Training for Translators

Classes for translators and interpreters

Money


Corinne McKay

When to throw in the towel on a task

At the end of 2008, I wrote a post about post about outsourcing that generated quite a bit of interest, so I thought it was worth raising this topic again. After years of battling with my business payroll taxes (I have an S-Corp and thus have to file quarterly payroll taxes and a separate year-end tax return for the business), I decided to hand that task over to my accountant and so far I’m really pleased with how it’s going. For $40 per month, my accountant will run payroll (I’m the business’ only employee, so this isn’t a monumental task), automatically withhold the appropriate tax amounts from my gross pay, file my quarterly payroll taxes and issue my own W-2 at the end of the year, along with 1099-MISCs for anyone to whom I subcontract more than $600 worth of work.

I decided to throw in the proverbial towel on this task for a variety of reasons: most of all, I just hate accounting. In addition, the paperwork burden associated with corporate taxes increases as you make more money. If you have an S-Corp and you owe more than $2,500 per quarter in federal income tax, you have to electronically deposit your payments every month, rather than sending a check in once per quarter. Then if you have subcontractors earning more than $600 per year, you have to collect W-9s from all of those people, calculate who you paid more than $600 and issue 1099s to them. Although I write all of the appropriate deadlines on my calendar, on a couple of occasions I’ve forgotten to initiate the electronic tax deposit soon enough; the deposit takes a couple of business days to process, so if the due date is on a Monday, you have to initiate the deposit by the morning of the Thursday before. The IRS no longer offers printable 1099-MISC forms on its website, so you have to order the forms by phone and they take 3-5 weeks to arrive…do you have a headache yet?

I decided to outsource this task because it passes the two main outsourcing-qualification tests: I don’t enjoy the task and the outsourcing will pay for itself immediately. It’s gotten me thinking about other tasks to outsource, but for now I feel that at least I made the right decision by admitting defeat on this one! Readers, any tasks you’re thinking of outsourcing in 2010?


Corinne McKay

Where do you keep your money?

One of my business goals for this year (because the new year should really start with the school year, don’t you think?) is to do better with managing my business finances. I already pay myself a regular salary but there are definitely areas for improvement. Specifically, I feel like I’m drowning in bank accounts, but I’m having trouble seeing how I could eliminate any of them; I’ll list my account system here and please feel free to contribute ideas about how you manage your business finances. The accounts I currently have are:

  • Personal checking and savings accounts: Because I am incorporated and keep my business and personal finances completely separate, I don’t envision getting rid of these. However, I have both accounts at a bank in my neighborhood, partially because it’s convenient and partially because I’ve never taken the time to research better options. Lately my savings account has been getting an eye-popping 0.05% interest (yes, that’s five one-hundredths…) and I would like to look into options like an online savings account with a better interest rate, or possibly short-term CDs through a local credit union. Because I sometimes do translations that have to be notarized, I do find it convenient to use a local bank that offers free notary services.
  • Business checking and money market accounts: Again, both of these seem necessary. The business checking account has really low fees (no service fee regardless of the balance and very low fees for incoming wire transfers, of which I receive a fair number) and I like having the money market account because I put 40% of everything I earn into it, then use that money to pay my taxes. However (here’s where it starts to get complicated), this particular bank does not accept foreign currency checks of any kind, so then we have the…
  • Alternate business checking account: This is at a different bank, and I only use it to deposit checks in euros. It’s also a no-fee, no minimum balance account, so theoretically I guess I could just make it my main business account. My only barrier here is inertia; switching accounts would involve switching the auto-pays that come out of my business account (Internet service, web hosting, etc.) and providing the new information to my clients.
  • PayPal account: PayPal has its issues, and the fees are especially crushing if the sender funds your payment through their credit card. However, I like the fact that I can have individual (non-corporate) clients pay in advance using PayPal, and that if I really have to chase a client for money, I can offer the option of taking the payment by credit card.
  • Mutual fund brokerage account: This is the account I use for general savings, which I mostly hold in low-risk mutual funds and bond funds. I have an automatic transfer from my personal checking account every month (the old “pay yourself first and you don’t miss it” rule really works for me) and overall I am happy with this account.
  • Two retirement accounts from previous jobs: Here’s another big area for improvement. In addition to my current Individual 401K (see below), I have two retirement accounts with two different companies, both from salaried jobs I had in the 1990s. I think that I should either consolidate these, or better yet (and if it’s allowable), roll them both over into my current retirement account.
  • Individual 401K account: Someone in the local freelancers’ group I’m in tipped me off to this, and it’s been a great financial product for me. An Individual 401K operates like a 401K run by a big company, but is for one or two-person corporations. The advantage over traditional retirement savings plans for the self-employed (or at least this is my understanding), is that the contribution limits on an Individual 401K are very high, up to $49,000 per person per year. The only thing I don’t like about my particular account is that my fund company does not allow electronic transfers into Individual 401K accounts, so I have to send a paper check. I’m not so much against the paper check idea, but because it’s not automatic, I sometimes forget to send it in.

Does anyone else have ideas for organizing your financial life?


Corinne McKay

Link: living on an irregular income

Get Rich Slowly has a great post on How to budget for an irregular income; it’s definitely worth a read on your coffee break. Two of J.D.’s tips that I particularly agree with are:

  • Use separate business and personal accounts and pay yourself from the business account as if you were an employee. I started doing this about three years ago and it made a huge difference in my financial life. I pay myself equal amounts on the 5th, the 15th and the 25th of each month regardless of how much I’m earning. I’m not really given to overspending, but sometimes when I have a large “windfall” project, I give myself 10% of the money to spend on something I want but don’t really need. Otherwise I stick with the “salary” that I’ve set for myself and at the end of the year, I evaluate what amount I should pay myself for the upcoming year. If I have a big surplus in my business account, I take it as corporate profit (because I have an S-corporation) and pay that month’s personal credit card bill with it (and as we talked about in last winter’s post on Freelance frugality, I think that the number one principle of personal finance is to never, ever carry a credit card balance).
  • If you have a spouse/partner, live off one income. The Thoughts on Translation household lives off one income and banks the other, which gives us a great deal of financial flexibility. If I have a very slow month, instead of putting the groceries on credit we just don’t save as much of my husband’s salary as we otherwise would have. I feel that an additional benefit of this strategy is that I can avoid taking low-paying work out of desperation, and inevitably the higher-paying work comes back. Granted, in order to do this we have made some choices that other people probably can’t or don’t want to make. One car (used, paid for in cash), prepaid cell phone, no cable TV, no household service providers (lawn, cleaning, child care etc.), maybe one meal out per month, virtually all clothing and household items purchased used or on mega-sale, lots of homegrown food, etc. However, all of these steps have allowed us to live pretty comfortably on one (sometimes irregular!) income.


Corinne McKay

Personal software training: a niche waiting to be filled?

Last weekend, I had the pleasure of giving a seminar on “Beyond the Basics of Freelancing” for the Northern California Translators Association. At the end of the seminar, I did a short overview of ways to diversify your freelance income stream. All of us are familiar with the basics such as editing, proofreading, voiceover, copywriting, but I wanted to generate a few new ideas. I’ll write more about these in the coming weeks, but one sideline business that really jumped out at me is personal software training for other freelance translators (i.e. going to people’s houses and helping them learn a new piece of software or improve their computer skills).

This idea first came to me when a fellow freelancer in Colorado told me that she had recently hired a bookkeeper to come to her house and set up QuickBooks. This freelancer was an instant convert to the personal software trainer model; in just a few hours, she had her entire accounting system set up and was also able to ask exactly the questions that she wanted to ask. In my own case, I recently battled with setting up Wordfast Pro on my Linux computer; in that case I couldn’t get the software to work properly for other reasons, but I also looked at Wordfast’s new standalone model and thought “Can’t I just pay someone to come to my house and teach me how to use this?”

Partially, I think that there is a big and untapped market for this type of service because as freelancers become more successful, our time is more valuable. Personally, I would rather pay someone $200 to come to my house for a couple of hours and teach me exactly what I want to know (and not repeat what I already know) than sit through an all-day seminar that covers some topics I want to hear about and some that I don’t. Likewise, I’d prefer one-on-one attention to a webinar where I can’t really ask questions until a defined time if at all.

It seems to me that there are a lot of pieces of software that would lend themselves to the personal training approach. Obviously any of the big translation environment tools, Dragon Naturally Speaking, accounting software, etc.  In addition, I think that this approach could win more freelancers over to some of the less well-known translation environment tools; whenever I evangelize about OmegaT, the free (as in doesn’t cost anything) and open source translation tool that I use and love, people seem excited by the idea but intimidated by the idea of installing it and learning how to use it.

An additional benefit of a personal software trainer who comes to your house (or works over the phone and uses a VNC system to see your desktop) is that you’re seeing how the software works and looks on your computer and how it interacts with your file system. It seems to me that this system could be a win-win deal; good extra income for tech-savvy translators and a great service for busy freelancers who want to learn new applications or polish their skills.

Finally, not to send everyone rushing to the domain name registrars, but my random sample research shows that the domain name “personalxyztrainer.com” is available for all of the translation-specific software that I searched, where “xyz” is the name of the software (yes, including the market leader!). If you decide to start this type of business, let Thoughts on Translation know how it goes!


Corinne McKay

Diversifying your income stream

With the economy not really knowing what it’s doing this year, it’s a good time to look at your income stream: what’s up, what’s down, and how can you do more of the work that’s up? In my case, my work from U.S.-based agencies is markedly down, work from European clients (both direct clients and agencies) is holding steady and work related to translator training (such as my book and course) is way, way up.

Happily, most successful translators are good candidates for branching out beyond translation. If you’re running a successful freelance business, chances are that in addition to being fluent in at least two languages, you’re a good or excellent writer in your target language and you’re reasonably tech-savvy. All of these are good starting points for a sideline venture.

There’s a plethora of information on the web about how to create a spinoff business and make money from it. Many of these sites have useful tips on things that translators could potentially do, such as writing articles online and getting paid for it. The barometer that I always use is whether the site’s author gives actual data about their earnings so that you can judge whether the sideline business in question is a good possibility for you. For example, I  enjoy reading The Smart Passive Income Blog, because the author gives monthly reports about his income and what he did to earn it. For example, I deduced from reading this blog that writing articles on eHow, a possibility that I once considered as a remarketing tool for translation-related articles I’ve already written, is actually not a great option.  In addition, although the author of Smart Passive Income makes a lot of money from Google AdSense, I personally find ads on blogs to be pretty off-putting. By contrast, Smart Passive Income has a lot of great information about how to write and market an e-book, which I think could be useful to many translators.

Following are some ideas about diverse revenue streams for translators, feel free to contribute your own!

  • Write. This is probably the most obvious fit for many translators who are already good writers. Subject-specific glossaries and application-specific software guides offer fairly endless possibilities for writing. Also, I’ve seen from personal experience that niche business guides (how about something on marketing to direct clients?) can do very well. You can either create a simple PDF of your document and sell it on your website or use a self-publishing service such as Lulu (I use and enjoy Lulu but I don’t have any sort of affiliate deal with them) to create an e-book or traditional book.
  • Teach. You could teach classes at an established institution, maybe a course on how to run a successful freelance business via your local adult education program? Or you could offer courses on your own; how about something related to a translation-related tool that you use? With modern web-based tools, it’s not hard to set up a webinar, e-course, conference call, etc.
  • Do tech work for other translators. Think of a tech task that you’re proficient at and which is either labor-intensive/highly annoying or requires expensive software that most people don’t have. Alignment and PDF conversion are two tasks that spring to mind. I get a lot of PDFs to translate, but I’ve so far resisted purchasing a good conversion tool such as Abbyy FineReader because of the cost; I would definitely be willing to hire someone to do this task for me when it involves non-confidential documents.

In addition, why not expand these ideas to projects that aren’t translation-related? In the course of reading books with my elementary school-aged daughter, I’ve gotten interested in writing some historical fiction for young people and using the same publishing and marketing tools that I currently use for my book about how to become a translator. Any other ideas out there?