Guest post from Janet Shaughnessy at TranscribeAnywhere
We are thrilled to have Brad Martin on the blog today as our guest!
Brad is the CMO of Soar Payments. They specialize in providing high-risk merchant accounts to businesses who accept credit card payments over the phone or via eCommerce. If you want to learn more, you can head over to their Facebook page.
Brad is going to take us through seven different ways you can save money by working from home. You might have already thought of some of these, but I bet there are some you haven’t. (I won’t spoil it by telling you which ones!)
Take it away, Brad!
Are you thinking about finally making the jump and quitting your corporate job to work from home?
When considering a move from a corporate position to a work-from-home opportunity, many aspiring transcriptionists smartly write up a list of pros and cons. But when it comes to financial considerations, comparing a corporate salary to work-from-home pay isn’t always apples to apples.
In fact, there are a lot of hidden ways to save money by working from home that you should attempt to quantify and factor into your decision. In this post, we’ll look at seven surprising savings that you may be able to achieve when working from home and how quickly they can add up to more than $15,000 in annual savings.
One of the biggest life changes to occur when working from home is not having to commute. But in addition to removing a stressor and time suck from your life, how much can commuting really add up?
Probably more than you ever imagined! Using AAA’s cost-of-car-usage data, if your commute is 25 miles each way, your commute, including related costs, is costing you roughly $8,016 per year. The cost to walk to your home office, by contrast, is just a few calories.
Anyone who has worked in a corporate office setting has gone through the Sunday night routine of identifying the tons of leftovers in your fridge and making a mental promise to bring them to the office to eat that week. Despite that, most of us rarely follow through. We either don’t have the time, or we feel like we’re being antisocial if we don’t go out with our office mates.
In a work-from-home context, however, the default option becomes eating leftovers (or at a minimum, making something at home) as opposed to going out for lunch. So inevitably, you do it a lot more. According to Mint’s calculations, the annual savings just on not going out to lunch all the time ranges from $1,000 to $1,500 for the average person who shifts to working from home.
Offices are increasingly moving to a more casual dress code. But despite that, most Americans still can’t wear their preferred clothing to the office. They have to instead purchase a separate work wardrobe. Overall, the average American spends $1,881 per year on clothing and apparel. Assuming just half of that budget is allocated to work attire, that’s a savings of $940 per year for people who work from home.
Even though we spend all that money on office attire, almost nobody actually prefers to wear it. Office clothes are often stiff, uncomfortable, and worst of all, they generally have to be dry-cleaned. Your discount dry cleaner may advertise that it’s only $1.09 per shirt, but those dollars really start to add up. In fact, the average American spends $500 per year, and the average professional spends between $600 and $1,000 on dry cleaning, according to industry studies. Bet you didn’t think about this hidden way to save money by working from home!
If you’ve spoken to a CPA, they’ll generally tell you that if you’re a traditional office worker that occasionally works from home, claiming a home office tax deduction is likely more hassle than it’s worth. However, that’s not the case with individuals who primarily work from home. And that additional tax break is just the tip of the iceberg.
Individuals who work from home (particularly those who own their own business, like a contract transcriptionist) have access to a whole host of tax deductions. These include deductions applicable to work-related internet, cell phone, travel, and other expenses.
Collectively, these tax deductions can mean thousands of dollars in additional savings available to individuals who work from home. But conservatively, just factoring in the average deduction for a home office, which according to the IRS is $3,000 (or $750 in tax savings), is a significant savings for individuals who work from home.
If you have young children, you already know how expensive child care costs. A study by the National Association of Child Care Resource and Referral Agencies found that the average cost of child care in the US is $11,666 per year. But the range went from as little as $3,582 to as high as $18,773 per year!
Working in a traditional office setting means that for most Americans with young children, full-time child care is a must-have. And while someone working from home likely won’t be able to cut those bills entirely (as it’s hard to be productive with a toddler on the loose), just being able to cut that cost by 20% still adds up to thousands of dollars a year.
Working from home means significantly more flexibility in your work schedule. For people who work from home, what counts is that you’re productive and that your clients are happy. It doesn’t matter whether you’re chained to a desk from 9 to 5 each day. That added flexibility means there are tons of additional financial savings that you can take advantage of throughout the year.
There are small things, like getting haircuts or getting your car washed on discount days. Or having the flexibility to go to out to dinner during happy hour rather than fighting the 7:30 p.m. rush. These savings are difficult to quantify, but if you’re able to save a mere $20 per week, it adds up to a full $1,040 by year’s end.
There are many reasons people choose to work from home and leave their office job. Those factors include time flexibility, a better work-life balance, and a lower-stress work environment. One factor many forget to consider closely, however, is the potential financial savings inherent in working from home. As demonstrated in this post, that amount may be more than $15,000 per year (our total indicates $15,079.20).
So what do you think? Did you realize that you could save money by working from home with things like dry cleaning and lunches? It’s amazing to see how reducing costs in some areas can add up to significant savings in the long run. The benefits of working from home are endless!
Do you have any tips to share on how you save money? No matter how big or small, I’d love to hear them. Leave a comment below!