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Starting a business when you’re on maternity leave is tough on your finances. Your maternity pay is about to run out, your savings are a distant memory and your credit card is feeling the strain.
So when deciding on your business, it pays to think about how long it will take before you make some money. (By ‘make some money’ I mean your pay cheque.) Then you can start paying off that credit card bill!
Freelancing is generally the fastest way to get a pay cheque if you work for yourself. But there are a few ‘ifs’.
- If you have a skill that’s in demand
The trick is to offer people a skill that they need now. Maybe they have a big project and need extra help. Perhaps you have a skill that they don’t. Freelancing isn’t going to be a fast earner if you go back to college for a couple of years to get the right skills.
- If you market yourself
You’ll have to go and find the work because it won’t find you. (Unless you’re very lucky or already have a good network of contacts.)
- If your clients pay up on time.
This one is difficult to control. The best you can do is to have a clear set of terms and conditions and make an educated guess about the reliability of your client.
Don’t be put off though, as you might already have a skill you can turn to freelancing.
The types of work that spring to mind when you think of the word ‘freelance’ may be web design, graphic design, writing, public relations and other skills you might offer to companies. But it could also include office admin, dog walking, alternative therapies and gardening. You could also help out your ex-employer with a project if they need an extra pair of hands.
The down side of freelancing is that you’re exchanging each hour of your time for a sum of money. There’s a limit to how much you can earn as there are only twenty-four hours in a day. The smart way around this is to build up a steady income (well, as steady as freelancing can ever be) then start another income stream that doesn’t involve a direct exchange of time for money.
At the other end of the ‘how long until I get paid?’ scale is inventing a new product.
Why? Well, you’ll need to have a good idea, do extensive market research, build a prototype and test it, possibly get a patent, get a loan or invest your own money (or both), research manufacturers and materials, get the product made, market it and sell enough of it to pay back your loan or investment. Then you can start to make a profit. You’d be lucky to see a pay cheque in less than a year.
The big advantage of the new product is that you’re not exchanging time for money, as you are with freelancing. So you could make a lot more money. But the risk is greater and you could lose money too.
Somewhere in between these extremes are the other business types.
So if you’ve got a great business idea, don’t forget to check if it’s a good match for your family finances. You don’t want to run out of money before you start to see an income from your business.