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3 Reasons Why You Need a Business Bank Account

This post by Nellie Akalp originally appeared on the Freshbooks Blog in February 2017

Keeping It Professional: 3 Reasons Why You Need a Business Bank AccountAs a small business owner or freelancer, you probably encounter a lot of overlap between your business finances and personal finances. On the surface, it seems simpler to just have one bank account—after all, it’s a centralized place to keep tabs on client payments that come in, and personal and business expenses that go out.

However, there are several reasons why you must separate your business finances from your personal finances. For one, having a business bank account will separate itself from your personal assets, while streamlining your tax records. But that’s not all. Below are the three reasons why opening a business bank account is crucial for your business and your financial sanity.

Reason #1: A Business Bank Account Keeps the “Corporate Veil” Intact to Protect Your Personal Assets

Many small business owners form a limited liability company (LLC) or corporation because it helps shield their personal assets from things that might happen in the business—for instance, if the business is sued or can’t pay its debts. This is known as a “corporate veil” since it forms some separation between the business owner and the business.

In order to keep that personal liability protection, you need to properly maintain your LLC or corporation. This includes drawing a clear line between your business finances and your personal finances. By creating a business bank account, you ensure that your business is its own entity and separate from you as an individual.

In addition, if your business is ever sued, the plaintiff may try to pierce your corporate veil by showing you haven’t maintained the corporation/LLC to the letter of the law. In this case, they can go after your personal assets. In instances like this, that’s why it’s absolutely critical for LLCs and corporations to keep business finances completely separated from personal finances.

Reason #2: A Business Bank Account Helps You Stay Organized Come Tax Time

Combining your personal account and business account is asking for more trouble that you’d think. Ultimately, combined accounts make it harder to stay on top of your books come tax time.

You may find yourself spending countless hours wading through the past year’s transactions—including personal trips to the grocery store—just to find business expenses to write off. Having separate accounts streamlines your recordkeeping which, at the end of the day, saves you time and ensures you won’t miss any legitimate deductions.

Reason #3: A Business Bank Account Gives You More Credibility to Your Paying Clients

When you’re running a business, it can look a tad unprofessional to pay your contractors with a personal check or have your clients write a check to you as an individual. Will this ever be a deal breaker? Probably not. But, having a dedicated business banking account can send the right signals as you scale your operations and evolve from freelancer to business owner.

As a side note, if you’re running your business as a sole proprietorship, you don’t legally need a separate bank account for your business, but it’s still a good idea for the second and third reasons. Having a business bank account can help make your case to the IRS that you are indeed running a business and are entitled to deduct your business expenses should you ever be audited.

You Ready? What You Need to Open Your First Business Bank Account

Opening a business bank account is a relatively simple process. To make things easier, you can open an account at the same bank where you already have a personal account, so you only have to deal with one institution. Alternatively, you may receive reduce banking rates if you belong to a professional group or organization—such as a group for writers, veterans or performers. Check if they offer access to business checking services through a specialized credit union. This can be a great option.

No matter where you choose to open your business account, you’ll need the following documentation:

  • Your company’s EIN (or Federal Tax ID number).If you don’t already have an EIN for your business, you’ll need to get one from the IRS. You shouldn’t use your personal social security number to open a business account.
  • Articles of Organization / Articles of Incorporation.If your business is structured as an LLC or Corporation, then you’ll most likely need your Articles of Organization/Articles of Incorporation that’s signed and stamped from the state. You may also need to show your Operating Agreement.
  • Certificate of Good Standing.In some cases, you may also need to get a certificate of good standing from the state. This documentation essentially says that your business is up to date on its state taxes and other requirements.
  • Tax ID, social security number, DBA.If your business is structured as a sole proprietorship, you’ll need less documentation, since sole proprietors are considered more like consumers than a business. In this case, you’ll most likely need a Tax ID, social security number, as well as a DBA (Doing Business As) registration if you’re using a business name that is different than your personal name.

As your business grows, it’s crucial to build a proper legal and financial foundation. Opening a separate bank account is one small step in that direction, and will help keep your books organized, as well as ensure your business and personal lives remain separated. In addition, opening a bank account will help form your business’ credit history—a big milestone should you ever want to take out a business loan or line of credit in the future.

About the Author: Nellie Akalp is a passionate entrepreneur, small business expert, professional speaker, author and mother of four. She is the Founder and CEO of CorpNet.com, an online legal document filing service and recognized Inc.5000 company. At CorpNet, Nellie assists entrepreneurs across all 50 states to start a businessincorporateform an LLC, and apply for trademarks. She also offers free business compliance tools for any entrepreneur to utilize. Connect with Nellie on LinkedIn.

Are You Making Offensive Comments Unknowingly?

This post by Mark Swartz was originally published to the Monster Career Advice blog.

Are You Making Offensive Comments Unknowingly?You don’t think of yourself as insensitive. Co-workers generally laugh or smile at your jokes. It’s rare that someone complains you’ve hurt their feelings by something you’ve said.

Then a colleague files a complaint against you for making an offensive remark. How can this be? You ask yourself. I don’t remember being inappropriate.

The rules of office etiquette are changing. Yesterday’s tolerated comments may be unsuitable today. Do you know how to avoid being an offender?

Diversity Can Create Uncertainty

If everyone at work was similar to you it would be simple not to offend. There might be unspoken rules about off-limit subjects and acceptable ways to communicate.

In diverse workplaces cultural norms vary. It can be harder to tell who you might upset by saying the wrong thing. You may sincerely believe that you aren’t coming across as abrasive. After all, your friends, family and work buddies never complain.

Definition of Offensive Comments

If beauty is in the eye of the beholder, offensive remarks are in the ear of the receiver. Each person will weigh what you’ve said against their own sense of what’s tolerable.

If they consider your remark offensive they’ll see it as one or more of the following:

  • Personally repugnant, in violation of their moral or decency standards. For instance if you make a sexually suggestive joke.
  • Personally insulting, like when you belittle their work performance or intelligence.
  • Bigoted, as in judging others based only on their skin colour, religion or political beliefs.

Offensive statements cause people to cringe. Those who are affronted feel attacked or otherwise upset. That’s why you need to be aware of the impact your words are having.

Bigotry

A remark can be distressing if it stereotypes people. Bigotry is a broad category that covers some heavy duty typecasting. Statements that reduce a person to a set of prejudged traits belong here. They diminish the importance of respecting others as individuals.

Racism and sexism are in this category. So are sweeping comments based on age bracket, disability or sexual orientation. Same for marital and family status or country of origin.

Good thing there are ways to minimize your tendency to pigeonhole people.

Put Downs and Insults, Even In Jest

It’s unlikely you blatantly insult your boss and colleagues. More probably any put downs are made with a measure of humour. It can be fun to point out someone’s shortcomings – or to exaggerate their behaviour – in a non-hurtful way.

Except there’s a possibility of your intent being misinterpreted. Some people don’t find those sorts of comments comical. There’s also a risk that no matter how harmless the remark, the person on the receiving end is insecure or overly sensitive. They could react negatively.

Be careful about making people feel vulnerable. That’s especially true when publicly shaming others to motivate them.

Raising Sensitive Issues

Are there topics best avoided where you work? You might offend accidentally by bringing them up, even if you do so innocently.

Recalling embarrassing incidents that everyone wants to forget falls under this banner. Revealing somebody’s personal information without their permission does as well.

Watch That You Don’t Violate Policy

The workplace is not a 100% free-speech zone. Your employer may have policies that govern what’s off-limits. Read the employee manual for guidance. Study the sections on mutual respect and acceptable communication practices.

These policies could extend to what you say online. Express your controversial opinions to trusted followers. Offensive social media remarks that are publicly visible might get you called in for chat.

Online and off, it isn’t that you have to walk on eggshells in fear of offending someone. What you need to ensure is that you’re delicate in what you say or write, and never blurt out something that could be taken as harassment or bullying.

Get More Positive Stress at Work

Positive pressures create a way to balance out anxiety and worry

This post by Mark Swartz was originally published on the Monster Career Advice Blog.

Get More Positive Stress at Work (Positive pressures create a way to balance out anxiety and worry)Here’s some sunny news about stress: certain types can actually be good for you. A bit of pressure and nerves gets you focused.

But too much of what happens at work creates “distress” (negative tension). Like lack of control. Or not enough resources to do the job well. That can lead to ailments of the body and mind.

Creating more positive tension, also known as “eustress,” takes a conscious effort. A number of techniques are available to turn this into a healthy habit.

Good Stress Builds You Up

We all know the symptoms of stress. Over time the bad kind can lead to health problems, or play havoc on emotions unless dealt with.

Eustress does the opposite. There’s still tension and pressure involved. Only it challenges you to try harder, reminds you to concentrate on what’s important, and generates results that improve self-confidence.

Good stress is a great antidote to negative tension. There is less wear and tear, more drive toward accomplishment.

How Eustress Is Experienced

You know that feeling of butterflies in your stomach? Not the kind that makes you violently nauseous, or leaves you paralyzed with fear.

It’s more like the nervousness you feel on the way to a job interview you’ve prepared for, or before making a presentation in front of your colleagues.

The adrenalin is flowing. Your heart pumps faster and louder. All of your senses seem amplified. This fight-or-flight response makes you more alert and ready for the tasks at hand. It seems like whatever is about to happen will be within your coping abilities.

When the challenge you’re facing is completed, relative calmness returns. Eustress tends to be short-term and event-specific.

Typical Good Stressors At Work

There are lots of examples of positive personal stressors on the job. These may include:

  • Starting a new job or career you’re excited about
  • Receiving a desired promotion or raise
  • Relocating for work after asking to be re-assigned
  • Getting ready for a much needed vacation when things are busy
  • Preparing for retirement

 

Big events such as changing jobs or relocating don’t arise frequently. So you’ll have to produce your own eustress on a more regular basis. Consider the examples below.

Learn a new skill

It can be stressful to try and pick up new knowledge or skills. Yet it ultimately brings about self-improvement and increased personal marketability. Those are the hallmarks of eustress.

Set Firmer Boundaries

Have you said “no” recently when the boss asked you to work nights and weekends? Standing up for yourself takes gumption. It often creates tension at first, which encourages you to take care and do it respectfully.

Volunteer To Do A Presentation

Few things boost your profile like giving a well-prepared talk. Yet few things are as nerve-wracking as public speaking. The secret is to know your stuff, cater to the needs of your audience, and rehearse till it hurts.

Deal With Workplace Conflicts

It is risky to confront an annoying colleague or supervisor. However if something must be done, proceed in ways that are likely to generate eustress. Plan your approach carefully. Try to propose win-win solutions. And do your best to keep emotions in check.

Take On A Stretch Assignment

Step out of your comfort zone every so often. Offer to work on a committee that puts you in a leadership role. Attempt to solve a problem that no one else has been able to.

Eustress Versus You Stress

Worry and strain are among the many aspects of working life. They need to be balanced with positivity in your daily routine.

Eustress is beneficial pressure that ignites your resolve to succeed. Insert more of it into your overall activities. At first you may feel increasingly vulnerable. But as you learn to manage the fears, you can harness those butterflies to fly in formation.

Terrible Tax Advice Exists — Here’s How to Spot It

This post by Janet Berry-Johnson originally appeared on the Freshbooks Blog in March 2012

Terrible Tax Advice Exists—Here’s How to Spot ItHow do you know you have a great accountant? He has a tax loophole named after him… All jokes aside, tax is a complex subject and, despite decades of talk about simplifying the tax code, it just seems to get more confusing each year. After a decade of working in public accounting, I can’t count how many times clients came to me to ask about sketchy tax advice they’d received from dubious sources.

“My neighbor says Social Security income isn’t taxable.”

“My girlfriend’s dad told me I can deduct all of my vehicle expenses if I set up an LLC.”

“I saw an ad on TV that promised me a bigger tax refund than the competition.”

“I heard that paying taxes is voluntary.”

When you’re seeking out sound financial answers, be wary of the source. Next time someone offers their tax advice, look out for these 8 red flags.

  1. The Advice Sounds Too Good to be True

This kind of advice usually involves tax-free income or being able to deduct personal expenses.

According to the IRS, all income is taxable unless the law specifically says it isn’t. Life insurance proceeds, scholarships, gifts and inheritances, child support payments, welfare benefits and damages for physical injuries or sickness are all types of income that may not be taxable. However, there are a few situations where they might be. When in doubt, consult with a qualified tax pro.

Personal expenses are rarely deductible. Some common exemptions are home mortgage interest, real estate taxes, medical expenses and charitable contributions. They’re allowed as itemized deductions on Schedule A of your Form 1040. Other expenses for your personal residence or vehicle are only deductible if they are used for business. If a friend tells you he writes off all of his home or vehicle expenses, he’s practically telling you he’s committing tax fraud. Don’t take tax advice from a crook.

  1. The Advice Lacks Context

Above, we mentioned that certain types of income are usually non-taxable, but may be taxable under certain circumstances. The tax code is rarely absolute. When you read the code, you’ll see a lot of words and phrases like “generally,” “except under certain conditions,” “usually” and “in most cases.”

Most tax pros joke the answer to any question starts with the words “that depends.” Be wary of any advice that doesn’t take your unique situation into account.

  1. You Have Difficulty Understanding It

The tax code is complicated, but a good tax pro should be able to explain any basic rules, deductions and credits that apply to your return.

Remember: you are responsible for everything on your tax return, whether or not you paid someone else to prepare it for you. If you don’t understand something, ask! If you’re getting a much larger return (or owe more money) than expected, consult someone and find out why.

  1. There Might Be a Conflict of Interest

Look out for tax advice from people who are seeking to receive a commission or kickback. Some tax pros are also qualified to give financial advice but avoid taking advice that comes with an ulterior motive. The person might suggest you invest in a real estate venture that they hold a stake in or recommend financial products for which they receive commissions or referral fees.

Don’t be afraid to ask, “How will you benefit from this?” if you suspect the advice is not in your best interest.

  1. The Advice Suggests Taxes is Voluntary

No matter how many times these arguments get shot down in court, some people continue to claim that the payment of federal income taxes is “voluntary.” This claim is based, in part, on the fact that the IRS itself describes the way we file and pay federal taxes as “voluntary compliance.”

As the fact-checking website Snopes points out, “common sense dictates that if paying income tax were really voluntary, that tidbit of information wouldn’t be known to only a small cadre of tax protesters while millions of other Americans annually forked over considerable amounts of money they weren’t obligated to pay.”

As numerous tax court cases have shown, neither the obligation to file a tax return nor the payment of income taxes is voluntary. File your return and pay what is owed. Otherwise, you’ll soon find out just how mandatory paying taxes really is.

  1. The Advice is Referred to as a “Tax Shelter”

There are a few bonafide tax shelters such as those related to oil and gas exploration and development. However, most are at least bad deals from a business viewpoint, and at worst they violate tax law. Any business deal that needs to be structured as a tax shelter to be profitable is not a sound business deal. Good business deals show profits before tax considerations.

There are also tax shelters that promise you’ll receive $400 in deductions for every $100 you invest (or some similar “too good to be true” scenario). The tax authorities are constantly investigating such tax shelters. If you get caught avoiding income taxes by illegal means, you’ll have to pay back taxes, plus interest and some hefty penalties.

  1. Someone Promises You a Big Refund… Before They Look at Your Info

Every year during tax season, the commercials, ads and billboards that promise huge tax refunds begin to flood in. No accountant can get your refund faster or bigger than anyone else. You are entitled to the same refund, whether you prepare the return yourself or hire a professional.

Anyone promising they’ll get you the biggest refund may be padding your return with credits you’re not entitled to. Don’t fall for the hype.

  1. You Receive No Advice at All

Even if you normally prepare your own tax return, you may occasionally run into a new situation and need help. Major life changes, such as selling real estate, buying your first home, starting a new business or adopting a child usually means significant changes to your tax filing.

Don’t be afraid to seek out the advice of a professional. Even if you want to prepare your own return, most tax pros will be willing to sit down with you to answer questions and offer advice on your unique situation. The hourly rate they’ll charge may be well worth avoiding an audit—or paying a penalty for filing an incorrect return.

If you’re unsure, seek that advice from a certified and experienced tax pro. Look for someone with a credential, such as a CPA or EA. These professionals are well-trained, held to a code of ethics and required to maintain up-to-date knowledge.

At a minimum, all tax preparers in the United States are required to obtain a Preparer Tax Identification Number (PTIN). You can use this search tool available on the IRS website to find a preparer who holds a professional credential or voluntarily obtained a certain number of continuing education hours each year.

Getting professional advice is more expensive than getting advice from your skateboard buddy, but think of it as insurance: pay a small premium today to avoid an expensive disaster tomorrow.

About the Author
Janet Berry-Johnson is a CPA and a freelance writer with a background in accounting and insurance. Her writing has appeared in Forbes, Parachute by Mapquest, Capitalist Review, Guyvorce, BonBon Break and Kard Talk. Janet lives in Arizona with her husband and son and their rescue dog, Dexter. Outside of work and family time, she enjoys cooking, reading historical fiction, and binge-watching Real Housewives.

How to Handle Office Pet Peeves and Annoying Coworkers

This post by Joe Issid first appeared on the Monster Career Advice Blog

How to Handle Office Pet Peeves and Annoying CoworkersIf you’ve ever worked in an office, it is inevitable that you have held on to some unhealthy feelings towards one (or more) of your colleagues. Whether it is your impolite boss or a hygienically-challenged cubicle mate, ill-feelings can develop pretty quickly and can linger for longer than necessary. Personally, I have had my fair share of annoying co-workers over the years (my personal favourite was the co-worker who built a temporary wall to divide our cubicle because he suspected that I was stealing his work). I am also reasonable enough to admit that I must also be guilty of being that guy to other people with whom I have shared an office over the years. No matter the case, no one is immune to these feelings of frustration and we are all equally eager to rid ourselves of these regular annoyances. Here are some suggestions that may help:

Don’t suffer in silence

One of the worst things you can do in a professional setting is to hold on to grievances. If there are some elements in your work life that are not living up to your expectations, it behooves you to discuss then with the relevant people involved. I’ve seen far too many people suffer in silence, which only serves to further their feelings of frustration and alienation. So, if you share a cubicle with someone who insists on cutting their toe nails at your desk every week or floss right in front of you, it is probably best for you to address this before you get to the point of destructive confrontation. So, how do you do this?

Effective feedback

Whenever we consider providing feedback in a work context, it is usually perceived negatively as it is often associated with some form of consequence. As such, it is somewhat understandable why so many people refrain from providing unsolicited feedback. However, providing effective and constructive feedback is the single best option that you have to resolve any work issue you may encounter. According to Chantal Westgate, Adjunct Professor of Organizational Behaviour at McGill University’s Desautels Faculty of Management, “[for] feedback to be perceived differently, one has to convey that it is the only way we can improve.” So, if you have a colleague whose behavior is distracting and/or bothersome, providing constructive feedback is an excellent way to address an ongoing issue.

When to speak up?

While I would certainly advocate an open dialogue in all offices, there are certainly some situations that may be best left untouched. For example, a former boss did not like the fact that one of my team members came to work wearing a very short skirt and asked me to address it with her. After deliberating for a while, I chose not to raise this with the team as I did not feel that it had any real merit. Firstly, the company did not have a formal dress code, so my staff member was not violating any defined protocol. Additionally, her attire was not impacting her work nor was it impeding anyone else in the office from performing their work. As business was not being impacted, I felt that raising the issue may have had a negative impact on the workplace despite the fact that the boss’ sensibilities were being tweaked.

It’s not getting better

As with most work-related disputes, I would suggest you try and resolve them among yourselves. In some instances, however, you may need to escalate the matter if the issue has grown into something more substantial. Personally, there have been some situations where I simply could not reconcile the differences between a co-worker and myself. In such a case, you need to be honest with yourself and determine whether these differences are deal breakers. In some cases, these annoyances are minor and can be ignored when looking at the bigger picture. For example, are you really willing to go to war over a co-worker who noisily chews gum during meetings? On the other hand, is the issue significant enough that it is impacting productivity and happiness at work? If so, you may need to look into speaking with your boss or someone from human resources before the issue gets out of control.

Am I the problem?

To paraphrase a bawdy expression that my grandfather used to say: if everyone around you is annoying, maybe you are the problem. If you find that your default mood at the office is aggravation or hostility, you may want to consider the possibility that you may be the source of much of this negativity.

Over the course of my career, I have been very well-served by looking inward whenever I encountered difficult situations. Let’s face it: we’re not all perfect!

Communication is Key for a Successful Job Interview

Making the Most of That One Big Chance to Make a Lasting First Impression

This guest post was provided by the good folks at Effortless English

Making the Most of That One Big Chance to Make a Lasting First ImpressionThere is a good chance that you have had at least one job interview, and probably more than that, where you review your performance and feel frustrated that you could have given some better answers to the questions put to you.

Trying to anticipate the sort of questions you are going to be asked will help you to prepare for the process and stop you from freezing in the headlights when you get thrown a curve ball question.

Rise above the crowd

Of course, it is not just about rehearsing some carefully crafted stock answers to certain questions, as your interviewer will probably have come across these responses many times before. To get the job or even be considered for the job, you need to find a way to stand out from the crowd and make it easy for your interviewer to remember you and mark you down as a potential candidate for filling the role.

As this resource demonstrates, the mindset that you need to adopt is that you are not applying for a job as such, but selling yourself in the style of sales presentation. Your pitch might well amount to the same thing as submitting your application for a position, but the mindset and approach are different.

If you are trying to perfect your English and want to come across as grammatically correct as possible, the fundamental point being put across by the Effortless English service in the link above, is that to present yourself in the best possible light, it is not a case of sitting down and laboriously going through a set of rigid grammar rules, it is much more a case of learning to think English grammar.

There is a difference between the two learning methods, and that can definitely come across in a much more personable way when you are sat across the table from an interviewer, and trying to sell yourself as the best candidate they have seen.

Good listening skills are essential

The art of listening is also often grossly underestimated when it comes to coming across as a strong candidate.

Some consider listening to be one of the most important communication skills that you can possess, and it could be argued that one of the most powerful ways to make a meaningful connection with another person, is to listen.

This is an attribute that can serve you well in an interview process. Yes, you are expected to do a lot of speaking and provide convincing answers when being interviewed for a job, but just as important is knowing when to stop and listen to what is being said to you and what is specifically being asked.

Listening doesn’t just mean interpreting the words being spoken. It also means non-verbal as well as verbal communication skills.

Your ability to listen successfully hinges greatly on the extent to which you are able to accurately perceive and understand the verbal and nonverbal messages being portrayed to you in the interview process.

Many companies put a lot of emphasis on good communication skills, and if you are able to demonstrate this ability in abundance during your interview, by the way you speak, listen and present yourself, you will be increasing the odds of getting the call to say the job is yours.

Want to Start a Business While Working Full-Time?

You Can — Just Keep These Tips in Mind

This post by Nellie Akalp first appeared on the Freshbooks Blog on October 20th, 2016

Want to Start a Business While Working Full-Time? You Can—Just Keep These Tips in MindWhether you’re about to venture out on your own as a solo professional or launch a new business, it’s often easier to lay the groundwork while still employed. The stability and steady paycheck associated with full-time employment comes in handy when you’ve got real-world responsibilities like a mortgage and student loans—or you just want to eat something other than ramen every day.

Working on a business or freelancing while still at a full-time job builds your experience, confidence and project pipeline. You get to explore the different aspects of solo work and see if you enjoy wearing all the hats that come along with business ownership. As they say, you need to learn to walk before you can run. And staying employed while you learn the ropes can help you do this.

Balancing a job and a budding business is possible, but it does take some careful consideration—including legal, personal and professional matters. If you’re thinking about starting a business while keeping your day job, here are 5 things to keep in mind.

  1. Check Your Employee Contract

Before you begin taking on side projects, you should become very familiar with your employee contract and/or handbook. Some companies include non-compete clauses, which can mean you aren’t allowed to accept work on the side. The strictest clauses are usually found in ad and creative agencies who don’t want their employees to poach company clients.

Poring over legal fine print is no one’s idea of a good time, but it is essential. If you’re caught breaking the terms of your contract, you can be fired—even sued. Fighting a lawsuit while unemployed isn’t the best way to help get your small business off the ground. So, read your employment agreements carefully. If the wording seems vague, you can decide for yourself whether you’d like to approach your boss or HR for clarification, or keep your plans to yourself.

  1. Give 110% to Your Day Job

No matter how excited you are about your new venture, you’re still committed to your current job and company. It will be obvious relatively quickly if you aren’t holding your own in the workplace. This means staying on top of deadlines, getting to meetings on time, being enthusiastic—basically just doing your job as well as you always have. Underperforming at the office can hurt your professional reputation and long-term prospects.

There’s one important difference now. Since your new business is going to take up most of your spare time, you can’t stay late or work weekends for your “day job.” This means you need to make every minute in the office count. Master the arts of prioritization and delegation in order to get as much done as possible during your normal work hours. These are essential skills for being a freelancer and entrepreneur, anyways.

  1. Create a Disciplined and Regular Routine

There are only 24 hours in a day, so you’ll definitely be feeling a scheduling crunch when you first start out. Try to develop a steady rhythm for working on your new business, setting time aside in the evening, early in the morning and on your days off. Creating a regular schedule will help you stay disciplined. You need to make time to work on the business whether you have projects or not—there’s always important work to do such as creating your business’ website, networking or hustling for new business.

If you are struggling to find time to work on your business, take a careful look at the root cause. It could be circumstantial; for example, you’re just really busy right now for a major project at work, but things will quiet down soon. Self-employment requires a lot of discipline, self-direction and self-motivation. It’s very different than previous experiences with a boss or professor. This means it is important to identify early on if the solo work style is right for you.

  1. Treat Your New Venture as a Legitimate Business

You may still be a full-time employee, but the minute you accept money for your work, you’re also a business owner and entrepreneur. This means you need to treat your side work as a legit business—and learn all the responsibilities that come along with owning a business, including how to organize your finances, report your income and pay your taxes.

This would be a good time to meet with a CPA or tax advisor who is familiar with the needs of small business owners and freelancers. Setting up good practices early will help you scale later. One interesting point is that if you form a business and it takes a loss during the first year, you can actually deduct that loss to offset your income from your regular job (talk to a CPA/tax advisor for the details).

In addition, consider creating a formal business entity (such as a Limited Liability Company) to help lower your personal liability should your side business be sued or can’t pay its liabilities.

  1. Determine When You’ll Dive into Solo Work Full-Time

As your business grows, you’ll surely experience periods of intense work overload. At this point, you will need to decide if it is better to quit your job or turn down new client projects. How do you know if it’s time to start working on your own full time? It’s not an easy question to answer, but here are a few thoughts…

Unless you’re willing to blow through your savings or take out a line of credit, you shouldn’t consider leaving your job until your business can bring in as much income as your current job (or close to it or at least enough to meet your needs). That’s the practical consideration.

In addition, it may be time to rethink your situation if you find yourself so excited about your new business that it’s hard to muster any enthusiasm for your day job. This can drain you personally and professionally and you don’t want to just stick around until your employer kicks you out. If you’re having a hard time going to work each morning, then it’s time to accelerate your new business. Figure out how to build a runway of clients and have some cash flowing in—then take the jump.

About the Author: Nellie Akalp is a passionate entrepreneur, small business expert, professional speaker, author and mother of four. She is the Founder and CEO of CorpNet.com, an online legal document filing service and recognized Inc.5000 company. At CorpNet, Nellie assists entrepreneurs across all 50 states to start a businessincorporateform an LLC, and apply for trademarks. She also offers free business compliance tools for any entrepreneur to utilize. Connect with Nellie on LinkedIn.

7 Signs Your IT Resume is Outdated

7 Signs Your IT Resume Is OutdatedYour resume is the most important tool that you have in your job search arsenal. It’s your ticket in the door to an interview, and without one, you might as well just give up on finding a job.

Yet all too often, IT professionals rely on resumes that are outdated, poorly formatted, or full of irrelevant information, and then wonder why they aren’t hearing back from employers. If it’s been a while since you updated your resume (i.e. more than a year or two) or if you’re still relying on the format you learned back in college during the 1990’s, there’s a good chance that employers are ignoring you because of it. In a field like IT, where having the most up-to-date skills is a necessity, an outdated resume sends the wrong message.

If you are embarking on a new job hunt and still using the same resume that landed you your current job, you need to spend some time updating — and that means more than just adding your current position to your work experience. In fact, you might need a complete overhaul, especially if you spot any of these problems.

  1. You Have an Objective Statement

Perhaps the biggest indication that you haven’t kept up with trends is the fact that you have an objective statement highlighting your career goals at the top of your resume. Simply put, no one does this anymore. Employers don’t care that you want a challenging position or want to grow in your career. They want to know what you can do for them. Replace the passé objective with a short value statement and summary of strengths, showing employers what you can do for them.

  1. Your Certifications Are Old

Most employers want to hire IT professionals with the latest certifications, but if your resume doesn’t reflect your most recent achievements, you aren’t going to land the interview. Make sure that your resume accurately reflects all of your current certifications; if you are currently working on additional certifications by completing CISSP preparation or other coursework, mention that with an expected completion date. You want to demonstrate your commitment to growth and development, and be sure that your qualifications are obvious and relevant to the position you want.

  1. You Focus on Tasks, Not Accomplishments 

How do you describe your previous work experience? Do you list your responsibilities and rehash the job description? If so, you aren’t telling employers what they want to know. Employers want to see accomplishments, and how successful you were in your previous jobs. Instead of listing your day-to-day activities, highlight your successes using quantifiable data. If you can’t quantify your achievements, use quotes from testimonials or other accolades.

  1. You Still Have Unrelated Experience Listed

If you have been out of college for 15 years, but still have your college job at the supermarket listed on your resume, you aren’t doing yourself any favors. Typically, resumes should focus on what you have done in the last decade or so, and be highly focused on related experience. If you are just out of school and don’t have much experience, including unrelated jobs is fine if you can show transferrable skills, but as you get more experience, those jobs should fall off the resume.

  1. You Aren’t Keyword Focused 

Most employers use applicant tracking systems to scan resumes for keywords, and then rank candidates according to how many keywords appear. Therefore, if you don’t include the right keywords, your resume could be rejected even if you are the perfect candidate. When revising your resume, then, you should review job postings for your ideal jobs and incorporate the same language used by the employer; for example, if the employer asks for “strong knowledge of computer science fundamentals,” you should include “knowledge of computer science fundamentals” somewhere in your resume to ensure a match.

  1. Your Resume Doesn’t Highlight Technical Competencies

When applying for IT jobs, you need to clearly demonstrate your technical competencies and your skills. Don’t make employers search for that information or guess what you can do. Spell out your technical skills in a specific section. If you have any special achievements in these areas, include that information as well.

  1. You Don’t Highlight Transferrable or Soft Skills

Finally, many employers are looking for IT professionals with specific soft skills, such as teamwork, communication, and time management. Make these connections throughout your resume, including information about how you have demonstrated these skills when you discuss your achievements.

These are the major red flags that your resume is outdated and needs a makeover. Others include noting that references are available (employers know this), listing basic skills in your skill summary (we hope you can use Microsoft Office by now), and using an old email address from AOL or your university. If you make these changes, you’ll have a much better chance of landing the interview, and the job you want.

Author bio: Tiffany Rowe is a marketing administrator who assists in contributing resourceful content throughout the World Wide Web. Tiffany prides herself in her strong ability to provide high quality content that readers will find valuable. She enjoys connecting with other bloggers and collaborating for exclusive content in various niches. With two years of experience in blogging, Tiffany has found herself more passionate than ever to continue developing remarkable content for all audiences. http://www.seekvisibility.com/

Does Calling Yourself a ‘Freelancer’ Hold You Back?

This post by Susan Johnston Taylor first appeared on the Freshbooks Blog on September 28th, 2016

Does Calling Yourself a ‘Freelancer’ Hold You Back? One of the perks of freelancing is choosing your own title. So, what exactly should you call yourself? A freelancer, an entrepreneur, a small business-owner, something else?

In my experience, solopreneurs who choose not to self-identify as freelancers tend to fall into one of two main camps. The first camp chooses some other title to post on social media, print on their business cards and use in their elevator pitch (for instance, “independent web developer,” “creative director for hire” or “entrepreneurial journalist”).

Or they set up a business (for instance, “Sam Smith Media, LLC” or “The Red Pen Unlimited”) officially or unofficially that de-emphasizes their solo status and allows them to call themselves the owner, CEO or similar. In that case, maybe they plan on eventually scaling up to include others or they want to give the impression of being a larger company so they can attract bigger clients.

Here’s a look at the advantages and disadvantages of calling yourself a freelancer.

Advantages of the ‘Freelancer’ Title

Clarity

In certain circles, people will know immediately what you’re all about if you call yourself a freelance web designer or a freelance copywriter. They may not understand what you mean by a “web design ninja” or an “independent content marketing strategist.” That’s especially true of LinkedIn profiles. No client or employer searches LinkedIn for people with cutesy or creative titles like “copywriting maven” or “SEO guru,” so in that context, you’d want more a straightforward professional title that makes it clear what you do.

Camaraderie

Freelancers are a pretty rad tribe of free-thinking, creative people. Self-identifying as a freelancer means you’re part of that community and gives you the ability to tap into the collective wisdom of the tribe through online forums, in-person events and the like. Of course there are also forums and networking events for people who self-identify as solopreneurs or small business-owners, but freelancers tend to share some similarities that they may not share with the broader community of small business-owners who have brick and mortar locations or employees to manage.

Disadvantages of the ‘Freelancer’ Title

Lack of Respect

Alas, some clients just don’t respect freelancers. They may pay their freelancers late (or not at all) or email them at all hours of the day or night assuming the freelancer must have nothing better to do than wait at the client’s beck and call. Calling yourself something other than a freelancer could help establish yourself as a legitimate business entity deserving of greater respect.

Negative Associations

The term can have negative stereotypes for those who assume that a freelancer is someone who couldn’t hack it in the corporate world or who loafs around in pajamas watching daytime soap operas. For most freelancers that isn’t the case, but using a term other than freelancer could help bypass some of these misperceptions and position yourself as a bona fide professional.

Self-Perception

Aside from how others treat you, calling yourself a small business-owner or a solopreneur could also shape the way you think about your own work. If you view freelancing as a casual thing you do in between full-time jobs, you may not behave like a business or charge what you’re worth. But if you think of yourself as a business, then you’re more apt to get agreements in writing, send professional-looking invoices and take other steps that establish you as a business.

Possible Limitations

Some creative professionals grow from freelancing on their own to subcontracting work to others or even creating a virtual digital agency with multiple contractors or employees. If you see yourself as a digital agency of one, then that could create a smoother transition into a larger business in the future. Branding yourself as something other than a freelancer means you won’t have to rebrand when you decide to expand or change how you think about and describe your work. Of course, scaling up isn’t for everyone. Some freelancers are happy to remain a company of one.

Distancing Yourself from Your Work

Some solopreneurs choose to incorporate as a business to provide an extra layer of protection in case there’s a legal dispute around their work. Also, some freelancers define themselves by the success or failure of their work (an unhealthy, but all too common mindset). Using a business name other than your own name could also have the psychological benefit of reminding you that you are not interchangeable with your work.

In my case, I vary my word choice depending on the context. If I meet fellow freelancer, I’m apt to self-identify as a freelancer as well so that we can find common ground. If I’m hobnobbing with other solopreneurs, I might self-identify with that group. Ultimately, I think behaving like a business-owner is more important than what you call yourself.

About the Author: Freelance journalist Susan Johnston Taylor covers entrepreneurship, small business and lifestyle for publications including The Boston Globe, Wall Street Journal, Entrepreneur and FastCompany.com. Follow her on Twitter @UrbanMuseWriter.

 

The Dreaded Project Gap

How Your Contracting Business Can Plan for Continued Financial Health

This post first appeared on the CA4IT Blog on February 16, 2016

The Dreaded Project Gap—How Your Contracting Business Can Plan for Continued Financial HealthAs an independent contractor, you know that your business relies on a consistent project load to maintain profitability. However, at some point, you may face a gap between projects. This situation creates many concerns, but with careful financial planning, these rare occurrences should have little, if any impact on your bottom line. By utilizing some commonsense tips, you can safeguard against any effects from project gaps or other unforeseen disruptions.

Tips for Minimizing the Impact of a Gap Between Projects

  • First and foremost, you should always have a plan in place for project gaps. If you are just starting your small business, you need professional accounting advice as to how to plan for downtime not just between contracts, but for all unexpected events that could disrupt your business, such as illness. Remember, your business relies on your ability to perform, so if you suddenly cannot work for any reason, you need a financial back-up plan. This can include a focused savings plan or an emergency plan to liquidate assets or scale down expenses.
  • Stay on top of every expense and think ahead for tax deductions. Tools like cloud-based accounting for small businesses let you keep track of every income and expense in real time so that you always know how you’re doing. The most powerful tool you have is information, and when you can see your business’s financial picture on demand, you gain the power to manage it proactively.
  • Use downtime wisely. Whether your gap lasts a few days or a couple of weeks, never look at this as vacation time. Brush up on your continuing education, or go after than certification you need. View every day as an opportunity to grow and refine your business.

As a business accounting service specializing in independent contractors, CA4IT believes that you need careful, conscious preparation for changes in your workload. We can help you plan for any scenario and fro continued financial stability. Turn to us for all of your accounting needs so that you always feel confident about your financial outlook. To learn more, contact a CA4IT representative for the best accounting help in your community.