Archive for January, 2008
The anti 9-to-5er: Sabrina Helas, Los Angeles, California
My job: I am a pet photographer. My company’s name is Cookies and Water Photography. I began this adventure two-and-a-half years ago.
What makes my gig anti 9-to-5: I work for myself. I came to a point where I felt such an imbalance in my life that I had to do something to change it. I found myself blessed to find the love of my life, the best dog on earth, a great place to live, and a job that I loathed. And of course I spent more time with the loathsome part of my life than the blessed.
The bureaucracy of my job, the “leadership,” the politics, and the rules, made doing my job impossible and senseless. Nothing made sense anymore except that I had to do something else. The problem didn’t lie in the company I worked at or had worked at previously — the problem was what I did for a living and how I spent my days.
What I did in my former 9-to-5 life: I studied cinema at San Francisco State University. I had worked in the entertainment industry since I left college in 1997. I have held many titles in that time, some of which have been production assistant, location assistant, producer’s assistant, and co-producer. When I couldn’t take the production side of things anymore I stepped into the post-production realm, where my last position was post coordinator/scheduler/all-around fallout gal.
How I made the anti 9-to-5 leap: With my job being soooo awful, I got sick a lot, migraines mostly, so I would get massage therapy frequently. I felt so good when I left that I wondered and fantasized about how great these therapists’ lives must be, making a living helping others, working in such a serene environment. It all sounded so great, so I got a loan, a credit card, conveniently got fired from my job, and enrolled in massage therapy school. I finished the classes and realized that as wonderful a profession as it was, it simply wasn’t me.
My next step was to forgive myself and go back to the drawing board. What I hadn’t realized was that what I wanted and what was me was right under my fingertips, in front of my face the whole time. Two things I have always loved are dogs and photography. Every month with our rent check, I would include a picture I took of my landlord’s dog in the envelope. Every day that I went to the dog park, I saw ads for pet photography. My landlord jokingly would say that she didn’t care about the rent as long as I didn’t forget the picture. She loved my work and suggested that I take pictures of pets for a living. So I took her advice.
My biggest obstacles: Starting your own business is a long slow process. If you’re not a businessperson to start out with, you have to learn everything from scratch. I knew nothing. I learned everything on the fly. I did a lot of homework and research. I looked up other photographers, I studied their platforms, I read books (Photographer’s Market, Pricing Photography by Michael Heron and David Mac Tavish) to mention a few.
I donated pet sessions to charity events. I put up flyers at my local dog parks, vets, and pet stores. I advertised on Craigslist, created and passed out postcards, attended pet events. My non 9-5 job turned into a 24/7 job, but it made me happy, so happy. I lacked money, contacts, experience, equipment. I had no legal advice, but I had the support of my loved ones, a bunch of new books, a camera, and finally something that I loved to do. I just kept trying, kept learning (still do). I take the hurdles as they come and figure them out one by one.
My tips for other cubicle expats: Find the thing you love, find the thing you are good at, give it a go, and then keep going. If that thing is photography, do your homework, research other photographers, research equipment (Cnet.com and KenRockwell.com are great references), take a class. Get a good digital DSLR — get it used, refurbished, look on eBay, craigslist, in local camera shops. You don’t have to pay full price. Look online — you’ll find a good deal if you keep looking.
Get a good computer. Here, I must give props to Apple. I couldn’t have done it without them. Well, maybe I could have, but they make everything so fun, easy, and accessible.
Once you have your camera and your (hopefully) Apple computer, go out and shoot. Experiment and shoot some more, develop your style. One of the best things about digital technology is you have the luxury of making mistakes, shooting a picture badly — it’s free. Keep shooting, learn from your mistakes. The best advice I can give is to shoot, shoot, shoot and don’t give up.
What’s that link again? CookiesAndWaterPhotography.com
Read past anti 9-to-5 profiles. Then fill out your own profile to be featured on this site.
January 29th, 2008
Denis writes: I’m 23 and just started doing freelance work this year. I did work for three different clients and I didn’t receive more than $600 from any of them. So I’m not going to receive a 1099 from any of them. Do I still have to report that income? If so, then can I deduct expenses such as internet and computer accessories? I just wanted to know what you think based on your past experiences.
I answer: Congrats on starting to freelance. Exciting! As for your question:
(1) From what I understand, and what an accountant once told me when I was starting out more than a decade ago, technically you have to report to the IRS (pay taxes on) any income you earn as a freelancer. Your clients might report that they paid you $200 for a job, and through its omniscient brain, the IRS could catch wind of this and come after your self-employed ass for the money it’s due. Or something like that.
That’s not to say I haven’t heard of freelancers doing the occasional one-time $100 job they knew the client wasn’t reporting and electing to keep that information to themselves, not that I’m advocating trying to screw the government out of its hard-earned war funding or anything. Mess with Uncle Sam at your own risk.
(2) Without being a financial professional, and without knowing your situation, it’s impossible (and professionally irresponsible, not to mention risky) for me to advise you what to do. But here are a few questions for you to ask yourself:
- Do the city and state in which you live require you pay business taxes? If so, you may owe them money too. Check your city and state licensing departments to find out.
- How much income are we talking about anyway? If it’s just $100, you might be able to go away quietly into the night without any political entity being the wiser (see above), not that I’m advocating you do. If it’s $1,500, I suggest you talk to a tax pro who can advise you how much to pay up. H&R Block has a free “Ask a Tax Advisor” service on their site that might be helpful. Or you could get TurboTax, which supposedly walks you through every little detail of filing your taxes.
- Do you also have a full-time staff job that’s taking taxes out of your paycheck? How much you’re already sending to the IRS through your day job might affect how much you’ll owe on your freelance earnings. Again, a tax pro who’s looking at the big picture is your best bet here.
- And finally, how much are your business expenses? Yes, you can claim the internet bill and computer accessories if you’re claiming the freelance income. But if the expenses exceed the earnings, you might not owe Uncle Sam any money. Maybe. I dunno. But you still may need to file a form. Maybe. See why you need to talk to a tax pro?
(3) I can’t stress this enough: Don’t rely on people like me who don’t work as CPAs, CFPs, or bookkeepers for fine-grained advice on how to file your taxes. You need to talk to a professional who can assess all the variables of your individual situation and tell you what to do. Or you need to get a program like TurboTax to walk you through it. Don’t give the IRS a reason to audit you, which would only land you in an accountant’s office anyway.
AFTERTHOUGHT: You may also want to read this post, on business licenses and the IRS definitions of “hobby” and “business.”
Got a question about self-employment or career change I don’t need a financial degree to answer? Ask away.
January 27th, 2008
It’s the most wonderful time of the year (that is, if you’re a CPA). That’s right, folks, tax season is upon us. And not surprisingly, I’ve had a couple requests recently for a round-up of this site’s past posts on paying your freelance taxes.
Before we get to the round-up, I’d like to take this opportunity to remind you that I’m a freelance writer, not a financial professional. Tax laws change every year, and no one knows their nuances better than your friendly tax professional. So although you can get some initial pointers from a freelance blog, I wouldn’t substitute them for the almighty input of someone who’s trained to fill out tax returns. Capiche?
OK, back to our regularly scheduled programming…
Additional resources:
January 24th, 2008
*sniff*
January 23rd, 2008
Besides working from home, my best commute to work was for the last staff job I had, back in the early nineties. I lived in Hoboken, New Jersey, two blocks from the PATH train into Manhattan. I’d take the train one stop to 33rd Street and then walk a couple blocks to my publishing job. Easy peasy, though not entirely roomy during rush hour.
Today the Seattle Times ran an article about two guys who live on Bainbridge Island (near Seattle) who commute across the Puget Sound by water bike. As in, across the water. By pedaling, not paddling. One guy shaved his 80-mile roundtrip ride to work to just 12 miles, one of which he does on his water bike.
I’ve kayaked in a bunch of lakes and the sound around here, most notably in the San Juan Islands, and all I can say is, good on them! Sounds like a dream commute to me. No traffic snarls, exhaust fumes, or parking fees. Just exercise, fresh air, and seal pups for company.
OK, so now that we’ve established that I’m a tree humper, what about you? What was your best commute? Your worst? Your weirdest?
January 22nd, 2008
Traci asks: Do any of your clients pay you via PayPal? I have an account, and I’ve seen that other freelance folks sometimes list it as a payment option. Has it worked for you? Any pros/cons to consider?
I answer: I have not used PayPal to receive payment. Nor do I plan to anytime soon. Not when I can get clients to send me a check or make a direct deposit payment into my bank account, which, as far as I’m concerned, is accounts receivable nirvana.
Here are what I see as the pros of using PayPal for freelance work:
- If you work with clients halfway around the world, it might be easier to get paid this way.
- If you sell your wares (earrings, silkscreened T’s, hand-crafted journals) through your site or blog, it’s an easy way to accept credit card payments. You definitely don’t want countless people you’ve never met sending you checks for $25.
- If you work in a super-tech sector where everyone uses PayPal, you might want to apply the “when in Rome” philosophy. Clients don’t appreciate freelancers who aren’t up to speed and throw a wrench in their carefully crafted systems, accounting or otherwise.
- I imagine PayPal can enable getting paid faster. Like direct deposit, it does cut out the step of having to deal with a hard copy check. But there’s something that never fails to excite me about opening my P.O. box and finding a check there for a writing job well done from the comforts of my home office.
Here’s my take on the cons:
- Doesn’t PayPal take a cut of your pay or charge an annual fee? Why should I do this when I can get paid for free?
- Not all clients use or want to use PayPal. Again, if you’re selling a service (rather than a product), you want to make it easy for them to work with and pay you. Meaning, you want to abide by the payment systems they have in place. (See pros, above.)
- I hate the idea of leaving my bank account or credit card info with an online service. Here’s a perfect example of how things can go horribly awry.
I realize I may be old school in my views on PayPal (and web banking in general), so I welcome your input, especially if you’ve used PayPal to receive or make freelance payments.
Got questions about self-employment? I got answers. And if I don’t, someone else around here is bound to. Here’s where you can reach me.
January 21st, 2008
Sarah Jio asks: As a fellow freelancer, I work from home. I’m pretty anal about organization, but when it comes to my office, it’s become a catch-all for baby stuff, the vacuum cleaner, STACKS upon STACKS of magazines, and plain ol’ junk! As I plan a big office remodel this year, I’m polling my freelancer friends about their work spaces. I always love to hear where others write, how they keep their spaces tidy, and how they make them an enjoyable place to work — so Michelle, please share! Do you keep your office super clean? Do you need it to feel organized to feel creative? What are your tricks for keeping your files in order — and avoiding chaos? Is it important for you to enjoy the space (i.e., have you painted it a cool color, splurged on a great chair)?
I answer: I write in the spare bedroom in my house. Besides the desk, phone, computer, fax, etc., it contains four bookshelves, a file cabinet, and stacks and stacks of neatly piled folders from past articles/gigs that I need to sort through this spring. It also has a door that shuts and two windows, one on either side of my desk. The natural light is key for me. Ditto for the door, in case anyone’s over or the dog decides to bark when I’m on a call.
I desperately want to repaint the office and get some taller bookshelves and make it cozier/cuter/more space-optimal, but that’s a project for spring or summer. (Ideas: Stencils on the walls and a bulletin board painted some bright color.) Right now I have a big, multi-week deadline to focus on, which is of course why I’m answering this question instead.
My big thing is that as long as my office is neat and relatively free of dog-hair tumbleweeds, I can work. A few months ago, the floor was littered with crap (books, magazines, old files, bulk office supplies, clothes that needed to go to Goodwill) and it was really distracting. In fact, I stopped using my office altogether and started working at the kitchen table!
Fortunately, an out-of-town family visit prompted me to pick up the floor. I moved a lot of the old files and bulk office supplies into the garage, filled the recycling bin with files and magazines I didn’t need anymore, and neatened the rest of the files into stacks that I’ve pushed against the walls and corners… to be sorted in a few months. (In an ideal world, I’d purge my files once a quarter. Also, I’m trying to print out less, but sometimes you just have to read an in-depth research doc or edit offline, you know?)
If my desk gets too crazy cluttered or I can’t find the printed contracts/research that I immediately need, I will stop right in the middle of my workday to deal with it. Not ideal when you’re on a roll with an article or chapter. And right now, I’m dying to spend an evening rearranging my bookshelves because it’s been hard to find the books I need for research during the past few weeks. That’s probably something I’ll tackle this month.
As for accoutrements, I recently bought a bigass flatscreen monitor, which I love. So much better than hunching over my laptop. My body is happier too. Ditto for the $300 chair I bought a couple years ago, which was an ergonomic necessity. I was living at the chiropractor’s office. I’m still looking for the ideal way to store hard copies of newspaper and magazine clips I want to save. Maybe I’ll spluge on one of those flat filing cabinets, if I can find a tall, skinny one that’s pretty. (If anyone has suggestions, I, too, would love to hear.)
Got questions about fleeing the cube and working from home? I got answers (that is, as long as you don’t want me to look at your resume and tell you what to do with your life — there are, ahem, books for that). Here’s where you can reach me.
January 18th, 2008
Over the past week plus, personal finance gurus Manisha Thakor and Sharon Kedar, authors of On My Own Two Feet: A Modern Girl’s Guide to Personal Finance, have kindly answered a bunch of questions on this blog, including the one that follows. You can read the previous Q&As here (part 1), here (part 2), and here (part 3). I want to thank Manisha and Sharon for generously sharing so much of their financial know-how on this blog. This concludes the question-and-answer part of the program, girls and boys, but if you want to learn more about Manisha and Sharon’s book, visit their website, OnMyOwnTwoFeet.com.
Annie asks: How aggressive should I be about investing my retirement funds in the current economy? I’m 23 with a brand new 401(k). I know I shouldn’t be afraid to choose riskier options at my age, but I’m worried this option might backfire pretty badly in the short run. I hate to sound like an alarmist, but what do you recommend as far as how to invest during uncertain times? Thanks!
The MBAs answer: Great question! The conflicting economic news these days is enough to make any sane person’s head spin. You are wise to raise this question. The key to answering it is two-fold: (1) This is your RETIREMENT money, and (2) You are VERY YOUNG.
In other words, the money you put in your 401(k) is money you should not plan on touching until you are at least 59 1/2 years old. (Yes, there are certain circumstances where the government will allow you to access that money penalty-free before then. But heck, the point of that money is to fund your retirement, so best to stay away from that cookie jar in the interim.)
As such, you very well may see your balance go up and down — in fact, up and down quite a bit at times. However, until you close in on retirement, until you hit age 50, we think it’s best to keep that investment gas peddle to the floor and stick with those more aggressive investment options. Remember, you won’t be SPENDING that money between age 23 and age 59 1/2, so it’s ok if its upward trajectory is a little wild.
The reason is that no one can predict where the market will go — but when when it does move up, history has shown us that it tends to do so very quickly and with no advance warning. For instance, if you look back over the last 10 years, studies show that 90% of the return you made in stocks came from less than 10% of the trading days. But alas, no one knows for sure which 10% of the days those big moves will come on. That’s why for years smart investors have said investment success is about “time IN the market,” not trying to “time the market.”
Our favorite keep-it-simple option if your 401(k) plan offers it is a target-date retirement fund, which is a mutual fund that will adjust to “right” level of aggressiveness based on your age. But the most important thing is that you are participating in your 401(k). At your age, that puts you solidly in the drivers seat on the path to financial nirvana. Go you!
January 14th, 2008
Last week, personal finance rockstars Manisha Thakor and Sharon Kedar, authors of On My Own Two Feet: A Modern Girl’s Guide to Personal Finance, kindly answered a bunch of questions on this blog. You can read the Q&As here (part 1) and here (part 2). Manisha and Sharon also agreed to answer five questions from you. So far, we’ve only received one (answer below), which means we get four more freebies. If you have a personal finance question for these two Harvard MBAs, post it in the comments by Monday.
Rachel asks: I’d love to hear some advice on how all these savings and retirement ideals fit into credit card debt. My income has stabilized but I’ve got a little debt from starting my business — should I be stashing money anywhere else besides into paying this off?
M & S answer: Ahhh, your question warms our heart. It’s such an important question that we actually devoted a whole chapter of our book (Chapter 10) to it! The short answer is that your goal is to balance the two rather than take an all or nothing approach. Our argument is that while focusing solely on paying down your credit card debt is mathematically the hands-down answer, practically, if you wait to start saving until all your debts are paid off, odds are high you won’t get there. (It’s like saying you’ll start dieting AFTER your local grocery store stops selling premium ice cream in your favorite flavor!) We go into much more detail in our book, but our favorite plan of action is the following:
- First and foremost, make the minimum required payment ON TIME, EVERY MONTH on all outstanding debts.
- Save $2,000 as a “starter” emergency fund.
- If your employer has a 401(k) type plan that offers a “match,” contribute as much as you need to get the full match.
- Continue to build up your emergency fund to at least 3 months (ideally working up to 6 months) of your essential living expenses.
- Now pay more than the monthly payment on any credit card debt. (If your debt is $5,000 or less, pay at least an extra $50 a month EVERY month; if your debt is between $5,000 and $10,000, pay an extra $100 EVERY month; and if it’s over $10,000, pay an extra $150 EVERY month until all that debt is wiped out.)
- Now if you want to buy a home, you can start saving for a down payment.
- If you don’t want to buy a home (or already have one), keep saving for retirement.
One important caveat: These are rules of thumb. The final choice is always up to you. If your credit card debt is making you dry heave every time you think of it, well, by all means swap steps (4) and (5) and accelerate the debt pay-down first. Our primary point is that getting in the habit of saving is like starting to floss your teeth. Once you get going, you wonder how you ever did without. This is why we think it’s so important to do at least a little saving while you are working off your debt. Finally, go you for being interested enough in your personal finances to ask us a question — that speak volumes about your mojo!
Have a personal finance question for Manisha and Sharon? Post it in the comments by Monday.
January 10th, 2008
Pity the doctors and lawyers. They slogged through countless, sleepless years of higher education and amassed astronomical student debt only to realize that they’re no longer envied and revered by the rest of us poor working slobs.
According to yesterday’s New York Times, “some doctors and lawyers feel they have slipped a notch in social status, drifting toward the safe-and-staid realm of dentists and accountants.” What’s more, MDs and ESQs “only” make six figures, when much sexier-sounding hedge funders and webpreneurs (some of whom didn’t even go to college — gasp!) are making millions.
Call me callous, but I find it hard to feel sympathy for anyone who chooses a profession just because they think it will sound good at a dinner party. (Why does the Sunday Style section measure everything against the dinner-party yardstick?) This might have something do with the fact that when I was in school, everyone and their grandmother (mine included) regarded Lawyer or Doctor as the holy grail of career choice. As for flexible, creative, entrepreneurial work? That’s what stoners and slackers did.
So score one for the so-called slackers. And note to the Times: Not everyone under 30 in the brave new entrepreneurial workforce wants to be the next Web 2.0 bazillionaire. Some just want to do work they can stomach, have some time left over to spend with the people they love, and avoid a hefty dry cleaning bill in the process.
January 7th, 2008
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The anti 9-to-5er: Sabrina Helas, Los Angeles, California