The 250 Questions Every Self-Employed Person Should Ask

Mary Mihaly

• Publisher: Adams Media
• Year: 2009
• ISBN:
  9781440512957
• Topic: Personal Development
• Subtopic: Careers

I want to be my own boss.
I never want to punch another timeclock.
I want to follow my own dream.Each year, millions of Americans choose the path of self-employment—whether as freelancers, consultants, or microbusiness owners. And every year, they encounter pitfalls and detours along the way. When they have questions, where can they turn? This book answers 250 of the most critical questions about short- and long-term success, such as:

• What are the specific tax benefits of being self-employed?
• What kind of insurance coverage do I need for a home-based business?
• What's a domain name, and where can I get one?
• When should I hire employees?

Planning is key to any self-employment arrangement. Accomplished freelancer Mary Mihaly calls on fifteen-plus years of experience to present the questions that you might not even know to ask--the ones that will set you up for success. With this book by your side, you can find happiness in your true calling.

PART1

The Decision
and Getting
Started

IT’S BEEN ON your mind for some time now, and you’re close to deciding that you want to be your own boss—but where do you begin such a complex passage in your life? Part 1 will help you determine, once and for all, whether self-employment is for you.

You’ll start by examining your own motivations and skills, and by taking a realistic look at everything you will gain—and relinquish—if you switch to self-employment. This section will help you select a business, evaluate your finances and risk-taking capacity, and realize what sort of professional assistance you might need along the way. If your plans go beyond a home-based business, we’ve also included information on the ins and outs of franchises, and notes on starting a new enterprise versus buying an existing business. When you finish this section, you will be well equipped to make your final decision—and a commitment!

#1. Which personal qualities do I need to be successfully self-employed?

The hallmark of a self-employed person’s life is hard work. No couch potatoes need apply. If you anticipate working shorter days and never putting in weekend hours, you will be disappointed. From marketing to production, whether you’re selling resumes or spots in a children’s nursery, every small business owner is a hands-on worker. The only way to keep costs down is to do much of the work yourself.

You also should enjoy responsibility. All of the legal, financial, ethical, managerial, and production aspects of your business will land on your desk. When the business thrives, the credit goes to you—but if it tanks, that too will be your responsibility.

Persistence is another key quality. You’ll need it to get you through the times when the money runs thin, suppliers aren’t delivering, customers are angry, and you want to give up.

Lastly, you will need a reputation for honesty. Businesses are built on relationships, and you can only turn occasional customers and vendors into relationships if the individuals trust you.

#2. How do I know if I’m self-motivated enough to be a business owner?

Notice this is a different question from, Are you miserable when Monday mornings come around? and Are you ready to leave your current job?

Do you have enough cash saved to pay your personal bills and living expenses for about six months? Because whether you can discipline yourself to save a healthy supply of cash before you begin will be your first self-motivation test.

We mentioned persistence when answering question #1, but it’s worth emphasizing here: are you good at finishing what you start? You can’t embark on a new business, then quickly tire of it and move on to something else. Check your personality and habits, and be honest with yourself. Can you commit to sticking with the business once you begin?

You also need to motivate yourself to try things that you’ve never done before. We’ll talk about public speaking in Part 4, but you should ask yourself now whether you’re willing to get past shyness and put yourself “out there” to make your business succeed. As the business owner, you will be the one spreading the good word about your products or services. If local television stations or newspapers want to talk, you should be ready with enthusiasm, poise, and great things to say about your business!

You could also say that being self-employed is a little bit about being brave.

#3. Which job benefits will I lose when I become self-employed?

As a person with no “employer” perse, there will be no one to pay for your health insurance. That’s probably the most substantial financial benefit you will sacrifice; in 2008 the average annual premium for a family’s health insurance was $12,680, according to the Kaiser Family Foundation. The good news for self-employed people is that health cost is a major reason that many companies contract with independent workers instead of hiring full-time employees; they don’t pay health insurance for independents. If you’re going to be covered, you will pay the premiums under an individual plan.

You also will relinquish non-monetary benefits, such as being part of a corporate family. The isolation of working for yourself is something to consider. Many people blossom and thrive when they’re left to themselves, but others crave coworkers and structure. You might even discover that you miss having someone make major work decisions for you!

#4. What are some financial pluses of being self-employed?

Lest the message be entirely doom-and-gloom, hear this: the sky is the limit! As a self-employed person, you are not restricted to anyone else’s ideas of how much money you should earn, or how often you should give yourself a raise. Go ahead. Make money by the bucketful!

You also will save money in ways that might surprise you. No more monthly parking fees, pricey lunches downtown, obligatory drinks after work, candy and cookies that your coworker’s kids are selling, expensive work suits, dry cleaning costs, or constant gasoline fill-ups. And that’s before you start tallying up your income tax deductions that didn’t exist when you were someone else’s employee.

#5. What are some other advantages of selfemployment— especially if I’m working from a home office?

Your schedule will be flexible. If you need time during the day for banking, exercising, a parent-teacher conference, shopping, or even just a nap on a rainy afternoon, you don’t have to ask anyone’s permission or make arrangements with coworkers. A few additional bonuses include:

There is no dress code at home. You can stay in your fuzzy slippers all day—though some of the best advice I received when I first started working for myself was to dress every day as if I were going to the office. I don’t take it that far, but I do wear decent pants and sweaters, and always wear shoes. Somehow, I can’t get started until I kick off those slippers and put on some shoes. Then I feel as if I’m “going somewhere.”

No more commuting! There is nothing more luxurious than standing at your front window in the dead of winter, a cup of steaming-hot coffee in your hand, as you watch commuters sliding on the icy streets and listen to them scraping ice from their windshields.

You are no longer bound to the corporate culture. If you didn’t trust your employer, or didn’t approve of the way he treated customers or even other employees, it is a relief to walk away. From now on, only you will define your corporate culture.

You will now have time and energy for your family and friends. You’ll put in long hours, but you can arrange that time any way you like. You might even find time to read a good novel.

You’ll be your own boss! You can be as creative as you like. Your parameters will be set by you and no one else.

#6. I want to work from home. How do I decide what kind of business to start?

There are three main points to put into play. First, what are your talents and skills? If you can’t cook, don’t start a restaurant. If none of your skills stand out, make a list. Do you know how to sew? You could start doing alterations for people. Are you good with older people? Perhaps a nearby nursing home can use your help in some capacity.

Second, what do you know? Have you collected stories about local history? Your community might need someone to hire herself out to local museums, set up exhibits, give tours, and help develop brochures. Do your friends admire your upbeat personality? Maybe local chefs can use your enthusiasm to publicize their tastings and other special events.

Third, produce what will sell. Be creative in finding your niche, but don’t choose a calling that’s so obscure no one will see the need for it.

#7. What are the most popular home-based businesses?

Almost any kind of professional consulting service is popular among those who want to work from home, including financial counseling, editorial services, travel agenting, antique appraisals, and insurance sales. However, if your consulting business would have clients coming to your home office for appointments, be sure to check with your local zoning commission. If your neighborhood isn’t zoned for a public office and a neighbor complains about the traffic traipsing in and out of your house, you can be shut down; it happened to a member of my family, an accountant who had spent a lot of money remodeling his garage into an office.

Other popular home-based businesses are those repair “shops” that don’t involve a lot of client traffic or major equipment. Examples of this are computer repair, doll repair, clothing alterations, and costume making. Specialty teaching, too,...

Table of contents

• Cover Page
• Title Page
• Copyright Page
• Dedication
• CONTENTS
• Introduction
• PART 1: The Decision and Getting Started
• PART 2: The Office
• PART 3: Financial and Legal Aspects
• PART 4: Marketing and Selling Your Products and Services
• PART 5: Time,Energy, and Personal Considerations
• PART 6: Managing Ongoing Success
• Afterword
• Appendix A: Sample Contract
• Appendix B: The 250 Questions