseeable future, although brands change identities often, so it's not as important as the actual business name. Good luck.</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/10-fundamentals-of-naming-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/think-like-a-startup-to-boost-your-finances">Think Like a Startup to Boost Your Finances</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-signs-its-time-to-close-your-business">5 Signs It&#039;s Time to Close Your 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/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/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-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-8-best-books-for-entrepreneurs">The 8 Best Books for Entrepreneurs</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship advice naming a business self employment SEO small businesses startups strategies Wed, 06 Dec 2017 09:30:11 +0000 Paul Michael 2066636 at http://www.wisebread.com 8 Life Lessons I’ve Learned from Self-Employment http://www.wisebread.com/8-life-lessons-i-ve-learned-from-self-employment <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-life-lessons-i-ve-learned-from-self-employment" 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_cafe.jpg" alt="Woman working at cafe" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>In 2011, I started a side hustle that would ultimately lead to self-employment. I didn&rsquo;t know at the time that I would become my own boss one day. But you know how life can be; sometimes the stars align and you end up doing <em>exactly</em> what you were meant to be doing all along.</p> <p>And it didn&rsquo;t take me long to figure out I was, in fact, in the ideal career for my personality and talents. So, after a successful year of part-time work, I quit my steady professional job in 2012 to begin a career as a blogger and online content creator.</p> <p>Since those early days, my husband has come home to work with me, our profits have grown, and our business dealings (and taxes) have become a lot more complex. Where I was once a novice at all things self-employment, I feel like I <em>finally </em>know what I&rsquo;m doing.</p> <p>Of course, most of our biggest lessons were learned the hard way &mdash; by messing things up and figuring out how to fix them. I also learned a ton about what <em>not </em>to do just by realizing my own mistakes.</p> <p>Here are some of the lessons I&rsquo;ve learned about self-employment, and why I don&rsquo;t think I could ever go back to my old life. (See also: <a href="http://www.wisebread.com/6-moves-every-first-year-freelancer-should-make?ref=seealso" target="_blank">6 Moves Every First Year Freelancer Should Make</a>)</p> <h2>1. With self-employment, you reap what you sow</h2> <p>At my old office job, there were days when I would sit and stare at the clock for hours, counting down to 5 p.m. so I could leave. Even when there wasn&rsquo;t enough work to fill my day, I still got paid for being there.</p> <p>But self-employment is an entirely different animal. When you work for yourself, slacking off means taking money from your own pocket. When you run out the clock or don&rsquo;t do your best, you&rsquo;re only hurting yourself. You don&rsquo;t get paid for showing up (not to mention vacations and sick days!), nor will you automatically get a salary bump each year or be in line for a promotion. You have to reach for your potential on your own &mdash; grow your skills, raise your rate, and land your clients.</p> <p>Once I became self-employed, I realized that <em>I </em>was the one in charge of my own destiny. If I wanted full-time results, I had to put in everything I had. So that&rsquo;s exactly what I&rsquo;ve learned to do. (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>2. You can&rsquo;t avoid taxes, so you might as well plan for them</h2> <p>Paying taxes as an employee isn&rsquo;t that painful. Although you can see how much is withheld from each paycheck you receive, the money is gone before you really see it. And as long as you set your withholdings up the right way, you shouldn&rsquo;t owe too much money come April 15.</p> <p>But self-employment taxes can really hurt, and they start hurting even more as your income grows. Since you don&rsquo;t have money withheld from your paycheck, you have to make a payment each quarter for <a href="http://www.wisebread.com/avoid-irs-penalties-with-this-simple-estimated-payment-strategy?ref=internal" target="_blank">estimated taxes</a>.</p> <p>I hate writing those checks every three months, but it&rsquo;s a lot easier to handle when you have the money already set aside. Over time, I&rsquo;ve learned to set aside around 30 percent of my income as I earn it so I&rsquo;m ready to pay my tax bill when the time comes. (See also: <a href="http://www.wisebread.com/how-to-budget-consistently-without-a-steady-paycheck?ref=seealso" target="_blank">How to Budget Consistently Without a Steady Paycheck</a>)</p> <h2>3. Living below your means is the best way to deal with an unpredictable income</h2> <p>While we always earn more than enough money to pay our bills each month, our monthly income often fluctuates by thousands of dollars. This is an inevitable part of self-employment, but it&rsquo;s one I&rsquo;ve gotten used to.</p> <p>Since I hate owing money or feeling like I don&rsquo;t have enough, I decided early on in self-employment that I wanted to keep our bills as low as possible. As a result, we live well below our means. We don&rsquo;t have any credit card debt, we don&rsquo;t have any expensive hobbies or toys, and our house payment is less than 10 percent of our gross income. Even though we could afford to live a little more lavishly, I&rsquo;ve found the peace of mind that comes with living below our means is well worth it. (See also: <a href="http://www.wisebread.com/6-moves-every-first-year-freelancer-should-make?ref=seealso" target="_blank">6 Moves Every First Year Freelancer Should Make</a>)</p> <h2>4. When it comes to health care, you&rsquo;re on your own</h2> <p>One of the biggest drawbacks of self-employment is the fact you don&rsquo;t have any benefits unless you buy them. This means buying your own health insurance plan, purchasing your own life insurance, and paying all your dental bills out-of-pocket. (See also: <a href="http://www.wisebread.com/how-the-self-employed-can-cut-health-care-costs?ref=seealso" target="_blank">How the Self Employed Can Cut Health Care Costs</a>)</p> <p>While health care has always been a struggle, we are finally at a place where we&rsquo;re happy with what we have. We have tried a few different plans over the years, but we ultimately ended up in a health care sharing ministry called Liberty Healthshare after the Affordable Care Act was passed.</p> <p>In terms of dental care, our local dentist offers a $799 per year for a family plan that includes two cleanings with X-rays for all of us plus a 20 percent discount on dental work.</p> <p>None of this is ideal, but it&rsquo;s the price we pay for self-employment and something we&rsquo;ve had to get used to. (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>5. Saving for retirement is not that hard</h2> <p>A lot of people assume that health care and retirement are the biggest issues facing the self-employed. Personally, I&rsquo;ve found that, while dealing with health care is a pain, retirement planning is a breeze.</p> <p>You don&rsquo;t need to have an employer to set up a retirement plan. We set up our own SEP IRA and Roth IRA plans with Vanguard when we first got started, but have since transitioned to Solo 401(k) plans instead. Either way, Vanguard funds are some of the least expensive available, and you can find all kinds of resources online to help you choose the right funds. When in doubt, you can even buy target date funds that automatically adjust for risk based on the year you want to retire. (See also: <a href="http://www.wisebread.com/a-simple-guide-to-retirement-plans-for-the-self-employed?ref=seealso" target="_blank">A Simple Guide to Retirement Plans for the Self-Employed</a>)</p> <h2>6. You have to set limits on yourself</h2> <p>When you work a nine-to-five job, you can leave your work at the office and enjoy your free time at home. When your work is <em>at home</em>, on the other hand, it can be very challenging to separate your personal time from your work time. If you&rsquo;re not careful, you end up working all the time.</p> <p>I&rsquo;ve fallen into the habit of working 50-hour weeks several times over the years, but I try really hard not to. These last few years, I have tried to work only when my kids are in school, or during the hours of 8 a.m. to 3:40 p.m. Once they get home, I put my computer away to do housework and spend time being a mom. It doesn&rsquo;t always work out that way, but I have a much better work-life balance when I set clear limits for myself. (See also: <a href="http://www.wisebread.com/the-5-biggest-mistakes-people-make-when-working-from-home?ref=seealso" target="_blank">The 5 Biggest Mistakes People Make When Working From Home</a>)</p> <h2>7. Freedom is better than PTO</h2> <p>If I had a dollar for each time a person asked me if I missed having paid time off, I would be rich! For some reason, people assume that not having paid vacation is a huge drawback of self-employment.</p> <p>While it may be a downside for some people, I am more than happy to forgo paid vacation in order to set my own hours and work when I want. With the freedom to make my own schedule, I can work ahead any time I take a trip. And I never have to ask permission, either.</p> <p>At the end of the day, I value freedom over paid vacation and sick days &mdash; even if that means working during vacation or having fewer days off each year. (See also: <a href="http://www.wisebread.com/freelance-your-way-to-more-income-and-flexibility?ref=seealso" target="_blank">Freelance Your Way to More Income and Flexibility</a>)</p> <h2>8. I wouldn&rsquo;t trade self-employment for the world</h2> <p>The final lesson I&rsquo;ve learned from self-employment is that, for me, this was a one-way street. Even though self-employment isn&rsquo;t perfect, I couldn&rsquo;t imagine going back to a regular job now.</p> <p>I truly enjoy the challenge of figuring out how to earn a living without a steady salary. I am used to putting my head down and working hard to achieve my goals without having to make small talk or drive to an office. And I love the fact I can earn more money by working harder, instead of relying on someone else to determine how much money I make. Even though my income varies widely and I don&rsquo;t have any benefits, I have something more important &mdash; real freedom to live my life how I want.</p> <p>No job is perfect, and that&rsquo;s certainly true when you work for yourself. But self-employment lets me bet on myself every day of the week &mdash; and it doesn&rsquo;t get any better than that. (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 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%2F8-life-lessons-i-ve-learned-from-self-employment&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F8%2520Life%2520Lessons%2520I%25E2%2580%2599ve%2520Learned%2520from%2520Self-Employment.jpg&amp;description=8%20Life%20Lessons%20I%E2%80%99ve%20Learned%20from%20Self-Employment"></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/u5180/8%20Life%20Lessons%20I%E2%80%99ve%20Learned%20from%20Self-Employment.jpg" alt="8 Life Lessons I&rsquo;ve Learned from Self-Employment" 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/holly-johnson">Holly Johnson</a> of <a href="http://www.wisebread.com/8-life-lessons-i-ve-learned-from-self-employment">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-12"> <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-biggest-mistakes-freelancers-make">The 5 Biggest Mistakes Freelancers Make</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-life-skills-every-freelancer-needs">8 Life Skills Every Freelancer Needs</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-secrets-to-a-successful-family-business">The three secrets to a successful family 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/22-websites-that-will-pay-you-to-write-for-them">22 Websites That Will Pay You to Write for Them</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/11-freelance-jobs-that-pay-surprisingly-well">11 Freelance Jobs That Pay Surprisingly Well</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship Lifestyle blogger entrepreneur freelancer self-employed self-employment work from home Fri, 01 Dec 2017 09:30:05 +0000 Holly Johnson 2059321 at http://www.wisebread.com How Small Business Credit Cards Affect Your Personal Credit http://www.wisebread.com/how-small-business-credit-cards-affect-your-personal-credit <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-small-business-credit-cards-affect-your-personal-credit" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/florist_holding_a_credit_card_in_her_flower_shop.jpg" alt="Florist holding a credit card in her flower shop" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>If you're looking for a new credit card, then you&rsquo;ve probably noticed that many cards are offered in both personal and small business versions. <a href="http://www.wisebread.com/the-5-best-credit-cards-for-small-businesses?ref=internal" target="_blank">Business credit cards</a> can offer rewards and benefits more suited to the needs of small companies, but how does their use affect your personal credit?</p> <h2>Business credit card basics</h2> <p>When you apply for a small business credit card, the card issuer will check your personal credit report and credit score to see if you qualify for a new account. It doesn&rsquo;t matter whether you supply an Employer Identification Number (EIN) or a Social Security Number, your personal credit information will be checked, since nearly all small business credit cards require your personal guarantee of repayment. This means that even if your business dissolves, gets sold, or goes into bankruptcy, you&rsquo;re still responsible for paying off the credit card debt. The credit card may have your business name on it, but as part of the application, you agree to be personally responsible for it. (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&rsquo;re Self-Employed</a>)</p> <h2>How applying for a business credit card affects your credit</h2> <p>When you apply for any new credit card, it has several effects on your credit. To grasp these, it helps to understand the <a href="http://www.wisebread.com/the-5-things-with-the-biggest-impact-on-your-credit-score?ref=internal" target="_blank">five main factors that go into your FICO score</a> &mdash; the most commonly used personal credit score. These factors are:</p> <ol> <li> <p><strong> Payment history (35 percent of the total credit score):</strong> On-time payments are the most important part of your credit score. (See also: <a href="http://www.wisebread.com/how-late-payments-affect-your-credit?ref=seealso" target="_blank">How Late Payments Affect Your Credit</a>)</p> </li> </ol> <ol start="2"> <li> <p><strong> Credit utilization (30 percent of the total score):</strong> It&rsquo;s best to keep your <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> &mdash; the amount you owe compared to how much total credit you have available &mdash; as low as possible.</p> </li> </ol> <ol start="3"> <li> <p><strong> Length of credit history (15 percent of the total score):</strong> The higher the average age of your accounts, the better. (See also: <a href="http://www.wisebread.com/why-the-age-of-your-credit-history-matters?ref=seealso" target="_blank">Why the Age of Your Credit History Matters</a>)</p> </li> </ol> <ol start="4"> <li> <p><strong> New credit: (10 percent of the total score):</strong> Opening <a href="http://www.wisebread.com/can-too-many-credit-cards-hurt-your-credit-score?ref=internal" target="_blank">too many credit lines</a> at once could suggest you&rsquo;re having financial trouble.</p> </li> </ol> <ol start="5"> <li> <p><strong> Credit mix: (10 percent of the total score):</strong> Lenders like to see that you can handle a variety of debt types, such as installment loans and credit cards. (See also: <a href="http://www.wisebread.com/how-credit-inquiries-affect-your-credit-score?ref=seealso" target="_blank">How Credit Inquiries Affect Your Credit Score</a>)</p> </li> </ol> <p>When you apply for a new card, it affects the new credit part of your score because the application will result in a new inquiry on your credit report &mdash; a so-called hard inquiry. Applying for a single line of credit will have very little effect on your credit score, but applying for multiple new lines of credit in a short period of time could cause a small, temporary drop in your score.</p> <h2>How business credit cards may affect your personal credit differently</h2> <p>In most ways, a small business credit card will affect your credit just like a personal credit card. However, some credit card issuers only report your business credit card account if it&rsquo;s delinquent and don&rsquo;t report balance and payment information at all. Therefore, your use of business credit card accounts may or may not affect your credit one way or another. (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 to Get a Business Credit Card Over a Consumer Card</a>)</p> <p>Assuming you have a card that does report regularly to your personal credit, once approved, the new account will affect the credit history part of your score. It will lower the average age of your lines of credit, which on its own might cause a small drop in your score, especially if you have a very limited credit history.</p> <p>Your monthly balances and payment for this new account will appear on your credit report as well. So long as you make your payments on time, this new account will help build your credit history, which is good for your credit score.</p> <p>Finally, having a new line of credit may or may not help to reduce your credit utilization ratio. A card with a large credit limit (and business cards tend to have higher limits than personal cards) raises your amount of available credit. But in order to keep your utilization ratio low, you have to keep your balances low. If you quickly max out the new card, you could actually hurt your credit utilization ratio.</p> <p>If you get a business credit card that doesn&rsquo;t report to your personal credit, then the small dip in your credit from the hard inquiry will bounce back and nothing else will happen to your credit, unless you default on the business credit card. Then it will appear on your credit report as a loan in default.</p> <p>The only way to know for sure if your business credit card accounts are reporting your balance and payment information is to look at a copy of your credit report. You can obtain a free credit report each year from each of the three major consumer credit bureaus by going to AnnualCreditReport.com.</p> <h2>How business credit cards affect your business credit report</h2> <p>In addition to possibly affecting your personal credit report, your small business credit card may also affect your business credit reports. Your issuer may report your balance and payment information to companies that compile credit reports on small businesses. The main business credit reporting agencies are Dun &amp; Bradstreet, Experian, and Equifax. For many small businesses, having a strong business credit report is vital to securing future lines of credit and favorable payment terms from suppliers. It&rsquo;ll also benefit you to be able to get funding without a personal guarantee, which can only happen by building a strong business credit history first.</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-small-business-credit-cards-affect-your-personal-credit&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520Small%2520Business%2520Credit%2520Cards%2520Affect%2520Your%2520Personal%2520Credit.jpg&amp;description=How%20Small%20Business%20Credit%20Cards%20Affect%20Your%20Personal%20Credit"></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%20Small%20Business%20Credit%20Cards%20Affect%20Your%20Personal%20Credit.jpg" alt="How Small Business Credit Cards Affect Your Personal Credit" 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/how-small-business-credit-cards-affect-your-personal-credit">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-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-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/the-5-best-credit-cards-for-small-businesses">Best Credit Cards for Small Businesses</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-one-ratio-is-the-key-to-a-good-credit-score">This One Ratio Is the Key to a Good Credit Score</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-to-grow-your-solo-business-without-hiring-employees">How to Grow Your Solo Business Without Hiring Employees</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards Entrepreneurship business owner credit cards credit score personal credit small business Tue, 21 Nov 2017 09:30:10 +0000 Jason Steele 2057716 at http://www.wisebread.com 5 Ways to Build Business Credit When You're Self-Employed http://www.wisebread.com/5-ways-to-build-business-credit-when-youre-self-employed <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-ways-to-build-business-credit-when-youre-self-employed" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/businesswoman_paying_online.jpg" alt="Businesswoman paying online" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>It's hard to beat the freedoms of being self-employed. But with the joys of being your own boss and creating your own schedule come some trade-offs. One trade-off can be unsteady income.</p> <p>Even if you are very careful about your finances, it's possible that a great business opportunity will present itself that you simply don't have the cash for. If you've built good business credit and have access to a business credit card or line of credit, it will be easier to jump on those opportunities.</p> <p>Building good business credit can seem like a mysterious process if you've never done it before. Here's how to get started. (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> <h2>1. Establish strong personal credit first</h2> <p>The vast majority of small business credit cards require you to personally guarantee the charges you make &mdash; even if the card is issued in your business's name. That means if the business fails, you will still be responsible for the debt.</p> <p>Because you ultimately will be the one who pays the balance, expect lenders to pay attention to your personal credit when you seek business credit. Under the Fair Credit Reporting Act, when you apply for business credit, a lender has the right to look at your personal credit profile to evaluate whether to issue it to you.</p> <p>To make sure you have a full array of options when it comes to business credit cards, make sure you are paying your personal cards on time and not maxing them out. A high <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> &mdash; that is, using a large percentage of the credit available to you &mdash; can cause your credit score to drop. (See also: <a href="http://www.wisebread.com/5-ways-to-improve-your-credit-score-fast?ref=seealso" target="_blank">5 Ways to Improve Your Credit Score Fast</a>)</p> <h2>2. Run your business like a business</h2> <p>If you want to get business credit in the future, keep good financial records by using accounting software such as FreshBooks, QuickBooks or Xero. Using software designed for this is much easier than using spreadsheets and reduces the chance that you'll make mistakes.</p> <p>Many accounting software programs have a &quot;reports&quot; function that allows you to create a profit and loss (P&amp;L) statement with the click of a button. A P&amp;L statement shows all of your sales and expenses for a set period, such as a year. To get a business line of credit with your bank, you will very likely have to produce one of these statements, so this feature is a huge timesaver. (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. Keep your business finances separate</h2> <p>Before you try to open a line of credit with your bank or apply for business credit cards, open a business checking account. This will show lenders you are serious about running your business.</p> <p>Maintaining a business checking account also gives you an opportunity to develop a relationship with your banker. If money is flowing into your account regularly, you are maintaining more than the minimum balance, and you are handling the account responsibly (i.e., the checks you write are clearing), chances are that your banker will begin to offer you products such as a business credit card and possibly a line of credit.</p> <p>Don't use your business checking account to pay your personal bills. You need to establish separation between your business and personal finances and keep accurate records.</p> <p>To open a business checking account, you will generally need a federal Employer Identification Number (EIN). You can <a href="https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online" target="_blank">apply for one online</a> through the IRS.</p> <h2>4. Use your business credit card strategically</h2> <p>If you don't have strong personal credit, you may still be able to get a business credit card. There are some higher-interest cards designed for people with a &quot;fair&quot; credit score.</p> <p>While paying higher interest isn't ideal, if you use the card responsibly, you'll be able to improve your credit profile and should qualify for better deals in the future.</p> <p>Once you get a business credit card, use it regularly to make business purchases and pay the bill on time &mdash; ideally in full &mdash; to build a history of using it responsibly. Don't use the card for personal spending. If you connect this card to your accounting software, it will be easy to enter your business expenses, saving you a lot of time.</p> <h2>5. Monitor your business credit report</h2> <p>How do you know if you are actually building good business credit once you make these efforts? Use the free searches on <a href="http://sbcr.experian.com/pdp.aspx?pg=sample&amp;hdr=pp&amp;link=5502&amp;offercode=sbcredit&amp;intcmp=EXPSBsmbusicrd_marquee" target="_blank">Experian</a>, <a href="https://sb.econsumer.equifax.com/bizdirect/companySearch.ehtml?advancedSearch=true" target="_blank">Equifax</a>, or <a href="https://businesscredit.dnb.com/" target="_blank">D&amp;B</a> to see if your business's credit is being tracked. (You will have to pay to get the actual report).</p> <p>There's a different system for business credit card scores than for personal ones. Business credit scores go from 0 or 1 to 100. Each of the major credit bureaus uses its own formula, but factors such as how long you've been in business, your credit utilization, and the lines of credit you have opened in the last six months are likely to affect your score.</p> <p>If you find your business isn't on the radar screen of the major credit bureaus and you have already gotten your EIN, try <a href="http://fedgov.dnb.com/webform/displayHomePage.do;jsessionid=81407B1F03F2BDB123DD47D19158B75F" target="_blank">applying for a free D-U-N-S number</a> with Dun &amp; Bradstreet, which should get the ball rolling.</p> <p>All of these steps take some work and can't be done overnight, so start early &mdash; ideally a few months before you think you'll need business credit. It'll pay off. Having strong business credit is a valuable asset that you'll greatly appreciate if you ever get into a cash crunch.</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-to-build-business-credit-when-youre-self-employed&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Ways%2520to%2520Build%2520Business%2520Credit%2520When%2520You%2527re%2520Self-Employed.jpg&amp;description=5%20Ways%20to%20Build%20Business%20Credit%20When%20You're%20Self-Employed"></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/u5180/5%20Ways%20to%20Build%20Business%20Credit%20When%20You%27re%20Self-Employed.jpg" alt="5 Ways to Build Business Credit When You're Self-Employed" 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/5-ways-to-build-business-credit-when-youre-self-employed">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/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-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-building-credit-in-college-helps-you-win-at-life">5 Reasons Building Credit in College Helps You Win at Life</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-grow-your-solo-business-without-hiring-employees">How to Grow Your Solo Business Without Hiring Employees</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-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-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-always-dispute-mistakes-on-your-credit-report">Should You Always Dispute Mistakes on Your Credit Report?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Entrepreneurship building credit business line of credit business owner credit reports credit score freelance lending self-employment small business Tue, 07 Nov 2017 08:30:20 +0000 Elaine Pofeldt 2045797 at http://www.wisebread.com 5 Fun and Unexpected Ways to Get Out of a Business Rut http://www.wisebread.com/5-fun-and-unexpected-ways-to-get-out-of-a-business-rut <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-fun-and-unexpected-ways-to-get-out-of-a-business-rut" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/portrait_of_an_attractive_woman_at_table.jpg" alt="Portrait of an attractive woman at table" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Even the most innovative entrepreneurs feel &quot;stuck&quot; sometimes when solving business problems. Many small business owners who need some outside inspiration go to business events and mingle with other entrepreneurs, but that can backfire when you're feeling uncreative. Between all of the networking and hyperactive pitching, it's possible to leave feeling drained instead of inspired.</p> <p>So what do you do if you feel like you've fallen into a creative rut in your business? Sometimes, turning to unconventional sources of inspiration can help. Here are five ways to regain your creative mojo.</p> <h2>1. Attend an event outside of your industry</h2> <p>When your schedule is packed, it can be hard to break away from the day-to-day to attend a conference or trade show, let alone one outside of your field. But spending time with people in other industries can be a good way to immerse yourself in new ideas you aren't likely to hear about from colleagues in your own field.</p> <p>At least once a year, and preferably two or three, make time to attend an event for professionals in a field outside of your own. If you're in a traditional brick-and-mortar industry like real estate, head to an event for pros involved in artificial intelligence or automation. Run your own accounting business or a small law office? Pop into a trade show where you can immerse yourself in the latest fancy foods, tech gadgets, or fitness trends. The list of possibilities is endless, so pick one that seems interesting to you personally. The event doesn't have to be more than an hour to expose you to new ideas.</p> <p>By paying attention to how people in other fields are solving problems and challenges in front of them &mdash; or solving problems for their customers &mdash; you'll get some fresh ideas on how to move your business forward. You may also meet some new potential clients you wouldn't ordinarily encounter. (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>2. Immerse yourself in the arts</h2> <p>Reconnecting with your imagination by enjoying art, music, or theater can be a fantastic way to spark new solutions to your most vexing business problems &mdash; or help you come up with new products. One business owner told me that playing piano and visiting art galleries gave him inspiration when designing technology involved in streaming music, for instance. My hairstylist recently told me he gets his creative juices flowing sculpting and cooking.</p> <h2>3. Learn a new discipline</h2> <p>It's tempting when you feel &quot;stuck&quot; in your business to hunker down at your desk, but that can be counterproductive and tiring. Reboot your brain by doing a guided meditation (perhaps using an app like Headspace), trying a new yoga class, or signing up for a martial arts class. All of these activities will push you out of familiar patterns of thinking.</p> <p>Ideally, pick an activity that requires so much focus and concentration you can't think about anything else. For me, hot yoga does the trick. I sometimes wonder whether I should take the time out of my day to drive to the studio, given how long my to-do list is, but after I've spent an hour in a 100-degree room doing downward dogs, my mind is completely clear. Often, I find that the answers to work-related challenges pop into my head on my ride home from the yoga studio &mdash; or I realize that a problem that was worrying me isn't as big of a deal as I thought and simply cross it off my &quot;list.&quot;</p> <h2>4. Go back to school</h2> <p>Even if you don't have time to sit in a classroom, there are plenty of opportunities to take self-paced classes these days through online platforms such as edX and Coursera. Instead of taking the practical approach and taking a business course, consider studying a subject that interests you outside of your business. edX, for instance, offers classes such as the History of Chinese Architecture, Making Government Work in Hard Places, and The Science of Happiness. Studying almost any new subject will bring fresh ideas into your mind &mdash; and by extension, into your business. (See also: <a href="http://www.wisebread.com/10-classes-that-can-pay-for-themselves?ref=seealso" target="_blank">10 Classes That Can Pay for Themselves</a>)</p> <h2>5. Reconnect with your childhood</h2> <p>If there are kids in your life &mdash; whether they are your own or those of a friend who would appreciate some free baby-sitting &mdash; spend a couple of hours playing with them. Go to a park and let them dictate what you play, or bring over some crafts supplies or materials for a science experiment and put them in charge. Experiencing how they think, experiment, and solve problems will get you out of the &quot;adult&quot; mindset of doing everything efficiently and aiming for results. The more you can connect with the childlike side of yourself, the more willing you'll be to try new, possibly messy, approaches at work. That's a good recipe for getting unstuck.</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-fun-and-unexpected-ways-to-get-out-of-a-business-rut&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Fun%2520and%2520Unexpected%2520Ways%2520to%2520Get%2520Out%2520of%2520a%2520Business%2520Rut.jpg&amp;description=5%20Fun%20and%20Unexpected%20Ways%20to%20Get%20Out%20of%20a%20Business%20Rut"></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%20Fun%20and%20Unexpected%20Ways%20to%20Get%20Out%20of%20a%20Business%20Rut.jpg" alt="5 Fun and Unexpected Ways to Get Out of a Business Rut" 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/5-fun-and-unexpected-ways-to-get-out-of-a-business-rut">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/dont-go-to-college-to-learn">Don&#039;t Go to College to Learn</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/effective-networking-in-a-one-horse-town">Effective Networking in a One-Horse Town</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-important-signs-that-your-job-sucks">10 Important Signs That Your Job Sucks</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-to-use-the-holiday-quiet-time-to-boost-your-career">How to Use the Holiday Quiet Time to Boost Your Career</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Career Building Entrepreneurship arts business rut comfort zone creativity education inspiration networking playing small business owners stuck in a rut Tue, 31 Oct 2017 08:30:08 +0000 Elaine Pofeldt 2041363 at http://www.wisebread.com 6 Moves Every First Year Freelancer Should Make http://www.wisebread.com/6-moves-every-first-year-freelancer-should-make <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-moves-every-first-year-freelancer-should-make" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/she_makes_multi_tasking_look_easy.jpg" alt="She makes multi-tasking look easy" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>When I started my freelance career seven years ago, I honestly had very little idea of what I was doing. I made some seriously painful mistakes that affected everything from my bottom line to my stress level to my relationships with some of my clients. (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> <p>But even though self-employment mistakes are common, they're not inevitable. You can make the transition to self-employment much smoother and easier to handle if you commit to doing the following things in your first year as your own boss. Not only will you lay down the good habits and policies you'll need throughout your new career in self-employment, but these moves can also help your career start off with a bang. (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. Set aside 30 to 35 percent of every paycheck for taxes</h2> <p>One of the double-edged swords of working for yourself is the fact that your paychecks will generally not have any taxes withheld. While it feels pretty good to have the full amount of money you earned coming directly to you, it can really mess up your finances if you don't plan ahead for taxes.</p> <p>Many of the newly self-employed can get themselves into trouble by assuming they'll pay their quarterly estimated tax bills with whatever funds they have received as of the quarterly estimated tax due date. But Uncle Sam doesn't care if you have a slow work spell or are waiting on some payments that are not quickly forthcoming from a client &mdash; he wants you to pay the taxes you owe on time. (See also: <a href="http://www.wisebread.com/avoid-irs-penalties-with-this-simple-estimated-payment-strategy?ref=seealso" target="_blank">Avoid IRS Penalties With This Simple Estimated Payment Strategy</a>)</p> <p>You can bypass the quarterly stress of finding the necessary funds to pay your tax bill by specifically setting aside 30 to 35 percent of every check you receive. This does take a depressingly large bite out of your paychecks, but it gives you the peace of mind to know that you will be able to cover your estimated tax payments. In addition, by putting this money into a savings account, you can earn a little interest &mdash; which already puts you financially ahead of folks who have their taxes withheld.</p> <p>If your diligent savings of 30 to 35 percent of each paycheck means you have more money than you need for taxes in your first year of self-employment, then you can always use the leftover money to reinvest in your business or smooth over any lean months in your second year of self-employment. (See also: <a href="http://www.wisebread.com/7-things-i-learned-about-money-after-i-went-freelance?ref=seealso" target="_blank">7 Things I Learned About Money After I Went Freelance</a>)</p> <h2>2. Hire an accountant</h2> <p>Speaking of taxes, they are going to get more complex now that you have begun working for yourself. While it is certainly possible for you to complete your taxes all by yourself as you've done in the past, the money you spend on an accountant for your self-employment taxes can both save you time and lower your stress. (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> <p>Asking for referrals from trusted colleagues or small business owners can be the best way to find the right accountant or tax professional for your needs. Don't let this important part of self-employment go on the back burner. Having an accountant throughout your first year of self-employment can help you to accurately pay your quarterly estimated taxes on time, and take advantage of deductions and other tax benefits that you might otherwise miss.</p> <h2>3. Determine your payment floor</h2> <p>During my first year as a freelancer, an educational company contracted me to write lesson plans for English teachers. I had been working as an English teacher before my freelancing career, and I loved that this company was committed to using humor in all of its resources. I thought it was a perfect fit, and I quoted them a price per lesson plan that felt reasonable for my expertise (and comedic chops). They offered me a fifth of what I asked for. Since I was worried that I wouldn't be able to actually make a living as a freelancer, I took the job.</p> <p>It was a huge mistake.</p> <p>Here's why: The amount of work that I put into each lesson plan meant I was earning less than minimum wage for my hours of toil. It took me months to get through the initial contract of 10 lesson plans, in part because I knew how little I was making and it was difficult to prioritize this client over those who paid more for less work.</p> <p>Even though the company loved my work, we parted ways after I finished the first round of lesson plans. They were just as happy to get a quicker and less-funny turnaround from another freelancer who did not have my expertise. I was glad to no longer be working so hard for a company that did not financially value my contributions.</p> <p>After this experience, I learned to figure out my payment floor &mdash; the least amount of money my time was worth. Once I knew my payment floor, it became much easier to recognize which jobs were worth my time, and which jobs would leave me feeling overworked and resentful. Knowing your payment floor may seem premature in your first year of self-employment since you feel like you are hustling just to capture enough clients to keep the lights on. But you are better off holding out for clients who value you, rather than taking any job, no matter how low the pay.</p> <h2>4. Build free time into your schedule</h2> <p>There are a couple of common scheduling traps that can trip up the newly self-employed:</p> <ul style="margin-left: 40px;"> <li> <p>Working all the time. Since you are now completely in control of your schedule and your career, and since you presumably love what you do, it can be very easy to throw yourself into your work 24/7.</p> </li> <li> <p>The planning fallacy. Even after seven years as a freelancer, I still <a href="http://www.wisebread.com/this-is-why-your-projects-always-take-longer-than-you-expect?ref=internal" target="_blank">underestimate how long it will take</a> me to complete a project, because it never occurs to me that my kids might get sick, my internet might go out, my research might uncover more complex issues than I anticipated, or that I might be struck down by an unexpected nap after eating too many carbs for lunch.</p> </li> <li> <p>Lack of discipline. For some newly self-employed individuals, it can be difficult to stick to self-imposed (or even client-imposed) deadlines if you don't have a boss to keep you honest. It's a lot harder to succeed in self-employment if you have trouble sticking to a work schedule.</p> </li> </ul> <p>All three of these scheduling mistakes can be helped by building free time into your schedule. Forcing yourself to take time off from your otherwise nonstop work will prevent burnout and allow you to be far more productive. Having a free afternoon built into each week has helped me to improve my on-time percentage, because it leaves some slack for when life happens and I'm not able to finish things according to my pie-in-the-sky planning assumptions. And anyone who struggles with self-discipline will generally have an easier time forcing themselves to work if they know that there is free time coming. (See also: <a href="http://www.wisebread.com/self-employed-tips-for-taking-time-off-without-trauma?ref=seealso" target="_blank">Self-Employed? Tips for Taking Time Off Without Trauma</a>)</p> <h2>5. Capture excess income in a savings account</h2> <p>When you are self-employed, there will be some months when several paychecks or client payments come in all at once. This can feel pretty great, especially if you can thank your own hustle for making it rain, but it's important to be disciplined about this kind of excess income and put it in a savings account. That's because you are likely to have a low-income month sooner or later, and that excess income can be the difference between you being able to pay your bills as usual and you having to go grocery shopping with couch cushion change. (See also: <a href="http://www.wisebread.com/the-sep-ira-is-how-the-self-employed-do-retirement-like-a-boss?ref=seealso" target="_blank">The SEP-IRA Is How the Self-Employed Do Retirement Like a BOSS</a>)</p> <p>During your fat-paycheck months, you should not only set aside the 30 to 35 percent you put away for your taxes, but you should also put whatever additional excess income you can afford into a &quot;rainy day&quot; savings account. This account is where you will go to get the money you need to keep everything running smoothly during any lean months. And like your taxes savings account, if you don't end up needing to dip into this rainy day savings account, that means you will have money already set aside that you can potentially invest back into your business. (See also: <a href="http://www.wisebread.com/how-to-budget-consistently-without-a-steady-paycheck?ref=seealso" target="_blank">How to Budget Consistently Without a Steady Paycheck</a>)</p> <h2>6. Insist on clear contracts</h2> <p>Everyone who has ventured into self-employment has at least one story about being stiffed out of payment from a client. For instance, in my first year of freelancing, I was hired to write for a startup parenting website. I wrote several articles for the site, but I was only paid for one of the half dozen pieces I provided them. (See also: <a href="http://www.wisebread.com/8-ways-freelancers-can-make-sure-they-get-paid-on-time?ref=seealso" target="_blank">8 Ways Freelancers Can Make Sure They Get Paid on Time</a>)</p> <p>The client was in the wrong for not paying me &mdash; but I also made a mistake in accepting work from them without a contract. Our arrangement was based on nothing more than email exchanges and a phone call. We did not have a contract that spelled out our legal expectations of each other, which meant it would have been very difficult for me to pursue the client for the money they owed me.</p> <p>In addition, contracts are also helpful for defining the scope of a project and specifying the details of a termination fee. A contract that outlines the specific timeline and deliverables will protect you from having to revisit the same project over and over again for no extra money if your client insists on more edits or revisions or a larger scope than you expected. Similarly, if your client decides to end your project, having a contract that specifies the termination fee you'll receive under such circumstances will protect you from having wasted your time.</p> <h2>Welcome to self-employment!</h2> <p>You can set yourself up for se<span id="1508499285936S" style="display: none;">&nbsp;</span>lf-employment success in your very first year as your own boss. Planning ahead for everything from taxes to lean months to time management to contractual disputes will help you create a self-employment career that you'll love for years to come. (See also: <a href="http://www.wisebread.com/freelancing-a-beginner-s-guide-to-doing-it-right?ref=seealso" target="_blank">Freelancing: A Beginner's Guide to Doing It Right</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%2F6-moves-every-first-year-freelancer-should-make&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F6%2520Moves%2520Every%2520First%2520Year%2520Freelancer%2520Should%2520Make.jpg&amp;description=6%20Moves%20Every%20First%20Year%20Freelancer%20Should%20Make"></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/u5180/6%20Moves%20Every%20First%20Year%20Freelancer%20Should%20Make.jpg" alt="6 Moves Every First Year Freelancer Should Make" 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/emily-guy-birken">Emily Guy Birken</a> of <a href="http://www.wisebread.com/6-moves-every-first-year-freelancer-should-make">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-biggest-mistakes-freelancers-make">The 5 Biggest Mistakes Freelancers Make</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/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-3 views-row-odd"> <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-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-signs-its-time-to-close-your-business">5 Signs It&#039;s Time to Close Your 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-to-budget-consistently-without-a-steady-paycheck">How to Budget Consistently Without a Steady Paycheck</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship budgeting contracts free time freelance Mistakes payments self employment taxes variable income Mon, 30 Oct 2017 08:30:14 +0000 Emily Guy Birken 2039970 at http://www.wisebread.com How to Grow Your Solo Business Without Hiring Employees http://www.wisebread.com/how-to-grow-your-solo-business-without-hiring-employees <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-grow-your-solo-business-without-hiring-employees" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/waitress_holding_an_open_sign_at_a_restaurant.jpg" alt="Waitress holding an open sign at a restaurant" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The conventional wisdom is that to &quot;scale&quot; a business, you have to do it the traditional way &mdash; by hiring employees. Otherwise, the thinking goes, you'll be limited to whatever revenue you can generate personally.</p> <p>That presents a conundrum. What if you really don't want to hire employees because you're not the managerial type &mdash; or can't pull it off financially? Creating jobs does a lot of good for society, but it is a big responsibility. For very small businesses that have uneven cash flow, it can be unmanageable. You can't just opt out of cutting paychecks one month if a big client pays you late. Employees depend on getting paid on time.</p> <p>Fortunately, there's another option. In the digital age, it's increasingly possible to grow revenue in a one-person business or partnership without hiring traditional W-2 employees. In researching my upcoming book, <a href="http://amzn.to/2i09ttX" target="_blank">The Million-Dollar, One-Person Business</a>, I came across many people who were approaching or breaking $1 million in revenue without adding employees. They are among the 35,584 owners of &quot;nonemployer&quot; businesses that the U.S. Census Bureau found were hitting or breaking $1 million in revenue in 2014. (Nonemployer businesses are those staffed only by the owners.)</p> <p>So what are they doing? It runs the gamut. Entrepreneurs are breaking $1 million while running internet retail sites, professional services firms, real estate investment firms, healthy cooking online courses, and many other businesses. It's not necessarily the type of businesses they run, but the way they run them that has enabled them to scale. Here are three growth strategies they are using that anyone in a one-person business can start using today to greatly increase revenue.</p> <h2>Outsource</h2> <p>In many small businesses, your time is your currency. If you waste it on nonproductive activities that don't add to the bottom line, you'll never maximize your revenue. The conventional wisdom is you need to hire staff so you can offload tasks that can be delegated, but many of the million-dollar entrepreneurs I interviewed used another approach. They outsourced whatever they could to make their business more efficient.</p> <p>One example was Camille and Ben Arneberg. They started Willow &amp; Everett, a store with its own website and a presence on Amazon, in 2015. Neither was a retail veteran. Camille had worked in the corporate sustainability field, while Ben had been in the military. But they loved home entertaining and had a knack for selecting products other people like, such as decorative tea kettles.</p> <p>The couple started small, investing $5,000 in inventory, and reinvested in new products as they went along. By April 2016, they had grown the business to $1 million in revenue, one year and four days after their launch.</p> <p>One secret to their rapid growth was hiring the right kind of service to help them. After trying to pack a bunch of early orders themselves and finding their home buried in boxes of mugs, they switched to using a fulfillment service offered by Amazon. Although there is a small cost for this, the service handles tasks like labeling and fulfillment, freeing the Arnebergs to focus on growing their business.</p> <h2>Contract it out</h2> <p>One of the myths about running a one-person business is that it's an isolated affair. In reality, many smart <em>solopreneurs </em>rely on a team of trusted contractors to expand their capabilities. One entrepreneur I interviewed, Dan Mezheritsky, founder and president of Fitness on the Go in Vancouver, follows this model. As a former junior national champion decathlete in Canada, Mezheritsky founded his one-person, in-home personal training franchise in 2005 and grew his own annual revenue to $1.5 million in 2016. He did it by building a network of 180 personal trainers, who are all contractors.</p> <p>Mezheritsky got burned out on the idea of bringing on traditional employees after finding out that many of his original hires were not motivated to help him grow the business. Because they were paid on salary, they didn't share in the financial gains the business made in a tangible way. When he switched to hiring them as contractors, that changed. Now that they had their own businesses, they saw a direct financial benefit if he brought on new customers &mdash; whom they would get to serve.</p> <p>Mezheritsky provides help to the trainers that makes it more advantageous for them to work for him than on their own entirely. He licenses the right to use the company's brand name to the trainers and provides support with business management, leads, continuing education and other areas of the business for $400 a month. The company sets prices for the training sessions and the trainers keep about 91 percent. &quot;It was a no brainer for the trainers, when they took a look at what they were receiving,&quot; Mezheritsky told me. &quot;It was simpler than trying to do everything on their own.&quot;</p> <h2>Automate</h2> <p>Like many of the million-dollar entrepreneurs I interviewed, Mezheritsky is passionate about finding ways to automate repetitive tasks in his business. For instance, he hired a pro to help him build customized software that handles billing for all of his trainers, acts as a customer relationship management platform, handles his client rewards program, and more.</p> <p>But you don't have to build your own software in most one-person businesses. For instance, you can save several hours a week on scheduling tasks by using inexpensive tools like ScheduleOnce or Calendly &mdash; scheduling programs that let you send business contacts a link to your public calendar so they can book a time to meet with you without emailing back and forth.</p> <p>My new favorite app is Everlance, which tracks your mileage automatically from a smartphone. That way, you don't have to keep a written journal in your car.</p> <p>Incorporate a couple of other time savers like that and you can easily free up a day every week to recharge and figure out new ways to grow your business &mdash; while enjoying the pleasures of running an ultra-lean operation.</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-grow-your-solo-business-without-hiring-employees&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520to%2520Grow%2520Your%2520Solo%2520Business%2520Without%2520Hiring%2520Employees.jpg&amp;description=How%20to%20Grow%20Your%20Solo%20Business%20Without%20Hiring%20Employees"></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%20Grow%20Your%20Solo%20Business%20Without%20Hiring%20Employees.jpg" alt="How to Grow Your Solo Business Without Hiring Employees" 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/how-to-grow-your-solo-business-without-hiring-employees">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/how-to-hire-your-first-employee">How to Hire Your First Employee</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-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-3 views-row-odd"> <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-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-protect-your-job-when-youre-in-a-workplace-relationship">How to Protect Your Job When You&#039;re in a Workplace Relationship</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-use-social-media-in-business">13 Ways to Use Social Media in Business</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Career Building Entrepreneurship business owner employees entrepreneur hiring process hiring staff human resources small business Thu, 12 Oct 2017 08:30:10 +0000 Elaine Pofeldt 2035053 at http://www.wisebread.com 8 Famous People Who Got Rich After 30 http://www.wisebread.com/8-famous-people-who-got-rich-after-30 <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-famous-people-who-got-rich-after-30" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/legacy_mcdonald's_hamburger_sign_with_speedee_v.jpg" alt="Legacy McDonald&#039;s Hamburger Sign with Speedee V" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Many people are under the impression that if they haven't made any serious money by the time they hit 30, it's just never going to happen. But as the following famous people can attest to, &quot;rich&quot; can be achieved well after you hit the big 3-0. Get ready to be inspired.</p> <h2>1. Vera Wang, fashion designer</h2> <p>You probably know the name Vera Wang even if you don't own any of her products. She's one of the most famous and lucrative fashion designers working today. But, she did not start out as a budding fashion designer in her 20s. In fact, she was a skilled figure skater who started the sport at just eight years old.</p> <p>In 1968, Wang competed at the U.S. Figure Skating Championships and was featured in <em>Sports Illustrated</em>. But when she failed to make the U.S. Olympics team, she turned her attention to fashion. After graduating from Sarah Lawrence, Wang was hired as an editor at Vogue, where she worked for 17 years. In 1987, she joined Ralph Lauren, and her brief stint there gave her the drive to go out into the fashion world on her own. Two years later, at the age of 40, she designed her first wedding gown.</p> <p>Since then, Wang has made gowns for a litany of famous people and her career has exploded. Vera Wang is now a household name and she has a net worth of $420 million.</p> <h2>2. Henry Ford, founder of Ford Motor Company</h2> <p>Who doesn't know Henry Ford? He is often considered the father of the modern automobile, having created an assembly line technique that revolutionized the auto industry. And while he didn't actually invent the car, or the assembly line for that matter, he did combine the two to make automobiles affordable for American families. However, this revelation did not come to him early in his career.</p> <p>After a series of experiments in his free time, Ford built a fully-functioning vehicle in 1898 at the age of 35. This eventually led to a partnership with Alexander Malcomson and a contract with the Dodge brothers. On June 16 1903, with $28,000 in capital, the Ford Motor Company was born. Five years later, in 1908, the Ford Model T was introduced to America. At a price of $825 (around $22,000 today), it was very affordable.</p> <p>Just 10 years later, when Ford was 55, half the cars in America were Model T's. The business had exploded, and he continued to build his empire. Ford was president of the company he had built well into his late seventies, and when he died in 1947 at age 83, he had a net worth of what would have been almost $200 billion in today's dollars, adjusted for inflation. That made him the richest man in the world by a long, long way.</p> <h2>3. Ray Kroc, president of McDonald's</h2> <p>Recently immortalized in the movie <em>The Founder</em>, Ray Kroc is the man responsible for creating the McDonald's company as you know it today.</p> <p>At the age of 53, well into what many would consider the twilight years of their career, Kroc was selling milkshake mixers door-to-door. It was not a thriving business. However, when he discovered that brothers Richard and Maurice McDonald had purchased eight of his multi-mixers for their burger joint, he had to see the restaurant for himself. And what he saw changed his life.</p> <p>Kroc convinced the brothers to franchise their store and eventually bought them out for just $1 million each; a pittance considering the value of McDonald's today. Kroc innovated the chain restaurant, the real estate process that drives the McDonald's empire, and rolled out inventions like the Chicken McNugget and the Happy Meal. When he passed away in 1984, he had a net worth of over $600 million.</p> <h2>4. Donald Fisher, founder of Gap Inc.</h2> <p>Born in 1928 in San Francisco, Donald Fisher hardly had the career trajectory of a traditional fashion icon. After finishing school, he served as an officer in the U.S. Naval Reserve before becoming a cabinet maker.</p> <p>In 1960, at the age of 32, he started his own business renovating hotels and purchased the Capitol Park Hotel in Sacramento. This was to be a turning point in Fisher's career. He leased some of the hotel's retail space to Levi Strauss &amp; Co., and after a poor customer service exchange involving the return of a pair of Levi's, he noticed something that was crippling the store; it had a limited selection of jeans.</p> <p>He suggested to Levi's that they open a store with a much greater range of sizes and styles, and they bought into it. In August of 1969, at the age of 41, Donald and his wife Doris opened the very first Gap store (so named because it served the &quot;generation gap&quot;) and sold Levi's jeans, records, and tapes. It was a massive success. Just three years later, the Fishers launched their own Gap clothing label, and later went on to buy out Banana Republic and found the Old Navy chain. When he died, Donald Fisher had a net worth of over $3.3 billion.</p> <h2>5. Reed Hastings, founder of Netflix</h2> <p>It's hard to imagine life without Netflix these days: instant streaming, incredible original series, and a massive library of movies all at our fingertips. But the man behind it, Reed Hastings, did not come up with the idea until he was 37 years old.</p> <p>Hastings spent the beginning of his career in the Peace Corps teaching high school math in Swaziland from 1983 to 1985. When he came back to the States, he went to Stanford University and graduated with a master's degree in computer science. He used his skills at a company called Adaptive Technology where he invented a tool for debugging software. From there, Hastings went on to found Pure Software in 1991, which focused on software troubleshooting.</p> <p>Just six years later, his company was acquired for $750 million; and Hastings knew just what to do with that money. After getting a $40 late fee on a VHS rental of <em>Apollo 13</em>, he came up with the idea of a monthly DVD rental business that had no late fees. You keep the discs as long as you want, return them, and get another disc in your queue. It basically led to the downfall of Blockbuster and Hollywood Video and the creation of a service that changed television and the movie rental industry. Hastings has a current net worth of $2 billion.</p> <h2>6. Martha Stewart, author, cook, and businesswoman</h2> <p>Martha Stewart is one of the most popular household names in America, despite her brush with the law and a highly-publicized prison sentence for securities fraud. Ironically, after a career in modeling, Stewart was actually a stockbroker for some time. And while she was trading, she started a catering business in her basement with Norma Collier, a friend from her modeling days.</p> <p>After catering the book release of <em>The Secret Book of Gnomes,</em> she was introduced to Alan Mirken, head of a large publishing firm. He was so impressed by Stewart that he asked her to develop a book. <em>Entertaining</em>, ghostwritten by Elizabeth Hawes, was a success. From there, the Martha Stewart name started to take hold, with many more books in the series hitting the shelves. Stewart also made regular appearances on <em>The Oprah Winfrey Show</em> and <em>Larry King Live</em>.</p> <p>In 1990, the magazine <em>Martha Stewart Living</em> was launched, and three years later, her massive TV show based on the magazine took to the airwaves. Martha Stewart was 52 at that time. Now Stewart has a net worth of over $300 million.</p> <h2>7. Momofuku Ando, inventor of instant ramen</h2> <p>Born in Taiwan in 1910 to a wealthy family, Momofuku Ando was raised by his grandparents following the deaths of his parents. At 22 years of age, he started a textiles company. But after the end of World War II, he was convicted of tax evasion and spent two years in jail. His company declared bankruptcy.</p> <p>In the decade that followed the end of the war, Japan was suffering from a severe food shortage. The government was trying to convince its citizens to eat bread with the flour supplied by the U.S., but Ando thought noodles were a more obvious solution to this problem. After many months of trial and error, Ando, aged 48, perfected his prepackaged instant noodles. In 1971, at 61 years of age, he brought Cup Noodles to the market.</p> <p>Ando died when he was 96, and it was said he ate his chicken ramen noodles almost daily. His net worth was around $100 million.</p> <h2>8. Sam Walton, founder of Walmart</h2> <p>If you ever wondered why the Walmart warehouse chain is called Sam's Club, now you know. It was Sam Walton who started the massive Walmart empire, and it began in 1945 with a loan for $20,000. He was 44 years old at the time, and that $20,000 figure was no small sum. Adjusted for inflation, that's $250,000 today.</p> <p>He used the money to buy a Ben Franklin variety store in Newport, Arkansas, and three years later, he bought another. And then, another. By 1962, along with his brother Bud, he owned 16 stores in Arkansas, Missouri, and Kansas. In fact, 1962 was a banner year for Sam Walton. He opened the first true Walmart in Rogers, Arkansas &mdash; the Walmart Discount City store.</p> <p>Ironically, Walton was determined to market only American-made products supplied by U.S. manufacturers that could price their items low enough to meet foreign competition. These days, Walmart stores are stocked primarily with foreign-made items, something Sam would no doubt despise. He died in 1992 from a type of blood cancer, and the empire was taken over by his wife and children. His net worth was estimated at $65 billion.</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%2F8-famous-people-who-got-rich-after-30&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F8%2520Famous%2520People%2520Who%2520Got%2520Rich%2520After%252030.jpg&amp;description=8%20Famous%20People%20Who%20Got%20Rich%20After%2030"></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/u5180/8%20Famous%20People%20Who%20Got%20Rich%20After%2030.jpg" alt="8 Famous People Who Got Rich After 30" 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/8-famous-people-who-got-rich-after-30">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/6-money-lessons-we-could-all-learn-from-dwayne-the-rock-johnson">6 Money Lessons We Could All Learn From Dwayne &quot;The Rock&quot; Johnson</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-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-3 views-row-odd"> <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-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-unexpected-first-jobs-of-the-wealthy-and-famous">9 Unexpected First Jobs of the Wealthy and Famous</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/10-beloved-books-of-successful-millionaires">10 Beloved Books of Successful Millionaires</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship after 30 age businesses celebrities famous people inspiration inventors net worth wealth Tue, 10 Oct 2017 08:00:07 +0000 Paul Michael 2033606 at http://www.wisebread.com How the Self Employed Can Cut Health Care Costs http://www.wisebread.com/how-the-self-employed-can-cut-health-care-costs <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-the-self-employed-can-cut-health-care-costs" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/medical_costs.jpg" alt="Medical Costs" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>When you run your own business, times like the present &mdash; when there is a lot of uncertainty about health care policy &mdash; can be challenging. Many self-employed Americans are already struggling to pay for insurance and medical costs. And it's hard to predict whether your premiums or out-of-pocket costs will rise substantially in the near future.</p> <p>So how do you insulate yourself? There isn't an easy answer, as I found during the roughly 10-year period when my husband and I were both freelancers raising four children in New Jersey, a very high-cost state when it comes to health care. (Last fall, he went in-house with a client, so now we get our health care through his job.) This is what worked for us.</p> <h2>Opt for a high-deductible plan with a health savings account</h2> <p>When it comes to health insurance, many people prefer plans that cover most of their out-of-pocket costs &mdash; such as a preferred provider organization (PPO) plan. Unfortunately, the premiums for these tend to be extremely high. For us, enrolling in a PPO plan would have been like taking on a second mortgage. (See also: <a href="http://www.wisebread.com/the-one-question-you-need-to-answer-to-choose-the-best-plan-on-the-health-care-marketplace?ref=seealso" target="_blank">The One Question You Need to Answer to Choose the Right Health Care Plan</a>)</p> <p>If you don't use a lot of medical care, you may find yourself over-insured with a PPO plan. Generally, if you're self-employed, the most affordable option is a high-deductible health care plan (HDHP), which allows you to open and use a <a href="http://www.wisebread.com/how-an-hsa-saves-you-money?ref=internal" target="_blank">health savings account (HSA)</a>.</p> <p>The premiums for an HDHP tend to be lower than those for a PPO plan. Like most health care plans, an HDHP will completely cover preventive health services such as routine physicals and vaccinations &mdash; meaning you don't pay anything. However, there's a catch. Outside of preventive care, with a high-deductible plan you need to pay a certain dollar amount of medical costs &mdash; your deductible &mdash; before the plan starts covering your medical expenses. Often the deductible for an HDHP is thousands of dollars.</p> <p>A health savings plan can help you save for those medical costs in a tax-advantaged account, which is only available to people who have an HDHP. To use a health savings plan, your insurance plan's annual deductible in 2017 must be at least $1,300 if you're an individual, or $2,600 per year for a family plan (these numbers are adjusted every year).</p> <p>Putting that money into a health savings account on a pretax basis can reduce your taxable income. Because this helps cut your tax bill, there are, of course, limits to how much you can contribute ($3,400 for yourself only, or $6,750 for a family plan). You can use the money you put into the HSA to pay your medical expenses with a special debit card or checkbook you get when you open the account. The IRS publishes a <a href="https://www.irs.gov/pub/irs-pdf/p502.pdf" target="_blank">list of expenses you can use an HSA for</a>. (See also: <a href="http://www.wisebread.com/10-reasons-an-hsa-is-actually-worth-having?ref=seealso" target="_blank">10 Reasons an HSA Is Actually Worth Having</a>)</p> <p>To be sure, it is not easy to come up with the money to fund an HSA, especially if you are a freelancer with uneven income. We have funded ours by cutting down on extras. Sometimes making a small change, like switching to a better mobile phone plan, can make a difference. Even if you can only put in a quarter of the amount you're allowed and gradually increase the amount you contribute each year, you'll be further ahead than if you don't put anything into an HSA.</p> <h2>Get second opinions and shop around</h2> <p>There have been many cases over the years where the medical community has revised evidence-based recommendations as new information has become available for treating particular conditions. Given that reality, I've realized that there are many gray areas in medicine and have taken time to get second opinions any time a family member is advised to get a test or treatment that comes with risks or could be very costly. Sometimes, the doctor giving me a second opinion will suggest a way to tackle a problem using a simpler, less expensive solution that I haven't considered.</p> <p>I've found that functional medicine doctors can be fantastic allies in this respect. These MDs tend to be oriented toward finding the root cause of a problem so you can eliminate it, rather than simply treating the symptoms. Some don't take insurance, but there are a few who do, so it's worth asking health-oriented friends if they know one.</p> <p>Sometimes, it's even possible to shop around for medical procedures, despite the general lack of transparency in U.S. health care costs. I haven't personally used it, but the site <a href="https://www.mdsave.com/" target="_blank">MDsave</a>, which one entrepreneur highly recommended to me, allows you to compare prices and pay for medical procedures in advance at prearranged prices. There are also a number of other websites that let you compare medical costs.</p> <h2>Live a healthy lifestyle</h2> <p>None of us has total control over our health, but by doing what you can to eat well and stay fit, you can at least reduce your chances of developing health problems that have a lifestyle component or mitigate the harm they cause if you already have developed one.</p> <p>Many chronic conditions can be very costly, as a recent survey by the International Foundation of Employee Benefit Plans pointed out. Employers who completed the survey said the number one condition impacting their medical costs was diabetes, cited by 41 percent of respondents. Obesity, heart disease, and hypertension/high blood pressure were also among the top 10 medical costs.</p> <p>Two simple things you can do to stack the odds in favor of staying healthy, without any added expense, are buying fresh, unprocessed foods and preparing your food at home as often as you can. When you eat a lot of prepared frozen foods or eat out all the time, it's hard to avoid unhealthy ingredients, unless you can afford the highest-end options. (See also: <a href="http://www.wisebread.com/are-meal-prep-subscription-boxes-worth-it?ref=seealso" target="_blank">Are Meal Prep Subscription Boxes Worth It?</a>)</p> <p>The less-is-more approach can work with fitness, too. Instead of waiting for that perfect day when you can afford to sign up for a CrossFit or Barre class and do it regularly, find some type of enjoyable physical activity that is available to you now, whether that's taking a yoga class at your YMCA, going for a walk or jog around your neighborhood, or playing actively with your kids. And if you participate in an activity that gets you away from your computer, you'll probably meet some new friends, too, which is another good way to reduce stress. (See also: <a href="http://www.wisebread.com/10-lifestyle-changes-that-will-always-pay-off?ref=seealso" target="_blank">10 Lifestyle Changes That Will Always Pay Off</a>)</p> <p>These steps do take some effort, but they can pay off in lower health care costs. That's a big benefit if you're paying for your premiums and medical bills on your own.</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-the-self-employed-can-cut-health-care-costs&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520the%2520Self%2520Employed%2520Can%2520Cut%2520Health%2520Care%2520Costs.jpg&amp;description=How%20the%20Self%20Employed%20Can%20Cut%20Health%20Care%20Costs"></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%20the%20Self%20Employed%20Can%20Cut%20Health%20Care%20Costs.jpg" alt="How the Self Employed Can Cut Health Care Costs" 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/how-the-self-employed-can-cut-health-care-costs">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/11-surprising-things-your-hsa-will-cover">11 Surprising Things Your HSA Will Cover</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-vital-things-to-remember-when-buying-health-insurance">5 Vital Things to Remember When Buying Health Insurance</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-reasons-an-hsa-is-actually-worth-having">10 Reasons an HSA Is Actually Worth Having</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-common-medicare-myths-debunked">5 Common Medicare Myths, Debunked</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-one-question-you-need-to-answer-to-choose-the-best-health-care-plan">The One Question You Need to Answer to Choose the Best Health Care Plan</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship Health and Beauty Insurance freelancers hdhp health care health savings accounts healthy living high deductible plans HSA medical care PPO self employed small business owners Tue, 03 Oct 2017 08:30:11 +0000 Elaine Pofeldt 2028483 at http://www.wisebread.com 5 Business Lessons From These Child Entrepreneurs http://www.wisebread.com/5-business-lessons-from-these-child-entrepreneurs <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-business-lessons-from-these-child-entrepreneurs" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/two_boys_dressed_as_nerds_smiling_with_mind_reading_helmets.jpg" alt="Two Boys Dressed as Nerds Smiling with Mind Reading Helmets" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Kids inspire us to look at the world differently. Their insights and optimism help us find the best in ourselves and in others. This unbridled belief in their ability to make an impact also makes them inspiring entrepreneurs. If you've ever had a business idea and doubted yourself, let this short list of kid entrepreneurs erase your fear and teach you the lessons you need to build the business of your dreams.</p> <h2>1. Mikaila Ulmer, founder of Me &amp; the Bees Lemonade</h2> <p>Imagine taking a painful experience and rather than growing bitter, you get better. That's exactly what happened to Mikaila Ulmer. When she was four years old, she was stung twice by a bee. That would make many people afraid of bees, or at least dislike them. Instead, Mikaila was fascinated by them. Those bee stings gave Mikaila a mission: to learn about bees and their role in our ecosystem. In the course of that research, she learned that bees were dying at an alarming rate.</p> <p>Simultaneously, Mikaila also received an old cookbook from her grandmother that contained a recipe for flaxseed lemonade. She took that recipe, added local honey to it, started selling it at events, and donated a portion of her profits to help save the bees.</p> <p>Today, <a href="https://meandthebees.com/" target="_blank">Me &amp; the Bees Lemonade</a> is going strong, flying off the shelves at Whole Foods and at many other restaurants and stores nationwide. And Mikaila? You can often find her speaking and educating people about bees and our ecosystem at events and on panels, and running workshops to save the bees. Her motto is &quot;Buy a bottle. Save a bee.&quot;</p> <p>Her lesson to us: Find the silver lining. Spin an unpleasant experience on its head, look at the situation from a compassionate, curious perspective, and use what you learn to build a successful business.</p> <h2>2. Neha Gupta, founder of Empower Orphans</h2> <p>Imagine that you have the tradition of giving gifts to others to celebrate your birthday. That's the tradition in Neha Gupta's family. Every year, to celebrate their birthdays, her family members travel back to their hometown in India to give presents to orphans.</p> <p>Neha wanted to do more than just provide gifts to orphans. She wanted them to have the resources they need to create a better life for themselves as they get older. To fund this effort, she made and sold wine charms door-to-door and at community events. The wine charms became so popular that she attracted the attention of corporate sponsors who also supported her effort.</p> <p>With the success of the wine charms, Neha started a nonprofit organization called <a href="http://www.empowerorphans.org/" target="_blank">Empower Orphans</a>. The organization has raised over $1,000,000, and Neha has won numerous awards for her work, including the International Children's Peace Prize.</p> <p>Her lesson to us: A rising tide lifts all boats. Passion for a cause can drive success not only for you, but for others as well.</p> <h2>3. Bella Weems, founder of Origami Owl</h2> <p>A few years ago, my mom gave me a locket to celebrate the opening of a play I wrote and directed in New York City. It's a metal locket with a glass center that has a charm inside. My charm depicts the tragedy and comedy faces associated with theater. It's a beautiful locket and I was so intrigued by how unique it is that I looked into the company that made it, <a href="https://www.origamiowl.com/" target="_blank">Origami Owl</a>.</p> <p>I learned that it was created by teenager Bella Weems. She wanted a car of her own, and rather than help her get one, her parents told her to find a way to earn the money to buy a car for herself. Bella always loved making jewelry and was particularly passionate about locket necklaces and bracelets. Origami Owl was born!</p> <p>In just two years, Bella had turned her passion for jewelry making and her desire to have a car of her own into a multi million-dollar direct sales business. Since then, she's empowered others to be designers and supported other kid entrepreneurs by being what she calls a Force for Good.</p> <p>Her lesson to us: Sometimes, entrepreneurs are born out of something as simple as wanting a new car. You never know what life event will spur you to create something successful. Then, when you find that success, pay it forward.</p> <h2>4. Moziah Bridges, founder of Mo's Bows</h2> <p>Are bow ties fashionable? In the hands of Moziah Bridges, they certainly are! Hailing from Memphis, Tennessee, Mo founded <a href="https://mosbowsmemphis.com/" target="_blank">Mo's Bows</a>. Mo learned how to sew from his grandmother and mother, and his very first ties were crafted from vintage fabric he found in his grandmother's closet. His bow tie designs have been so successful that he recently inked a licensing deal with the NBA. His next goal? He wants to finish school in Memphis so he can attend Parsons School of Design in New York City, and develop his own full clothing line by the time he's 20.</p> <p>His lesson to us: Follow your creativity and perfect your craft. Produce a quality product you are proud of, and success will ultimately follow.</p> <h2>5. Lily Born, founder of Imagiroo</h2> <p>The best products are born from pain points: That's a main tenant in product development. Find something that ails you or someone else, create a solution, and build a business around that solution.</p> <p>Lily Born saw her grandfather struggling with Parkinson's disease. One of the primary difficulties for people with Parkinson's is the tremor that makes their hands shake. Lily's grandfather was having a hard time holding and drinking from a cup because of his tremors. She designed a cup that wouldn't tip over and would prevent her grandfather from spilling his drink.</p> <p>She found this design was also helpful for her father, who was prone to spilling his coffee on his computer when he was working. The seed of her future company, <a href="http://www.imagiroo.com/" target="_blank">Imagiroo</a>, was in that original cup design. Her cups are now available in a durable plastic material with comfortable grips and in a wide variety of fun colors.</p> <p>To encourage all of us to imagine a better world through better products, Lily also created the <a href="http://www.imagiroo.com/invention-workbook/" target="_blank">Invention Workbook</a>. It walks readers through the invention process, and is available for free on her website in PDF format.</p> <p>Her lesson to us: Don't overthink it. Sometimes, the answer is right in front of you. Solving a common problem with a simple solution is often all it takes for a business to flourish.</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" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-business-lessons-from-these-child-entrepreneurs&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Business%2520Lessons%2520From%2520These%2520Child%2520Entrepreneurs.jpg&amp;description=5%20Business%20Lessons%20From%20These%20Child%20Entrepreneurs"></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%20Business%20Lessons%20From%20These%20Child%20Entrepreneurs.jpg" alt="5 Business Lessons From These Child Entrepreneurs" 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/christa-avampato">Christa Avampato</a> of <a href="http://www.wisebread.com/5-business-lessons-from-these-child-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-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/the-top-7-blogs-for-entrepreneurs">The Top 7 Blogs for Entrepreneurs</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-8-best-books-for-entrepreneurs">The 8 Best Books 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/over-7-million-money-making-ideas-google-patents">Over 7 million money-making ideas - Google Patents</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/6-smart-financial-gifts-to-give-your-kids-this-year">6 Smart Financial Gifts to Give Your Kids This Year</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-to-prepare-your-kids-to-live-on-their-own">How to Prepare Your Kids to Live On Their Own</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship businessowners children design inspiration inventions kids small businesses Mon, 18 Sep 2017 08:00:07 +0000 Christa Avampato 2021153 at http://www.wisebread.com How to Budget Consistently Without a Steady Paycheck http://www.wisebread.com/how-to-budget-consistently-without-a-steady-paycheck <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-budget-consistently-without-a-steady-paycheck" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-607504814.jpg" alt="Woman learning how to budget with inconsistent income" title="" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Freelancers, small business owners, contractors, and salespeople working on commission all have one thing in common: irregular income. Anyone who has worked in these professions knows the insecure feeling you get when you are lurching from flush months to lean months as work (and on-time payment) waxes and wanes.</p> <p>Since the majority of budgeting advice starts with the assumption of a steady paycheck, it may seem like budgeting is out of reach for the average person with an irregular income. Nothing could be further from the truth. Not only can you successfully budget an irregular income, but creating and adhering to a budget can mean the difference between surviving the lean months and thriving through them. (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> <p>Here's how to create a budget if your income is inconsistent or irregular.</p> <h2>The cash flow bucket system</h2> <p>Before you even get started, you should know what budgeting success will look like. According to Roger Whitney, certified financial planner and podcaster, &quot;the goal for inconsistent income is to slowly build up your savings to the point where you can pay yourself a regular monthly salary out of your cash reserves.&quot;</p> <p>How do you do this? By using a method called the cash flow bucket system. With this system, instead of having your paychecks deposited into your checking account, they will go into savings. Once a month, you'll transfer the amount you need for expenses and bills into your checking account. This is your own self-created &quot;monthly paycheck.&quot; This system is a great fit for anyone with irregular income, because it keeps excess money from burning a hole in your checking account, and will help you smooth over the irregularities in your income.</p> <p>However, creating a cash flow bucket system can take a little more time with inconsistent income. Here are the steps you need to follow to get this system to work for you.</p> <h3>1. Capture excess income</h3> <p>Before you plunge headlong into depositing all of your income into your savings account, start by putting away excess cash during high-income months. This can take some discipline.</p> <p>Anyone who has received irregular income knows the feeling of being flush when several paychecks or client payments come in all at once. It's very tempting to use that excess income for discretionary spending, especially if you can thank your own hustle for the huge payday. But before you blow the big check on a steak dinner, slow down and remember how tough it is to go grocery shopping with the change you pilfered out of the couch cushions.</p> <p>That's why it's so important to recognize when you are experiencing a flush month and immediately put aside as much of the excess income as you can. The larger your savings account is as you start the cash flow bucket system, the easier it will be for you to smooth over the inconsistency of your income.</p> <h3>2. Determine your minimum budget baseline</h3> <p>The next step is determining your baseline expenses for a regular month. This baseline should be comprised of the expenses that are the absolute essentials for maintaining your life &mdash; such as your rent or mortgage, utility bills, transportation, groceries, and child care.</p> <p>This figure should be relatively easy to calculate. Write down your fixed expenses, such as your rent or mortgage, and estimate the fluctuating expenses, such as utility bills and groceries, by figuring the average cost over the past six to 12 months.</p> <p>When you know your baseline minimum, compare it to your existing savings account balance. Assuming you already have some money saved, you can see how many months' worth of minimum expenses you have set aside in your savings account &mdash; or how much you need to accumulate. It's a good idea to have three to six months' worth saved up, depending on the variability of your income. Just recognizing that you could survive with no money coming in for several months can help ease a great deal of the financial stress that comes with an inconsistent income.</p> <h3>3. Calculate your discretionary expenses</h3> <p>Once you know the bare minimum that you need to have on hand to keep the lights on and everything running, it's time to calculate how much you spend each month on discretionary purchases. This will include your spending on everything from dining out, to entertainment, to your hobbies.</p> <p>It's a good idea to go over several months' worth of bank statements and credit card bills to figure out how much you have spent on average on these discretionary expenses in the past. This way, you can come up with an average monthly discretionary budget.</p> <p>Be prepared to cut your discretionary spending as needed, since that can help you smooth over your inconsistent income more quickly.</p> <p>The best way to pare down discretionary spending is to cut things from easiest to hardest. If you love your weekly movie date with your best friend, then make sure that $15 you spend per week is preserved in your budget. But if you get coffee at the local coffee shop out of habit rather than enjoyment, then be prepared to start brewing your own.</p> <h3>4. Start having your paychecks deposited into savings</h3> <p>Now that you've beefed up your savings account during flush months, and figured out your baseline budget level and monthly discretionary spending, you can start having your payments from clients deposited directly into savings, rather than checking. Then, on the first of each month, transfer your &quot;monthly paycheck&quot; from your savings account into your checking account to pay for your monthly expenses.</p> <p>This is where things differ between someone with a steady paycheck and someone with irregular income. Depending on how much money you have already set aside in your savings account, and how frequently you deal with lean months, early on you may need to decide from month to month whether you will be living on your baseline budget or your baseline budget plus discretionary spending.</p> <p>However, as you build up your cash reserves, you will be able to eventually switch to an automatic transfer of your baseline budget plus discretionary spending.</p> <h3>5. Keep an eye on the system</h3> <p>Your checking account will be nearly depleted by the end of the month, but if you calculated your budget correctly, the money should last you until the first of the following month.</p> <p>If you find you are running short before the end of the month, you will need to look at your expenses to see where your calculation went wrong or your spending was too high. You can also decide to move more money from your savings account into your checking account or end all unnecessary spending until the next month begins.</p> <h3>6. Start saving for the future</h3> <p>The final step of budgeting irregular income is to incorporate saving for the future. While the cash flow bucket system will put excess income into your savings account and hold it for your lean months, it does not take the place of saving for retirement or other financial goals.</p> <p>Once you have reached a point that you have enough savings to consistently pay yourself a monthly salary, factor saving for the future into your monthly budget. Set up an automatic transfer of that amount from your savings account to your retirement fund or (other savings vehicle). Though you won't see that money in your monthly &quot;paycheck,&quot; you will need to factor in the deduction from your savings account.</p> <h2>Budgeting like a boss</h2> <p>Earning an irregular income can feel overwhelming. Not knowing how much you make from one month to the next may seem like a liability. But with the right money management, your irregular income can empower you to take control of your finances, your career, and your life.</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" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fhow-to-budget-consistently-without-a-steady-paycheck&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520to%2520Budget%2520Consistently%2520Without%2520a%2520Steady%2520Paycheck.jpg&amp;description=How%20to%20Budget%20Consistently%20Without%20a%20Steady%20Paycheck"></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%20Budget%20Consistently%20Without%20a%20Steady%20Paycheck.jpg" alt="How to Budget Consistently Without a Steady Paycheck" 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/emily-guy-birken">Emily Guy Birken</a> of <a href="http://www.wisebread.com/how-to-budget-consistently-without-a-steady-paycheck">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/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-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-financial-questions-you-must-answer-before-going-freelance">6 Financial Questions You Must Answer Before Going Freelance</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/5-common-budget-mistakes-you-can-fix-right-now">5 Common Budget Mistakes You Can Fix Right Now</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/6-moves-you-should-make-now-for-your-2018-taxes">6 Moves You Should Make Now for Your 2018 Taxes</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting Entrepreneurship contract work expenses freelance inconsistent incomes irregular incomes paychecks saving money self employment Fri, 11 Aug 2017 08:30:05 +0000 Emily Guy Birken 1998639 at http://www.wisebread.com 7 Strategies for Paying Off Debt When Living on a Variable Income http://www.wisebread.com/7-strategies-for-paying-off-debt-when-living-on-a-variable-income <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-strategies-for-paying-off-debt-when-living-on-a-variable-income" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-516427450.jpg" alt="Woman paying off debt on variable income" title="" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Paying off debt can be a challenge even if you have a steady paycheck. When your income is variable, it's even harder. These strategies can help you take care of your financial obligations even when your salary isn't stable.</p> <h2>1. Set a budget from your baseline</h2> <p>Take a look at your earning potential and set a baseline. Base it on what you can expect to earn even in a worst-case scenario month. For example, if you're in sales and you earn a base salary plus commission, your baseline is your base salary. If you're a freelancer with several contracted clients and fluctuating income from other projects, your baseline is what you earn from the ongoing contracts.</p> <p>From your baseline, build a budget that covers the minimum payments you need to make every month. If more money comes in, you can split it among savings and paying down debt. (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>2. Reduce your expenses and bills</h2> <p>Be very detailed in your baseline budget. Your recurring bills are the starting point; your actual spending is just as important. You need to know, for example, if you spend $100 on books every month, or if your grocery bill is $200 more than you think it is. Once you're aware of all your bills and expenses, look for ways to reduce them. You don't need to reduce them all; keep the expenses that give you the greatest payback in satisfaction and minimize the costs that don't add much to your quality of life.</p> <p>If you're paying off more than one debt, debt consolidation might be key to reducing multiple high-interest payments into one monthly payment. Explore your options to determine if you can lower your debt interest and payments and close that gap.</p> <h2>3. Build up your gap savings</h2> <p>When you have a high-earnings month, send a percentage into a savings account and let it accumulate over time. When needed, you can use it to fill in the gap when your baseline earnings aren't quite enough.</p> <h2>4. Pick up a side hustle</h2> <p>Another strategy for closing the baseline gap is to pick up a steady side job. There are many kinds of side hustles and part-time jobs you can consider; it's most helpful, in this case, if you find one that will give you a predictable amount of earnings every month. That way, you can add it to your baseline so that there's no longer a gap between what you'll make and what you need to make.</p> <p>When you get that big commission or finally get paid for the last project, it's tempting to splurge and enjoy the high times. A little splurging is good for morale, but the key to surviving and thriving on a variable income is making the most of the big paydays.</p> <h2>5. Follow a savings plan</h2> <p>You may not be able to add to your savings during the lean times. But when your earnings spike, save a good percentage of it. Put a plan in place before you get the big payday. You might decide, for example, that anything over your baseline gets divided into three categories: 30 percent for savings, 30 percent for debt payments, and 30 percent for expenses that have been on hold. That leaves you 10 percent for splurge money.</p> <h2>6. Follow a debt reduction plan</h2> <p>If you use the plan above, or one similar to it, you'll know that a set percentage of your earnings over baseline go to reducing your debt. It's good practice to pay off the debt with the highest interest rate first, otherwise known as the <a href="http://www.wisebread.com/snowballs-or-avalanches-which-debt-reduction-strategy-is-best-for-you?ref=internal" target="_blank">avalanche method</a>. You can also negotiate with creditors if you have a good chunk of the debt ready to pay. Some creditors will reduce your total amount owed if you're able to pay off most of it in cash, right away.</p> <h2>7. Maximize your savings</h2> <p>Finally, don't let a variable income keep you from being smart about how you save. While it feels good to have cash at the ready, it's a smarter long-term strategy to put your savings into high-earning investments. Build up a decent <a href="http://www.wisebread.com/a-step-by-step-guide-to-creating-your-emergency-fund?ref=internal" target="_blank">emergency fund</a> so you can handle a crisis and close that baseline gap as needed. Put any savings beyond the emergency fund into longer term investments with a higher yield, so you make the most out of your income, variable or not.</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" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F7-strategies-for-paying-off-debt-when-living-on-a-variable-income&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F7%2520Strategies%2520for%2520Paying%2520Off%2520Debt%2520When%2520Living%2520on%2520a%2520Variable%2520Income.jpg&amp;description=7%20Strategies%20for%20Paying%20Off%20Debt%20When%20Living%20on%20a%20Variable%20Income"></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%20Strategies%20for%20Paying%20Off%20Debt%20When%20Living%20on%20a%20Variable%20Income_0.jpg" alt="7 Strategies for Paying Off Debt When Living on a Variable Income" 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/annie-mueller">Annie Mueller</a> of <a href="http://www.wisebread.com/7-strategies-for-paying-off-debt-when-living-on-a-variable-income">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-4"> <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-budget-consistently-without-a-steady-paycheck">How to Budget Consistently Without a Steady Paycheck</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-moves-every-first-year-freelancer-should-make">6 Moves Every First Year Freelancer Should Make</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-money-moves-you-can-make-when-we-turn-the-clocks-back-for-fall">8 Money Moves You Can Make When We Turn the Clocks Back for Fall</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/6-ways-to-avoid-vacation-debt">6 Ways to Avoid Vacation Debt</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-signs-its-time-to-close-your-business">5 Signs It&#039;s Time to Close Your Business</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting Debt Management Entrepreneurship debt payments emergency fund financial planning freelance saving money self employed side gigs variable income Wed, 02 Aug 2017 08:00:09 +0000 Annie Mueller 1990975 at http://www.wisebread.com Think Like a Startup to Boost Your Finances http://www.wisebread.com/think-like-a-startup-to-boost-your-finances <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/think-like-a-startup-to-boost-your-finances" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/confident_in_her_business.jpg" alt="Confident in her business" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>From tech giants like Facebook, Dropbox, and Instagram, to retailers like Harry's, Warby Parker, and CartFresh, companies who found success as startups seem to be all the rage in business news. But don't take startups as a business fad &mdash; there are plenty of personal finances lessons that the average Jane and Joe can learn from them.</p> <h2>1. Focusing on too many things can kill your finances</h2> <p>Spreading your financial goals too thin can often do more harm than good. Successful startup founders often find that a service that does one thing really well works better than a service that tries to do many things.</p> <p>Venture capitalist and PayPal co-founder Peter Thiel advises all budding entrepreneurs to think hard and pursue a single idea that nobody else is doing. In an article for The Wall Street Journal, Thiel asked entrepreneurs, &quot;What valuable company is nobody building?&quot; The answer to this question is harder than it looks.</p> <h3>Personal finance lesson</h3> <p>Keep things simple. Focus on the biggest issue affecting your finances. For example, hone in on paying back a 401(k) loan or eliminating high-interest credit card debt.</p> <h2>2. Forgetting that cash is still king</h2> <p>Startups famously burn through cash for &quot;growth,&quot; believing they will land yet another round of capital the next time around. That plan cannot only backfire, but become the death sentence of some startups. An example of this is server chip designer Calxeda. Despite raising $131 million in four rounds of financing, executives had to shut down operations in 2013 and declared, &quot;We simply ran out of money.&quot;</p> <h3>Personal finance lesson</h3> <p>Plan ahead and be ready for periods in which you won't get a constant paycheck. Even when receiving payment from your employer, sometimes <a href="http://www.wisebread.com/what-to-do-if-your-paycheck-bounces?ref=internal" target="_blank">paychecks can bounce</a>! Pay yourself first out of every paycheck and build an emergency fund to cover your basic expenses for three to six months.</p> <h2>3. Preparing to be wrong</h2> <p>&quot;Pivot&quot; is among the top three terms most used by startup founders. And for good reason: There are countless stories of million-dollar ideas that flopped but were able to turn into much more profitable ones after a well-timed adjustment.</p> <p>Take Payal Kadakia, for example, who first founded Classtivity (a self-described &quot;OpenTable for fitness classes&quot;) with a pay-per-class model. About two years into operations, Kadakia's service wasn't seeing the user traction that she was seeking. So, she pivoted Classtivity into ClassPass, a monthly $99 subscription that lets users go to any class at any participating gym. Once a struggling startup, ClassPass is now a $470 million business.</p> <h3>Personal finance lesson</h3> <p>If the plan isn't working at all, it's time to change the plan. Consider these facts:</p> <ul> <li> <p>50 percent to 70 percent of college students change their majors at least once and most <a href="https://sites.laverne.edu/careers/what-can-i-do-with-my-major/" target="_blank">will change majors</a> at least three times before graduation.</p> </li> <li> <p>American workers stay on the same job for a median of 4.2 years, according to MarketWatch.</p> </li> <li> <p>The average person changes jobs 10 to 15 times (with an average 12 job changes), according to data from the U.S. Bureau of Labor Statistics.</p> </li> </ul> <p>Change is inevitable, so welcome it and make the most out of it. It may very well improve your financial situation.</p> <h2>4. Outsourcing nonessential activities</h2> <p>&quot;Spend your calories on things you do well and the things that make you and your business valuable &mdash; and outsource things that aren't core to that mission,&quot; Jeff Haynie, co-founder and CEO of Appcelerator, wrote for Recode. From accounting to employee meal planning, startups are well known for outsourcing as much as possible to keep overhead costs down.</p> <p>To improve your overall productivity, Matt DeCelles, co-founder of sunglass retailer William Painter, recommends mapping out all tasks and determining which ones may be better completed by another person. By focusing on core operational activities, DeCelles is able to make the most out of his day. (See also: <a href="http://www.wisebread.com/11-time-saving-hacks-from-the-worlds-busiest-people" target="_blank">11 Time Saving Hacks From the World's Busiest People</a>)</p> <h3>Personal finance lesson</h3> <p>Remember complaining about how you never seem to have time to balance your checkbook, organize your tax deductions, or get an additional quote for a home or car loan? Spending money on &quot;help&quot; to complete these tasks can save you a couple hundred dollars in the long run.</p> <p>If you think that you need to be a high roller to hire somebody, think again. Leverage gig economy sites such as Fiverr, Elance, ODesk, Fancy Hands, or Zirtual to post your tasks, find talented freelancers, or hire a virtual assistant for as little as $5 to $10 per hour, depending on the type of task.</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" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fthink-like-a-startup-to-boost-your-finances&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FThink%2520Like%2520a%2520Startup%2520to%2520Boost%2520Your%2520Finances.jpg&amp;description=Think%20Like%20a%20Startup%20to%20Boost%20Your%20Finances"></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/Think%20Like%20a%20Startup%20to%20Boost%20Your%20Finances.jpg" alt="Think Like a Startup to Boost Your Finances" 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/think-like-a-startup-to-boost-your-finances">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-4"> <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-fundamentals-of-naming-a-small-business">10 Fundamentals of Naming 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/9-things-football-teaches-us-about-money">9 Things Football Teaches Us About Money</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/why-some-economists-say-you-should-give-cash-instead-of-gifts">Why Some Economists Say You Should Give Cash Instead of Gifts</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/6-smart-financial-gifts-to-give-your-kids-this-year">6 Smart Financial Gifts to Give Your Kids This Year</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/47-simple-ways-to-waste-money">47 Simple Ways To Waste Money</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Entrepreneurship advice cash financial lessons gig economy outsourcing planning startups strategies Fri, 28 Jul 2017 09:00:05 +0000 Damian Davila 1989544 at http://www.wisebread.com How to Hire Your First Employee http://www.wisebread.com/how-to-hire-your-first-employee <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-hire-your-first-employee" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/tell_me_more_about_yourself.jpg" alt="Tell me more about yourself" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Hiring your first employee is exciting! And also pretty intimidating. You don't need a complicated system in place to make your first hire, but you <em>do</em> need to take a few essential steps along the way. Here are some ways to simplify the process of hiring your first employee.</p> <h2>Decide what your employee will do</h2> <p>First things first: You know you're busy and you have more on your plate than you can accomplish alone. However, do you know exactly what your employee will take off your hands? Before you write an ad or think about a salary, make a list of the tasks and responsibilities you'd like to hand off to an employee. This list will help you hire the right person, and will also help you know exactly how to get them to full productivity quickly.</p> <h2>Write that employee handbook</h2> <p>Writing an employee handbook sounds like an overly complicated, formal process. It doesn't have to be! An employee handbook can be direct, casual, whimsical, full of pictures, and even interactive. It can also be a simple document of a few pages that covers the important values and rules you need to have in place for all employees, present and future. The U.S. Small Business Administration has a thorough guide to <a href="https://www.sba.gov/starting-business/hire-retain-employees/employee-handbooks" target="_blank">writing a handbook</a>, or you can find free templates online.</p> <h2>Set up a payroll service</h2> <p>In hiring an employee, what's most important to you is getting work done. What's most important to your first employee is getting a paycheck. Take some friendly advice: Hire a payroll service to handle the paycheck part of the equation. You will save yourself countless dollars in time and headaches. A good payroll service will provide necessary tax withholdings according to federal and state rules, keep accurate documentation, allow customizable withholdings to be set as needed, and ensure that your employee gets paid on time. All you have to do is go through the initial setup process and put a salary in place.</p> <p>And for the record: It's a really, really good idea to pay yourself through a payroll service, too. Missing tax documentation will always come back to haunt you.</p> <h2>Advertise for a great employee</h2> <p>Now you're ready to start seeking your first employee. Start by writing a great job listing ad. How, you ask? The keys to a great employment ad are specificity and authenticity.</p> <p>Specificity means that you'll list the exact tasks and responsibilities that your employee will take on. Don't use a vague term like &quot;Office Manager&quot; or &quot;Production Assistant&quot; without stating exactly what that means in your business. By making your ad specific, you will automatically filter out the applicants who aren't qualified or interested in completing the work you actually need done.</p> <p>Authenticity means that your employment ad should be like you, and like your business. If you're a casual, mom-and-pop kind of place, don't write an ad with formal language and overblown requirements for employment. Use first-person language, for example: &quot;We're looking for someone to work at the front counter.&quot;</p> <p>On the other hand, if your business is a more formal establishment with a dress code and high-end clientele, reflect that accurately in your advertisement. Use a more formal tone: &quot;Bobkin, Bobkin, and Butters, LLP, seek a qualified office assistant.&quot; The language and tone you use in your initial ad help you attract the type of applicant that will fit well and work well in your business.</p> <h2>Provide initial training</h2> <p>While you're waiting for the pre-filtered applications to roll in, thanks to your stellar employment ad, get your training materials in place. Do this by going back to that list of tasks and responsibilities that you want your first employee to handle. For each major task, write down the step-by-step process to complete it, well, completely. For each responsibility, list the tasks to be completed and, as appropriate, the timelines, resources, contacts, and other pertinent information.</p> <p>When you make that first hire, you'll have the information to start their training. As a general rule, it's a good idea to do two things: First, provide a copy of the complete training material to your employee, so they can go over it and get a big picture of the role they're taking. Second, prioritize the tasks and responsibilities and work with your new employee on each one in order of importance.</p> <h2>Set up a system for performance reviews</h2> <p>Ah, the dreaded performance review! Employees don't tend to love them, and frankly, neither do employers. However, when done well and frequently, reviews can create a working relationship that's much more beneficial for everyone involved.</p> <p>Start by letting your employee know that you will provide weekly feedback in their first month, or quarter. This is important as new employees often have no way to gauge if they're doing the job right and meeting your standards, or not. Not knowing leads to anxiety and tension, which leads to more mistakes, and can create an ugly cycle of stress and mess-ups. Provide clear, regular, weekly (at a minimum) feedback for your new employee for at least their first month.</p> <p>Thereafter, feedback sessions on a quarterly, monthly, or even a continued weekly basis are the most effective. Annual reviews are too few and far-between to be effective; they have the fun effect of making employees feel blindsided and betrayed. Don't do that! Instead, provide ongoing, informal feedback to your employee, either in face-to-face meetings or via phone, email, or messaging.</p> <p>You can provide feedback on a scheduled basis (weekly or monthly, for example) or after the completion of a task or project. In both cases, shorter, more frequent meetings tend to be more helpful. For best results, focus less on &quot;what you did wrong&quot; criticism and more on &quot;specific steps to improve&quot; instruction.</p> <p>A last note: It's a great idea to get feedback from your employee, as well as giving feedback to your employee. It's your first hire, but it probably won't be your last. Ask your new employee how you can make the process easier and be a better boss; you'll be even better prepared when it's time for your second hire.</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" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fhow-to-hire-your-first-employee&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520to%2520Hire%2520Your%2520First%2520Employee.jpg&amp;description=How%20to%20Hire%20Your%20First%20Employee"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <div align="center"> <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%20Hire%20Your%20First%20Employee.jpg" alt="How to Hire Your First Employee" 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/annie-mueller">Annie Mueller</a> of <a href="http://www.wisebread.com/how-to-hire-your-first-employee">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-5"> <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-grow-your-solo-business-without-hiring-employees">How to Grow Your Solo Business Without Hiring Employees</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-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-3 views-row-odd"> <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-4 views-row-even"> <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-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-inspiring-stories-of-normal-people-building-a-thriving-online-store">4 Inspiring Stories of Normal People Building a Thriving Online Store</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship business owner employees employment first hire hiring interviews reviews small business training Fri, 28 Jul 2017 08:30:10 +0000 Annie Mueller 1990725 at http://www.wisebread.com 5 Signs It's Time to Close Your Business http://www.wisebread.com/5-signs-its-time-to-close-your-business <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-signs-its-time-to-close-your-business" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/owner_closing_shop.jpg" alt="Owner Closing Shop" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Many people dream of launching their own business. Some start small, with a side gig or moonlighting on top of their full-time job. Others jump right into launching their own company. Regardless of the business type, surviving can be difficult. According to the Small Business Administration, 50 percent of new small businesses close within five years of opening.</p> <p>However, it's hard to know when to shut down when you've poured your heart and soul into a business. Making a smart, objective decision can be compromised by the passion you have for your company and the thought of the money and time you invested. Having a list of concrete indicators can help you make a wise choice.</p> <p>Here are five clear signs it's time to make the difficult decision to close.</p> <h2>1. There's no more profitability</h2> <p>It can take a while for a small business to break even, let alone turn a profit. But while you should expect some time to ramp up your clientele, your business should show progress and eventual profitability. Otherwise, you'll be unable to pay your bills, buy inventory, or afford basic essentials.</p> <p>If you've been working around the clock and cannot get in the black month after month, it may be time to reconsider your business model and sustainability.</p> <h2>2. You cannot take a large enough salary</h2> <p>Many entrepreneurs forgo paying themselves to help their business grow and succeed. The expectation is that after a year or two, they can start taking a salary. In the meantime, they have to live off their savings or rely on credit cards to fill the gap.</p> <p>That's a dangerous game to play for too long. Going without pay &mdash; or working for less than minimum wage with a side gig &mdash; can cause you to go into debt and give a false sense that your business is doing well.</p> <h2>3. The market changed</h2> <p>While your side hustle or business idea may have been successful for the first few months or even years, the market can change. What was a hot business can cool down quickly as time goes by.</p> <p>For example, driving for ride-share services was a great way to make extra money. Some drivers found it so lucrative they quit their jobs to drive full-time. However, there's been more competition in the industry, and companies like Uber and Lyft have cut drivers' rates to attract new customers. That can make it more difficult to make money, and many are making a fraction of what they used to.</p> <p>If you see your earnings decline continually, don't hold onto hope for a recovery for too long. It's better to cut your losses and pursue something else than to be overly optimistic about a return to form.</p> <h2>4. You no longer enjoy it</h2> <p>When you first started your business or side gig, it may have consumed and fulfilled you. But while working on a passion project on a part-time basis can be enjoyable, it can change when you devote more of your time to it or make it a full-time endeavor.</p> <p>Work can start feeling more like a drag than fun. If you go to work every day dreading what's to come, consider shutting down to give yourself the freedom to start elsewhere.</p> <h2>5. It's just not worth your time</h2> <p>Make sure to calculate how much you need to earn (and not just to pay your bills) for your small business to be worth your time. If you're working 20 hours a week, but making just a couple bucks an hour, it may be a better idea to invest your time in another business or just enjoy your hobbies.</p> <h2>Closing a business</h2> <p>Shutting down a business of any kind can be hard. Whether you invested $100,000 to launch a restaurant or just $500 to start an online craft store, you likely feel very passionately about your work. The idea of closing it and admitting defeat can be difficult. But doing so can save you thousands over time, and free you to pursue a new career or side business you enjoy.</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" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-signs-its-time-to-close-your-business&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Signs%2520It%2527s%2520Time%2520to%2520Close%2520Your%2520Business.jpg&amp;description=5%20Signs%20Its%20Time%20to%20Close%20Your%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%20Signs%20It%27s%20Time%20to%20Close%20Your%20Business.jpg" alt="5 Signs It's Time to Close Your 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/kat-tretina">Kat Tretina</a> of <a href="http://www.wisebread.com/5-signs-its-time-to-close-your-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-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/4-ways-to-fund-your-new-business-without-borrowing-a-dime">4 Ways to Fund Your New Business Without Borrowing a Dime</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/self-employed-heres-how-to-get-your-apartment-application-approved">Self-Employed? 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