The internet has made it possible to work from anywhere.
As a result, more and more people are deciding to work where they’re most comfortable: at home! After all, what could be better than exchanging your hour-long commute for a 5 minute one between your bed and desk? Or throwing away those business suits and replacing them with a few pairs of sweats?
But of course, a home-based business is still a business! And that means that you have to look beyond the perks and learn what it takes to run a successful enterprise. Start your lessons today by looking at these common mistakes that those starting out often make.
1. Not tracking your expenses.
Running your own business costs money. You need to make sure you’re making more than you’re spending. Even if you’re running a business with low overhead (many home-based businesses really just require a computer and an internet connection), you may be able to claim other expenses, such as part of your mortgage, cell phone bill, and car expenses, on your tax return. Keeping track can save you big at the end of the year, so consult with a tax professional early on.
2. Not paying your taxes.
If your home-based business is your only source of income, it’s likely you’ll have to pay self-employment taxes quarterly to avoid being hit with a penalty when tax seasons comes around – as well as having to pay all those taxes at once! Be sure to bring that up when you speak with your tax expert.
3. Not setting aside time and space.
It’s easy to get distracted when you run a home-based business. After all, your couch and TV are just a few feet away, and you can always finish up work later, right? But that, of course, can lead to procrastination. You can address this problem by establishing an office–whether it’s a separate room or just a designated area—that’s entirely focused on your work. It’s also helpful to establish a schedule. You can be flexible, but at least, you’ll have something to start from.
4. Not getting it in writing.
Didn’t get paid by a client? You’ll have a hard time collecting or taking them to court if you don’t have your agreement down on paper. Often, an email will work just fine, but it can be beneficial to have a more formal standard agreement. Develop a template (or a few templates) so that you can put one together quickly when taking on a new client.
5. Not continually promoting yourself.
Remember, your customers can walk away at any time. You need to make sure that you keep putting yourself out there, so that the well doesn’t dry up, or you could be back to seeking traditional employment.
No matter how much you prepare or how much advice you seek, you will make mistakes. Many freelancers put the blame on their client. “I just got stuck with a deadbeat client!” or “He just didn’t know what he wanted.” Often, that’s exactly the case – but that doesn’t mean you can’t learn from what happened and prevent it in the future. Instead of playing the blame game (or the flip side: beating yourself up about an error), try to figure out what you can learn from the situation.
About the Author:
Patrick and Joyce Del Rosario are Filipino business and career bloggers. They work at Open Colleges, one of the pioneers of Online education in Australia and one of the leading providers of diploma of management (http://www.opencolleges.edu.