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Square: what’s all the hype about this mobile payment app?

Square has revolutionized how mobile payments work in the field, and with Starbucks now on board, another wave of change is coming your business’ way.

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square payments

Square for small business

Small business owners have a lot of things to consider in order to support the day-to-day operations of their business, one of the most important being how to get paid for their goods and services. Square, a mobile credit card processing app, has recently been in the news in conjunction with Starbucks.

The app has two key uses: business owners can process customer credit card transactions via a card reader that plugs into their cell phone or iPad or they can allow customers to “pay with Square.” With the latter option, customers can link a credit card to their Square account and pay for items with their phone rather than handing over a physical credit card.

So how does this benefit your business?

One of the many benefits of Square is that business owners can link the app to their bank account and receive money from customer purchases by the next business day if the purchases are made during business hours.

The app negates the need to enforce a “cash only” policy and decreases the necessity of making frequent trips to the bank to deposit money. And even you if are an owner of a small or mobile business like a food truck, Square gives you the same credit card processing capabilities that giant retailers provide regularly in brick-and-mortar stores as well as online.

The cost for use

The company does charge a 2.75 percentage fee each time a card is swiped, but besides that there are no monthly fees. The app also provides business owners the capability to conduct business 24/7 wherever they happen to be. If you’re running a business out of a truck or manning a booth at an event, you can process sales on-the-go without being inhibited by a hardwired card processor connected to a register.

Using the “pay with Square” option, people who have downloaded the app are able to see your business via the Square directory and pay for their purchases via a credit card that they’ve linked to their account beforehand. When it’s time to cash out, the customer’s picture and name appear on your register, you confirm their identity and the sale is done. This option helps business owners track regulars and even offer rewards for those who give frequent repeat business thereby increasing customer loyalty.

The takeaway

In the past, business owners were limited to patrons that happened to carry cash. But with Square, they are able grow their business and solicit sales anywhere, at any time. As the world of commerce continues to become more innovative, Square allows business owners to focus on what matters most, making their products more valuable to their customers, rather than worrying about how to process payments. And best of all… if you happen to be a small business owner reading this article, you now have a solution for the customers who are eyeballing your wares but don’t have cash on hand to pay for it.

Destiny Bennett is a journalist who has earned double communications' degrees in Journalism and Public Relations, as well as a certification in Business from The University of Texas at Austin. She has written stories for AustinWoman Magazine as well as various University of Texas publications and enjoys the art of telling a story. Her interests include finance, technology, social media...and watching HGTV religiously.

Business Finance

Tips on setting a more accurate freelance rate

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Setting a freelance rate can be difficult given that any industry has conflicting norms regarding an appropriate billing amount – a fact made more difficult by about a billion other factors such as experience, location, and so on. Whether you prefer to determine your rate the long-form way or you just want a calculator to point you in the correct direction, here are some tips for figuring out how much you should be charging.

Jennifer Bourn, business guru and freelancer extraordinaire, eschews the general “start with the salary you want and work backward” approach. Under this model, you would theoretically determine the amount of money you want in a year, divide that number by the number of hours you plan on working in a year, and charge whatever the quotient is (for example, $100,000 divided by 2080–which is 40 hours per week times 52 weeks in a year–is roughly $50 per hour).

The problem with this model, Bourn posits, is that it doesn’t actually get you what you want to earn. Once you take into account things like your overhead spending, vacation time, insurance, profit margin goals, and actual billable time versus the time you need to do administrative things, you’re looking at a substantially smaller figure at the end of the year.

Bourn’s solution is to start with the salary you want, add all of your expenses, multiply that result by your desired profit margin (e.g., 1.10 for a margin of 10 percent), and then divide by a realistic look at your billable hours for the year–not just the standard 2080 work days in a year (which is already problematic due to the aforementioned vacation time and potential for sick leave).

If all of that sounds like way too much effort, there are a myriad of rate calculators that you could use instead. Each of our following picks has a variety of applications:

  1. Clockify is a simple, straightforward calculator that looks at your industry, location, and experience level to generate an average hourly figure.
  2. Nation 1099starts with your desired salary and then gives you an hourly rate and a daily rate based on many of the factors espoused by Bourn.
  3. Your Rate asks for your desired annual income, your number of weekly billable hours, and your anticipated time off per year to come up with a set of rough figures for weekly, daily, and hourly rates.
  4. Freelance Rate Calculator is a Google Sheets template that takes into account your goals, expenses, billable hours, and more.
  5. All Freelance Writing is a more intensive calculator with an advanced option to determine all of your costs, goals, billable hours, time off, and so on, making it a pleasant option somewhere between Bourn’s long-form calculations and something like Clockify.

You should test your salary calculations in a variety of spaces if you have the time. This will ensure that you end up with a solid, well-corroborated result that you can quote to clients rather than having to fall back on one website’s opinion. Whichever option you choose, though, remember that you deserve to be paid what you’re worth–not just what your services are worth.

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Business Finance

How should freelancers be saving for retirement (is it even possible)?

(FINANCE) Adulting is hard, but retirement looms no matter your age – here are some ways to start squirreling money away so it’s less stressful later.

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Freelancing is a tenuous approach to employment, made all the more so by a profound lack of amenities usually offered by more stable arrangements – chief among which is a retirement fund. It can feel impossible, especially when your business suffers amidst a pandemic, so some of what follows can be ignored until the ship isn’t sinking, but don’t wait a minute longer than that – deal?

So there are several schools of thought regarding the best way to start saving and where you should put your money, but the bottom line is that, if you’re a freelancer, you should be allocating your own retirement funds. Here are some ways to do just that.

Before you can even get into the weeds of how to invest in retirement, you should have a parachute in case things go sideways. My Bank Tracker suggests starting with an emergency fund of $1,000, adding to it as you can until you have anywhere from 3 to 12 months of expenses covered.

This serves two purposes: ensuring that you’ll have the luxury of time if you need to perform an abrupt job hunt, and establishing how much you can safely put away each month without jeopardizing your business or standard of living (within reason).

Having a relatively large sum of money on hand for emergencies is always good, and if you never have to use it for the purpose for which you set it aside, it can supplement your retirement whenever you decide it’s time to cash in.

My Bank Tracker also suggests storing your emergency fund using a “high-yield” bank account, such as an online savings account, rather than sticking with traditional, low-interest savings options.

You also need to plan for taxes, which in addition to whatever your tax bracket percentage is, includes allocating 15 percent of your income to pay Social Security and Medicare. This means that you’re probably putting aside a pretty hefty sum (at least 30%) each month.

Once you’ve established your emergency fund and planned for taxes, you should have a general idea of what your wiggle room looks like vis-a-vis saving for retirement.

The actual saving part of retirement entails investment in a retirement account such as an IRA, Roth IRA, a 401(k), or a pension plan (referred to as a “defined benefit plan”).

Each of these account types has benefits and drawbacks depending on your situation.

  • A Roth IRA will allow you to contribute a certain amount each year, and you can usually set up an account quickly from a variety of online locations. The money that goes into a Roth IRA is post-tax, meaning you don’t have to pay tax on the retirement funds you pull out. Your income, however, can disqualify you from investing – if you earn above a certain threshold ($140,000 in 2021), you won’t be able to use a Roth IRA.
  • Other IRA options exist as well, each with a cap on how much you can contribute per year and varying tax requirements. For example, a traditional IRA account requires you to pay taxes when you withdraw the money, and there’s an upper limit on how much you can contribute.
  • A SEP IRA is similar, but the upper limit on investment is substantially higher – and you need to be self-employed (or an employer) to have one.

Nerd Wallet also points out that a 401(k) is a reasonable option for self-employed people who don’t employ anyone else, especially if you plan on saving “a lot in some years — say, when business is flush — and less in others.” 401(k) accounts allow you to put up to a certain amount ($58,000 in 2021) in each year pre-tax, and you pay taxes on withdrawals whenever you start pulling out money.

More eccentric retirement options exist as well. Taxable Brokerage Accounts let you invest in stocks and securities through a brokerage, and you’re able to use the money whenever you please – but you’ll have to pay taxes on your gains each year, which can become expensive in the long run.

And defined benefit plans are expensive and entail high fees, but they allow you to set up a pension with high investment opportunities as opposed to some of the lower-investment options.

Whichever option (or options – you can always invest in multiple accounts) you choose, make sure you’re saving for retirement in some capacity. And remember that these accounts represent exponential growth, meaning that the sooner you start saving, the better off you’ll be when you begin your retirement journey.

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Business Finance

Stripe makes it easier to collect money from customers

(FINANCE) Stripe didn’t reinvent the wheel, but they are outshining competitors by adding features that help small businesses.

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Payment processing is an attribute of any sales process that can make or break the customer’s experience – and, with it, your revenue stream.

While coding in a payment portal can be time-intensive and costly, payment processor company, Stripe has a simple alternative: Payment Links.

Stripe Payment Links are exactly what they sound like. Rather than linking a customer to a product and then having them check out via the usual cart process, you can send them a Payment Link for that specific product; the customer then enters their payment information in the ensuing window, and the product is theirs.

It’s a very straight-forward process that is made easier by Stripe’s no-code presentation, a choice that ProductHunt posits is an effort to go with the no-code flow we’ve seen in the last year.

And, the easier the checkout process is, the more likely a customer is to complete a transaction. It’s one of the reasons why Amazon’s “Buy Now” feature is so rewarding (and dangerous, especially at night).

By offering a customer a direct link to a product with a space to enter their card info in a hassle-free manner, Stripe has created an incredibly convenient way for them to pay – and, without the usual process of checking out involved, customers have less time to second-guess that payment.

Call it what you want (manipulative, pushy, morally grey), but if a customer doesn’t get the chance to rethink their purchase before the payment form has been filled out, chances are decent that they’ll follow through.

Certainly, there are drawbacks to this system. The link applies to individual products or services, which means that, while you can create an individual link for each item on your site, your payroll processing will categorize each of those links differently. That can be a mess to sort out at the end of the day.

But it’s a great way to ensure that customers who want something specific can get it quickly and without much ado about anything.

Putting a Payment Link in your bio after advertising a product on Instagram, sharing your link on Twitter, or even DMing links to interested customers is sure to be a productive, if shameless, endeavor.

Here is a quick rundown from Stripe:

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