8 Tips on Launching Your Passion Project (and Making Money!)
Let’s face it: College is pricey. While the experience is totally worthwhile, eating ramen (despite how awesome you make it) and decorating your dorm room on the cheap isn’t enough to foot the bill for tuition. You’ve read everything you can about how to land the best gig after graduation, but you’d love to know how to pay for your classes right now. Well, one plucky University of Virginia student is paying some of her college tuition with the money she makes from running her own jewelry business, Designed by Lei. Now LeiLei Secor is sharing tips behind her success and how she’s managed to sell 10,000 pieces of jewelry to customers in more than 30 countries.
1. Time management is a work in progress. Balancing jewelry making and a full college courseload isn’t easy, but Secor has the right frame of mind when approaching the divide. “It’s a continual work in progress to keep up with orders throughout the school year,” says Secor. On average, she spends about three to five hours a week handcrafting jewelry. The holidays are her busiest time, between studying for finals and gift orders, but she takes it all in stride. “I truly enjoy making jewelry, so even when I’m buried in school work, I’m taking an hour or two to make jewelry throughout the week not only to fulfill orders, but also give myself a break from the stresses of academics and schoolwork.”
2. Create your own job. During the summer of her sophomore year of high school, Secor couldn’t find her ideal summer job, so she decided to sell her jewelry. Later that summer, she opened her Etsy shop with macrame beaded bracelets. When the bracelets weren’t selling well, Secor didn’t abandon ship. She simply taught herself how to make wire-wrap jewelry with the help of online tutorials and YouTube videos. She sold her first item a week later, and since then sells pieces daily.
3. Down time is extra work time. During summer and spring/winter breaks, Secor can be found diving into the more time-consuming aspects of her biz that she simply can’t handle during the school year. She updates her website, designs new promo materials and photographs new pieces. She works hard for the money, and it shows.
4. Be a social media pro. To garner a global audience, Secor connected with her potential audience via Facebook, Pinterest, Tumblr and Instagram. She swears by the site Wanelo. “Some of my products have been saved on there more than 40,000 times,” says Secor. In addition, Secor searches for sites and mobile apps that she thinks her target market would use and connects with those brands. “Scroll through the top apps in the app store” to figure out who to reach out to, suggests Secor.
5. Fantastic photos are key. In a jewelry-based business, Secor knows that the key to selling and promoting her work is stunning, high-quality imagery. “If the pictures are great, then customers post them and it’s like free advertising,” says Secor. For example, her “love” ring has been reblogged on Tumblr more than 50,000 times.
6. Research your way to success. It might surprise you that despite her thriving jewelry business, Secor doesn’t have a business background. She spent hours “reading countless articles and forums about how to sell on online and on Etsy.” Looking at successful shops gave her ideas about how to run hers. She took the time to learn about SEO, photography and marketing so her business would be something she could be proud of and run smoothly.
7. Stand out from the crowd. Jewelry is “one of the most competitive categories on Etsy,” so the competition is fierce. Secor says she has to stay on top of trends to make sure she “stands out in a sea of similarity.” Her suggestions for rising to the top: Use SEO-friendly titles and tags for your items, and snap sellable shots.
8. Go for it. “Be persistent,” says Secor, who encourages anyone who wants to pay for college with their side gig. She landed her first sale after heavily promoting herself on Instagram. “If you really want to achieve something, and you have the drive and determination, you’ll find a way to make it work,” says Secor.
Would you start a business to pay for college? If so, tell us in the comments what business you’d like to create .
Welcome to Selfmade Finance School, our new money series with Block Advisors to help small business owners with their tax, bookkeeping, and payroll needs year-round. This week, we explore the tax implications of bringing family members into your business.
The question for today is this: Does hiring your family members make sense for your business? Let me be clear. This is not a piece about whether hiring your family members makes sense for your relationships with those family members. As someone who is part of a family business, I could fill up a lot more than 600 words on my opinions about that. For today's purposes, we focus on whether it makes sense from an overall "good business and tax implication" perspective. As it turns out, there is a decent amount of tax nuance when it comes to employing your family. Let's break it down based on relationship to the employee:
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Spouses Who Are In Business Together
Personally, if I had to be in business with my husband, it would not go well. However, many couples build viable, strong businesses together and I say, good for them! Depending on how you have your business entity structured, it will make a big difference on the tax treatment of you and your spouse working as partners. Because a business jointly owned and operated by a married couple is generally treated as a partnership for Federal tax purposes, the spouses must comply with filing and record keeping requirements imposed on partnerships and their partners. The election to file two Schedule C (Form 1040) forms, (one for each spouse) permits certain married co-owners to avoid filing partnership returns, provided that each spouse separately reports a share of all the businesses' items of income, gain, loss, deduction, and credit. Under the election, both spouses will be subject to self-employment tax and on net earnings from self-employment and receive credit for Social Security earnings.
One Spouse Employs Another
If you have a dynamic where your spouse is an employee of your business, then your spouse's wages are subject to income tax withholding, Social Security and Medicare taxes. If you are self-employed (not a corporation or a partnership), your spouse's pay does not have to be included in your federal unemployment tax account (FUTA) contributions and payments. However, if your business is a corporation or a partnership you must include that spouse's pay in your unemployment tax contribution calculation.
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You Employ Your Child
First, let's be clear. I work in my family business, but I am an adult, so I am treated just like a normal employee. However, if you, for example, run a family restaurant and want to hire your children under 18 to work for you, there are some tax benefits. But first, you should check with your state for rules on how many hours minors can work (in non-agricultural jobs) and reference the Fair Labor Standards Act for information on limitations on the kinds of work children can perform.
"This is an often overlooked or under-utilized strategy. Paying your children for true services they provide in your business can be a powerful tax-saving tool," says Cathi Reed, Block Advisors Regional Director. "If you are a sole-proprietorship or single member LLC, and the child is less than 18 years of age, the business is not required to withhold FICA or payroll taxes. The child can use his or her standard deduction against income you pay."
You Hire Your Parent
Oh dear. If you are brave enough to do this, know that you will need to pay Social Security and Medicare taxes on your parent's wages and make the appropriate withholdings, but you don't have to pay unemployment taxes. Now all you have to do is convince your parent that you are the boss. Have fun with that!
Is Hiring Family Members Worth It For The Tax Benefits?
"There are some positive tax advantages to hiring family members. It's important to treat a family member like any other employee. Hiring your children can result in substantial savings for businesses. Make sure your child has real, age-appropriate work to do and a reasonable pay rate, comparable to other employees. Consult with a Block Advisors small business certified tax pro to ensure that you are complying with all requirements," advises Reed. "Block Advisors, a team within H&R Block, is dedicated to meeting the tax, bookkeeping and payroll needs of small business owners year-round. To start working with the tax experts at Block Advisors, visit blockadvisors.com."
In my opinion, you should not hire a family member solely because of the tax benefits. You should always hire based on whether that person is right for the job and keep in mind how this hire could materially impact your relationship with that person and others in your family. Finally, as I mentioned, make sure you have a tax professional on your team when making these determinations. As you can see, things can get a little tricky!
*All details were sourced from IRS.gov and blockadvisors.com