You’ve probably heard about many of the advantages of working from home, from being able to work in your pajamas, to taking off to run errands on your own schedule, and many things in between.
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To be sure, there are some tremendous upsides to working from home, but to be successful requires some work and dedication on your part. If you think that you are ready to take the plunge, but would like just a bit more advice to get started, consider the following tips designed to help you start a business from home.
Formulate a Strategic Plan
Before you quit your ‘day’ job, you need to devise a strategic plan for how you will operate a home-based business, should you go through with it. Drafting a business plan is a great way to accomplish this. Be as detailed and honest as possible to determine if this is a good move for you in the end.
Can You Do It Alone or Do You Need Employees?
Beginning a home-based business has many advantages. For some, the main one is working on your own. Working alone has enormous tax advantages, but you need to be sure that you can perform all of the work necessary to make a living that will support you and your family. Some home-based businesses will need employees or independent contractors to work effectively. This obviously serves to increase your revenue if done correctly, but it can also mean more expenses. Part of your strategic plan should analyze these core issues.
Remember to Pay Your Taxes
If you do decide to go out on your own and start your own business at home, remember that you need to pay estimated taxes on your income on a quarterly basis. If you do not do so, then you could get hit with some hefty fines and penalties come tax time, not to mention quite a shocking one-time expense to boot.
Plan for Retirement
No matter how young or old you are when you start a business at home, you should be socking some money away for retirement. You will no longer have an employer helping you to do this, so consider opening a SEP IRA or simplified employee pension in order to get you started. Remember to fund this account monthly so when the time comes you can enjoy your retirement years.
Organize Your Work Space
Just because you are working at home does not mean you should work on the couch while watching television. That would not be very productive in the end. Ideally, you should have an area in your home dedicated to the business, and make this area off-limits to others in the home during ‘work’ hours. For the business to work, you need to treat it like another day at the office. Have a home office also have some great tax advantages as well!
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There you have it – some tips to live by when deciding if opening a business at home is the right move for you.
