Solving the Home Based Business Puzzle, How to make Money at Home, Online or Offline

Why, When, Where, What and Who can be an Entrepreneur

Why a home based business and should it be online.  How to make money and how to recognize an opportunity.

One of the most important factors in starting out is to determine why you might want to make money  online or have a home based business.  I have found that most people when they begin to get education are very focused on the "what to do".  Even as children we are saying "when I grow up I want to be".  I have found over the course of my lifetime that why you do anything is a critical 1st step. 

Before you decide what to do, determine why you are choosing a particular field.  Are you interested in only making money?  Are you pursuing a passion and you don't really care whether you make a lot of money or not.   When a person is young and doesn't have a family, maybe even still lives with parents, then that person is sometimes disinterested in how much revenue is available.  That I would suggest will change when there are car payments, mortgages, medical and dental bills, savings for college, insurance etc etc.  So having said that, perhaps the more you can earn from invested time the better.

I suggest that you drive around different neighborhoods and decide how you want to live.   What kind of car or cars do you want to drive, do you want children or what kind of colleges do you want for the ones you already have?  Do you want to travel to exotic places.  Do both of you want to work. If you are a woman do you want to work after having children; do you mind if they go into "storage" otherwise known as baby sitters or daycare. We all have dreams and goals and want the finer things of life.  So the 1st thing to do is identify why you are going to work and secondly what to do.  Write out a list of activities that might turn into a part time at home based business. 

Why work at home might be an advantage.

A W-2 wage earner is someone who has the fewest tax deductions.  A person who operates a home based business has the same tax advantage as a big business or a person who has an outside office and many of your on going expenses can turn into tax deductions if you have a legitimate home based business.  You must have intent to profit or it's considered a hobby. 

Consult with material from the IRS as well as a professional.   I am not going to give you tax advice but suggest that you find a tax adviser who can help you set up your home based business properly.  It is very important that you keep good records.  Document everything, this is where a day planner is crucial.  

The five W's are important on your tax record, why you did it, who you did it with, when; the day and time of the activity, what transpired and the business reason you met and where the activity took place.   This might take extra effort but it is essential to your record keeping.  You can go to http://www.irs.gov/ and find periodicals covering what you need to do to have home based office as well as what constitutes a legimitate business venture and not just a hobby.

When and Where do you want to set up a home based business.  The answer is ASAP;  having said that you also want to be very prepared.  Have a three "P" approach.  Preparation, Planning and Persistence.  Don't get so caught up in preparation however, that you don't take action at all.  There is "analysis paralysis" where there is just too much information (TIM). 

This is where planning and a systematic approach will be of benefit.  How you prepare is going to depend on 1. how much capital you have. 2. Are you the expert or do you have to hire one. 3. Is this a home based business opportunity or an office away from home.  4. Does your business require employees? If so you will need an "EIN" employee identification number, booklets from the IRS and state you live in explaining an employers responsiblity. 

If you are not trained in accounting or bookkeeping you might consider hiring one to at least set up your bookkeeping system and all the necessary licenses.  An offline business has many factors even if it is a part time one.  To have a tax benefit you will need to have an "intention to profit".  My blog is not designed to cover all the myriad details required to operate a home based business.  Just know you will be way ahead of the game if you understand how to read profit and loss and balance sheets. 

Most businesses failures occur not because a person doesn't understand the process they chose i.e. a physician or attorney might set up a business but they need other professionals to run the infrastructure.   The most expensive lesson will be caused by ignorance.  So having gone through only a small number of requirements for business as usual outside the home, let's proceed to in home business opportunities. 

In order to have a recognized home office deduction on your taxes, there are several required elements.  You may again go online search the IRS site on home office deductions and follow it to the letter.  The only suggestion I might make is for you to take photographs of the room you set aside showing that it is a exclusive area.  Date the photo and mail it back to yourself "certified return receipt requested"  and put the envelope away unopened in a safe place.  If you do this every six months or so you will have proof of a genuine home office. 

As far as bookkeeping goes there are a couple of software programs I like but remember I have 30 years experience as a bookkeeper as well as 2 years of accounting training so what looks easy to me may not be to you.   I like Quicken for businesses as well as Quick Books Pro.  Both of these link up with Turbo Tax if you are doing your own taxes.   However depending on your expertise, a professional may be the least expensive way to go long term as the more complex your business the greater the need.  I am not intending to be discouraging about setting up home based business opportunities, but being mindful of the details is critical to your long term success.  There will be obstacles but persist and get professional help.  One suggestion might be to check with local Senior Citizen organizations as they may have folks available to assist you for nominal fees. 

Next posting will cover the what to do:  Make Money Online, Make Money at Home, What constitutes a Business opportunity, Can you work from home and make money.  Be succesful, reach your dreams and goals  Review of what I've already tried and the results so far.

Business opportunities online depend on: Success Rule #1 Set Goals

One of the elements I found that helped me in my home based businesses was a report that  a major university  tracked a class of graduates for 20 years that used goal setting. After 20 years, it was discovered that only 20% actually had a plan and only 5% of them had them written down. The major successes came to that 5% and it was determined that 85% of the wealth belonged to that 5%.

After hearing this statistic I immediately took an eight hour goal setting seminar with Franklin Covey, used their planners and systems and was amazed at the different results I had. Here are some of the discoveries I learned, but I would suggest that the best investment you might make is learning how to manage your time productively, whether you are starting a conventional  home based business or an online one.  In order to make money at home or make money online, organization of your events and time will be  key elements to your success.  Making choices for your activities every day will assure long term success in your home based business.   Your dreams and goals can come true when they hold a high priority every day; when you have a strong why it overcomes the obstacles of the "how to".

Important tips on time management for home based business opportunities

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   First determine what you want. What are you willing to do and what are you willing to put on hold for a while. Most people only have a vague idea of where they want to go. Think not only short term, but where you want to be in 5 years, 10 years, 25 years and lifetime goals. You should be able to believe that you can accomplish these goals and something that stirs your emotions. Once you have thought about this go to the next step. This applies equally to offline or online businesses.
   
   
   
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   Second, everything should be written down (this is critical, do not skip this step). I use 3x5 cards. Write it down in vivid present tense detail. i.e. I am (your goal) at such and such a date. Once you have done that then do the following daily exercises.  Because you work at home, discipline becomes even more important.   Your daily tasks can be just as easy to do as not to do. 
   
   
   
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   Third, read what you have written out to yourself silently and repeat for about 10 minutes.
   
   
   
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   Fourth, now read contents of your cards out loud and repeat until you have spent about 10 minutes in the process.
   
   
   
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   Fifth, dwell and spend time with your dreams and goals every day. "Whatever is planted in our subconscious mind and nourished with repetition and emotion, will one day become a reality." Imagine how you would feel if your dream was here today. I spend about 10 minutes a day in a quiet place and think about the result I want. See the end at the beginning.
   
   
   

This may seem an unimportant and simple exercise but this 30 minutes will implant your goals and dreams firmly in mind. Our actions always tell us what our belief systems are.

Unfortunately most of us have about a 90 to 1 ratio of negative to positive messages long before we have the guards up against unwanted programing We come into this world I believe, a blank slate, "Tabla Rasia" and then all the important people around us begin to influence our thought processes long before we can protect ourselves. For instance we are told over and over not to speak to strangers which is a great programing for children, however that thought applied to a person in marketing, a home based business, sales or management, might not be able to figure out why they are shy or have trouble with confidence and self esteem.

I am not suggesting that you go into psychoanalysis but having a very directed program of laying out new direction can overcome with time, a lot of the old thought patterns that hinder our successes whether it be a home based business or our jobs.

Now I know all of us talk about saving time, managing time and so forth, however it can't be done. We only have 24 hours no matter how you cut it. A minute once gone is gone forever, can't get it back so all we can do is prioritize and manage the events of our lives. It is critical to your success in home based businesses to have a written plan of action.  If not we may spend our precious resource time on unimportant non essentials.

This is where a goal setting program and a planner comes into the picture. Most of us spend our time minoring in the majors and majoring in the minors. We need to spend our time in a productive manner to get the best results. I have a sign on my desk that says "I must do the most productive thing in every given moment".

This will require an examination of your daily task and deciding in view of your goals what takes the highest priority. Most people are still working at jobs or their businesses so that along with commuting is probably your 1st priority, but if you are chronically late for everything, you may have the calendar all of your daily schedule until you get on track. On that note there is some thought that being late is a form of rebellion against someone else's control.   Have a "3 D" home based business; Dream, Determination, Discipline.

Once you have prioritized your tasks into A most important, B next in line, C after A-B's are done and then D's they are the least important on that day. Check each task off as it is accomplished and then reschedule any remainders for the next day. Always gauge priority in light of importance relating to your goals, which may   not necessarily be urgent. An event may be both important and urgent but I have found that when you take the long view that sometimes the most important things aren't necessarily urgent. Sometimes our success is found in those small important but not urgent steps we take every day. I have discovered that being successful sometimes is simple and just as easy to do as not to do.

What happens when you don't want to do what is necessary try to remember Earl Nightingale's "Greatest Secret", "Successful and unsuccessful people both don't want to do the same things, but successful people are more interested in pleasing results than pleasing methods".

I hope, dear reader, that these thoughts and observations are of value to you in starting your home based business and I have posted a few links that will assist you in taking control of the events of your life. Bon Voyage and may you find many opportunities on your path to your goals and dreams.  Stay tuned for next in the series;  why, where, when, what and possibly who is an entrepreneur that has a home based business.