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Solo's blog provides the resources that microbusinesses, solopreneurs, freelancers, and other super-small businesses need to start, operate, and grow.

Blog for starting, running, and growing your business | Solo.co

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If you run a local business, you may view marketing as a problematic, nebulous, expensive, “necessary evil.”\nOr you may not see the need for a marketing plan at all, relying instead on “word of mouth” or foot traffic to bring customers to your business. (More on that later.)\nRegardless of your views, it’s a good bet that if you’re reading this article, you want to know the best ways to stretch your marketing dollar. Well, you’re in the right place.\nHow much should a small business spend on marketing?\nFirst of all, let’s clarify just how big that small business marketing dollar should be. \nMost experts' recommendation is that small businesses spend 7-8% of gross revenue on marketing, which corresponds to guidance from the U.S. Small Business Administration. \nThat may sound like a lot, but consider that larger businesses on average spend about 13% of their gross revenue on marketing, and a study by Duke University and Deloitte found that many businesses spend up to 50%! Yikes.\nIf this all sounds overwhelming, don’t worry. While you really should have a marketing budget, small businesses don’t have to spend nearly as much as big companies, and spending more doesn’t necessarily produce better results. \nIf you’re careful and smart, even a modest marketing budget will produce significant returns. (You can even see substantial improvements without spending ANY money! Keep reading for the secret.)\nOwn your online presence and you will attract more customers\nSome of the most effective small business marketing tools are not only affordable, they’re positively cheap. How cheap are we talking? Well, how does FREE strike you?\nBut before you spend ANY money on advertising, you first need to optimize your online presence—your business’s digital reputation—and all this costs you is your time. If you don’t start here, any advertising dollars you spend will just send your potential customers to someone else.\nWhy? Because, although “word of mouth” is still the #1 way customers find local businesses, that conversation has now moved online to review sites like Yelp, Facebook, Google My Business, and TripAdvisor. And 88% of consumers trust recommendations from these sites as much as personal recommendations from friends or family!\nSo, imagine you spend $1,000 per month on advertising but you haven’t first claimed your business profile on all the popular review sites and taken control of your online presence.\nWhat’s the first thing people do when they hear of a local business they’re interested in patronizing? You guessed it… they search online for reviews, location, hours of operation, etc. \nSo if you start spending advertising money without first optimizing your online presence, you’re promoting a business that either (a) people can’t research online because you don’t have a solid digital footprint, or (b) has a poor review rating and/or inaccurate information on these critical sites. In either case, you’re wasting your money.\n\n84% of consumers search online for local businesses. Make sure your business’s digital footprint is ready!\nSo start by claiming your business’s profiles on all the top review sites and start responding (politely) to all reviews. Responding to reviews shows you take customer feedback seriously and are committed to providing a top-quality experience. Plus, research shows that businesses that claim their listings on multiple online business reviews sites make 58% more money!\nPro tip: we’ve written helpful articles about \nhow to claim your business listing on TripAdvisor\n, \nhow to claim your business on Yelp\n, \nhow to claim your Google My Business listing\n, and how to respond to \nonline reviews\n.\nBiggest bang for your small business marketing buck? Email marketing\nOnce you’ve taken the vital step of claiming your business profile on all relevant review sites and have started to engage your customers by responding to reviews, you’re ready to start marketing to current and potential customers to drive new and repeat business.\nAs we’ve written previously, \nemail marketing\n is hands-down the most powerful, effective, and efficient small business marketing tool. 86% of customers actually want promotional emails from businesses they patronize.\nHow good is the return on investment (ROI) for email marketing? Somewhere between 36:1 and 44:1, depending on whom you ask. That means that for every $1 spent on email marketing, it brings in between $36 and $44. There is simply nothing else in the marketing toolbag that has anywhere close to that ROI.\nWith all the buzz about Instagram this, Facebook that, and Google the other, the concept of email marketing might seem positively archaic. But there are several advantages to email marketing that aren’t shared by its younger social-media cousins:\nEmail isn’t limited to one platform. Social networks come and go, and are dependent upon one company. Email, on the other hand, can be accessed and used via any one of thousands of email clients.\nEmail is nearly universal and dwarfs the largest social media companies. Facebook boasts 2.2 billion users, and over 500 million tweets are sent on Twitter per day. That sounds impressive until you learn that there are over 3.8 billion email users. Want to take a guess at how many emails are sent per day? \n281 billion.\nGetting started in email marketing\nTo get the full monty on the tips and how-tos for getting started, be sure to read our detailed post on \nemail marketing\n, but the TL;DR version is 1. Be consistent, and schedule time to compose an email weekly; 2. Provide real value and focus on the story, not the click; 3. Triple-check your formatting, links, and layout to make sure everything works (and find a good proofreader); and 4. Don’t send generic, bulk emails and consider automating the process. \nIf this all seems like too much, commit to this one vital practice: send a thank you email after a customer purchases at your store. The value of this practice can not be underestimated. \nSources:\n
\nhttps://deloitte.wsj.com/cmo/2017/01/24/who-has-the-biggest-marketing-budgets/\n
\nhttps://searchengineland.com/88-consumers-trust-online-reviews-much-personal-recommendations-195803\n

Small business marketing: What’s the biggest bang for your buck?

In this article:\nWhat is freelancing or freelance work?\nBest freelance jobs for highest pay\nTop freelance jobs that anyone can do\nHow to get started in a freelance career\nFreelancing is growing in popularity, and the era of the “gig worker” has definitely begun. Whether this has been the result of the COVID-19 pandemic and the related adjustments to the workforce, freelancing has been around since before the local “handyman” became a thing. Freelancing and it generally gives those who do it extra money on the side of their full-time job or even is there full-time job and allows them the chance to manage their own schedule. \nOver the course of the coronavirus pandemic, the freelance industry shifted, and it now makes up about 36% of the U.S. workforce. Beyond that, 75% of freelancers who left an employer to do their freelance work full-time say they make the same or more than they did with their previous job. \nSeems compelling, right? Well, if you’re interested in getting into the freelance game, check out some of the best freelance work that you can do as you read on. \nWhat is freelancing or freelance work?\nFreelancing is when someone works for themselves instead of for another company. You’re basically self-employed and offering your services to others who need it. \nFreelancers can be categorized as independent contractors, temp workers with staffing agencies, gig workers, project-based workers, and even self-employed business owners. \nThe beauty of freelancing is that it’s very flexible too. It doesn’t have to be a full-time job (although it certainly can be). You could freelance to supplement your income from your full-time job, do multiple freelance jobs, or find enough customers that you can do your main freelancing job full-time. \nIf you just want to try freelance work for a little bit, find a job that you can do for a few hours a week and see how you like it. \nBest freelance jobs to earn the highest pay\nSome of the highest paying freelance jobs you can find are based on specific skillsets. If you have a specialized skill that you can offer to customers, then you may be set to start making good money for freelance work. \nCheck out these top high-paying freelance jobs. \nContract and corporate law\nIt’s no secret that attorneys and law clerks can make a lot of money. If you decide to take this on your own, you could work in corporate law or help companies develop contracts and work completely for yourself rather than through a firm. \nAverage pay: $75-85/hour\nBest places to find freelance lawyer jobs:\n\nhttps://www.lawclerk.legal/\n\n\nhttps://www.upwork.com/freelance-jobs/corporate-law/\n\n\nhttps://www.lawyerexchange.com/\n \nDigital marketing consultant\nMarketing is another industry that is very specialized and takes a lot of experience and knowledge to get the job done right. As a digital marketing consultant, you could take your industry knowledge of marketing and previous experience and translate that into helping companies better manage their digital marketing strategies. Consult on the areas you are strongest and provide best practices and methods for your clients to move forward with. \nAverage pay: $50/hour\nBest places to find digital marketing consultant jobs:\nJoin a digital marketing jobs group on Facebook\n\nhttps://www.upwork.com/freelance-jobs/digital-marketing/\n\nSearch engine marketer\nSEO (search engine optimization) is necessary for any business that wants to get found online. If you’re familiar with the ins and outs of Google and how to raise a website’s visibility, then you might try your hand at freelancing as a search engine marketer. \nAverage pay: $50/hour\nBest places to find freelance SEO jobs: \n\nhttps://www.freelancer.com/jobs/seo/\n\n\nhttps://www.upwork.com/freelance-jobs/seo/\n \nWeb designer or developer\nEvery business needs a website and new businesses are popping up every day. Put your web design and development skills to use to create beautiful websites for your customers. You could even seek out local businesses that need a little website help and pitch some low-cost websites to get started and build your portfolio. \nAverage pay: $45/hour\nBest places to find freelance web design jobs:\n\nhttps://dribbble.com/web-design-jobs\n\n\nhttps://www.fiverr.com/categories/graphics-design/website-design\n \nProgramming and software development\nIf you have great programming skills, you could start freelancing and develop mobile apps and software for businesses. This might be one of the highest paying freelance jobs because it requires such a specialized skill set and a lot of experience to do it well. Because the industry and needs for programming varies so greatly, so does the average pay. But great programmers can make upwards of $150-$200 per hour. \nBest places to find freelance programming jobs:\n\nhttps://www.freelancer.com/jobs/programming/\n\n\nhttps://www.upwork.com/freelance-jobs/application-programming/\n\nCareer coach\nAre you good at job interviews, writing resumes, and connecting others with job opportunities? You may have what it takes to make it as a freelance career coach. This is a job you could do one-on-one with individuals who are seeking career advice and trying to get a good job. You could also provide workshops, online courses, and partner with staffing agencies for seminars. \nAverage pay: $45/hour\nResources for becoming and marketing yourself as a career coach:\n\nhttps://www.readyresetgo.com/the-career-coach-accelerator\n\n\nhttps://www.linkedin.com/pulse/so-you-want-become-career-coach-heres-some-tips-help-harris-ms-cprw\n \nFinancial advisor\nA freelance job in finances could range from being a financial modeling expert, to a CPA, to a financial estate planning attorney. Focus on your area of expertise and find the customers that would value those skills. \nAverage pay: $62.50/hour\nBest places to find freelance finance jobs:\n\nhttps://paro.ai/experts/\n\n\nhttps://www.upwork.com/freelance-jobs/finance/\n  \nBusiness consultant\nBusiness consultants help businesses improve their performance and efficiency. Have you run your own businesses before or worked in auditing capacities that allow you to create solutions for businesses? Then this could be the right freelance job for you. \nAverage page: $60/hour\nBest places to find business consultant jobs:\n\nhttps://www.upwork.com/freelance-jobs/consulting/\n\n\nhttps://www.fiverr.com/categories/business/business-tips\n \nSpecialized writer, copywriter, technical writer\nTechnically this could have been placed in the number-one spot. If you are knowledgeable in just about any given topic, or know how to research and write well, then you could become a freelance writer and make good money doing it. Have you been working in a specialized industry for a while? Find businesses in that industry and write content for them. The pay range varies a lot depending on your experience and the industry you’re writing for, but experienced writers can make well over $100/hour. \nBest places to find freelance writing jobs:\nFind digital marketing groups on Facebook (digital marketing teams are always looking for skilled writers to help their marketing efforts for clients across various industries)\n\nhttps://www.upwork.com/freelance-jobs/writing/\n \nNote: The pay for any of these jobs can vary a lot. You may make well over the average or might not be able to get companies to pay you the average. It’s all in how you market yourself, what the market is like locally for your services, and what your customers’ needs are. \nBest freelance jobs that anyone can do\nYou don’t have to have years of experience, a degree, or even any special skills to make it as a freelancer. There are tons of jobs out there that anyone can do while providing the benefits of being your own boss and managing your own schedule. \nCheck out these freelance jobs:\nApp-based driver\nHave you ever wondered what it would be like to work for Uber or Doordash? As a driver for any of these app-based driving companies, you would be an independent contractor, setting your own hours and only working when you want to. It’s a great side gig to earn some extra cash, and if you really enjoy it you could even make it work full time. \nJust visit the website for the delivery/driving service that you want to work with in your and get started today. \nA few important tips:\nYou will need a working vehicle (in some cities you can even ride a bike) and a driver’s license\nYou must be 18 years or older\nYou’ll need to consent to a background check for most services\nVirtual assistant\nAs a virtual assistant, your job could vary between several different responsibilities, from data entry to customer support. Many business owners opt to hire freelancers for the simpler tasks that are difficult to keep up with on a daily basis. That’s where you come in. And if you do it well, you could be looking at a long-time career in the virtual assisting game, particularly if you get good experience and can land some larger clients. \nCheck out \nUpwork\n for some good beginner freelance jobs for virtual assistants. \nTranscribing services, transcription\nCan you type 60+ words a minute? Do you enjoy typing? Then you might be the perfect candidate for a freelance transcriber. There are tons of transcription services out there that are always hiring freelancers to help with their workload. A good freelance transcriber could make anywhere between $15 and $30 per hour. \nCheck out these sites that hire freelance transcribers:\n\nhttps://www.rev.com/freelancers\n\n\nhttps://www.transcribeme.com/jobs/\n \nWriting, editing, proofreading\nIf you know how to write and research well, then you could easily become a freelance writer. The more specialized and experienced you are, the more money you can make here, but anyone can become a freelance writer if they are good with grammar and putting sentences together. And the beauty of this is that businesses in all industries need writers. You can find a topic that interests you and start applying for jobs. \nResources for starting a freelance writing career:\n\nhttps://www.upwork.com/freelance-jobs/writing/\n \nHow to get started in a freelance career\nIf you are ready to dive into the world of freelance work, congratulations! We hope you enjoy it! Here are some helpful tips as you get started that will help you better define your services as a freelancer and start getting clients. \nChoose a niche. You can explore different areas of expertise in the beginning, but really nail down the industries that you enjoy working in and get a ton of experience to build up your repertoire in that area. Becoming the expert will make you a much more desirable candidate for new clients. \nDefine your services. As you can see, there are a ton of things you can do as a freelancer. But similarly to choosing a niche, you’ll want to define your services to those that you can really excel at. This is how you’ll make more money in the long run and get really good at what you do. \nKnow your ideal client. Become familiar with your ideal client. What problems do they need solved? What will your ideal client be willing/able to pay? Can they afford to hire you? Are there specific demographics that your ideal client meets? Knowing this will help you market yourself as a freelancer. \nStart marketing yourself as a freelancer. Use as many outlets as you can to start marketing yourself. Create a portfolio website that you can send to potential clients. Update your LinkedIn profile to show your experience as a freelancer and describe yourself in such a way that appeals to businesses that are hiring freelancers. Create profiles on freelancing sites like Upwork, Fiverr, and more. \nStart freelancing before quitting your day job. This is important so that you can really test out freelancing before diving all in. Find out if you like it and get some good gigs started before dropping your main source of income. Once you get more experience freelancing and can supplement your main income with it, then you’re ready to go all in. \nContinuing growing your skills and acquiring new clients. Keep up on your skills and the changes in your industry. Staying sharp will help you become the best in your field so that you can continue to grow your client base. \nSources:\n
\nhttps://www.upwork.com/i/freelance-forward\n
\nhttps://www.cnbc.com/2019/12/14/highest-paying-freelance-jobs-of-2020-where-you-earn-90000-or-more.html\n
\nhttps://freelancinghacks.com/highest-paying-freelance-jobs-earning-steady-income/\n
\nhttps://www.transcriptioncertificationinstitute.org/blog/transcriptionist-salary\n


13 best freelance jobs for 2022 (and tips to get started)

In this article:\nDIY websites for small businesses\nWordPress\nSquarespace\nWix\nShopify\nSmartly Done Websites\nYour website should be an online extension of your business, so you don’t want to skimp out and you definitely want it to look professional. But sometimes you just need something to get you started that doesn’t cost an arm and a leg. \nWe’ve seen tons of small business websites all across the board, from highly custom sites that cost thousands of dollars to free websites built by some of our customers themselves. There are solid website options for any budget that you are looking to start with, and we’ll outline some of our favorite DIY budget websites for small businesses here. \nWordPress.org\nWordPress.org (\ndifferent from WordPress.com\n) can be a great website builder to start with. And we might be a little biased because we use WordPress, but it has some great capabilities for any business! \nFrom a DIY standpoint, if all you need is to add information about your company in the form of pages and blog posts, WordPress can really take you far. \nThe cost of using WordPress is super manageable. All you need to pay to get your website up and running for the world to see is web hosting (at $7.99 per month) and for a domain name (at $14 per year). If you want a premium theme that someone designed, there may be additional costs associated there as well, but beyond that, you’re looking at a pretty good deal.\nEven better, if you choose to pay for your WordPress site through BlueHost, you can get your domain name for free and only pay $3.95 per month for web hosting. That’s a steal!\nPart of the advantage of using WordPress for your website is that it’s an open source platform where anyone can create modifications for others to use. This means that developers al over have created plugins and themes that can help you to modify your website to your specifications. \nGet started at \nWordPress.org\n. \nA note of caution: Not all WordPress plugins play friendly together, especially as new updates come out for your WordPress software. Sometimes plugins that aren’t compatible can cause weird design effects or security vulnerabilities on your website. But that doesn’t mean that you shouldn’t use it, just that you should do your research to maintain your site well or consult a developer when adding multiple plugins to your website. \nSquarespace\nSquarespace is a really powerful all-in-one website manager for those of you who want to build your own website and do it for a relatively low cost. \nThey have tons of unique templates to choose from with customization options to really make your site stand out from your competitors. \nSquarespace has four basic pricing plans: Personal, Business (their most popular), Basic Commerce, and Advanced Commerce. \nEach of Squarespace’s plans comes with the following features:\nFree custom domain\nSSL security\nUnlimited storage\nSEO features\nTemplates for every type of website need\nOptions for multiple contributors (the Personal plan only allows two contributors, but all others are unlimited)\nMobile responsive websites\n24/7 customer support\nBasic website metrics\nHere’s a little more information on each of their individual plans. \nPersonal \nThis plan starts at $12 per month when you pay annually, or $16 per month if you choose to pay month to month.  \nBusiness\nThis plan starts at $18 per month when you pay annually and is $26 per month if you choose to pay monthly. If you choose to use this plan for eCommerce transactions, there will be a 3% transaction fee required. \nBasic Commerce\nThis plan starts at $26 per month when you pay annually and is $30 per month if you pay monthly. On this plan and the Advanced Commerce plan, there is no fee associated with transactions. \nAdvanced Commerce\nThis plan starts at $40 per month paid annually or $46 per month when paid monthly. The difference between this plan and the Basic Commerce plan is that with Advanced Commerce you have capabilities to sell gift cards, advanced shipping calculations, sell subscriptions, offer advanced discounts, and a few more advanced features. \nEach of Squarespace’s business plans comes with a free professional email box on G-suite with the option to purchase more. \nGet started with \nSquarespace here\n!\nWix\nWix can be a completely free option if you don’t need any additional features like your own domain and you don’t mind their ads on your site. But, for a professional business website, we recommend at least getting their basic plan to have your site on your own domain and remove those ads. \nWix has four premium plans that you can choose from:\n Combo at $13 per month\n Unlimited at $17 per month\n Pro at $22 per month\n VIP at $39 per month\nBasically, with each additional pricing tier, you gain more support, analytics capabilities, storage, ad vouchers, and some other add-ons. \nSimilar to Squarespace, Wix has tons of beautiful pre-made templates that you can choose to start from. And then you can customize each site to match your unique brand and style. \nGet started with \nWix\n today. \nShopify\nShopify is a platform that was built specifically for online sales. Whether you have a brick and mortar location or not, Shopify is perfect if you plan to sell any products online. \nIf you are starting a new business, their basic plan at $29/month will be the best solution. This includes the following features:\nOnline store (with a full eCommerce website and blog)\nUnlimited products\n2 staff accounts\n24/7 Shopify support\nSales channels (through social media and online marketplaces)\nManual order creation\nDiscount codes\nPOS apps and integrations\nAnd more!\nOnce you have an account set up with Shopify, you can start adding your products, customize the look of your site, and really set it up to be your own. \nThere are \nfees associated with transactions\n for every plan on Shopify which could be one downside to the platform, but you can’t beat the ease of setting up your products and website. \nGet started with \nShopify\n now. \nWhat to do next\nOnce your small business is all set with a new, professional-looking website, that’s just the start. There’s a lot that you can, and should, do to help improve your business’s online visibility so you can continue to grow your business. \nThere are several \nfree local SEO tips\n that we have outlined in some of our articles. One of those tips is managing your online reputation by gaining new online reviews and managing your online business profiles. 

5 best DIY websites for small businesses on a budget

25 free local advertising ideas for small businesses

Goldman Sach has published \nan infographic \nthat details exactly why there’s so much fuss over the so-called Millennial generation (those born between 1980 and 2000). Here are a few highlights:\nMillennials are the largest generation in history, at 92 million people in the U.S. alone. Compare that to 77 million Americans who are, or were, part of the Baby Boomer generation\nThey use technology to make better informed decisions on the fly. As one example, 57% compare prices in stores, often using their mobile devices to do so.\nSocial media plays a big role in their overall social behavior. In fact, 34% of Millennials say they like brands that have a social media presence better, compared to just 16% of older consumers.\nIn summary, Millennials are quickly becoming the main consumer force in America and beyond, and everyone is trying to figure out how to better sell to them, including one-person startups, sole proprietorships, contractors, and more.\nA changing payments landscape\nSmall businesses, solopreneurs, and freelancers, need to adjust, also. In addition to thinking about ways to make your products and services more compelling to younger buyers, it’s important to make payment easier, as well.\nResearch shows that small businesses are doing a better job of accepting credit cards, which is an important starting point. The vast majority of consumers prefer to pay with credit or debit cards, and small businesses are making more money from card transactions thanks to getting on board.\nSmall businesses must accept peer-to-peer payments\nAnother avenue worth exploring to attract younger consumers who’ve grown up with social media is accepting payments from peer-to-peer applications like Venmo or Cash App. If you’re not familiar, these payment apps allow consumers to pay each other, which is helpful if you’re splitting a restaurant bill, bar tab, or just want all your friends to know where you’re spending money.\nHere’s how \nFortune Editor Adam Lashinky described Venmo\n, which processes about $8 billion in peer-to-peer transactions every quarter: "\nIf you haven’t used Venmo, it’s tough to understand what millennials might have to do with cash transfers. The reason is that Venmo makes it easy to tell one’s friends about transactions, like: “Just split a meal with Britney.” I use Venmo, which fundamentally works a lot like PayPal and Square Cash, in that it links to a checking account and makes it easy to send cash to personal contacts."\nOne of the interesting aspects of peer-to-peer payment apps is that Millennials, in particular, treat them like a social media platform, kind of like Facebook, Instagram, or Twitter. They login to see what their friends are doing, not just to send them money.\nIf younger buyers are attracted to the uniqueness and originality of your business in the first place, it’s likely that they’ll want to share the fact that they’ve spent money with you online, as well. So, accepting payments from these kinds of apps could be beneficial in two ways: first, because Millennials like to make their payment experiences social and simple, and second, because it’s free publicity when others see that their friends patronized your business.\nIf you’re not accepting credit card payments, start there. If you are, consider whether accepting peer-to-peer app payments is right for your business.\nSolo makes it easy to pay and get paid\nSolo is not a bank, but is a financial super-app for small businesses, freelancers, sole proprietors, contractors, and more. Solo is the easy way to pay and get paid. Your customers don't have to sign up to pay you, and can use several payment methods, including Apple Pay, Google Pay, and cards. QR codes make it easy to get paid, and you can easily cash out your Solo account balance for free, or spend it using your Solo Cash Card anywhere Visa is accepted. Learn more at \nSolo.co\n.

Should your small business be accepting payments from peer-to-peer apps like Venmo or Cash App?

In this article:\nTraditional & Roth IRAs\nSEP IRA\nSimple IRA\n401K & Self-employed 401K\nKeogh Plans\nRunning your own business or being self-employed definitely has its perks—choosing your hours, choosing who you want to work with and where you want to work, and being responsible only to you. But this also means that you’re responsible for your own benefits packages, such as retirement plans. \nWhen it comes to planning ahead, you need to decide whether or not a retirement plan is a good option for you and what options are available. Throughout this article, we’ll go over several types of retirement plans for business owners and self-employed individuals so you can make an informed decision about which is best for you. \nPlease note:\n This article is for informational purposes only. Solo does not assume any liability for the accuracy of this information. Consult a licensed, qualified retirement investment broker and/or financial advisor. \nWhat’s the best retirement plan option for small business owners or self-employed individuals?\nAs you are looking into retirement plans for yourself, you should become familiar with the different options that are available in order to make the best decision for your situation. First, it’s good to have an idea of how much money you’ll need to retire comfortably. Use this \nretirement calculator\n to determine that amount. \nOnce you’ve determined how much retirement income you’ll need, let’s go over several types of retirement plans that can help you reach that goal. \nTraditional or Roth IRA\nAn individual retirement account, or IRA, is a retirement savings account offered by financial institutions, and it is generally tax-free. IRA’s are an investment that grows over time. You can choose how involved you want to be in these investments and based on that, pick a provider through which to invest your money and start your IRA. \n(Image)\nThe main difference between a traditional IRA and Roth IRA is when you want to take advantage of the tax deduction. \nWith a traditional IRA you can deduct contributions to your IRA from your business taxes and you won’t owe any income taxes on your IRA contributions or earned interest until you withdraw the funds. If you are in a lower tax bracket when you retire, this could be a great advantage of this type of IRA. \nRoth IRAs are the other way around: you don’t pay taxes on the money when you withdraw it in retirement, but you can’t deduct contributions to a Roth IRA from your annual business taxes. In other words, you are contributing Roth funds “after taxes.” Additionally, any earnings your Roth account makes grow tax-free, subject to certain limitations, while traditional IRAs’ earnings are tax-\ndeferred \nuntil you start withdrawing your funds at retirement. \nThere are also contribution limits for traditional and Roth IRAs, so it’s important to be aware of what that limit is each year. If you are wanting to put away more than the annual contribution limit for these types of plans, then you may want to look at other options. \nThe contribution limit for 2020 and 2019 for traditional and Roth IRAs is $6,000 ($7,000 if you are over age 50). \nWith a traditional or Roth IRA, you must wait until you are a certain age (or meet specific exceptions) before you can withdraw your retirement funds. The current age is 59½, so if you are planning on retiring before then, you may want some additional funds to get you through to that time. \nOne more thing to keep in mind when deciding between traditional and Roth IRAs: anyone with earned income can contribute to a traditional IRA, up to age 70.5. However, Roth IRAs have a limit on modified adjusted gross income if you want to contribute. In 2019 you couldn’t choose a Roth IRA if you earned more than $122,000 if single, or $193,000 if married filing jointly.\nSEP IRA\nA “simplified employee pension,” or SEP IRA, is a good choice for a retirement account for business owners and self-employed individuals. You can deduct your annual contributions from your business taxes and your taxes are deferred on your retirement savings until you withdraw it as income.\nImportant note: If you have employees that are eligible for the SEP IRA (they are at least 21 years of age, have worked for you for at least 3 of the last 5 years, and have been compensated more than $600 each year), then you must contribute to \ntheir\n IRA accounts at the same rate that you contribute to your own. For example, if you are contributing 10% of your income to your SEP account, then you must contribute 10% of your employees’ income into their SEP account. Because of this, a SEP IRA is best suited for self-employed individuals or those who have few or zero employees. \nOne reason that SEP IRAs are appealing is that they allow a significantly larger contribution limit than traditional and Roth IRAs. The contribution limit for 2020 is $57,000. However, one thing to be aware of is that that you cannot contribute more than 25% of your compensation. So if you earn a more modest salary, you may not be able to max out that $57,000 annual contribution limit. \nSimple IRA\nSIMPLE IRAs are generally offered by companies with 100 or fewer employees. This allows you to offer your employees the same retirement plan that you have for yourself. If you don’t have many employees, this option probably isn’t the one for you. \nSIMPLE is an acronym for “Savings Incentive Match Plan for Employees.” With a Simple IRA, employers must contribute to their employees’ accounts based on set requirements from the IRS. A Simple IRA also allows employees (and you, as an employee of your own company) to choose the amount that they want to contribute, up to $13,500 in 2020. \nThe contributions to each employee’s (and your own) account will reduce the taxable income for the year and income taxes on this account won’t apply until it is withdrawn. \n\n401K & Self-employed 401K\nA 401(k) is similar to IRAs in that you set aside money into a retirement plan for investments. The major differences between 401Ks and IRAs are the contribution limits and when you can pull out your retirement funds. \nThe 2020 annual contribution limit for a 401K is $19,500 for employees. If you have a self-employed 401K, you can contribute as the employer \nand\n as an employee of your own company, meaning that you can contribute $19,500 as an employee and then as an employer contribute 25% of your earnings, up to $57,000. \nThe second major difference between 401Ks and IRAs is the conditions surrounding when you can withdraw your retirement funds. Under an IRA, you can pull your retirement savings at any time, with the caveat that you’ll face a 10% tax penalty if you pull them before age 59½. \nWith many 401K and self-employed 401K plans, you must meet one of the following requirements if you need to access your retirement funds before age 59½:\nRetire from or leave your job\nDie or become disabled\nExperience certain hardships (outlined by the plan)\nThe plan gets terminated\nIf your plan allows early withdrawal under the above or other circumstances prior to age 59½ you will be subject to the 10% tax penalty, in addition to paying your standard income tax rate on the funds. This can be a healthy chunk, so think very carefully before you try to withdraw 401K funds.\nNote: Some 401(k) plans allow for “hardship distributions” where you can use a portion of your savings for medical or funeral expenses (among others) under certain conditions, without facing an early withdrawal penalty. So be sure to discuss these options with your investment counselor.\nKeogh plan\nKeogh plans were created for self-employed business owners and unincorporated businesses to offer their employees and owners retirement benefits. Independent contractors do not qualify for a Keogh plan. \nKeogh plans fall into two categories: defined benefits plans and defined contribution plans. \nA defined benefits plan uses a formula to calculate a predetermined amount for the employee’s contributions. Generally, this will take into account the employee’s time with the company and their annual earnings. Due to the formula and variations between employees, this method can become more complicated than other retirement options. \nDefined contribution plans are basically 401Ks. They specify an exact amount of funds that can be placed into an employee’s account and have the same allowances and tax requirements as a 401K. \nAs you can see, you have several options for starting a retirement plan. You just need to decide which option is best for you as a business owner and your employees (if you have any). Once you’ve come to that decision, find a local provider that can help you get your retirement accounts set up. 

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