Is Now the Right Time to Sell Your Business?

Your business is often your life. You’ve given time, money, love, care and days of hard work to getting it to where it is today. You’ve made it profitable, it has an established reputation and often you will know your customers on a personal not just professional basis. With all this in mind, you might think that there would never be the right time. But in reality, would now not be the best time to sell.

Why Consider Selling?

If your business is running effectively it is because of the investments you have made; financial, emotional and your time. It will continue to need all of these if it is to continue being successful, which means that it will continue to be a drain on time spent with your family, be an emotional roller coaster and to develop it to the next level will need more of your money. With all this in mind, is it worth all this commitment?

The Benefits

The above reasons highlight what will be needed to allow your business to continue to grow. Is it worth missing out on more time with your family, when selling could give you financial stability to allow you to spend time with them unencumbered by work and potentially fund a sabbatical to make up the time you may have missed? A break would also allow you to recharge emotionally and begin to figure out where you are in life and find something to be your next dream and figure out how you are going to chase it. Consider also, would the business you love be best nurtured by someone with the resources, drive and time to take it to the next level whilst continuing to build upon what you have created? Selling may give you control of this as you can decide who it is that takes over your role and brings a renewed sense of vigor which you may have lost. If this sounds like you, selling may be in the best interest of your firm.

Why Now?

There are two important things to consider when you are determining whether now would be the right time to sell. As mentioned there are the personal reasons listed above, the drain it has placed on you may have left you missing out on events in your life, it would allow you to enjoy them. Also, the fact your business is effective and profitable means now would be the best time to sell. If you were a lawyer, would you want to sell an attorney practice when you had no clients, or when your client base is large and strong? By selling whilst your business is strong, you are maximizing the compensation on all of the hard-work you have put into making it a success.

Avoid the 5 Biggest Career Mistakes

We’ve all heard of asset management and even anger management, but what about career management? The fact is, if you want to truly reach your full career potential, managing your career is the key.

Let’s face it, even if you have a position and a career that are relatively stable, and your next few career steps have been planned out, things can change and change quickly. Taking steps to avoid huge financial problems when these changes occur Is necessary, and it’s the focus of today’s blog. Enjoy.

Career Mistake #1: Not continuing to Network.  Complacency is a huge mistake that many employees make, especially if they’ve been with the same company for a few years. Knowing the people in your company that can help you and make things happen is good, but having contacts outside of that company is definitely a good idea, just in case changes suddenly occur that leave you on the outside looking in.

Career Mistake #2: Keeping to yourself. In larger organizations there are many ways to make a contribution outside of your particular department or expertise. For example, review committees are a great way to meet people that might, in the future, open the door to bigger and better opportunities. If you stick to exactly what you’re supposed to do you might not make waves but you certainly won’t be able to catch one either.

Career Mistake #3: Not letting your superiors know what you’ve been doing for them over and above your assigned duties. It happens every day; a lesser talented colleague progresses faster than you because, when it comes to letting that boss you know how great they are, they excel. They might not actually do a better job than you (and in most cases, they don’t) but since you haven’t been letting people know the great job you’re doing, you get skipped over.

Career Mistake #4: Not knowing when to ask for raise. Women seem to have this problem more than men, specifically that they don’t know their true worth and don’t ask to be paid up to their level. It’s been calculated that, over the course of a career, $1.5 million dollars are left on the table in lost lifetime earnings simply because someone wasn’t able to effectively negotiate their salary.

Career Mistake #5: Negativity. While it’s true that finding the perfect workplace is almost impossible, complaining constantly to your colleagues will almost always come back to bite you in the end. Even worse is the employee who loses their control in an argument and lashes out at a colleague or, even worse, at their boss. If there’s one thing that can bring a career to a screeching halt, it’s telling your boss your true feelings.  In short, even if you’re really unhappy where you are, keep cool, calm and quiet until you at least find better employment somewhere else.

Why I Just Gave Up Freelancing For A Full-Time Gig

In my last post, I talked a bit about my experience in three years of freelancing. What I didn’t share is that I’ve been in discussions to take on a full-time job. And sure enough, Monday was my first day at the job.

So why did I do it? There are several reasons for this.

They made me an offer I couldn’t turn down

At the time, I wasn’t really looking for a full-time job. But I always had it in my mind that I would take one if the right job came along. And then one day a few weeks ago, it did.

To me, this isn’t any “normal” job. There are a few key components that made the decision easy for me, including:

  1. Plenty of time off. I got much more than the standard two weeks at some jobs.
  2. Remote work agreement. No need to relocate or commute to an office. I can keep my same office space (except my new company now pays for it).
  3. Flexible work hours.
  4. It’s a startup. Working at a startup has been a dream of mine. And yes, I get to do cool shit.

All things considered, the job encompassed many of the things I liked best about freelancing and few I didn’t.

It’s my dream job

It’s weird to call this my dream job. I’ve never really had a dream job in my mind, to be honest. But if I could think of anything now, this would basically be it.

In addition to what’s above, my job lets me do and learn everything professionally I wanted to. I’m now in a more strategic role rather than being just a writer. I’m on track to manage people, which is also pretty damn cool. I know I’ll be able to learn more and do more of the things that I’m interested in.

A break from freelancing sounded nice

I’m not going to lie: freelancing was tough. Mostly it was the constant need to keep finding new clients. This means I’d have to devote somewhere from 25-50% of my time searching for new clients and marketing my business. To be honest, this isn’t the biggest strength (and certainly not a huge interest) on mine.

For now, I’m glad I can just stick to doing the work that I like to do and not having to worry about keeping my plate full with clients.

I can always go back to freelancing

When I first was approached about the job, I had some reservations. So naturally I turned to my copywriter friend Amber, who’s been on both sides. Her advice: freelance work will always be there, but job opportunities won’t. And she’s right. It’s not so likely another opportunity like this would come up for me again soon.

Don’t get me wrong: I’m planning to stay at this job for the long haul. But should anything change down the line, I can go back to freelancing on the spot.

With all that in mind, I took the job this week. It’s a bit of a weird feeling to have a job again after not having one for three years. But I’m glad to be back on a team that’s doing exciting things. I’ll keep you posted on how it goes from here.

3 Years of Freelancing Full-Time: What Have Been The Biggest Surprises?

My friend Melanie asked me at happy hour tonight what I thought the biggest surprises of freelancing were for me. It’s an interesting question to think about. And to be honest, it’s a little hard to remember back to when I wasn’t freelancing.

But I know I’ve had a few good ideas all along. So if you’re thinking about freelancing full-time, here are some things I learned that may help you.

It takes a while to get started

I planned about 8 months ahead of time to quit my job and go freelance full-time. And yet I thought once I started, I’d be booked solid in no time. But that wasn’t the case.

I quickly realized one key thing: I had no idea how to get clients. Sure, I had found some clients that came my way organically. But that was through networking and other long-term means. Finding clients when I needed them wasn’t something I had done before, and it took months to get a system going.

Thank goodness for my $8,000 quit my job fund.

Marketing yourself is a long-term strategy

Going along with the point above, I realized after a while that I could get clients without even trying. And they’d come from the strangest places!

One found and hired me because I had worked for a competitor of theirs in the past, and they noticed this on LinkedIn.

The weirdest referral: a client found me in a testimonial I had left on a site completely unrelated to personal finance. And the kicker: I didn’t even mention I was a freelance writer in the testimonial!

This was an important lesson. Being everywhere does count. You just might not see the results right away.

I hate working at home in my pajamas

This one has turned out to be the biggest myth for me. When I quit my job, I was like “Great! No more commuting in to an office! I’m just going to stay at home and work in my pajamas!” Damn did that get old fast!

Instead, I found myself getting really bored and lonely. I also wasn’t very productive since working out of my apartment (that I shared with roommates) didn’t leave me much space for a dedicated workspace.

About 6 months in I joined a coworking space, and I’ve been commuting to an office for my freelance work ever since.

Working on a schedule (like 9-5) actually makes the most sense

Another thing I thought I would love before I quit my job: flexible scheduling. I would just work when I felt like it. Nights, weekends, whenever. I wasn’t doing the 9-5 thing anymore, that was for sure!

But again, this just wasn’t great for productivity. Instead, I’d get more stressed, especially without clear boundaries between work and free time. I soon found that having some sort of work time scheduled was best. And what’s worked best has resembled a 9-5, M-F schedule or something similar.

However, I do take time off when I need it and wouldn’t be able to do at a normal full-time job. I’ll roll into my office at 9:30 am if my workout runs late. And unless I have something super urgent to do, I’ll take Friday afternoons off. Don’t get me wrong, I love this part of freelancing. But I do need some structure to work within.

Do you freelance? What’s been most surprising for you?

The Next Chapter…

As you may have noticed, Money Spruce hasn’t seen many updates lately. After quitting my job in May 2012 and becoming a full-time freelancer, there’s just been less and less time to write on here.

Today, I’m announcing the launch of my new business: Content Strategy for Do-Gooders.

CWAM is a one-stop shop for content strategy and creation for social mission-driven businesses and organizations. CWAM’s focus is to help these businesses amplify their social impact using effective content to tell their story, find more followers, and develop a loyal tribe of supporters.

Why am I making this change? There are a few reasons:

1. Social missions have always been close to my heart. After finishing my master’s degree, I passed up jobs with starting salaries of $60,000+ to work as an AmeriCorps VISTA volunteer. I served at a nonprofit in New Haven, Connecticut for a year, living on a stipend of  $1,100 a month and supplementing my earnings with food stamps. I learned so much that year as I lived closer to poverty than I ever had before.

After, I was hired as a full-time employee at the same nonprofit and continued to work there. I focused on helping my nonprofit update newsletters, refresh content, and simply do more to leverage online content to bring in more donations and stay in touch with past donors.

2. I’ve become much more than just a “freelance writer.” While writing is still a large part about what I do, it’s still just a piece to the much bigger puzzle of developing a strategy that works for the organizations I serve. In addition to writing, I spend hours strategically deciding what kind of content to develop and incorporating that into a larger content strategy. This strategy includes effective call to actions, email capture, lead nurturing through email, social media, blog posts, static content, and more.

3. Socially-minded businesses are perfectly suited to gain the most from an effective content strategy. Effective content is really about telling a great story. While many brands do a good job telling a story, fewer are actually “story-doers,” to use a term from this article published in the Harvard Business Review. Preliminary research from this study shoes that story-doers may be much more effective businesses than story tellers.

Social businesses like TOMS Shoes and many great others have amazing stories to tell. It’s these stories that earn them a large following of supporters. Supporters are really more than customers. They’re brand advocates who want to make a difference in the world, too.

My BIG goal: help more businesses and organizations harness their own powerful stories to gain more followers and increase the impact of their mission.

Thank you

Thanks so much for following along on Money Spruce. My life would be incredibly different right now if I didn’t start this blog and hear from all you loyal readers.

If you’re still hungry for more personal finance and other money-related articles, my friends Carrie, Mr. Money Mustache, Paula (and many more) are among my favorites to read for a steady stream of interesting and informative posts.

Wishing you all the best and brightest future,


P.s. – If you or anyone you know may be interested in my services,  I’d be really grateful if you’d send them over to this page. Here they’ll be able to get my free report “10 Steps to Maximizing Your Cause’s Impact with Content.” Thanks again for all your support!

The $100 Startup: More Possible For You Than Ever

There’s been no better time to start a business in history than today. The possibilities are endless, with new opportunities for startups being created all the time. It’s easier to access more customers than ever before (i.e. the entire wired world). And, it costs so little to create a new business.

Chris Guillebeau released his new book The $100 Startup on Tuesday that’s all about this topic. I received an advanced copy, and, after diving in, it’s truly a great read.

What I like most of this book is the range of real-life ideas and stories of others that it contains. It’s not just from the author’s viewpoint, and it’s not so preachy because of that. There’s literally 50 stories of real, low-capital entrepreneurs.

Some of the more interesting notes about the book is just how ridiculous some of the startup ideas really are, like one entrepreneur that started selling liquidated mattresses out of a vacant auto dealership. Who would’ve thought something like that would turn into a success?

Despite the numerous successes listed in the book, how realistic is it to create a $100 startup?

Can you really create a startup for $100?

Unless you’re five years old, $100 isn’t a lot of money. It’s a few meals at a restaurant or a fraction of your monthly rent. And it’s a tiny percentage of what it would cost to create many traditional brick-and-mortar businesses.

But even if it’s not a lot of cash, is it enough to create a viable business? Yes, it is.

Okay, so you’re not going to become the next Groupon right away if you’ve only got $100. But there’s a lot you can do with $100 now.

For example, Money Spruce was started for way less than 100 bucks. All it takes is a $7/month website hosting account and a domain name that costs about $12. A few hours later, Bam! You have your website and potential business.

You don’t even need to spend money on a website (there’s tons of free options). All you need is a decent, low-cost business idea.

Cheap doesn’t mean it’s great

There are a lot of startup ideas that can get going for really cheap but aren’t necessarily a viable business. A classic example is blogging. Many people start a blog (for just a few dollars, as I detailed above) with the intention of making fortune. But they have no real business strategy and goals when they start. I’ve certainly been guilty of this in the past, and I certainly don’t make a full-time income from blogging now.

The idea of a $100 startup isn’t just that it’s cheap. It has to be more than that.

Concentrating on what’s really important

Money isn’t only what matters. Far from it. Will investing more in a business up front give you a better chance of creating a viable business? I don’t have statistics on that (and I doubt they exist), but I’d bet that the answer is “no.”

Why? Because there’s so much you can do and should do that will cost very little money before you should even consider throwing a bunch of cash into your biz.

Why invest lots of money up front before you know if you have a viable business? If ordering business cards is your first move in your new startup, you’re in trouble (and it’s total BS if you don’t think you can make a sale before you have business cards).

If you’re set on spending only $100 to create a startup, there’s absolutely no room for frills. This really forces you to drill down and focus only on what’s necessary. Sure, you could create a fancy website (for either your online or offline business) by hiring a designer who will create logo and give your new “brand” an awesome appearance. There’s no way to do this for less than $100, though, so you’re better off on concentrating on actions that generate revenue by selling something.

$0 Startup?

Clearly, there are many startups you can create with $0. If you own a computer, you’ve got the only tool you need and don’t need to spend any more cash. If you have access to software or other tools, you’re in even better shape.

Let’s look at my SEO consulting business, for example. There is literally nothing I’m required to buy to get started and for clients to begin paying me. With free SEO tools, free tools from Google, plus all the free information in the form of SEO blogs and websites that I could ever ask for, I can do a lot with zero business expenses. Sure, I could go out and buy premium SEO tools, a nicer computer, and SEO textbooks, but none of that is necessarily needed.

The same is true for freelance writing. All I really need is access to the internet to find positions. Need an online portfolio? Whip up a blog, which could even be on a free site like Tumblr or

If you have technical skills, such as programming or developing websites, you can get going for $0, too.

It takes time, and lots of it

Let’s not forget: the major investment will always be time. There’s really no way around it, money or not. You’re going to have to put in the time to make your business a success, whether it’s a $100 or $10,000,000 startup. This really shouldn’t be any sort of a new revelation as anything that doesn’t take time is probably worthless or a scheme.

I hope to launch more of my own “$100 startups” this year. What about you?

Do you have a $100 startup idea? How’s it coming along?

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photo by: Alex Champagne (via Amazon)

Only 72: If You’re Serious About Building an Online Business

If you want to get right to the sale, click here to go to Only 72.

I’m writing today about the Only 72 sale. It’s 90% off over $1,000 in ebooks and guides for the entrepreneur – but only for 72 hours.

Why I’m writing a post about it

Almost 2 years ago, I began searching for a different path in life. I was frustrated with where I was headed, and I didn’t know how to get out of it. That’s when I stumbled upon a few different Ebooks about starting an online business – one of which was How to Live Anywhere by Karol Gajda (one of the Only72 creators). I was hooked!
Today, I’m well on my way with an online business that I can work from anywhere. After I quit my job (in just over three weeks now!), I’ll be supporting myself entirely from online income:
  • through this blog
  • with my online SEO business and
  • a regular freelance writing position
All of this is a direct result of following guides like the ones offered in this sale. In fact, I’ll be buying this sale myself. These guides are from some of the best in the business, and I’m wicked excited to learn more about developing iPhone apps and continue to build up my freelance business.

What you get

Everyone gets all of the following for just $100:

The $100 Startup – the Hardcover book with shipping included. Written by Chris Guillebeau.

Better Blogging ($137 in value)

Corbett Barr – Creating, Marketing, and Designing A Blog That Matters

Susannah Conway – Blogging From The Heart (eBook version)

Passion-based Business ($137)

Jonathan Mead — Identifying Your Passion Module + Workbook

Scott Dinsmore — Live Off Your Passion (eBook version)

Freelancing ($111)

Ashley Ambirge — You Don’t Need A Job, You Need Guts

Men With Pens — Freelancer Package: Write for Web, Guest Posting Guide, Beyond Brick & Mortar

Confidence & Courage ($129)

Johnny B. Truant — Tao of Awesome

Marianne Elliot — 30 Days of Courage (w/ Yoga Module)

Selling & Advertising ($144)

Pam Slim — Ethical Selling That Works

David Risley — Double Your Ad Income

Technology & Systems ($171)

Josh Kaufman — The Personal MBA Guide to Small Business Infrastructure

Free The Apps — How to Make iPhone Apps <— I’ll be reading this first

Brett Kelly — Evernote Essentials

Artists & Writers ($130)

Alyson Stanfield — Turning Your Hobby into a Career (download & audio program)

Chris Guillebeau — Unconventional Guide to Publishing

Click here to go to the sale

Who it’s for

This sale would be an awesome start for anyone looking to make a living online using their talents and passions. It’s not about making a quick buck – it’s about working to build a solid, sustainable business.

If you’re looking to take your online business to the next level, this is an awesome way to do that.

Either way, there’s a wide array of options for doing that with these guides – blogging, freelancing, iPhone apps, and more.

Just one of two of these ebooks could cost more than $100 in this sale.

Remember – it’s only available for 72 hours, starting at 12 pm EST today and ending at 12 pm EST on Thursday.

Click here to purchase

Even if it’s not for you this time, I totally understand. No hard feelings at all. But you can still head to their site and get on the list for future sales.

Thanks again for reading. This post does have affiliate links for which I get a commission for each sale. But I truly recommend this – it’s something I really believe in.

Wealthy, Successful Bloggers: Don’t Simply Follow Their Frugal Advice

financial-bloggers-adviceI often wonder if I’m brainwashing myself with the stuff I just want to hear.

Lately, I’ve been reading a lot of blogs, books, and other advice about self-employment and starting your own business. I’ve (mostly) convinced myself that working a 9-5 job isn’t the key to happiness and success in my life.

Of course, I haven’t always thought that way. I went to college for six years to study engineering – a field with much fewer prospects for entrepreneurship. Before doing that, I went to business school for one semester. It wasn’t just any business school – it was Babson College, which was (and may still be) the #1 ranked school in the U.S. for entrepreneurship.

I get a lot of the advice with how I live by from various bloggers around the web that have achieved success in their lives. But an interesting point (and one that I first heard from MJ Demarco, author of the Millionaire Fastlane) is that many of these successful bloggers or “gurus” did not achieve most of their wealth by following their own advice.

Now, before you think that I’m calling them hypocrites, I’m certainly not doing that. These people do follow their own advice, but they’ve gone beyond that in many ways to acquire most of their wealth. Here’s the proof:

JD Roth of Get Rich Slowly

JD went public last week with the story of how he sold his blog, Get Rich Slowly, almost three years ago. It’s a great story, and one that you should definitely read. I think it’s awesome that JD was able to do this. While JD doesn’t disclose how much he sold his blog for, the Dough Roller has a great article on financial blogs that have been sold and estimates of what they sold for. It’s almost certain that Get Rich Slowly sold for more than $1 million.

JD points out that he’s put all of his proceeds from his blog sale into a “nest egg” after he paid of his mortgage, and he continues to live off ~$48,000 of other income he generates by mostly writing. But, no matter how you dice it up, JD is almost certainly now a millionaire and is more wealthy than many of his readers via the sale of his blog.

Trent Hamm of The Simple Dollar

Trent is one of the masters of frugality and the author of The Simple Dollar. His advice is sometimes a little too extreme for me, but he’s offered a lot of tips and has undoubtedly helped tons of people. Nonetheless, I admire how Trent has grown the Simple Dollar and his dedication to producing useful content that undoubtedly affects the life of thousands.

But, like Get Rich Slowly, the Simple Dollar was also sold to another company for an undisclosed sum (see the Dough Roller post above), and it was also likely that it was a seven-figure deal. I’m sure Trent will continue to live a frugal lifestyle, but it’s unlikely doing so because of lack of wealth.

Dave Ramsey

Dave Ramsey boils down financial advice to the simplest level possible: pay off your debt, build an emergency fund, and save for retirement with as much intensity as possible. He advocates going all-out to do these things, and he’s very clear and effective with the advice he offers. He’s help tons of people turn their financial lives around.

As a result, he’s build his Total Money Makeover book and course into a financial empire. Dave has syndicated radio show, has appeared on Oprah and even had his own TV show for awhile. He now has several more books and courses that he sells. This site claims that his net worth is $55 million, which I haven’t been able to confirm elsewhere, but I wouldn’t doubt that it’s to far off.

You’ll still hear Dave tell his listeners to fund retirement accounts and sell their stuff to pay off debt even though he almost certainly doesn’t have to worry about any of these issues in his own life now.

Lesson Learned

I know it’s unlikely that any of us will duplicate the success of any of these people using the business models that they have. It’s much, much harder to create and grow a popular personal finance blog these days than it was in 2006 when these guys started. I don’t expect them any of these three people to spend the majority of their time or blog posts encouraging others to attempt to create a carbon copy of their success. But that’s not the point I’m trying to make.

My point is: if you’ve strictly followed these guys’ advice, you’d have a pretty darn good life (and maybe a great one). But you wouldn’t have the amount of wealth they have.

It’s nearly impossible to become a millionaire in your 20s, 30s or 40s by acting like a gazelle to pay of debt, maxing out Roth IRAs, and making your own laundry detergent.

What I’ve learned from this is that we shouldn’t take any advice so literally and accept it as the only way to do something. If you strictly followed tips from these writers, you most likely wouldn’t have a life (and a bank account) similar to theirs.

Instead, it’s helpful to look at how they were successful and consider that when determining which pursuits to take on in life. To put it simply for me, it’s come down to taking their advice and spending like they do, and not just seeking to earn and save like they suggest. If you do, you may “get rich slowly,” but it may be more slowly than you wish.

How do you feel about taking advice from people like this? Does their wealth affect your perception of their advice?

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photo by: velkr0

Help! I’m Not Investing For Retirement!

not-investingHere’s a secret of mine: I’m not investing, and I’ve added almost nothing to my investment/retirement accounts since 2008.

It’s been hard to do this while hearing common financial advice like “max out your Roth IRA” and “take advantage of compounding returns.” I know those are the things that I should be doing, but I have reasons why I’m “investing” in myself in other ways.

Making the decision I have has been tough, and I’ve wondered lately: Is it okay that I’m not investing even when you I afford to?

Why I’m not investing

Simply put, I’m not investing so I can save to support myself while making my switch from working to freelancing and blogging full time.

While I don’t need to invest a whole lot of money directly into my business right now (as compared to a brick and mortar business, for instance), I do need to provide living exposes for myself while I get my self-employed income rolling, which really starts in May. By doing this I’m essentially paying into the idea that I can run a business on my own, and I can eventually earn enough money to replace a job.

The tradeoff of this approach: I’m working to save $10,000 to finance this transition, and I won’t be able to put any money into investment accounts during the months it takes to save this money. I probably won’t be able to invest for some time after going self-employed, either.

I don’t have a whole lot of knowledge about what other people do to start their own business. In my mind, a lot of people just lay it all on the line, take out loans with their personal property as collateral, and then put their heart, soul, and all their time into giving it all they’ve got. I don’t think this quite applies to my situation.

My goals for this year are to smooth the transition by increasing my side income while I have my job. I don’t have the facts, but I’m assuming this is one of the better strategies that people take. Of course, it would be best to completely replace my job income before quitting (which I’m not on target to do by May), but it’s not always the most practical to do it this way.

Why it’s not okay I’m not investing

I’m not 100% sold that what I’m attempting is a great idea. For going this route, here are the potential consequences if it doesn’t work out.

Falling further behind and lose out on compound interest. As I said, I’m not investing much of anything now, I probably won’t be in 2012 either, and I’m putting $10,000 more or less on the line with this plan. If it fails, I’ll definitely be worse off financially than I am now.

Stock market returns are more stable, reliable, and easier to predict. I feel like this is about one-half myth at this point as nothing is guaranteed with stocks, but I feel like I can at least point to the stock market and say that I can predict around 8% annual return over a long period. That’s obviously not true in every year, but it’s probably still more predictable than any amount of benefit I can expect to receive from working on my own.

Why it’s okay I’m not investing

Even though there’s some uncertainty, I think there are some good reasons for doing this.

Returns could be many, many times greater than the stock market. Not that my goal is to get super rich, but investing a bit in the stock market here and there while I work a job isn’t going to get me anything outside of mediocrity. I’m technically “investing” in something, although it’s not a traditional investment like a house or the stock market. While the returns are unpredictable, success could mean a ROI a lot larger than the stock market produces even in its best of years.

I’m trying to create a better life for myself. Making this decision comes down to more than just the money itself. Investing in the stock market for retirement always feels like I’m deferring a “good” life until I’m 65. Investing with this mindset may never be sexy, and I’d argue that it’s simply going to lead to a pretty good and maybe not great life.

I have some side income, and I’ve put a lot of thought and planning into this. This is anything but a snap decision. I planned to quit and try this nine months before I would actually put it into action. I haven’t planned for everything, but it’s not like I just decided to quit my job one day.

I’ll know if I can pull off working for myself. Working for myself is something that I feel is meant to be for me, and I know that I’ll never be content with a job until I try out the self-employed life. If I fail, my life is far from over and I can just go back to the working world relatively unscathed.

I’ll put a time limit on my experiment. Just because I’m quitting my job doesn’t mean that I’ll never consider going back. I haven’t decided on a hard deadline yet, but I think it’s fair to give it 6 months of solid effort and then reasses where I’m at. $10k is about 6 months of living expenses for me (and don’t forget I’ll be starting with at least $1k in monthly self-employed income, too). Although I can see it would be hard to go back to getting a job, the lack of money will either make me work harder or will force to me to back to the world of cubicles.

I’m really excited about the situation I’m in, and I think it’s going to be a fun and life-changing experiment no matter what. To me, the consequences of not investing right now seem very small compared to the rewards from investing in my business instead.

Is this a strategy you have considered or would consider? I’d definitely appreciate any advice.

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photo by: CarbonNYC

Is it Better to Work for Commissions and Incentives?

working-incentivesI recently hired someone* to handle my advertising on Money Spruce. She gets paid 100% on commission, so if I’m not making money, she’s not getting paid by me.

She’s doing a great job so far, too.  A few times I’ve felt bad asking her to check on things for me or send emails, but then I realized: I shouldn’t feel bad. She must want to do this work because she gets paid a portion of everything I get paid.

That’s the beauty of commission-based earning.

On the opposite end of the spectrum, I’ve never had a job offering any significant commission, and that’s de-incentivized me from doing my best work.

I worked in retail, where I always got paid close to minimum wage. Store managers often threw weekly sales goals for the store at us employees, but I never really cared since I would get paid the same wage whether the store brought in $30 or $30,000,000 that week.

When incentives were offered, the best they could muster was giving cashiers $2 every time we convinced someone to pay $20 to sign up for a store membership card. Needless to day I didn’t put much of an effort on selling the memberships.

No Motivation to Work Hard

Many jobs don’t offer much in rewards for working hard and doing your best.

I guess the possibility of being fired or laid off is somewhat of an incentive to do your best at a job, but I’m still not convinced that’s the best incentivizer to get employees to try their hardest.

Other jobs offer the opportunity to advance to a better position with higher pay, which seems like it would be another good reason to do you best at work. But there are some jobs where there are really no opportunities or ability to achieve a higher position no matter how hard you work.

Some employees may not desire to advance from their current job anyway and instead plan to move on to other companies or places in stead.

Incentives = Entrepreneurship?

If you’re a really into working based on incentives, even if there are no guarantees that you’ll make anything, is entrepreneurship the way to go?

Short answer: I say “yes.”

What you earn is 100% tied to your own efforts. You aren’t restricted in what you can do (whereas you probably are restricted in at least some way by your job), and you can adapt your projects to changing markets and conditions.

For the driven, deriving what you earn almost solely based on your own effort and knowing that’s how you’re going to be paid is the greatest incentivizer of all, especially if all the profits are coming your way, too.

For those of us that like to work hard and put in whatever hours necessary to meet our goals (like me), having performance tied to pay is crucial.

But, of course, it’s not all great news.

Not all good

I realize that working for incentives isn’t going to be amazing all the time. If a majority of your pay is based on incentives or commissions, I imagine it can be unsettling at times not to know you’re definitely going to earn a certain amount on our paycheck.

I also bet that working with commission-based sales can be tough based on a lot of factors like the product you’re selling, the market for that products, the current economic climate, and more. This CNN article points out that earning based on commission is great, but you can’t simply “coast from paycheck to paycheck. Needless to say, working on commission isn’t well-suited for the unmotivated.

As far as waitstaff working for tips, that may not be completely related to work performance, either. According to this Planet Money Podcast on why we tip, many customers tip because they feel guilty and not because their server did an exemplary job. This is surprising and goes against intuition, but based on my tipping habits, I can definitely see some truth in it.

I’ve never worked at a job where a significant portion of my wages are based on performance or commission, but I would imagine that the best combination of pay involves a base salary with bonuses attached. Working entirely on commission is a little scary, but I can see doing it if it’s something I’m confident I can succeed at.

Have you had a job with performance incentives? Did you or would you prefer it? Am I missing any important considerations?

* that “someone” is Crystal, and you can check out her services here

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photo by: Kumar Appaiah