Create More Deductions with a Part Time Business!

Working from home has never been easier... NOR more essential, than it is today.

With 65% of American’s having already lost, or worried about losing, their jobs, the number of home based and small business start-ups has dramatically increased over the past several years. Some reports indicate an increase of as much as 12,000%!

Whether replacing income due to a job loss, or simply creating another income stream to provide greater financial stability, more and more American’s are getting the “entrepreneurial spirit” and launching their own business.

Financially it’s a smart move, since just starting a business increases your bottom line instantly. Why? Because owning your own business is the ultimate tax shelter.

“The No. 1 way to reduce your taxes is to convert your personal expenditures into allowable deductions. Turn yourself into a business owner. This is not complicated, expensive or difficult to do, and incorporation is not necessary.” Says Jeff Schneppe from MSN Money (more at: http://bit.ly/schnepper )

Just starting a (full OR part time) business produces, on average, about $10,000 in tax deductions out of money you already spend. Depending on your tax bracket, that is thousands added to your bottom line before you have even made any money in the business.

Do you like to travel?  It's easy to learn the IRS rules so that you can design travel around just enough business to make the trip tax deductible.  You'll still be able to "play" more than half the time and the work you DO do... will help you make more money down the road.

Do you like going out?  Make every visit to happy hour tax deductible.  Make every round of golf deductible.  The IRS rules make this simple, once you learn them, and how to document them properly.

Do you have an area you work at from home?  When you are self employed the rules for deducting part of your home, utilities, maintenance, etc., become very easy.  In fact there are NEW simplified rules for the home office deduction that took effect in 2013!

It's EASY to increase your deductions, and your "take home pay." by creating a part time business! The key is to find the business that is right for you, and to “fill in the gaps” in your skill set to increase your success level.

Any successful business is like a 3-legged stool." 

says Sue Copening, Director of Central Florida's

Connections Groups.

“One leg is your product or service, the 2nd is your marketing and the 3rd is management, which includes financial management and educating yourself on the tax deductions avail to you as a business person.

All three legs need to be strong, for obvious reasons. No matter how great your product or service is, you must market effectively in order to get it in front of potential clients. On the management side, taxes can eat up 20-40% of your gross income, so it’s essential to take every deduction you are entitled to.  Learning about the deductions that apply to small business owners means you can turn some otherwise personal expenses (such as entertainment, travel or a home office) into legitimate, deductible, business expenses.”

The great thing is… this IS truly the best time to be starting your own business. The internet is right at your finger tips and is a huge resource for everything you need to get started.... from knowledge & learning resources to avenues for marketing your business.

Want some ideas for what kind of business to start? Try “Googling” a phrase like “best business ideas” and you’ll come up with articles like this one in Entrepreneur.com: “Need a Business Idea? Here are 55” (at http://bit.ly/bizideas )

Think your favorite hobby could be a good business? Make sure you are thinking of all the angles by googling “turning your hobby into a business” and you’ll turn up this article in StartUpNation.com: http://bit.ly/hobby

If you have start up capital you might look at a franchise or even purchasing or buying into an existing business. While this can be riskier, the trick is to fully investigate, choose wisely and use an experienced attorney. It’s a business, so don’t get emotionally attached, and be ready to walk away if there are too many “red flags.” That said though, there are many successful business owners that want to retire at some point and are often willing to stay on at the business for a period of time to assist the new owner with the transition and help introduce you to their valued clients.   If you don't have the capital to outright purchase their business, you could approach them about a partnership for a few years with the goal being to buy them out down the road.

If you don’t have much start up capital, consider becoming part of an MLM or direct sales company. The advantages to that are that you step into a “turn key” business where you are generally provided with low cost marketing materials, a product (or products) that may have a proven track record of sales, and the ability to create “passive” or residual income by building a team and bringing others into the business also. Don’t get caught up in a company’s “hype” though. Use common sense and a check-list when evaluating each opportunity.

I want to see several things with 

any business opportunity I look at. 

Whether it's an MLM, a direct sales opportunity, or even a job offer...

First off, let me clear this up... an "mlm" (multi-level marketing organization) is a perfectly legitimate business model, however, you must know how to analyze one correctly.  An "mlm" has it's benefits, and it's faults...

Benefits...

1) Low cost to start your business
2) Turn-key system, marketing materials and products provided
3) Once you build a "team," and have a solid residual income coming in, you will make money even when you aren't working (I once made over $6000 for the two weeks I was on vacation).

Faults...

1) No matter what they tell you... ALL businesses involve SALES in some regard.  If you are afraid to pick up the phone and call people, or ask for the sale, you will not enjoy it and, mostly likely, will not be successful.
2) A company can be a "legitimate" mlm, but still function like a "pyramid scheme."  What do I mean by that?  I mean that if the products don't "stand on their own merits" - if people are ONLY buying the product or service because their motivation is really to be "in the business" then, once the company reaches "saturation" it because very difficult to bring new people into the business and the whole thing crumbles from the bottom up because people start dropping their auto-ships.  On the flip side, if the products are strong - and people would buy them anyway - you always have a legitimate sales opportunity and, while you might never become wealthy, you can still bring in a steady and reliable income, which is what the vast majority of us are really looking for.

SO, if it’s an MLM I want to know where the money comes from. Is the majority of it from sales of the products and what percentage of the products are sold to consumers versus the companies own reps or agents?  A good mlm should have a strong percentage of "consumers" that are NOT in it for the "business aspect."  This is sometimes hard to tell, because a lot of people will pay the small amount of money it takes to become an "IBO" (independent business owner) just because they want to get the products wholesale.   So you need to talk to people and also ask yourself... "would I, or anyone, buy these products regardless of where I had to buy them?"

I want to know the products either have long term success, or the potential for it. How are they priced compared to their competition? If the products are low priced... are they a consumable?  Do they SAVE people money or cost them money? Is there a lot of competition? Is the market for the product oversaturated? What is the ‘market reach’ for the product or service? In other words, out of 100 random people, how many are good prospects?

What does the company charge to get into the business and are there mandatory monthly fees or a requirement to buy product? What will your marketing costs be? Will it be necessary to spend a lot of money on samples?

If there is a monthly auto-ship do NOT get into the company unless you absolutely love the products - the reason "mlm's" have a bad name is a direct result of garages stacked high with products bought by people who fell for the "hype" of the 'business' and not the actual product.   If someone is trying to get you to sign up and they are focused on the money - and say something like "don't worry about the product - its incidental" - RUN, don't walk, to the nearest exit.  Just my opinion, but a company without a product is not a real company - it's no more than a "pyramid scheme" that has figured out how to be "legal."

What does the compensation plan look like? Realistically, how long will it be before you make decent money, keeping in mind that it’s an 80/20 world out there and, generally speaking, less than 20% of your new reps will “stick to” the business aspect (which is why you want a good mix of "consumers" and "business builders").

Finally, how does this particular product or service “fit” with your other business, career or lifestyle? For instance, if I’m an out of shape couch potato, selling a nutritional or fitness product would be a challenge, but if I work in heathcare, or I'm “gym rat,” I’m already in a “target rich” environment surrounded by many people who will be receptive.”

What companies does Sue Copening, of Connections Groups recommend right now?   Qivana and Worth Unlimited.  Qivana is a mlm - Worth Unlimited is not - but IS a "direct selling" company.  I'm sure there are other solid companies out there... do your research!

Important TIP:  Make sure you have personal PASSION about what you do so that talking about it comes naturally.

Worth is a program we recommend to our clients who want to get out of debt and become better financial managers.  It's great for insuring you have a firm financial footing, both personally, and for your business.

Worth is an award winning software and coaching system that helps their average client get debt free in about 1/3 of the normal time... and saving over $100,000 in the process. 

As a "business" while Worth is not something that is appropriate for everyone.  It is perfect for anyone in a business where they talk to clients about money, debt, real estate, credit or finance.  For them, it simply becomes something they refer a client to and step away.  The company does a detailed financial analysis (free of charge) to determine what clients will benefit from the program, and if they are ready to move forward, the company gets them set up and simply sends the referring party a "referral fee / commission" for simply suggesting the client take a look at it.

Now... what OTHER things should YOU look for in a business?

Consider...  How will you "market" your product? It better be in a way that you enjoy... because you'll want to spend a good amount of time doing it. If you enjoy playing golf, consider selling promotional golf products.  If you work out, enjoy sports, or work in health care - then obviously a health related product is a good fit.  Don't do something that is "counter-intuitive" to your natural lifestyle!

You need good sales and communication skills in ANY business. Consider joining a group like “Toastmasters” (http://www.toastmasters.org ) where you will learn and get support from other members as you improve your speaking, communication, persuasion skills and body language. As you develop your skills you have the added benefit of building new business relationships with the other members (any environment, event or social gathering is an opportunity to “network” for your business too!).

Design a solid marketing plan for your business. How many phone calls will you make each day? How many face-to-face events will you want to attend each week? WHO are your customers? How can you most effectively get in front of them? How will you market on the internet? What about the new “social media” craze? How is your time best spent? For your business, will it be “Twitter” or “Fritter?” Educate yourself on marketing strategies for small business through books (public library) and the internet (new technologies) and “target” your market like you’re using a laser scope, not a shotgun.

"Network like a Rock Star!"  Join networking groups, associations and “get out there” and meet people. An event doesn’t have to be a business event to be a good networking environment. Depending on what you do, events like (for instance) a charity golf tournament might be the ideal way to meet new clients. Think about who will be there. A charity golf tournament is usually attended by business men, but not just any business men, because they are usually held during a week day meaning the players are generally decision makers, owners or executives. If your product or service fits this demographic… buy a ticket to play… or just to attend the luncheon or dinner portion.

Networking groups are a great way to hone your presentation skills, refine your “elevator speech” (a 10-30 second introduction of your business), and develop long term, mutually beneficial, business relationships. Keep in mind the key is to develop relationships, not “sell” at the event. It’s a “Kevin Bacon” world… “6 degrees of separation” …everyone knows everyone. While “Bob” might not be a good prospect for your product or service, Bob knows lots of people and some of them will be.

To find networking groups just google/search for “business networking” and your city name. If you are in Central Florida, your first stop is Connections Groups where you can set up a free profile for yourself and check the calendar of events.

In closing… the opportunities, possibilities and resources for those wanting to start a part or full time business have never been better than they are right now and, depending on the length of time we will be facing a challenging economy, there has never been a time when starting that new business, or income stream, is more necessary or helpful.

I personally believe that you only need to know two basic things to be successful in business...

1) The first thing you need to know is that you don't know everything (self-assessment is critical - figure out what you don't know).

2) The second is that whatever you DON'T know... you can teach yourself, or learn from those that have gone before. And... a lot of that knowledge can be picked up for free from your local public library and the internet."

So get going… start reading… googling… learning and planning.

"Go for the moon. If you don't get there, you'll still land among the stars.” …Willis Reed