Create an operations manual. It’s probably business advice you’ve heard on more than one occasion. If you’re like most solopreneurs, it’s one of the things you skip — maybe because admin tasks just aren’t what you got into business for, or perhaps because you’re not sure what it is or why you need one.
We’re going to fix that today. Even if you’re just starting out, you can benefit from creating an operations manual! Let’s start at the beginning…
What is an operations manual?
Think back to the last time you started a job. You probably received a company handbook. That handbook laid out the company’s mission, rules, and procedures. They’re a required read to learn about the company’s expectations for you as an employee.
That document was the company’s operations manual. They built it over time as the company grew, likely adding to it as they found information they need to reference and relay to other people. It helps ensure the people they hire know what to expect and do while at work.
Even if you’re a one-woman show today, an operations manual can save you time, money, and headaches down the line.
Why create an operations manual for your solopreneur business?
There are a few reasons an operations manual might be a wise addition to your solo business.
1. Increase productivity. As your business grows, you’ll find your responsibilities do, too. Keeping track of every task you need to do will become impossible if your brain is your only storage system. You’ll inevitably start to miss steps in tasks you do on a regular basis. You’ll spend hours looking for a document because you don’t remember where you saved it. Soon you’ll find you’re spending more time fixing mistakes than moving on to the next task. Creating an operations manual will ensure you never miss a task or a step to complete things, saving you time and unnecessary stress.
2. Get organized. Organization should be a top priority as your business grows. It’s inefficient to have the tools you need to run your business scattered across a variety of platforms, apps, and devices. You end up wasting precious time trying to remember where the thing you need is, then searching for it across all the places you use for storage. By creating an operations manual, you build a central hub where things are all in one place and easily accessible.
Prepare to grow. Your business goals include growth right? While growth comes in many forms, many times it means bringing people on to help you. These people could be employees, freelancers, or collaboration partners. An operations manual will help you bring them up to speed quickly on what your business is about and how you run it, saving time (and money) in the onboarding process.
Your operations manual can be as simple or as robust as you’d like. There’s no right or wrong answer here. Keep this in mind, though: As your business continues to grow, it is much easier to implement new ideas if there is already a record of how things are currently done.
I know getting started can be hard so I’ve put together a few suggestions to help you out:
The options for items to include in your operations manual are endless. Decide what’s important to keep your business running in top form and put it in your manual.
Where to create your operations manual
I recommend creating your operations manual in a system you already use. I like to access my operations manual from anywhere, so I built mine in Trello. You might find Google Drive, Evernote, Asana, or some other system works better for your business. If you prefer to use a non-electronic operations manual, a binder with dividers is easy to update and copy.
Start building yours today
If your business plan includes growth, it’s never too early to start creating an operations manual. Next time you write and upload a blog post, for example? Take note of all the steps you take. It may seem like a lot of work, but an extra hour or two now can save time in the long run — and who doesn’t love saving time?
Your days, back in your hands.
Get instant access to 5 Days to Reclaiming Your Time, a free email course with the mindset shifts + action steps you need to get started in reframing your relationship with time. Sign up below!
Success! Check your email to confirm your subscription 🙂
When you’re running your own gig, email is a blessing and a curse. On the one hand, it’s rapidly becoming the next voicemail — nobody wants to look at it, it’s clumsy to use, and for God’s sake, why don’t you just text? And in light of the 205 billion+ emails sent every day, it makes sense that Inbox Zero is a thing (that deserves caps).
But on the other hand, you need to be in contact with your clients, prospects, contractors, and anyone else who helps keep your business world spinning.
What most small business owners don’t realize is that you have so much more control over the amount of email you get than you think. In fact, if you’re getting overrun with emails, chances are it’s mostly your own fault.
So how can you get people to email you less, while still being able to keep up with everything you need to keep up with? It’s all about boundaries + clarity.
If you don’t want people to email you, don’t set up situations where they feel invited to do so.
For instance, if you’re routinely asking for responses in the emails you send out, you’re going to get emails back. If you’re really open and casual on your social channels, people are going to feel more comfortable getting in touch out of the blue. If you’re sharing vulnerable stuff in your blog posts, chances are you’re going to get people with that same flavor of vulnerability emailing you and sharing their experiences.
But to keep it from becoming overwhelming, you need to have some solid boundaries in place, and you need to give people a way to connect with you without getting all up in your inbox.
The first thing to do is to implicitly and explicitly state your boundaries. Take a look at the way you’re connecting with people. Are you being a little too open? Do you need to dial it back a little bit, become a little less accessible?
Think about ways that you can (nicely) discourage people from sending you emails. For instance, putting something as simple as “We love design. We hate long emails. Keep it short and sweet and we’ll love you, too!” can make a world of difference.
Finally, think ahead about how people are going to want to connect with you, and give them an outlet to do so that doesn’t involve email. This means making sure your social media pages are up and active, your blog’s comments section is working, etc., and directing them to those places with a pre-written email. (More on that in a sec.)
Clients who get email-clingy typically do so because you haven’t shown them that they can trust you to lead this process. The way to avoid this is to set expectations up front, to watch your language, and to make yourself explicitly clear in every single email. (Sensing a theme here?)
When people first start working with you, make it clear what your hours are and your policies for responding to emails. It doesn’t have to come across as rude or standoff-ish — you can easily keep this in line with your branding. For instance, in my client onboarding guide, I have a section about email that says:
“We don’t spend all day watching the inbox because quite frankly, we’ve got better things to do. (Like writing your copy.) So don’t freak out if we don’t get back to you in seconds — you’ll always get a reply within 24 hours on weekdays.”
When you do have email correspondence with clients, keep up that leadership tone by avoiding hesitance, jargon, and uncertainty. Watch out for phrases like “I just…”, “Sorry to bother you…”, or “I think I might…” — all of which imply that you’re uncertain, which makes them feel like they have to lead. If you really struggle with this, here’s a great free app to help you out.
Finally, use the last sentence of your email to explicitly state what you’re going to do, what’s going to happen next, or what you want them to do. This way there’s a clear structure, you can easily refer back to it if they still manage to get confused, and they’re not left wondering whether they need to check in with you.
When it comes to contractors + coworkers…
The same thing applies in terms of setting expectations and watching your language, but the issue of clarity becomes even more important. Nobody wants to get caught up in a long email chain, so clarify your expectations up front — everything from expected response times to CC etiquette to what to do in an emergency — and then stick with it.
When you do sit down to write an email, pause for just a second before you start typing and make sure you’re clear on why you’re actually sending the email. Do you need information, and if so, what specifically? Are you looking for a decision, and if so, does the person on the other end have all the info they need to give it to you? Does this actually need a response at all? You’d be surprised at how many emails you can adequately respond to with a simple “Got it — thanks! EOM” in the subject line.
Finally, you can avoid loads of back and forth with some simple, pre-written emails.
To avoid getting sucked into endless email chains, have a think about the types of questions prospects, clients, and contractors tend to email you about repeatedly. Then, pre-write emails in response to them, leaving blanks for the name and the specifics, and save them in drafts or load them into a tool like Gmail’s Canned Responses.
This includes things like answers to common questions about what you do, “I’ll get back to you with a quote in 24 hours” emails, emails with your scheduling link, emails encouraging people to share on your social media or comments sections instead of via email, and responses both accepting and declining guest posting/product reviews/speaking opportunities. Then, when you do get inquiries, just mad-lib your way through your templates and you’re good to go.
Remember: boundaries + clarity = happier clients + contractors + way fewer emails for you. (And that means way more time to actually run your business.) Win, win, and win.
Streamline more. Stress less.
Drop your email below to get even more great content on productivity, automation, and streamlining your solo business!
Success! Check your email to confirm your subscription.
Let’s not beat around the bush: There seems to be a myth amongst One Woman Shops that it’s shameful to take on part-time or full-time work for someone else when they’re working to build their solo business.
The feelings that come up: shame; embarrassment; failure. After all, how can you call yourself a business owner if your business isn’t fully supporting you?
Excuse us while we clear our throats — as it turns out, we happen to have a lot to say about that.
Issue #1: That’s a whole lot of all-or-nothing thinking going on.
It’s not black or white. It’s not stop or go. And it’s certainly not all or nothing.
The author Barbara Kingsolver writes acclaimed novels, grows her own vegetables, runs a local co-op, and holds classes on farming out of her backyard. Do those “extracurriculars” make her any less of an author? No.
Just like babysitting, tutoring, tending bar, or any number of bridge jobs you might take on will not make you any less of a business owner, so long as you keep putting time into building your brand.
And the “gurus” who tell you that you have to be 110% committed or you’re not a “real” business owner? We happen to like Coach Jennie’s response to that one, after falling for that advice: “these all-or-nothing thinking gurus weren’t responsible for my rent.”
Issue #2: Working from a place of financial stress simply isn’t effective.
While we can come up with several reasons for a bridge job (and we share them, below), the biggest reason is because a solo business owner may find herself financially stressed.
And here’s what we see in our coaching clients, members, and community when they’re coming from a place of financial burden: desperation (that their audience can “smell”). Hasty decisions. Getting away from their values or what they’re truly aiming for.
What ends up happening is that they build a business for short-term gains instead of long-term appeal. This is through no fault of their own — when there are bills to pay, mouths to feed, and responsibilities, those short-term gains are necessary.
But they aren’t ideal for building a business that will fuel you for a long time to come — especially one where you’d like some semblance of solopreneur sanity.
Here’s what we mean when we’re talking about bridge jobs: a job that gives you financial stability while you build your solo business.
A bridge job is literally anything that brings that financial stability — from pouring wine tastings (Sara) to catering for a pizza restaurant (Cristina) to babysitting (both) and everything in between. There’s no shortage of bridge jobs out there.
What a bridge job allows for
Financial stability: We like to think of it as a comfy cushion. When you’re working from a place of financial comfort, you’re empowered with the confidence to take risks, fail faster, and reiterate. You have room to experiment. To work with people how you want to, not just in the way that will make you the most money. Maybe you just want money to put into your business? A bridge job can provide the money to invest in that new website.
Structure: Have you ever heard the adage, “If you want something done, ask a busy person?” As it turns out, most of us work better with structure. I (Sara) can speak from experience on this one: When building my business as a side hustle in addition to my full-time job, I was amazingly productive in the ~10 hours/week I devoted to it. Once I had my days wide open after quitting that full-time gig? Productivity became a tug of war. So if you’re worried about a bridge job taking away precious time, remember this: You can do big things with just 5, 10, or 15 hours a week.
Community: Depending on the role, a bridge job will introduce you to people who might end up as readers, followers, customers, clients, or collaborators in your solo business. And if the people themselves aren’t ideal partners in any way, shape, or form, let them serve as inspiration. (I’ve often considered becoming a bartender just for the appreciation of the stories I’d be sure to hear.)
Learning: Getting paid to learn might be one of the best feelings, ever. And if you go into your bridge job with this attitude, there’s no shortage of things you can learn. Learn from your boss; learn from your fellow employees; learn from the situation. I learned to upsell while pouring wine samples; Cristina learned the importance of connecting with potential clients and customers on shared interests. Keep an open mind.
Bridge jobs for building businesses
Whether you’re just starting out, or you’ve been in business for a while but just aren’t there yet, there is absolutely no shame in taking on a bridge job that helps you reach your long-term goals and build the business you want to run.
Businesses take time. “Overnight successes” more often take 10 years than they do one day.
We don’t share any of this to discourage — we certainly are not saying that you can’t take the leap from your full-time job tomorrow or stay away from “the man” forevermore. We share this because we’ve seen all sorts of business situations amongst our community and members, and, it takes most (us included!) a long time to become both profitable and sustainable. In fact, had we been in this solely for the money, One Woman Shop likely would’ve folded by now. (#truth) We’re fueled by our passion, our belief in what we’re doing, and the progress we’ve seen so far in helping other One Woman Shops.
You are in this for the long haul, right?
Tell us: What fears creep up for you when it comes to the idea of a bridge job to ease your financial situation? Remember: There’s no shame here!
For our business to grow, we have to continually educate ourselves on all the things we have to do, both in and on our company. In fact, when I quit my job to work full time for myself, I quickly learned that my accounting degree wouldn’t be enough.
I knew I had to invest in nontraditional education beyond the blog posts I was reading and the podcasts I was listening to. It was time to look at paid webinars, courses, classes, and books to help fill in any gaps my formal business degree left.
At some point, however, I became a “content consumer.” Similar to a “professional student,” I was taking every course and attending every workshop I thought would help make my business better.
I love learning new things but I was forgetting the most valuable piece of the puzzle: the actual implementation.
Since then, I’ve learned that I need to measure the return on investment (ROI) before I make a purchase on any new educational material that I come across, taking some time to work out the numbers and evaluate how quickly I can earn my costs back. (Yes, your purchase will be tax deductible — we’ll talk about that in a minute — but spending money you don’t need to is not good for your cash flow, either.)
Here’s how I do it, and how you can do the same.
Measuring the ROI of business development content purchases
Good news: You don’t have to be a mathematician to calculate a rough ROI on your course purchases.
Here’s what’s important: Having a roadmap to know where you’re headed no matter what concepts you’re studying. Nothing is random, and everything has a purpose. Creating ROI goals and meticulously tracking them gives you some accountability to yourself and helps you understand what it would take to recoup the cost of the purchase.
Here are the questions I ask myself before purchasing:
What does it cost?
What do I want to accomplish from this investment?
If I implement what I’ve learned from the material, can I create new paid content from it or increase my prices? If so, how much do I have the potential to make, based on my goals?
How does what I learn from this course or workshop enable me to build a more profitable, more efficient business?
Here are a few examples of how I consider the cost versus what I want to accomplish from learning:
If I have to decide on purchasing a $99 course on creating the best Instagram strategy, I set a follower goal for my Instagram account and then a revenue goal based on conversion rates.
If I purchase a $799 course on creating courses, I’d set a revenue goal to earn 3-5 times the cost before I buy it. This way, even if I fall short of the exact goal, I will have at least made my investment back.
Having a solid roadmap for how you’ll use the product/course to implement change in your business is key to knowing whether it will produce an ROI that makes it worth the investment.
Conference ticket registration fees (separate from hotel, flights, and rental cars, which are categorized under travel)
….and any other training and development material you purchase. If you’re conflicted on whether it falls under Business Development or a different category, reach out to an accountant who can steer you in the right direction.
Advanced note: If you’re a sole proprietor or a single-member LLC using a Schedule C on your personal tax return, business development expenses will be listed under “other expenses.” (It’s line 27 in the latest IRS edition.)
Get your books in order
Set yourself up to record your next professional development purchase now:
Open your favorite system you use to keep track of your expenses — a spreadsheet, Evernote, accounting software, etc.
In this category will go any content you’ve purchased from the categories listed above. Locate your receipts and keep them together. Be sure to take all physical receipts, scanning them in for backup and safekeeping so that at the end of the year, you’re not scrambling to pull information together or organize the shoebox.
When tax time comes around, be sure to include these expenses to help reduce your taxable income.
Measure ROI and record tax deductions on educational material: a better approach to learning
With a solid estimate of ROI before you’ve purchased a course and an understanding of how to record that income to maximize your tax return, you’re much better equipped to avoid becoming a “content consumer” and instead using your learning to truly better your business.
Starting a business can feel confusing, and can quickly become overwhelming. For some, a business plan is the solution to all these problems.
I have to agree that, on paper, it does sound pretty good. But I’m here to warn you: A business plan is not always what you should worry about when you’re ready to embark on the entrepreneurial journey.
Back in my corporate days, I worked on more business plans that I’d dare to admit, and let me be brutally honest: they all ended up in a drawer, never to be used again.
You do need some sort of plan, though, so let’s jump right into why a business plan might be the last thing you need, and what can you do instead to set up your shop for success.
Why having a business plan is the last thing you should worry about
1. Things never go as planned (and it’s perfectly okay)
A business plan assumes that you know things that you don’t know yet — and that no one expects you to know yet.
It can feel a little like writing a travel diary before you’ve actually been on your holiday: you can guess what places you’ll be visiting and the food you’ll be eating, but you have no real idea of what the journey is actually going to be made of.
2. There’s no room for experimentation
Business plans have a very ”set in stone” tone, when in reality starting a business is more about making the best possible hypothesis (on your product, your prices, your audience), getting out there and testing it out, and then re-assessing and changing direction if needed. It’s all trial-and-error.
3. You’re a one woman shop, not a board of directors
Corporate business plans include things like loss and profit planning, key personnel to hire, and other metrics aimed at appealing investors, and creating consensus amongst all directors.
As a solopreneur who likely isn’t trying to appeal to investors or a board, any plan that you have should be customized for your situation. It has to be written for you, by you, and with your own words. Not for a bank; not for a board of directors.
Where does that leave us? We know that business plans can be a waste of time for solopreneurs. But, no plan at all is a five-star recipe for disaster. I have an idea.
The better alternative to a business plan for solopreneurs
Rather than a business plan, create a workflow that will allow you to focus on what’s important. Something that:
Makes sense for where you’re at in with your business;
Is actionable and revisable;
Won’t let you quit
Here are some ideas:
1. Use the “3×4 makes 12” rule
As a solopreneur, you wear two very different hats: the boss hat, and the employee hat. But it’s not always easy to know when to work for your business and when to work on your business. Hence, the 3×4 makes 12 rule — or, how to grow and reach your yearly goals.
12: Once a year, write down your objectives. This will take time, but it is crucial. Be as specific as possible. If one of your objectives is to increase your sales, note by how much? If you want to grow your email list: How many subscribers do you want to reach by the end of this 12-month period?
3×4: Every 3 months (so 4 times per year) look at your 12-month goals and ask yourself: What do I need to do in the next 3 months to get closer? This quarterly assessment allow you to stay focused on your yearly goals, while making room for experimentation.
Once you have your 3-month plan (based on your 12-month plan), break down your objectives into small, actionable tasks organized by priority, and focus on doing.
2. Focus on what matters, not on what will matter a year from now
If you want to make progress in your business, you have to prioritize. It’s tempting to work on everything at once, especially in the early stages.
But the truth is: You don’t need to spend four hours on social media per day, while building your products, while setting up paid traffic campaigns, while trying to designing your website, while doing client work or fulfilling orders, while producing regular content. (Editor’s note:We promote sanity around these parts, not craziness!)
To avoid the frenziness, take a step back and ask yourself: What is important right now? Don’t get ahead of yourself and keep it simple: one little, but meaningful, step at a time.
The path to a profitable and successful shop is a different journey for every business. The key to doing what’s important right now is knowing what phase of business you’re in, and doing what makes sense in that spot. I’ve outlined a few stages and some ideas of what’s important in each, below.
The direction stage sets the base. By doing some research and strategic thinking from the get-go, you can be confident that what you build upon it will have a solid foundation.
The things you want to focus on here are defining your target market, business mission, vision and values. This is also a great time to take a look at the competition and understand your business landscape: are there any influencers or trends to know about? Finally, this is the time to evaluate your product idea before you dive in and create it.
This is the time to register your business, make sure you’ve got your legal basics covered, and set up a system for managing your finances.
This is also a great time to get a basic brand identity and website together. This can be tricky because it’s easy to get caught up in it and spend hours and money on more than you need right now. My advice? Start small. You’ll have plenty of time to expand this later on.
A basic visual identity with a logo, a color palette, and a couple of fonts is enough to streamline your brand without necessitating too much time and money. Same goes for your website.
Finally, this is the stage to package up your services or, if you are selling physical products, create a minimum viable product and price it.
This stage is about bringing qualified traffic to your site, marketing your products, and getting a few sales in.
Bringing traffic to your site and marketing your products can be done in many different ways. Using the customer research you’ve done in the first stage, pick the channels that are the most likely to bring qualified traffic to your site.
This stage is the hardest because it’s easy to feel like you have to do all.of.the.things at once. To prevent this, remember the 3×4 rule and pick only a few channels to focus exclusively on for three months at a time. Four times a year, re-assess.
Additional note: It’s normal for this stage to take a lot of time. Remember to re-assess every three months and stay focused, and don’t be afraid to experiment.
This, solopreneur, is where you’ll likely spent most of your business life once you’ve successfully set up shop through the first three phases. With traffic and a few sales, it’s time to tweak and improve what you’ve built, in order to improve your sales and your following, and to diversify your offering.
All these fancy or more complex things that you probably wanted to do right from the start (like playing with more social media networks than any normal human being can handle, testing and improving your conversion rate, and beta testing new products) finally make sense now.
Your support system
Yes, you need to pick a direction, have a vision, and build an action plan around it. But you don’t have to have a formal business plan. Knowing where you’re at in business and creating a plan that allows you to stay focused on what matters trumps a formal business plan any day.
We have a problem in the online business community: too much planning and not enough doing.
In an attempt to avoid being another wantrepreneur dreamer with big ideas and little action, many new business owners are diving head first into their work without taking the time to put together some thoughtful strategy.
While the advice to “start before you’re ready” is on point, you can get started in a smart way that allows you to set yourself up for success from the start.
A combination of planning and systems implementation will save you hours of heartache in the long run.
1. Get clear on your business model
The first, big-picture thing you should do, before planning out any systems or tools, is to get clarity on what kind of business you want to have.
Short-term, you may be focusing on 1-on-1 freelance work, and nothing else, which is fine.
But if you’re wanting to evolve quickly from a 1-on-1 model to an agency model or a products and courses model, you need to plan accordingly.
Map out your one-year plan, then set up the following systems with the long-term goal in mind. It will minimize the number of changes you’ll need to make as your business evolves.
2. Map out your project workflows
The next thing you should do is put together a rough outline of what tasks you’ll be doing, and in what order, to complete your work. For example, if you’re a copywriter, you may have the following workflow:
1. New client intake
2. Create first drafts
3. 30-minute client feedback call
4. Create second drafts
5. Final client approval
6. Finalize drafts
7. Copy delivery
8. Client offboarding
Now your initial reaction may be, “but why? I know I have to do that anyway.” And it does seem like something that’s easy to handle…at first. But as you get deeper into projects, it will be easy to forget exactly which stage you are in for each client.
In an interesting research study, a checklist system, inspired by the one pilots use before each flight, was introduced to hospital surgeons. Many surgeons were against the idea of being forced to use a checklist to do something they were experts at. The results, however, surprised them, and the researchers found that being forced to use the checklist brought the hospital consistently better surgery results.
When the 20% of surgeons who remained opposed to using a checklist by the end of the study were asked if they would like a doctor to use a checklist when operating on them, 94% responded yes.
So even if you don’t believe the checklist will help you, outlining your workflow for the client can give them peace of mind that you have a process they can rely on to get their deliverable. It’s a win-win.
In addition to delivering a good product in a timely manner, making your client feel taken care of from the minute they apply for a discovery call is a surefire way to ensure a smooth experience that results in testimonials and referrals.
Have you ever started work with someone only to have them forget to send you all the things they said they would — notes from your intake call, a contract, your invoice, information about how to schedule another call…?
It’s both maddening and disconcerting, because you’re not quite sure if this person knows what they’re doing.
Be certain you have processes in place for client onboarding that includes a welcome pack with:
Set aside a few hours in one block at the beginning or end of the month to create and schedule your social media, either natively within the platform (like Facebook) or with the free version of a tool like Hootsuite.
Now, instead of getting bogged down in an endless cycle of daily social media, you take care of it in one day and just check in and respond to messages throughout the month!
If engaging in Facebook groups is on your marketing to-do list, set aside one to three 1-hour long blocks each week to check in and offer advice or feedback to others. Put it on your schedule so that it’s an appointment, not just something to get around to when you’re bored, and you’ll treat it like a real marketing task instead of a time suck.
5. Schedule time away from your business
That’s right, the best system you can implement in your business at the start is one for self-care and balance. The 80-hour weeks can be necessary at times, but time to recharge is always necessary.
Your turn: What do you think you need to make your business successful from the start?
Congratulations! You decided to leave your 9-to-5 job to open your one woman shop. But, unlike a corporate job, solopreneurship doesn’t include a formal orientation with Human Resources. (Which were pretty boring anyway, right?)
So today, I’m going to answer your questions about solopreneur retirement options — because being on your own means shouldering the weight of setting up your retirement options. Even so, it doesn’t have to be draining. To make it more enticing? Take my view and think of it in terms of your “financial independence.”
The best definition I’ve read of financial independence comes from Matt Becker of Mom and Dad Money (he’s also a fee-only financial planner). He defines financial independence as “The freedom to make decisions based on what makes you happy instead of what makes you money.”
When you’re financially independent, you can choose to spend more time with your family, travel, or volunteer. You can choose when to work, and how you work. Unlike your 9-to-5, it’s all up to you. But unlike your 9-to-5, you’ve got some decisions to make. Let’s begin.
What do I do with an old 401(k) or 403(b)?
One of the first questions I get from solo business owners, or anyone who’s changed jobs for that matter, is what to do with their old 401(k) or other company-sponsored retirement plan. As tempting as it may be to cash out and use the funds to grow your new business, I wouldn’t go that route. Yes, investing in your business is a good idea, but there are additional taxes and penalties for tapping into your 401(k) before age 59½. An early distribution will generally be subject to both ordinary income taxes and a 10% early withdrawal penalty. Plus, you lose future tax-advantaged growth.
You have three good options when it comes to your old 401(k), 403(b), or other company-sponsored retirement plan: do nothing, roll the funds over to a Traditional IRA, or roll the funds into a solo retirement account. Let’s explore those options:
1. Do nothing and keep the funds in your prior employer’s retirement plan
Pros: This is the easiest option, but if your account balance is less than $5,000, you might be forced into taking action. Additionally, you may have access to certain investments (think institutional funds with potentially lower expenses) that might not be available outside of this retirement account.
Cons: You’re limited to the investment options chosen by your employer. Additionally, you’ll be unable to make additional contributions. If you can still make contributions, they’ll be restricted.
2. Roll the funds over to a Traditional IRA
Pros: You typically have access to a wider range of investment options, including mutual funds and ETFs (exchange-traded funds) as well as individual stocks, CDs (certificates of deposit), and bonds. Additional contributions are allowed and you have the option to move assets to a future employer’s plan. In addition, if you already have a Traditional IRA, all of your retirement assets will be in one place.
Cons: You can’t take a loan, but I wouldn’t recommend a 401(k) loan even if you had the ability to take it. Also, certain 401(k) investments may not be available.
3. Roll the funds into a solo retirement account like a solo 401(k) or SEP IRA
Pros: You can make contributions — and employer contributions are considered business expenses. Loans may be allowed.
Cons: Potentially limited investment options. This isn’t so much of a con, but a consideration. Depending on your solo retirement account type and size, you’ll need to file forms with the IRS.
Another consideration to make note of: If you rollover to a SEP IRA and hire employees in the future, you’ll have to contribute to the SEP IRA on their behalf if you also contribute for yourself.
Whichever route you take, pay attention to the fees and expenses associated with your old and new retirement accounts. Sometimes it makes sense to keep your money in your old retirement plan if the fees and expenses are much lower than a new retirement account.
Additionally, if you plan on rolling over your old retirement plan into another plan, make sure the new plan is set up first. Consider requesting a direct rollover, right to your financial institution. This is also referred to as a trustee-to-trustee rollover, and it can help ensure that you don’t miss any deadlines.
Maybe you’re not coming from a former employer with a company-sponsored retirement plan. No problem — there’s no better time to start investing (and saving) than now! Here are a few options for you, solo biz owner:
1. Traditional or Roth IRA
One way an individual with earned income can start saving for retirement is by contributing to a Traditional or Roth IRA. Individuals have until April 15, 2017 to make a contribution for the 2016 tax year. For 2016, individuals can contribute up to $5,500 ($6,500 if you’re age 50 or older) or their taxable compensation for the year, if their compensation was less than this dollar limit. However, a Roth IRA contribution might be limited based on tax filing status and income.
Roth IRAs are great because you can withdraw your money tax-free when you’re in retirement. Contributing to a traditional IRA, on the other hand, earns you an income tax deduction. However, that deduction may be limited if you or your spouse is covered by a retirement plan at work and your income exceeds certain levels. Review the IRS guidelines for more details.
Also, if you’re a new business owner, you may find yourself in a lower tax bracket than when you were at your corporate job. (Not for long, I hope!) That means it might be a good time to convert an old 401(k) or traditional IRA into a Roth, where you can capture lower taxes today and withdraw that money tax-free when you’re in retirement.
If you have more money to contribute to retirement than $5,500 ($6,500 if you’re age 50 or older), then you may want to invest in one of the following retirement accounts.
2. The Solo 401(k)
The Solo 401(k) is a traditional 401(k) plan covering a business owner with no employees, or that person and his or her spouse. A business owner can make the following contributions:
Elective deferrals of up to 100% of earned income up to a maximum annual contribution of $18,000 in 2016, or $24,000 in 2016 if age 50 or over; plus
Employer non-elective contributions up to 25% of compensation, with total contributions not to exceed $53,000 for 2016.
Note that these elective deferral limits apply per person, not per plan. So if you’re also participating in another employer’s 401(k), say if you’re starting your business while still employed at a corporate job and making 401(k) contributions to take advantage of an employer match, these will count against the limit for employee contributions to an individual 401(k) or IRA.
Also: A Solo 401(k) plan is generally required to file an annual report on Form 5500-SF if it has $250,000 or more in assets at the end of the year. A solo 401(k) with fewer assets may be exempt from the annual filing requirement. If you choose to go this route, your solo 401(k) must be set up by December 31st and funded by your tax return due date in order for contributions to apply for that year.
3. Simplified Employee Pension Plan (SEP IRA)
A SEP IRA is like a traditional IRA, but it is funded solely by employer contributions. A business owner sets up an IRA for each qualifying employee and can contribute up to 25% of each employee’s pay (and 25% of net self-employment income). Annual contributions are limited to the smaller of $53,000 or 25% of compensation for 2016. There are no “catch-up” contributions like the solo 401(k).
The SEP IRA is a great option for those who do not qualify for a solo 401(k), or who have employees and are looking for a retirement plan for their company. Business owners just need to file a form with the IRS (Form 5305-SEP) and open a SEP IRA at a bank or financial institution
How to choose your retirement account as a solo business owner
Which tax-advantaged retirement plan should you use? That depends on the nature and size of your business. (Do you plan on hiring employees in the future?) Additionally, you need to consider your tax filing status, age, and participation in other retirement plans. Since some plans require more administrative and fiduciary responsibilities, you may want to chose one retirement plan over another due to simplicity.
Pay yourself first!
Finally, in order to reach your financial goals, start by paying yourself first. This is important even if you aren’t a business owner! You can achieve this by setting up automatic transfers to your savings, retirement, and/or investment accounts. As an entrepreneur, your income may vary, so allocate your savings based on percentages instead of dollar amounts. For example, make it a goal to set aside 5% of every client payment. This will automatically help you save more dollars when your income is higher and keep you from overextending yourself during leaner months.
The client intake process can be a bore for users and a pain for the service-based business owner to create because there are a lot of moving parts — gathering pertinent client information, handling the legal documentation, collecting payment, and scheduling the actual client calls.
Yet the upfront time spent creating your client intake workflow can set you apart from everyone else, while also being beautifully branded and making the process easy for your clients. Your clients will thank you, and you will love having all client information in one document.
Set the tone from the beginning
Before building your client intake form, make a list of all of the information you need to gather from potential clients. Depending on your type of business, you might need:
client’s name and contact information
event date, time, and location
client’s website URL
who referred them to you
client’s expectations, struggles, or goals
Be sure to also consider anything that you will need from the client to begin your work with them. For example, you might want to create a contract for your client to sign, you might need to collect payment, and you might have pre-work for your client to do prior to your first meeting.
As soon as a client decides to hire you, be sure your initial email includes all vital information including:
link to intake form
a one-page FAQ or “what to know” info sheet
a link to schedule their initial call/consult
You want to alleviate a long email exchange and get right down to business, but you also want to make it clear to your potential client as to how you run your business.
Can one intake form do all this? Absolutely.
Building a comprehensive client intake form
The goal for your intake form is to gather all pertinent information from your client in one form. But keep in mind that this is the first professional interaction your client will have with your brand, so you want to leave a good impression.
For an all-inclusive and easy-to-use intake process, I recommend Typeform Pro. You may be familiar with Typeform as a way to survey to your readers or create pretty questionnaires, but there is so much more to Typeform.
You can easily create fields to gather basic information like your client’s name, contact information, and URL, but there are other fields within Typeform that will allow you to do more to really flesh out your client intake process. Here are a few examples:
Legal information: Use the “Legal” field to add your contract to the intake form. You can make it “required,” which means your client will have to agree to the contract prior to proceeding with the remainder of the form.
Be sure to include a note that lets them know that by agreeing to the contract in this form, they are essentially signing the contract. You can also include a copy in the “Files” section of Typeform, which we’ll get to in a moment.
Payment: Connect your Typeform account with your Stripe account and easily collect payment on your intake form.
Typeform also has a feature allowing you to set different prices based on your client’s selection of your products or services, calculating the total amount due at the end. Clients will be able to securely enter their credit card information directly in the Typeform and Stripe handles the payment.
File upload: Easily provide your clients with a PDF of your legal information, as well as any pre-work or other important documentation right there in the intake form.
This is also a great opportunity for you to include a copy of your FAQ sheet. As solopreneurs working with clients, we tend to get asked the same questions repeatedly. Encouraging our clients to read the FAQs ahead of time will help alleviate some of these questions, freeing up more of your time to devote to the actual client work.
Thank you page: Typeform’s thank you page allows you to give clients further instructions or notice of what to expect next. You might want to let them know to expect an email that confirms your receipt of their intake form, or provide them with a link to a specific website that allows them to schedule their initial meeting with you.
Respondent notifications: After building and designing your intake form in Typeform, you will need to configure the respondent notifications. Essentially, this is the email each client will receive after completing their intake form. Typeform allows you to add specific responses to this email, which I use to create an email receipt of their payment. It looks something like this:
Hello 1 – [Your name:]
Thank you for your submission! I’ll be in touch with you very shortly with the next steps based on the service package you have selected. If you have any questions or concerns in the meantime, don’t hesitate to hit “reply” on this email. I’m happy to help, and appreciate your business!
For receipt purposes:
You signed up for the following service(s): [name of service package…]
For your records, you paid [price]
Thank you & have a nice day!
Typeform fills in the name, service package, and price based on the responses in the intake form.
You may also want to include links to your FAQ sheet and scheduling tool in this email as well, just in case your client skipped over the thank you page in your Typeform.
As I mentioned earlier, an FAQ sheet is a great resource for your clients and helps you alleviate the back-and-forth email exchange that tends to happen. It’s also a great way for you to set expectations and guidelines for your client interaction. In addition to the questions you frequently get asked, consider including:
Your work hours: Let clients know upfront that you will only be available via email/phone during specific office hours. If they contact you outside of these office hours, let them know the average time it takes for you to get back to them.
Your email policy: Be very clear about how many emails are included in their service package with you. Advise them to send one comprehensive email each week, rather than a series of short emails throughout the week.
How meetings take place: If you meet with clients via Skype, Google Hangouts, or over the phone, let them know this upfront and provide a bit of direction in case they aren’t familiar with the platform you use.
Reminder of pre-work: If you provided any pre-work, remind your client that this needs to be done prior to your first meeting.
If the work you are doing for this client is dependent upon the client completing certain tasks, be sure to mention that, as well. For example, if you are designing a website and need images from the client of their products, be sure to let them know that you can only complete your work on time if they follow through with specific tasks based on the timeline of your project.
Streamlining your scheduling
If your client work involves working 1:1 with the client in a meeting, whether that’s online, over the phone, or in person, you will need to provide a way for your client to schedule their time with you.
Calendly is a simple scheduling tool that syncs with your Google, Office 365, or Outlook calendar. Create one type of event for each of your service plans and allow clients to book based on your availability. They can select which date and time works best for them, and the event is added to your calendar. You will be notified of this event when the client schedules with you.
Acuity Scheduling is another powerful scheduling tool that operates in a similar way as Calendly, allowing you to sync your calendar and create multiple types of events. Acuity, however, also allows you to accept payment from clients. This might come in handy if you accept a deposit via Typeform, and need to collect payments each time your client books another event with you.
Acuity also integrates with email service providers like ConvertKit and MailChimp, dropping your clients into your email list automatically, and allows you to schedule group events like webinars or workshops. If you use Quickbooks or Freshbooks for business accounting, payments received through Acuity can be automatically added to your ledger.
What a streamlined client intake process gives you
Eliminate the back and forth, so you have less headaches. Streamline the intake process, so your client knows exactly what to expect. Despite it taking more time to set up, it’s a win-win that you won’t believe you lived without before, service-based biz owner.
Now that your client intake process is streamlined, you have more time to actually work with clients, helping your business continue to grow.
We are affiliates for a few of the services mentioned above. As always, we only promote products and services we truly believe can benefit your business.
Apps like IFTTT (short for “If This, Then That”) allow you to set up recipes that automatically connect one app to another. You can set recurring tasks to be taken care of automatically, or with the simple push of a button. Think of it as outsourcing your least favorite tasks to robots (and then feel like a genius).
Whether you’re a veteran IFTTT user or you just hopped on board, you might be overwhelmed by the vast number of recipes available. You need your automation workflow to save you time, not distract you while you search for the best recipes!
Try these 8 best IFTTT recipes for solopreneurs to get you started.
Imagine being able to share quality content with your followers with just the click of a button. That’s exactly what this recipe does for you. Now when you come across an actionable article you know your tribe would love, all you have to do is add it to Pocket, and IFTTT will automatically add it to your Buffer schedule.
Don’t use Buffer? You can also connect Pocket to Asana, Evernote, or Google Drive to quickly gather all those shareworthy articles in one location. Then you or your VA can easily batch your social media sharing for the week in one sitting!
Hashtags are a great way to categorize information, but they don’t do you any good if you don’t have an easy way to refer back to them. This IFTTT recipe fixes all that by automatically adding any usage of a specific hashtag on Twitter directly to a Google Spreadsheet.
These are just some of the Twitter hashtags you might want to hang onto for later use:
Your brand or product’s custom hashtag (like #OneWomanShopLife!)
A Twitter chat that always shares helpful insights or resources
A Twitter chat you run yourself
A hashtag your dream clients use repeatedly
Hashtags prospective clients use to post job listings in your industry
All you have to do is check your spreadsheet to keep up with your favorite hashtags — and they’ll be saved there forever, so there’s no fear that you’ll lose them in your fast-moving Twitter feed.
Let’s be honest: LinkedIn is very few people’s favorite social site. But regularly sharing your posts there can go a long way toward landing new clients! Having an active LinkedIn profile shows that you’re invested in your career, and your latest posts will immediately display your skills and expertise to anyone who stumbles upon your profile.
This recipe is the easy way to keep your LinkedIn profile current and your connections up to date on your recent work without your having to lift a finger.
Ever wonder how many hours you really put into your solo biz? Most of us are bad at estimating how many hours we work in a week, which is a problem when you need to calculate an accurate hourly rate to base your project fees on.
Logging your time manually can be tedious, but this IFTTT recipe makes it a snap to track your work hours. This recipe doesn’t track the specific task you’re working on, but it can help you notice important patterns in your work day. Most importantly, it will tell you without a doubt how long you spent on the clock on any given day. (Goodbye, 16-hour days! Maybe…)
All solopreneurs have goals both within and outside of their business. This IFTTT recipe lets you keep a tally of anything you choose and store it in Google Drive with the single click of a button. This is a great way to aim for more self-care activities or fewer distractions in your day.
This recipe can help you track almost any goal or activity, but these are some of my favorites:
Finishing a glass of water
Getting up from your desk to stretch and move around
“Quickly checking” social media
Switching from one task to another, even if it’s just for a moment
Connecting with someone, whether online, in person, or over social media
Evernote is a big player in many solopreneurs’ day-to-day organization. Now you can use it even more efficiently thanks to this IFTTT recipe. Starring emails and then archiving them is the easy way to get your to-do list out of your inbox and into your actual to-do list in Evernote. Inbox zero, here we come!
Solopreneurs can use Craigslist to find everything from a great deal on office equipment to supplies to be used in their products. You can even find the occasional client on the Craigslist job board!
Scouring through Craigslist can be time consuming. This recipe takes care of the work for you by emailing you when a new Craigslist post matches your search criteria. So the next time you’re in the market for a used printer, you can wait for the perfect match to find you instead of the other way around!
If you’re regularly using Trello to organize your solo biz, you’ll love this recipe. Most of us have recurring tasks that happen on a daily or weekly basis. Save yourself the time it takes to manually create those Trello cards each week and let IFTTT automatically do the job for you! Any recurring cards will be ready and waiting in your Trello board with no extra work on your plate.
Which IFTTT recipes keep your solo biz up and running?
Did we miss any IFTTT recipes for solopreneurs that you can’t live without? Tell us about your favorites in the comments!
As business owners you want to make money and get paid (right?)…but most solopreneurs don’t take the time to back up to confirm that their pricing strategy has them set up to make money.
Which means oftentimes, there’s a better option.
And it’s worth looking into, when a better pricing strategy means you get paid more or more consistently so you can make those adventure plans happen, enjoy friend dates to the movies, go camping with the family and/or buy that new ‘thing’ you’ve been lusting after.
In this post, I’m digging into the most common pricing strategies: retainer, project, and hourly pricing; peeling back the layers of each one to understand the pros and cons, keys to success and views from the client side.
Let’s get started.
Pricing strategy #1: Retainer-based pricing
A retainer is a pre-set fee for a set period of time. The fee holds a set number of hours to do work during a specific period. Retainers generally don’t specify the type of work to be done. Virtual assistants, graphic designers, and website maintenance professionals frequently use a monthly retainer for a set number of hours.
Virtual Assistant: 10 hours a month, $200
Graphic Designer: 5 hours a month, $300
Pros, as a biz owner:
You can predict your hours
You can rely on steady income
You can work with clients consistently and build longer term relationships
Cons, as a biz owner:
Multiple clients may all request use of their hours at the same time
Vacation, illness and time away coverage is essential since your time has been committed and paid in advance
Projects may require more hours than the retainer covers since clients may be uncertain what projects would be needed or how long it takes
Without proper planning, you may not know what type of projects you’ll be asked to do can lead to projects outside your expertise
View from the client side:
Great for routine activities
Predictable monthly expenses
Use or lose: may not use all the hours purchased
Key to success with retainer-based pricing:
Set clear guidelines on how you’ll work together and your work hours (which may not include email requests at midnight or phone calls at 7am). This avoids clients who expect you to be ‘on call’ for those hours they’ve purchased.
Pricing Strategy #2: Project-based pricing
Project-based pricing: a pre-set fee for a specific product or package with a defined set of components. This pricing strategy is based on delivering an agreed-upon result regardless of hours or costs it takes to do the work.
Squarespace website set up with four page layouts, $1,500
E-course content development with 10 lessons, 5 worksheets and 3 videos, $997
Pros, as a biz owner:
Ideal for routine types of projects when you can easily calculate the time required
Increases ability to predict income
Incentive to minimize your time, be efficient and still deliver a quality result
Cons, as a biz owner:
Difficult to estimate pricing if you haven’t completed enough similar projects
Have to manage client expectations for elements not included in the defined project (scope creep)
Projects may take longer than you estimated, which means less profit for you
View from the client side:
Easy to know and plan for the project cost
Lack of transparency to the level of effort required for the project
Project definition may not exactly align with what they need
Keys to success with project-based pricing:
Be diligent in defining what’s including and not included in the project and how requests outside the definition will be handled
While perhaps not the most advantageous, hourly pricing is by far the easiest to implement and is, from my experience, the most commonly used pricing strategy. Hourly pricing is simply the price charged for each hour of work.
Pros, as a biz owner:
Easiest to use
Increases likelihood of being paid for all the hours you work (if you estimate well in your proposal)
Great approach if you haven’t done many projects
Easiest for managing time off
Cons, as a biz owner:
No incentive to be efficient with your time
Requires you to work a set amount of hours to reach your revenue goal
Difficult to incorporate value as part of price
View from the client side:
Most transparent pricing
Easiest to compare between competitors
May not get most efficient work from you
Keys to success with hourly pricing:
Ability to provide a solid estimate of the time required for a project
Clarity on what’s included in the scope of work for the time and price and how requests beyond the scope will be managed
Choosing your pricing strategy
What makes the most sense for your business where you’re at today? Consider your ideal clients, your specialty, and the results you can deliver. Know yourself and your ability to estimate time. Give your ideal clients the best opportunity to say yes(!) to working with you.
But perhaps most important to know is this: You don’t have to pick only one pricing strategy. Offering a combination approach may make the most sense for you and your client. Have a routine set of activities you offer? Consider project-based pricing, with hourly pricing for additional, ad-hoc requests. For highly customized and tailored services, retainer and hourly rates may be ideal. Offer a retainer package of hours then add in hourly rates for unexpected needs.
(What you should charge for your services is a separate and super important topic, too. Be sure you understand both your pricing strategy and what you should charge, because they go together like wine and chocolate or peanut butter and jelly. Yum.)
The easier you can make pricing for your clients, the easier it will be for them to say yes. It makes it easier for you too, so you can spend less time on preparing proposals and talking about pricing, and more time doing the work and growing your business.
PS: Want even more on pricing? Rebecca Tracey’s Get Paid (How to Price Your Services + Programs) e-course will be in this year’s Solopreneur Success Bundle! Head over to the Bundle page + sign up to get notified when it launches in September.