All posts by SeattleMoneyCoach

There is nothing passive about passive income

Practical Money Path

Passive income my ass! Sure the orders for the rate-setting toolkit pop up in my email. Hurray! But man-oh-man, it is a lot of work. And money. Let’s see. I paid a lot just to edit the original workbook. My husband created the cover. Now that it is selling, I’m sinking money into a professional cover. A set of ISBN numbers costs a couple hundred. The CD’s were professionally recorded and edited. (I think I’ve found a cheaper way for the future.) The marketing consultant costs money. The postage, the web development for www.ratesettingtoolit.com. And my assistant is a virtual assistant, so last week I was schlepping packages to the post office. How is it that I have this awesome assistant and I’m standing in line at the post office?

Well, at least I got this intellectual product thing started. Yeah for me! I will improve it and expand it. But at least I’m started. I give myself a lot of credit for that. What about you? What great ideas do you have that you are sitting on? Are you waiting until you have it all figured out? You’ll be waiting a long time…

My inner critic kept me up last night

Metaphysical Money Path

Making money selling intellectual property is the Holy Grail of the internet. Everyone wants to do it. I’m convinced there are more people writing about HOW to do it then are actually doing it! But I felt I had a shot. I was also intrigued by the possibility of passive income. Talk about the Holy Grail! Just imagine making money while you sleep! (Sounds like a late-night info commercial.)

I put together the rate-setting toolkit over the past six months. It is a combination of workbook and audios. Then I hired a marketing consultant. It was a LOT of work and much harder than the books lead you to believe.

The bottom line is I announced the toolkit to my subscribers and offered it on sale for two weeks. And the orders started coming in!!! Then the fear in the middle of the night awoke me. Was it good enough? Was it helpful enough? Were there mistakes? What if someone read it and it didn’t help them enough? What if they thought it wasn’t worth the money they paid? The front cover isn’t professional enough. There is a mistake on the back over. I could go on and on.

The good news is that I put it out anyways. If I waited until I felt everything was perfect, I would still be waiting. Of course we should put out the best work we can– work we can be proud of. But there is a line between doing great work and being overly perfectionistic. Have you crossed that line? Being a perfectionist can serve to keep you standing still.

Yes, it is hard to get away from the anxiety that comes with putting yourself out there. Being visible is stressful. What if they don’t like it? (We translate that to: What if they don’t like me?) But if I am going to earn my worth, I must go out on a limb and offer my work to the world. Change that: I must SELL my work to the world. There seems to be more money that way. (www.ratesettingtoolkit.com is where the toolkit lives by the way.)

How to Charge Your Dream Rate

Practical Money Path

There is an awesome article posted on Freelance.com called How to Start Charging Your Dream Rates (and Get Away With It)
Skellie writes about the three factors that will determine whether your clients accept your “dream rates”:
1. They need to believe you’re worth it
2. They must be able to afford it
3. They need to believe that you wouldn’t do it any cheaper

I really liked some of the phrases he used to illustrate point number three. He writes:

If the way you communicate portrays a lack of confidence in your ability to charge the rates you want, clients will pick up on it. Phrases like: “Let me know if these rates suit you”, “But I’m open to negotiation,” and “Let me know if this is more than you can afford” all say one thing and one thing only to clients: “I hope you’ll pay me what I’ve asked, but I’ll easily work for less“.

Are you guilty of using any of those phrases? Instead, he recommends using phrases like “My standard fee for all clients is…” or “The minimum rate I do this kind of work for is…” I agree that this will discourage people from trying to negotiate.
Just remember, not everyone should be able to afford you. If everyone can afford you, you are not charging enough money. I would add to his list a fourth point. YOU must believe you are worth what you charge. So much of rate-setting is about convincing ourselves that we are worth charging our dream rate.

Last week I HATED self-employment (warning: this post is not inspirational)

Emotional Money Path

Well, we tried to move my subscribers to the new company. It was awful!!! It was messy, confusing and infuriating. And we made some mistakes. I went with One Shopping Cart, by the way. After studying all the options, we decided on them because I use them already for my shopping cart and all my auto-responders. The fewer gadgets the better. Between me, my assistant, my marketing consultant, my web developer and the new company, we probably had too many cooks in the kitchen. That, and I don’t think this type of thing is ever easy. For one thing, the new company was supposed to send out the opt-in message to all my subscribers telling them what was happening and giving them the link to opt-in. Then I sent out a message from my old data-base explaining the situation and requesting people to click on the link they just received. One catch- the company held the opt-in email so people didn’t get it until hours after I sent out my message. The result: HUNDREDS of people emailed me personally, confused as to my message, and saying there was no link.

So there I was. I was seeing tons of private clients that week, I was preparing for the rate-setting toolkit launch, working with my new assistant and attending to 100 other details and then these emails started pouring in. I mean, POURING IN. I couldn’t keep up. Neither could my assistant. In the middle of it I left for an appointment with the eye doctor. She was late, of course, so I was cooped up in this little room, feeling like a caged animal. I ranted to my husband on my cell phone, “I’ve got to get out of this room!!!” I think the front desk heard me ranting. I’m trying to keep my cool. (Not succeeding). Then my personal cell phone rings, and it is my dad, “What is going on with your mailing list?! I can’t find this link…” and I started to cry. Crying is not good when you are seeing an eye-doctor, by the way. It makes it hard to check your eyes….

I spent several late nights responding to many, many people. I figured, if they actually took the time to email me, they must really want to stay on my list. I am honored by this! So I had better personally reach out as best I can.

I think I’ve gained some weight. It must have something to do with all the dark chocolate bars I bought this week. I’ve been nibbling away at night, coping with the anxiety and stress. Chocolate does seem to help, by the way. People think being your own boss must be soooo cool. Those of us who actually do it know the truth—being the queen of your own world has definite ups and downs. Yes, there is no cap on what we can earn. But there is no floor on how low we can go either. So you just ride along, as best you can, sometimes trying not to throw up. I’ll be more inspirational next week. I promise.

Rates and Pricing Info for multimedia and web design

Underearning 101

Karyn Greenstreet’s article on pricing (previous post) tipped me off to Brenner Books—check out this site if you are unsure how to price any web design and related desktop (including writing) work. This site and its books boast “The world’s largest collection of prices and pricing related support tools for the desktop professional.” They sell eBooks and hardcopy books, as well host a pricing database, that gives current rates for writing, editing, graphic design, DTP, prepress, multimedia and web design and development. I’m not even sure what all of that is. I’m not a techie by any stretch of the imagination. But rule number one around pricing is to do your research, so this might make it easier for some of you. You will feel more confident if you can see what others charge. Just thought I’d pass it on!

Acting “As if”…

Emotional Money Path

Karyn Greenstreet, a Small Business Coach and Self Employment Expert I really like, has a great article on her website: Embarrassed to Discuss Your Prices? Check it out. I particularly like her tips on “acting as if”.

Act “as if.” How would an experienced person in your industry act, when discussing her fees? Act as if you are that person and you’ll find your confidence increasing with each conversation. Practice, practice, practice.

Yes, as she says, telling someone about your prices can feel risky. But with risk comes great reward! As anxiety provoking as it is to take the risk of telling somewhat what you charge (no discounts!) the rewards are great. But remember—don’t talk about your prices until you are sure they need your services. Find out what they would like before you delve into pricing. (“Before we talk about price, can you give me a sense of what it is you would like done?”) Then if they are an appropriate client for you, you can tailor your conversation to what they are really interested in. And like Karyn says, even if you don’t feel confident while you are talking to them, fake it! It gets easier with time.

One tip to protect against time-usurpers

Practical Money Path

If you are selling your time, you have to guard it carefully. I teach people how to charge appropriately for their time. And I teach them how to really charge for “value” as opposed to just time. (Remember, the real question is, “what value are they receiving as a result of my work? That is what you charge them for. And if it is easy for you, than great! Charge for the value they receive, not how hard you work. But I digress.)

Many of us service-providers are “good girls” who always want to be nice. Colleagues and clients call with a “quick question” and thirty un-billed for minutes go by in the blink of an eye. Resentment sets in. We try to read our e-mail while half listening to the caller. (Anyone not guilty of that?) So here is a tip: after they identify themselves, instead of saying out of habit: “Hi Suzy, how are you?” say instead, “Oh hi Suzy, what can I do for you?” This immediately focuses the conversation on the task at hand and eliminates a lot of chit-chat. Said in a friendly tone, this simple trick works beautifully. So tape a note to your phone that says, “Hi… what can I do for you?” You will be amazed how much this helps. (Timothy Ferriss has a fabulous chapter called Interrupting Interruption and the Art of Refusal in his book, the Four Hour Work Week.)

Protect your time and start earning what you really worth!

One way to not leave money on the table

Practical Money Path

One way to truly earn your worth, if you have a particular expertise, is to learn how not to leave money on the table. One way to do this is to take advantage of people’s different learning styles and preferences, and offer your expertise in a number of ways. For example, I love learning in live seminars. But not everyone does. So I’ve learned to “package” my rate-setting expertise in a number of ways. I teach all day seminars on the subject. But I also wrote an eBook on it and recorded audios on it, which I bundled together in a toolkit. (www.ratesettingtoolkit.com) I’ve taught teleseminars as well. And some people want to work one-on-one with me on the subject, so they pay my hourly fee and I give them my undivided focus.

This was brought home to me last week when I spoke at EWomenNetwork. I had a marketing table and sold my toolkits. Some people were practically desperate for help with their rates and bought my toolkit to go home and use. Other people wanted to take a live seminar. But I haven’t set the dates for seminars yet in 2008. Not good. I probably could have filled a small seminar just from the interest in the room. But I was overly focused on the toolkits, since they are so new. The truth is that everyone learns in a different way. And it is a time and money thing as well. Some people have time to wait for a seminar, and some people need help right now. Some people can afford one-on-one help and some people can’t. Offer people multiple ways to use you. Otherwise, you are leaving money on the table. If you want to earn what you are really worth, you may have to stretch yourself and find ways to offer your expertise in ways that are sometimes uncomfortable to you. But not everyone learns like you do. Stretch yourself. Earn More.

Don’t make this mistake!

Practical Money Path

I teach women in fee-for-service businesses how to diversity their income streams. After all, there are many ways to earn what you’re truly worth. Great. But I also tell them not to launch more than one income stream every six months. You’ve got to have the energy to market it, the time to focus on it and the money to spend on it. My mistake: launching two projects at once. I didn’t mean to. That is partly why I’m so damn busy. The rate-setting toolkit project (www.ratesettingtoolkit.com) was pushed back while I looked for a good marketing consultant. (And finishing the toolkit itself took me longer than I anticipated.) Now, it is launching near the same time that I am rolling out the Virtual Earn Your Worth program. I may rip my hair out. I know better than this. But at this point, I’ve got to roll with it and remember my lesson carefully.

Here is a method that helps self-employed people avoid financial stress: The Five Percent Fund.

Practical Money Path

There it was last week: the Blue Screen of Death. I freaked out. My computer was down for the count and I couldn’t bring it back. So off to the repair shop we went. By the time it was fixed (data transfers, larger hard disk inserted, rush fees) it cost me over $600. Holy Crap. (Is crap every holy?)

This is the type of expense that would end up on a small business owner’s credit card faster than you can say “For everything else there is MasterCard.” It’s a legitimate business expense after all. And it is tax deductible, of course. But I work with tons of business owners who are carrying too much debt—debt that didn’t come from “investing” in their businesses, if you know what I mean. Drag drags you down. It is hard to earn what you’re really worth when a ton of money is going out the door servicing your debt! It doesn’t matter how much you earn. It matters how much you keep.

How do I avoid nasty credit card debt in my business? I have a “five percent fund”. At the end of every month, I count up my total revenue (the total amount of money that came I into my business) and I multiply by 5%. Then I transfer this amount into a savings account attached to my business checking account. I use this for business “periodic expenses”. Periodic expenses are all those irregular business expenses that hit you from time to time. Some we know about: yearly membership dues and travel for business conferences. Some we don’t know about: the Blue Screen of Death. A sudden advertising opportunity. These are the type of expenses that reek havoc on a business owner’s bank account. The beauty of a five percent fund is that it is a percentage. If I have a great month, five percent is a larger chunk put into savings. If I have a down month, five percent is not that much money. But the point is this: I was able to pay the $600 periodic expense and not put it on a credit card. I just used my business debit card and transferred the money out of savings. (If you use a credit card, than you just transfer the money back to make the payment.) Beautiful. Besides, debt really sucks.