The Great 'Working for Yourself' Hunt

MSE_Martin Posts: 8,273
First Post First Anniversary Combo Breaker
Money Saving Expert
Working for yourself gives you flexibility and independence, yet giving up a salaried job can be a serious financial jump. I’d like self-employed MoneySavers to share their advice on saving money while being your own boss.

What issues have you found and what advice would you give others who want to ditch the day job? From setting up your own website to sorting your taxes, I want to compile a list of all your top self-employment tips.

Please post below to contribute your ideas.

Martin Lewis, Money Saving Expert.
Please note, answers don't constitute financial advice, it is based on generalised journalistic research. Always ensure any decision is made with regards to your own individual circumstance.
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  • Savvy_Sue
    Savvy_Sue Posts: 45,806
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    You'll never regret time spent preparing and researching, as long as it doesn't scare you off starting!
    Signature removed for peace of mind
  • You need to be very organised about keeping all your receipts and thinking, with almost every purchase: "is this an outgoing that I can claim back against tax?" As a self-employed bod, you're quite likely to have extra outgoings for running your own office, for example, and it's important to be able to reduce your tax bill accordingly.
  • fguk
    fguk Posts: 255
    First Post
    So many ideas, having been in business for 3 years for myself.....ill try and give you some of the really important ones.

    1) Make sure you have a completely supportive partner (wife, husband, boyfriend, girlfriend), they can not only help with ideas and emotional support, but with the bills as well.

    2) Dont believe people when they say, "get through the first year and you will be fine", its not true, you always have to be on the ball and working hard.

    3) Get yourself some sound professional advice from accountants etc.

    4) Network, trawl through your contacts book and talk to everyone, some will be able to give you work, some will be able to help you with accounts, some will know someone that can help, some will know someone who knows someone who will call you in 6 months and help you immeasurably.

    5) Go through everything you can with your home bills and expenditure before you start, that way you know you have the minimum bills possible, which means those lean early months arent so pressurised (I found in the first few months of my business, and it really helped)

    Plan it all twice, think about it three times, work four times as hard, but definately give it a go!
  • Get yourself a good accountant. They will save you far more than they cost. But a bad accountant will be a nightmare.
  • Savvy_Sue
    Savvy_Sue Posts: 45,806
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    Don't be afraid to phone HMRC and ask what you need to do, both in relation to self-employment and taking on an employee. I always found them VERY helpful. But note that they're not there to reduce your tax bill - that's what you're keeping your receipts and paying your accountant for!
    Signature removed for peace of mind
  • Don't forget to register with HRMC as self-employed within 3 months of starting or you could be hit with a fine. They also send you lots of useful information when you do register.
    Personally I'm always ready to learn, although I do not always like being taught - Sir Winston Churchill
  • Don't waste money on advertising etc. until you have asked other people for their experiences.
    Personally I'm always ready to learn, although I do not always like being taught - Sir Winston Churchill
  • 1. Expect to be poor for the first couple of years. You can't seriously grow a business if you're sucking all the profits out of it and sticking it in a 5% savings account or whatever. If your business plan is executed well, you'll get a much better return investing in your own business anyway. Of course, this all depends on your confidence and appetite for risk :)

    2. If you know you'll need money to live, save it before you jump so you have the safety net in place.

    3. You don't need to spend a lot at first, next to nothing in fact. Just go and talk to some people at free networking events, make your first sale and reinvest the profits you make organically. You can do this alongside your day job. The notion you need buckets of money to start a business is a myth perpetuated by banks looking to make a buck and government agencies who can't function themselves without spending a few grand on a training course.

    4. Hunt around for grants and freebies. Most universities have some kind of SME freebie assistance you can grab (free web design, courses, etc). Some councils also offer freebie assistance, as does Business Link. In fact Business Link has a grant finder online; just remember to look for grants which fit with your strategy, not let the grants define your strategy.
  • This is a site that I like to keep an eye on - Here, you can find out about grants available in your local area. Check it out!
  • My top 10 tips, in my experience (assuming you are *really* sure you can cope with the long hours, hard work, and cash flow problems):

    1. You don't save money by skimping on professional help -- pay for an accountant, and they'll save you money and heartache; pay for a designer instead of trying to knock up business cards and a website yourself (it will look far more professional, and save you time for doing what you do best)

    2. Don't waste time on grants -- the paperwork, time, and reduction in supplier choice nearly always wipes out any value they have

    3. Just do it -- don't spend massive amounts of time planning (that's not to say don't do your research -- just that you don't need to plan every aspect of the business in advance).

    4. Make sure you get everything in writing from clients and suppliers

    5. Don't be afraid to say 'no' to jobs you don't know how to do, or will not be profitable - just a busy fool. But be prepared to go out and find work -- it won't just come to you.

    6. Try and avoid working for family - they are unlikely to be profitable because you will spend longer on them and do them for less (see 5) - it may be a 'nice' thing to do, but it won't pay your bills - you have to be hard nosed.

    7. Don't undervalue yourself. If you do a good job, people are probably willing to pay you more than you think.

    8. Word of mouth / networking is good advertising (and free). Yellow Pages is neither.

    9. Try and get an office - one-man units or hot desks can be quite cheap, or try and borrow a corner of a friend's. You'll appreciate being able to leave work at work - otherwise it will take over 100% of your time.

    10. Get a VOIP geographic landline number -- you don't want to give out your home number, and not know if a call in the evening is work or pleasure. A mobile doesn't look professional, 0845's can put some people's backs up, and BT business lines are expensive and not portable (you may well move offices in your first years of business). For a few quid you can get a proper VOIP handset, geographic number and be able to receive calls wherever you are.

    11. Put 20% of EVERYTHING you earn in a savings account AS SOON AS YOU EARN IT, so you've something to pay the taxman with at the end of the year.

    12. ^^^ Under promise and over deliver -- it's a cliche, but customers will love someone who goes the extra mile.
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