Five ways to make self employment work
If you are thinking of taking on some type of self-employment or working at home, here are five key things you need to concern yourself with.
I’ve been self-employed for almost five years now. Along the way, I’ve learned a lot of things about self-employment.
Originally, this article was going to be much longer, but as I found myself writing tip after tip, I discovered that most of them were either simply restating the same thing or they were very narrow, meaning they applied either only to my own psyche or specifically to writers.
Instead, I took a broader look at those ideas and boiled them down to five keys. If you are thinking of taking on some type of self-employment or working at home, here are five key things you need to concern yourself with.
Have a place that’s focused on work.
When I decided to make a full-time attempt at working, we converted the smallest bedroom in our home into an office. Aside from a shelf of board games in the opposite corner of the room from my work area, the room is pretty much entirely devoted to my professional work.
I have a shelf of personal finance and time management books at the ready. I also have some books on the art of writing. I have several notepads nearby to jot down ideas. Any electronic devices I’ll actually need, such as my headphones for Skype, are right there at arm’s length.
In short, the environment is set up to be conducive to whatever my work needs are.
When you need to bear down, shut off distractions. All of them. Yes, that means your cell phone, too.
What I don’t have are DVDs or fiction novels or other things to distract me from my work. I don’t have any video games nearby and although I do have a few computer games, they’re locked away from my work profile so I’m not tempted by them and, eventually, they’ll all be on the “family” computer, anyway.
When I know I need to bear down on my work, I shut down all programs but my writing software. I close my door. I turn off my phone. I try to make it so that it’s incredibly hard for any sort of distraction to interrupt my work.
That’s because I find that my best work occurs when I can slip into a work “zone.” By that, I mean that time starts to slip away from me because I’m so engrossed in what I’m doing and, eventually, I snap back to the “real world” to see that significant time has passed, but I’ve also accomplished a lot of good work.
Establish a daily routine around you.
One of the big reasons for me to work at home is so that I can fold my schedule around that of my family. This means that I constrain a lot of my work to the period where the older ones are at school.
I’m also aware that my peak writing happens first thing in the morning, so I usually get up an hour or so before they do and get in some solid work before anyone else wakes up.
I usually take care of a few loose ends in the evening when the kids are falling asleep, too.
In a typical week, I try to work ahead a little bit so that when a difficult week happens – the children are sick, there’s a school holiday, and so on – I can handle it without skipping a beat.
These add up to a varying amount of time in a given week. Some weeks, I work well over forty hours – other weeks, I don’t.
The key here is that I have a daily routine that I stick to the vast majority of the time. That routine keeps me always moving forward. Without that routine, I would find myself constantly distracted and constantly bumping my work around, and the end result of that would be not getting my work actually done at all, which would be a crisis.
A routine is vital. Without it, it becomes so easy to be distracted.
Save time for open-ended brainstorming, preferably outside of your place where you work.
Every few hours, I go on a short walk in which I try to brainstorm through any and all problems that I’m facing. I’ll start walking, try to wrap my head around one problem, and if a solution isn’t obvious, I’ll move to the next one.
Often, by bouncing from issue to issue like that in an open way while I’m strolling through new environments, answers sometimes just pop into my head out of the blue.
It happens so often that I consider this type of “brainstorming” to be an integral part of my day. Without it, I would spend an awful lot of my time just grinding my wheels and not really accomplishing much.
Be highly organized with your money.
Self-employment usually means irregular pay. It also means that you have to manage your own tax payments.
The second you even consider self-employment, you must set up a system to manage your money very carefully. Without it, you’re going to wind up in a financial pickle at some point.
My suggestion is to have all of the money flow into a business checking account, from which you pay yourself a regular wage. What should that regular wage be? I suggest 50% of the money you bring in from self-employment in a year should be paid out to you, with the rest going to taxes and business expenses, but that depends on what exactly you’re doing.
At the start, pay yourself as little as possible, for two reasons. One, you want to build up a very healthy balance in that business account so that cash flow isn’t a worry. Two, you want to establish what you can reasonably expect for a year’s worth of revenue so that when you do switch over to regular “paychecks,” you know a safe amount to pay yourself.
If you can’t make it on half of what you’re earning in pre-tax revenue, then you shouldn’t be jumping to full-time self-employment.
If you are thinking of making the leap, good luck to you. It’s a challenging path, but it’s one with a lot of rewards as well.
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