Taking the Leap Towards Self-Employment

Taking the Leap Towards Self-Employment

Are you ready to strike out on your own?

Being self-employed is the dream of countless Canadians. They fantasize about the freedom that comes with being the master of their own destiny…

But of course there’s another side to being self-employed. The rewards of being self-employed can be huge, but so are the risks and strains. Yes, you’re your own boss, but that means all of the responsibilities and risks are yours as well. If you want to be an entrepreneur, you need to provide your own motivation, pushing yourself every day towards success.

To be clear, we are not trying to talk you out of starting your own business! However, it’s important to have a clear understanding of what’s involved. With that in mind, here are some of the things you need to consider before making the leap to being self-employed.

What Do Your Current Finances Look Like?

Whether you’re considering going freelance or you’ve decided to start your own business, you cannot count on your endeavour becoming profitable right away. In fact, for the first year or so, you might be losing money.

Jumping from a reliable paycheque to invoicing clients and hoping they pay on time can be nerve-wracking—not to mention finding those clients and getting through the start up expenses. You must have detailed knowledge of your finances and your risk resilience before you make the full leap to being self-employed.

Not sure where to start when it comes to your numbers? Luckily, this is an area where The Number Works can help. We can walk you through all of your current financial data, showing you exactly where your profits and expenses are and what you can do to shape things up before you go into business for yourself.

Do Your Research

Before starting your own business, you should probably ask yourself the tough question, “Do I have any idea how to start my own business?”

There can be a real “look-before-you-leap” mentality when it comes to becoming self-employed. It isn’t just about the state of your finances; it’s also about learning the ins and outs of creating your own business and managing it effectively.

The first thing you might want to do is talk to some of your entrepreneurial friends. Getting a first-hand account of what it’s like to be self-employed can be invaluable, enabling you to bypass some of the mistakes they made in the early days of creating their businesses.

You’ll probably also want to read some books about entrepreneurship. While countless books have been written on the subject, you should be selective about which you pick up. There are significant differences between the Canadian and U.S. markets, so be sure your book is focusing on Canadians laws and guidelines. You also need to make sure it was written (or at least updated) within the last four to five years. Technology moves so fast that anything before 2015 will be borderline useless, omitting vast chunks of what it means to be self-employed today.

Ongoing management of finances can be another big hurdle for those who want to jump into the self-employed arena. If you’ve never had to manage anything larger than a personal budget, you might need a hand getting started. That’s another thing we can help you with at The Number Works. Right from the first minute of your business, we can be there to support your financial position and ensure you’re optimized and running things as smoothly as possible.

Start Slowly

Have you ever heard of a “side hustle?” It’s essentially part-time self-employment. A side hustle could be as simple as setting yourself up with an an Etsy store to sell things that you’ve created in your spare time, or taking on a single freelance client to get your feet wet in your desired industry.

Having a side hustle can be a great way to get a small business started. If you’re feeling nervous about jumping into self-employment with both feet, this can be an excellent starting point, building muscles that will come in handy when you decide to quit and go into business for yourself full-time.

Keep in mind that it can require building some serious discipline to force yourself to work even after you get home from your job, but the result can be more than worth it. And you’ll need all that discipline when you’re a full-time entrepreneur who has to continuously self-motivated.

Do Not Forget About Your Taxes

One of the biggest shocks that a self-employed person can go through is their first tax season.

When you’re working for a company, taxes are automatically taken off your paycheques. Now that you’re self-employed, you’re collecting the entire amount you’ve earned… until tax time that is. When tax season rolls around and you need to calculate your taxes, you might be in for a shock! Yes, you knew that your tax bill would be higher than usual because you’re now self-employed but… Surely there must be some kind of mistake, right? Don’t be one of those people who realizes they owe thousands of dollars to the government that they’ve already spent!

While, yes, there is a chance that you made a mistake, it’s much more likely that your numbers are correct and you need to give the government a sum of money that you hadn’t planned for. It’s shocking, but there are several ways you can mitigate this situation.

One thing you should definitely have is an accountant experienced in working with self-employed entrepreneurs in your province. At The Number Works, we know all of the deductions and legal tricks for Ontario that could save you big bucks, especially come tax time. With our help, we might be able to get your taxes down to a slightly less jaw-dropping amount. And we’ll certainly help you prepare so that you aren’t caught off guard when you see the amount you’ll owe.

We also recommend that, rather than just dump every paycheque you have into your Chequing account, you take off about 25% off and put it into a separate savings account that you use for taxes. That way, you’ll have a reserve of money ready for you come tax time, reducing any sense of “sticker shock” when you figure out precisely what you owe.

Take Care of Yourself

For new entrepreneurs and freelancers, self-care can become an afterthought in the pursuit of making your business a success. This is a massive mistake!

If you’ve been putting off going to the gym, heading to yoga, buying healthy groceries, or spending quality time with family or friends, be sure to start scheduling it in your calendar like you would a business meeting or other important event. Same with making sure that you take appropriate breaks for lunch and for stretching if you’re sitting down for long hours. If you don’t take care of yourself physically, you’re going to start getting worn down by the job. Manageable things could start to feel overwhelmingly stressful, all because you aren’t caring for your personal needs.

There is also a mental self-care component of being self-employed. Some people start feeling like every minute they aren’t working is a minute they’re losing money; an unhealthy mindset that can lead to self-esteem issues and self-abusive thoughts of “laziness”.

Even though you’re self-employed and can technically get up at any time of day (including well after 9am), try setting “business hours” where you do your work throughout the day. Working 9 to 5, even if you’re doing so from home, can help you maintain a healthy work-life balance. If you prefer unorthodox hours, that’s ok too but make sure that you schedule your on- vs. off-time. It can keep you from feeling guilty that you aren’t working at 9pm on a Saturday rather than spending time with friends.

It takes a great deal of bravery to be self-employed, either by starting a new business or by going freelance. No matter which path you choose, you can bet that at The Number Works we’ll do whatever we can to help. We work with freelancers and entrepreneurs every single day, helping them balance their finances and making sure they’re fully prepared come tax season. If you want to simplify your financial life while moving towards self-employment, get in touch with us today. We’d love to help your entrepreneurial dreams come to life!

How to Create an Unstoppable Virtual Support Team for your Business

How to Create an Unstoppable Virtual Support Team for your Business

Are you a budding entrepreneur? If so, chances are you’re a natural-born risk-taker! But trying to do everything yourself as a business owner is a risk you really can’t afford to take.

Every business owner needs an unstoppable support team, and in today’s digital world, there’s no reason your rockin’ team can’t be a virtual one!

Not only can an unstoppable virtual support team make the difference between the success and failure of your fledgling business, but it will also help keep you sane. Seriously! So many small business owners exhaust themselves working countless hours to take care of their business. While I have great respect for all those hard-workers out there, a bit of assistance from a stellar support team can not only help reduce that frenetic pace, but also boost efficiency and allow your business to grow.

Go For the Best

Typically, an unstoppable support team is made up of two kinds of people: mentors and specialists. Some you hire, some you pay for, and some you find by networking and outreach. Of course, you want your team to be as cost-effectively as possible, but don’t be scared to pay for experience and expertise. Having savvy people by your side is an investment that pays off by saving you years of hard work and mistakes.

As soon as you begin to draft your business plan, you should be on the lookout for members to add to your virtual support team. It’s a great idea to make a list of everyone you know who might be able to help you and your business thrive. Think about family members, old friends from college, even friends of friends who might help you gain the perspective your business needs. Remember, if you believe the person is mature, experienced, and has some relevant know-how, then they could be valuable to you.

The best part about working with a virtual team member is that it doesn’t matter if they move away. Using tools like Slack, Trello, Skype, and good old-fashioned email, you can connect with your entire team, no matter where in the world they’re located.

Decide On Your Team Members

So, what’s the relevant know-how and experience you should be looking for in your virtual team members?

The makeup of a virtual support team might differ a bit based on the industry, but almost every company can benefit from these experts: a designer, a copywriter, an ad specialist, a virtual assistant, and, without a doubt, an accountant.

A talented graphic designer will ensure that all of your branding is flawless, giving your business a truly professional look. Don’t underestimate the power of graphics in today’s online world. Graphics are what catches the eye to entice people to buy from your business. Adding a graphic designer to your team will help communicate your message and enhance the overall feel of your brand story.

Eye-catching graphics are essential, but so is the text that goes with them. An excellent copywriter will get people to click that ‘buy now’ button in record time, making them a major asset when it comes to writing sales copy pieces like your marketing emails and sales pages.

Facebook and Instagram are some of the best advertising platforms out there, and their ROI can go through the roof… if you know what you’re doing! An ad specialist is someone who can create marketing materials that position your calls-to-action in a way that gets you what you’re looking for: more clicks, more sign-ups, and more clients.

A virtual assistant is an asset to any great support team. Virtual assistants are there to lighten your load and take care of more mundane, daily tasks, so you’re free to grow and scale your business. Virtual assistants can help you in so many ways, from taking care of your website to keeping your systems up and running. They may even be able to help the rest of your team with light design, copy, and marketing work.

Don’t Underestimate the Power of a Good Accountant

No matter what size or type of business you run, you’ll need a professional accountant on your team. Why? Because it’s vital that you accurately track and report all the cash flowing in and out of your accounts that have to do with sales, expenses, and salaries.

Properly managing your books is provincial and federal law, but most importantly, it’s the only way to gain an accurate assessment of how your business is operating.

A professional accountant will be able to provide you with the information you need to make informed financial decisions to help your business succeed. In fact, one of the most common reasons companies fail is because they don’t have a professional accountant on their team.

Plus, the expense of hiring an accountant often pays for itself! A professional accountant will know the ins and outs of tax law, ensuring you’re maximizing your deductions, claiming all your credits, and ending the tax year with the biggest return possible.

Leverage Professional Networking

So, now that you know precisely who you should have on your virtual team, don’t limit yourself to local industry meetups or inviting people out to coffee. The whole world is your networking oyster, thanks to the power of the internet.

To attract the right people, make sure you have a stellar LinkedIn profile and active social media accounts, including Twitter, Instagram, and Facebook. Joining Facebook groups is a fantastic way to network and find the perfect virtual team members, while your LinkedIn and other social media profiles are the best way to make a good first impression on your potential hires.

Contact The Number Works

If you’re in the middle of assembling an unstoppable virtual support team and need a professional accountant in your corner, you’ll want to work with The Number Works. We’re a virtual bookkeeping, accounting, and financial coaching firm that helps creative entrepreneurs tell their financial story.

We offer a wide range of services, including cloud-based bookkeeping, full cycle accounting, financial statement analysis, strategic planning, and taxes. In other words, we’re your one-stop shop for all your business’ accounting needs in Hamilton and the surrounding Southern Ontario area.

Don’t hesitate to reach out and discover if we’re the right fit to join forces and help your business succeed.