As 81 million American baby boomers begin to move into their retirement years, they are redefining what retirement means. For many, it doesn’t mean they’ve stopped working, but rather that they are exercising more choice over how they work. According to a 2009 survey, some 75 percent of people who chose to engage in some form of work found the work satisfying, and in four out of five cases, they were able to find white collar jobs for what are known as “encore careers.”
Picking the perfect second act for your career can involve trying a field that’s always interested you, helping out with a cause that you believe in, or getting a chance to run your own business.
If it’s running your own business that appeals to you, chances are you don’t want to sink a large chunk of your retirement savings into a new venture at this point. Therefore, the key is getting started with minimal investment up front. This is very possible these days, depending on how you set up your business, and what type of business you choose to go into.
Getting Started with a Shoestring Budget
To start a business with relatively little up front capital, the key is to minimize fixed costs. Variable costs–expenses of the pay-as-you-go variety–are preferable because they allow you to ramp up or scale back investment depending on how the business is going.
Here are some key tools for keeping fixed costs to a minimum:
• E-commerce Solutions. Who needs a business location when you have the Internet? The ultimate low-overhead storefront, the Internet gives you access to a world of potential customers. Utilizing e-commerce solutions is much cheaper than having a physical place of business where you receive customers. For example, it allows you to avoid the many expenses of having a retail outlet, such as rent, utilities, staffing, and insurance.
• Outsourcing Back Office Infrastructure. Rather than building a complete organization from scratch, try to outsource anything that isn’t central to the unique value proposition of your business. For example, functions such as customer support, credit card processing and human resources are only needed occasionally or periodically. Therefore, it makes more sense to utilize outsourced call center services for telemarketing or customer support or HR outsourcing for human resource activities than to try to staff it internally.
• Use Online, Social Media Strategies to Promote Your Business. Developing a full scale online social media strategy can seem overwhelming at first. But you can implement simple things by hiring interns to do the leg work such as starting a blog or using Twitter, and tracking different programs making adjustments along the way.
Low-Cost Entrepreneurial Business Ideas
If the above are some techniques for structuring a business with minimum up front investment, what are some lines of business which lend themselves to getting started with minimal capital?
One rule of thumb is that services generally require less investment than manufacturers or retailers, though with e-commerce some re-sellers can operate cheaply if they have tight supply lines and add value in the process. Focusing on services, the following are some examples of businesses that might be right for the current environment, and can be started on a shoestring.
• Business consulting. If many retiring boomers are going to be starting their own businesses, why not use your business experience to help show them how to do it?
• Green consulting. People are striving to become more energy-efficient, for economic and environmental reasons. If you have expertise in this area, consulting with businesses and homeowners on how to reduce their consumption is a natural.
• Public relations. If you have media and promotional experience, you could be in demand with the new wave of entrepreneurs starting their own businesses. In particular, bringing knowledge of modern promotional techniques such as social media strategies could be valuable to these new businesses.
• Employment counseling. Between a weak economy and an aging population, there are many people facing a career crossroads these days. Helping them find the right niche can be a good way to make use of any personnel experience you have.
• Online Lead Generation. Sales Lead Generation is growing by leaps and bounds as far as start up industries are concerned. This is a very special industry that affords flexibility and freedom that is unparalleled. And, there is even a significant demand for highly specialized lead generation consultants to help companies generate qualified sales leads in this market.
Running your own business may not have been your parents’ idea of retirement, but things are very different today. If you have the entrepreneurial itch, starting a venture might just give you the satisfaction and extra income to make your “golden years” more than just an expression.
Tag: small business
Sometimes, smaller is better–just ask the small business entrepreneurs also called micropreneurs flourishing in today’s marketplace. A growing set of entrepreneurs are building successful businesses by serving a niche market. Micropreneurs aren’t trying to become the next Bill Gates or Larry Ellison. They’re thriving small-scale on the strength of a loyal customer base and utilizing social business networking and utility tools to help with sales lead generation.
Micro-Enterprises Rely on E-Commerce Solutions
Micropreneurs are rewriting the rules of small business–and they’re relying on the internet to make their business model work. A New York Times feature on startups explains: “the Internet has given people an extraordinary tool not only to market their ideas but also to find business partners and suppliers, and to do all kinds of functions on the cheap: keeping the books, interacting with customers, even turning a small idea into a big idea.”Thanks to a range of online small business resources, today’s micropreneurs have the resources to build their venture on a shoestring budget.
With minimal upfront investment, you can:
1. Create an Internet storefront for retail sales. E-commerce solutions can create a Web site with point-of-sale (POS) capability. Online POS systems enables secure credit card processing on your site, allowing you to keep the doors open 24/7.
2. Reach your niche market. Online sales lead generation and marketing tools excel at targeting interested consumers and businesses.
3. Communicate with your customers via online business networking tools, a blog, or social networking tools. Social media sites offer powerful resources for finding your needle in the haystack, also known as your niche customers and partners. They can also help you keep in touch; today’s customer service agents use online media such as twitter, facebook, tradeseam and email correspondence to connect with the public.
4. Need niche supplies or equipment to launch your niche business? Tradeseam connects entrepreneurs and suppliers of all stripes. You’ll find business resources including manufacturing companies, international suppliers, and everything under the sun online.
5. Web-based technology offers a range of resources for small business owners. Time-tracking software and online accounting programs are just two examples of today’s affordable, productivity-enhancing business tools.
6.The Internet offers the reach and low startup costs to support a niche business.
7. For many micropreneurs, the Eureka moment–the business idea–derives directly from a personal passion.
The following entrepreneurs built a following–and a profitable business–catering to like-minded individuals.
Specialty Food Carts
El Dorado tacos? Chow Fun to go? More and more specialty food carts are cruising urban neighborhoods, with offbeat menus to serve the random craving. Restaurant consultant Clark Wolf notes: “Mobile food is one of the hottest things going all over the country. Brooklyn has its ribs truck, Manhattan has its dessert trucks, and now Los Angeles has the cupcake patrol.”
Specialty food carts rely on social networking tools such as Twitter, Facebook to broadcast their coordinates. The strategy seems to work. L.A.’s Kogi taco truck draws between 300 and 800 by tweeting its location in advance, “setting off a taco-minded flash mob.”
Pedicab
A physically fit duo in Spokane, Washington has pedaled to success with a pedicab service. Cheaper and more eco-friendly than a cab, the bike-based taxi is finding no shortage of riders around the downtown area. To get the wheels rolling in your own leg-powered cab service, you’ll need pedicabs, licenses, insurance, and a local marketing campaign. Once you’ve gained a loyal ridership, you can establish a call center or online-based dispatch service linking riders to your mobile phone.
Guerilla Marketing Agency
Seattle businesses looking to make a unique statement can count on Wexley School for Girls to get the job done. The agency uses off-the-wall guerilla marketing stunts to build publicity for clients. For example, they created a buzz around Copper Mountain ski resort by staging a National Snow Day with improv ski-patrol actors and fake snow. The stunts aren’t for everyone; “either you get what Wexley is selling–a very particular sensibility and approach toward marketing–or you don’t,” comments an admirer. But the agency isn’t looking for mass appeal: “Wexley is biting off little pieces, looking to take on a particular niche of a business.”
Build your own businesses staging publicity events for businesses. Start with an eye-catching Website Design and online marketing campaign to get the word out. As the costs of running a business come down, micro-enterprises are flourishing. These small businesses focus on a loyal niche, taking advantage of online business networks to communicate with customers, source, distribute, and to manage the venture.
In today’s Internet-driven economy, it’s no longer necessary to chase the next big thing. A great small idea can take you even further.
Niki is an entrepreneur, business consultant and advisor to several small business entrepreneurs in the San Francisco bay area. She writes extensively on the small business blog and is a frequent contributor to several small business resource and networking sites that offer tools and resources for entrepreneurs and small business owners, including Tradeseam, Dell, Women On Business and Small Business Community.
Accounting Software Strengths
Easy to use by non accountants requiring no previous Accounting knowledge and is basically a list of sales and a list of purchases on preset excel spreadsheets. Each workbook is arranged as 12 monthly spreadsheets with preset columns and uses an entry code letter to analyse both sales and expenditure.
Cash and bank spreadsheets are included as optional extras for those businesses that require them with a built in automated bank reconciliation. The sheet is designed to be completed by copying the figures from the bank statement into the bank spreadsheet and the bank reconciliation is achieved by also entering the statement total which is automatically checked against the entries made.
Monthly profit and loss account also includes a financial health check based upon an automated tax forecast to enable businesses to monitor their financial performance. By entering drawings the package then compares the net profit made with the likely tax liability plus the drawings.
Quarterly vat returns are generated for vat registered business and is also suitable for non vat registered business. To produce a vat return clients simply go to the vat file and select the quarter end date from a drop down menu and the figures for the vat return are automatically generated.
The vat calculations can be disabled by non vat registered small businesses by simply changing the standard vat rate from 17.5 to zero making the accounting software suitable for both vat registered and non vat registered businesses.
The accounting package includes a stand alone sales invoice generator which requires invoices generated to be manually input into the sales sheet.
The fixed asset schedule is preset with the capital allowance tax rates to automatically calculate capital allowances when fixed assets are entered. Depreciation is also automatically calculated with preset percentages that can be changed as required.
A major benefit of using this small business bookkeeping software is the templates are arranged in such a way to automatically generate an excel copy of the self assessment tax return. The excel self assessment tax return is arranged in the same layout as the official inland revenue form with the same box numbers making it easy to copy the figures from one to the other for submission.
Accounting Software Weaknesses
The Self-employed Accounting Software UK is based upon single entry of transactions and does not produce a balance sheet which is an optional requirement for self employed and therefore not a problem for the vast majority of businesses. DIY Accounting actually recommend clients who are self employed and wish to produce a balance sheet to use their Limited Company accounts package which does produce a balance sheet being based not on single entry but on double entry principles. The small business accounting software is suitable for a single tax year, the latest being 2007-08 and does not cater for accounting periods other than April to April. There are benefits in anyone self employed adopting the standard April to April financial year as this avoids tax allowances from two separate years being a feature of the accounts. When used by small businesses using the cash accounting system the bookkeeping entries to the sales and purchase sheets must be entered according to the dates money is paid or received rather than the dates invoices were issued. At the end of the financial year any invoices not yet entered require to be listed to adjust the final profit and loss account figures. This a major disadvantage if using the vat cash accounting scheme rather than the Accounting Software being reviewed.
Very Low Priced
At £12.99 the accounting software is basically available for loose change and will save many businesses the need to employ an accountant potentially saving hundreds of pounds in professional fees. For the financial year 2008-09 the basic package for non vat registered business is available at just £11.99 and the standard accounting software for vat registered small business is £12.99.
Other Features
The product has a stock control feature to monitor any stock losses. The small business accounting software contains a wages interface that fully integrates the DIY Accounting Payroll Software when those files are saved into the same folder as the accounting software files. Being written on excel spreadsheets all transactions are visible and capable of being changed by for example overwriting any errors as opposed to a database system that requires new transactions to be entered to reverse previous entries. The sales and purchase spreadsheets include columns for entering CIS tax deductions and payments and the certificate numbers. The CIS tax being then automatically entered on the self assessment tax return. As the small business accounting software is written on excel spreadsheets then it is essential that users have a version of excel from 1998 onwards installed to use the program. The accounting software also works fine with an Open Source spreadsheet package.
Conclusion: to Buy or not to Buy
Exceptionally good value, very easy to use and produces exactly what every small business requires, automated accounts requiring no bookkeeping skills and no previous accounting experience with the valuable end product of a fully automated self assessment tax return.
Terry Cartwright qualified as a Chartered Management Accountant and Chartered Company Secretary in 1971. A successful business career followed as Head of Finance for major companies in the UK and several consultancy appointments. In 2006 he created DIY Accounting producing Accounting Software for self employed and small companies that use simple accounts spreadsheets to automate tax returns.
Running a payroll for larger organisations with full time accounting staff is easy. Full time professionals are employed or the payroll function may be outsourced to a payroll bureau. For the small business the payroll task often falls to the proprietor demanding even more time to familiarise with current payroll legislation and a not insignificant amount of administration time that could be better spent making profits than number crunching. For small business organisations with five to ten employees calculating the income tax and national insurance contributions in producing the weekly payroll can easily take an hour or more each week. An hour that could be better spent earning profits or at the very least having an extra hour of free time each week. Free time that every small business owner value at a premium since the majority of small business owners either work or think about work from dawn to dusk 7 days a week. A payroll software package to satisfy the PAYE requirements can be just one part of making that small business more efficient.
Small businesses that fail to operate a sound payroll system can produce a negative effect on the employees. The pay an employee receives is expected, often spent or spoken for on receipt and provided the amount is a competitive rate would only rarely have an effect on staff relations. However operating a Payroll system that does not provide each employee with a payslip is like telling your employee he has received a personal letter that was opened for him and discarded as not important. To the employee a payslip is very important. And so important in that every employer has a legal responsibility to provide each employee with a payslip and at the end of each year a P60 End of Year Employees Certificate. A Payroll Software package will satisfy both the legal requirement and the employee requirements. Failure to provide employees with payslips can only reduce the respect hat employee has for his employer. Every employee must receive a payslip that shows the amount of income tax and national insurance deducted from the gross pay. Every employer must also calculate the employer national insurance contribution. Employers not using a payroll software package such as available from DIY Accounting Payroll Software must design their own payslip to give to employees to satisfy legal requirements.
In the UK producing a weekly or monthly payroll can be a burdensome task to comply with the HMCE requirements. HMCE provide much expertise advice in this area both via their website and each year through the distribution of the Employers CD-Rom. To fully appreciate all the technicalities and complete all the correct documents such as the P11 Deductions Working sheet is time consuming. It does not have to be a problem. Payroll Software can automate this knowledge and functions and is available at insignificant cost. The DIY Accounting Payroll Software package is available for five to twenty employees at a cost of 15 to 25 pounds. That is a payroll software package that could save a small business over an hour a week, for twenty employees more like two hours, for less than 50p per week. All small business owners should at least consider suitable efficient payroll software.
Many payroll software packages are written using databases and can put many small business owners off using them due to both the cost and the fear of the unknown complexity of using such a payroll package. Many payroll software packages written on a database provide an excellent solution but have a tendency to be extremely politically correct and cover all potential rules and regulations and consequently become more complex to operate as they can demand at least a minimum knowledge of the payroll system. There are other PAYE solutions. The DIY Accounting Payroll Software is written on excel spreadsheets requiring no payroll experience and a minimum of entries to produce all the essential calculations of income tax and employees and employers national insurance. In addition excel copies of the time consuming P11 Deductions working sheet, P60 Employees Certificate and the P35 Annual Employers Return are all automated to save the small business valuable administration time.
A significant advantage of a payroll software system written on excel is that it can also be used with an open office spreadsheet package but not least all the entries are visible and therefore transparent. Errors and mistakes can be easily corrected simply by changing the numbers on the payroll ensuring the payroll is produced both quickly and accurately. Payroll Software is an effective tool that should receive serious consideration by all small business proprietors.
Payroll Software also has the advantage because it can be simple and fast to use of avoiding late payments to the revenue and the consequent unwanted letters and potential fines this can invoke. By having all the information required for the monthly or quarterly revenue payments late penalties can be avoided and by producing the Annual Employers return on time small business owners can submit their returns online and receive a tax free online filing bonus. The current online foiling bonus being 150 pounds and substantially more than the payroll software might have cost.
Terry Cartwright qualified as a Chartered Management Accountant and Chartered Company Secretary in 1971. A successful business career followed as Head of Finance for major companies in the UK and several consultancy appointments. In 2006 he created DIY Accounting producing Accounting Software for self employed and small companies that use simple accounts spreadsheets to automate tax returns.
The US Tax Code can be pretty rough on the self employed. It often seems to be written to favor big corporations over small and solo businesses. The rules are often complex and confusing for the average self employed individual to grasp, even with the help of an accountant. And that first paycheck can be a shock when you realize how much of it is eaten up by self employment taxes!
Even when tax breaks are available, figuring out if you qualify and then having all the right paperwork in place may make those deductions seem like they aren’t worth the hassle! For instance, if you have a home business, i.e. you work out of your house, you may be able to deduct for a ” home office” — but the requirements are strict, and can be a trigger for an unwelcome audit. Mileage reimbursement is a little more straightforward, until you realize you have to write down every trip, its’ length, who you met with and what you talked about! And not many new business owners even remember to keep track of startup expenses, much less understand how depreciation works, without the help of a good accountant.
There is one tax provision, however, that is clearly worth the trouble: a Section 105 Medical Reimbursement Plan. This can save you, quite literally, thousands of dollars a year. You must be married and able to legitimately employ your spouse at least part-time in your business in order to qualify. If you are and you can, read on — your heartburn over outrageous health insurance premiums and skyrocketing medical expenses may be about to go away!
Here’s the bottom line: with the requirements met and the proper paperwork in place, you can:
- Deduct 100% of your family health insurance premiums
- Deduct 100% uninsured family medical and dental expenses
- Save a huge chunk in federal, state, and self employment taxes!
How do you qualify? You must have a properly documented employment agreement with your spouse, and the work performed and salary must be reasonable. Complete records of the premiums and expenses and their reimbursement are required. Ugh, more paperwork…but help is on the way!
I’ve been very impressed with the BizPlan/AgriPlan Section 105 Medical Reimbursement Plan, offered by TASC (Total Administrative Services Corporation). Recommended by a colleague (who saves several thousand dollars every year with this plan), I’ve found TASC to be a very professional company that takes its obligations to its self employed customers very seriously, including offering a tax audit guarantee. And the annual cost is very reasonable, starting at under $200.
Don’t wait — you can only deduct expenses that occur in or after the month you apply for the plan. Consult your accountant, and check out BizPlan today, for maximum tax savings this year!