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The Beginner’s Guide to Working From Home

Working from Home
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Working from home is growing in popularity. And while there’s certainly a lot to like about ditching the company dress code and skipping the morning commute, it’s not the right fit for everyone.

In this article we’ll go over the most important details to consider when you’re thinking about working from home, including the three main types of work-from-home jobs, how to find the best opportunities, and how to spot and avoid scams.

Five Key Considerations

You don’t want to transition into a work-from-home role only to realize it’s not ideal for you. Here are some important things to think about before taking the leap.

#1. Are You Prepared For the Costs?

Working from home is often touted as an effective way to save money, and it’s true that you may be able to reduce certain expenses (such as gas and other transportation costs).

But there are also expenses and costs that are likely to increase if you’re working from home.

  • Housing: A study conducted by the National Bureau of Economic Research found that remote workers spend more on rent or mortgage costs than non-remote workers, and that they have more rooms in their home. This makes sense since remote work typically requires you (or at least encourages you) to have a home office.
  • Utilities: If you’re home all day, you’re likely to spend more money heating and cooling your environment in order to stay comfortable, leading to higher electricity costs.
  • Furniture and office equipment: Do you need to buy a desk, chair, printer or other equipment in order to do your job? If you’re working as an employee, you may get assistance from your employer for these expenses — but that won’t be the case for everyone.
  • Taxes and insurance: As we detail in the section below, these costs can be significantly higher when working from home.

If you’re working as a freelancer or independent contractor, as opposed to an employee, you’ll have expenses related to health care that need to be considered.

Employers typically pay between 70% and 80% of an employee’s insurance premiums. If you don’t have access to employer-sponsored insurance through your spouse or partner, you’ll be on the hook for a much bigger chunk of those costs.

Additionally, the self-employed are responsible for paying self-employment tax.

As a traditional, W2 employee, half of your Social Security and Medicare taxes are paid by your employer. But when you work for yourself, these taxes are your own responsibility. As of 2021, the self-employment tax rate is 15.3% — around 7.5% more than the Social Security and Medicare taxes you’re paying today. 

#2. Do You Have a Suitable Working Environment?

The COVID-19 pandemic led to millions of employees working from home unexpectedly. And while working from the kitchen table may be something you can do in a pinch, it’s not an ideal permanent scenario. Without a proper working space, you could be putting strain on your body and setting yourself up for high stress or mental health issues.

So if you hope or plan to work from home over the long-term, it’s important to have an appropriate and dedicated workspace.

Consider your current house or apartment and think about where you’ll be working. Ideally, you’ll have a separate room that can be used as an office — one that can be closed off from the living areas of the home (especially if other people will be there while you’re working). 

#3. Do You Have the Discipline to Work From Home Effectively?

Working from home can help eliminate some of the distractions that come from working in a traditional office, like excessive meetings, chatty co-workers and constant interruptions. But it also comes with its own set of challenges related to focus and productivity.

In order to be effective working from home, you’ll need the discipline to avoid distractions like:

  • Personal tasks and errands.
  • Browsing the internet (with no one to look over your shoulder).
  • Visits from friends and family.
  • Distractions from others in the house (especially your kids).
  • Long lunch breaks.
  • You get the idea…

Most people either do or don’t have the discipline to work independently. And while there are some things you can do to help yourself in these areas, it’s important to be honest about your work habits. Are you the type of person who enjoys and thrives working independently, or are you likely to get distracted easily?

Your particular type of work can also factor into this. If you’re freelancing or self-employed, it’s easier to stay focused and motivated since your income and livelihood depends on it. It’s easy to see that if you’re not working, you’re not making money.

On the other hand, working as a remote employee requires even more discipline, since you may not see the direct correlation between your productivity and your income in the short-term. 

#4. Will You Actually Enjoy Working From Home? 

For some people, working independently sounds great. The freedom to get work done without distractions and without the need to deal with co-workers in an office can be appealing. These types of people might not miss the personal interaction or the social aspect of not working in an office with co-workers and colleagues. 

For others, the social aspect is critical for a satisfying and fulfilling experience. If you’re one of these people, sitting at home working independently all day might make you feel lonely or isolated. You may enjoy working from home for a while, only to realize that you really miss being around others every day.

Think about yourself and your own preferences. If you were to work by yourself all day every day, would you miss the social aspect? Video conferencing can help to fill this void somewhat, but it’s still not the same as interacting with people in-person.

#5. What Are Your Long-Term Career and Financial Goals?

It’s also important to consider your long-term aspirations and plans, which can be significantly impacted by the type of work you do in the short-term.

You may not think that working from home would have much of an impact here, but it could play a big role depending on the type of work you’re doing and the specific goals you have.

A personal example: Back in 2008, I left a full-time office job to pursue self-employment and work from home. I had been working as a Certified Internal Auditor, and when I started on that path I had plans to make it my career. When I left that job for self-employment in internet marketing, I knew the longer I was away from the auditing world, the less likely I was to ever return to it. 

At this point, more than 12 years later, I couldn’t decide I wanted to go back because the gap in my resume is far too big.

Self-employment or working as a freelancer may be a good fit for certain long-term goals and a bad fit for others. Think about the skills that you’ll be building and the experience that you’ll gain. Would that help to get you closer to your long-term goals, or put you further from them?

Even if you’re working in a remote job as an employee, there are ramifications that should be considered. Many work-from-home roles will provide you with reduced networking opportunities compared to working in a traditional office. The connections and relationships you establish will often lead to career growth opportunities. In this sense, working remotely could negatively impact your long-term potential. 

The Three Types of Work at Home Jobs

In this article, we’re talking about working from home in general. But there are a few different types of jobs and roles that allow remote work.

Type 1: Freelancer/Independent Contractor

As a freelancer or independent contractor, you’re technically self-employed. You may be working with several different clients, or you may work predominantly for one client but not under the classification of an employee.

The popularity of freelancing has been on the rise for years, and a study conducted by Upwork suggests that a majority of the U.S. workforce will be freelancing by 2027. That study was conducted before the pandemic (in 2017), so the rate of acceleration has likely increased since then.

While freelancing is possible in many different industries and types of roles, here are some examples of jobs that are commonly done by freelancers:

  • Audio and video production
  • Bookkeeping
  • Consulting and coaching
  • Graphic design
  • Marketing (including social media)
  • Search engine optimization
  • Translation
  • Virtual assistant
  • Web design and development
  • Writing, editing and proofreading

Self-employment provides greater flexibility than remote jobs that come with employee status. You’ll have greater control over your schedule and the things you choose to work on, although the need to earn a living may require you to do some things that may not be your first preference. 

You could also benefit from the higher-income potential that comes with self-employment, although you’ll need to be able to handle some unpredictability and inconsistency in your income.

Possibly the biggest difference between self-employment and working from home as an employee involves your ability, or lack thereof, to “turn off.” 

As someone who has been self-employed for more than 12 years, I’ve found that I’m constantly thinking about work. The line between personal life and work life is difficult to manage at times.

On the other hand, an employee who works from home may be able to close their “office” door Friday at 5:00 p.m. and not give much thought to work until Monday morning.

Type 2: Full-Time Career-Track Positions

A growing number of companies are offering full-time remote jobs. However, many of the companies that offer these jobs are large, well-known industry leaders, and the remote positions they offer are typically not entry-level roles. 

For example, while Amazon does employ some work-from-home customer service reps, the majority of their remote positions are developer roles within their Amazon Web Services division — usually mid to senior-level jobs that require years of work experience.

As a result, finding a remote job (as an employee) that offers solid career growth potential will often require you to have existing experience. Solid entry-level online jobs with decent pay and clear opportunities for growth are typically harder to come by.

As trends continue to change and develop after the pandemic, it may be that more entry-level work-from-home jobs will become available. 

Type 3: Part-Time W2 Positions

These jobs were available to remote workers even before the pandemic. They tend to be lower-paying and well-suited for entry-level work. In many cases, they require no experience, and they usually do not require degrees or training. You may need certain skills in order to do the work, but those skills can often be developed.

Some jobs that fall into this category include:

These jobs can be part-time or full-time. They’re ideal for people who are looking for a way to make some money while staying at home, but who aren’t necessarily interested in self-employment or concerned with moving up the corporate ladder. 

For example, these jobs are popular with stay-at-home parents who want or need to make some money while still prioritizing their family.

Although the pay may be below average, working as an employee does offer a sense of stability and predictability as compared to doing the same type of work on a freelance basis.  

How to Find Work at Home Jobs

After considering the factors we’ve covered so far, if you feel like a work-from-home job would be a good fit for you, the next step is to start your search.

Since the details of the roles and the process of finding opportunities can vary so much depending on which type of job you’re looking for, we’ll provide specific tips for each job type.

Freelancers

If you’re looking to get started as a freelancer, there are a few ways to pursue your first few clients, including:

  • Leverage your existing network. Talk to your friends, family, neighbors, acquaintances and professional colleagues to let them know what you’re doing and see if they know of anyone who might be interested in your services. It’s likely that you’ll be able to find at least a client or two through your own network. People who know you — or people who trust someone who knows you — are more likely to hire you than someone completely unconnected to you.
  • Freelancing websites like Upwork and Fiverr. These sites exist for the purpose of matching clients with freelancers. While some of the work on these sites is low-paying, that’s not always the case. By using these platforms, you’re able to benefit from their popularity to get yourself in front of a lot of potential clients and start to get some work.
  • Freelance job boards. There are a number of job boards that feature opportunities for freelancers. Many of them are specific to a certain type of work, like Freelance Writing Jobs and the ProBlogger job board
  • Cold outreach. You can also identify someone who would be an ideal client for your services and reach out to them directly. Generally, your success rate with this approach will be lower since they may or may not be interested in hiring anyone at the time, but it can work if you’re contacting the right people. 

When you’re just getting started, the first thing you’ll need to do is put together your portfolio so anyone who might consider hiring you can see your work samples. If you don’t have any work samples yet, you could spend some time on personal projects to use in your portfolio, volunteer for a non-profit organization, or offer discounted work to someone in order to gain experience.

Regardless of how you go about finding your initial clients, you’ll need to be able to sell yourself and convince someone that they should hire you. Many freelancers fail in this area and, as a result, they don’t stand out from other service providers. 

Full-Time

If you already have a traditional in-person job and you’re interested in working from home, the first option is to ask your current employer if you could transition to remote work. There’s never been a better time for this discussion, and a growing number of companies are open to the idea. 

Before bringing it up, take some time to consider the most likely objections they might have, and find solutions to them. Think about your role and the challenges that might exist if you were to work-from-home and formulate a plan to alleviate these concerns. 

If transitioning your current job to a remote role isn’t an option, the best approach is to start by looking for opportunities with companies that are known for hiring remote workers. 

Some examples include:

Many of these companies list remote job opportunities on their website, so you can find jobs if you’re willing to put in a little bit of work. For even more options, see this list from Yahoo! Life of 40 companies that hire remote workers.

You can also use job boards that have been created specifically for remote jobs. There are a number of these websites, but some of the leaders include Remote.co, JustRemote and Remote OK

Of course, traditional job boards also include some remote jobs as well, and you may be able to find some opportunities by adding the word “remote” to your search.

Another option is to use Facebook Groups that have been established for sharing remote job listings. If you search Facebook for groups with words like “remote jobs” you’ll find a number of active groups, including Digital Nomad Jobs and Remote Job Seekers. These Facebook Groups tend to feature more of the flexible, lower-paying opportunities, but you can find some hidden gems as well.

Part-Time W2

If you’re interested in part-time remote employment there are a few resources that can be helpful.

  • FlexJobs is a job board specifically for remote work. Unlike most other job boards, FlexJobs uses a subscription model, which means you’ll have to pay a little bit to get access to the job listings. However, they manually vet every job and company so only legit opportunities get posted.
  • Appen was named the top remote company in 2020 by FlexJobs, and they offer many opportunities for part-time work.
  • Lionbridge is another industry leader and a source for both part-time and full-time remote jobs.
  • Facebook Groups. As mentioned in the previous section, Facebook Groups dedicated to remote jobs are also great for finding these part-time gigs.

How to Identify Work at Home Scams

Unfortunately, scams related to working from home are common. Scammers know that many people are drawn to work-from-home opportunities, so it gives them the chance to take advantage of people who may be willing to overlook the warning signs. Most scammers are either after your money or your sensitive personal information.

Here are a few key warning signs that can help you to spot a scam before you become a victim.

  • The job seems too good to be true. If the job comes with a salary that’s far above industry average, if the perks are incredible, or if they’re telling you that no experience is required to get a great job, it could be a scam.
  • They ask for money upfront. Legit employers will not ask you to pay them in order to interview or start a job. You may have some necessary expenses when you’re starting a new job, but they’re not usually paid to the employer directly.
  • You can’t find much information on the company or what they do. These days, almost every legit business has some sort of internet presence. If you can’t find a website or social media profiles, or if you can only find vague information about the company, it may be a warning sign.
  • You find warning signs from other people online. If you do a Google search for the name of the company or the person interviewing you, you might find warning signs from other people who have been scammed. Most scams aren’t new, so with a bit of research you might be able to find those warning signs.
  • They’re in a hurry to hire you. If they are extremely eager to get you on board and they seem to be rushing the process, it could be a warning sign. Of course, there will be some legit opportunities where the employer is in a hurry, but if you combine this with other warning signs it could help to confirm your suspicions of a scam.

What About MLMs and Network Marketing?

Multi-level marketing (MLM) opportunities often come up when the subject of work-from-home jobs are discussed.

These companies, also known as networking marketing companies, often promote the opportunity to be your own boss and build a successful business while working part-time hours. There are hundreds (probably more) of MLMs out there including well-known companies like Amway, Tupperware and Avon and newer iterations like LuLaRoe and Beauty Counter.

In order to get started with an MLM, you’ll typically need to pay an upfront fee — most of which goes to the person who is recruiting you. In order to have success, you’ll need to sell products and recruit others to join your downline. You’ll make money based on the people you recruit and the people they recruit, so bringing new people into the business often supersedes the need to actually sell a product.

The problem with multi-level marketing is that very few people actually succeed at making a decent income from it. Certainly some people do, and the success stories are used to recruit lots of new people. However, a study from AARP found that half of the people involved with network marketing actually wind up losing money while just 0.05% of people make $100,000 or more.

There are definitely plenty of people who do make some money with multi-level marketing, but you should be aware that the odds are heavily stacked against you. If being your own boss is your goal, starting another type of business is generally a better option.

How to Work From Home: Final Thoughts

There’s no doubt that working from home appeals to many of us. However, be sure that you consider:

  • The associated costs.
  • The working environment you’ll need.
  • Your level of discipline for staying focused and on-task.
  • Whether you’ll actually enjoy working on your own long-term.
  • Your career and financial goals.

If working from home seems like the right fit for you, consider whether you’d prefer to work as a freelancer, full-time employee, or part-time employee.

The next step is to start looking for opportunities, using the tips covered in this article.

Working from home can be a great opportunity, but it’s definitely not for everyone. Be sure to take an honest look at yourself and your own situation in order to decide if it might be right for you.

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Marc Andre is a personal finance blogger at Vital Dollar, where he writes about saving, managing and making money. He lives in Pennsylvania with his wife and two kids, and has been a full-time blogger and internet marketer since 2008.

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