RATES

• As a self-employed service provider, you receive income based on your billable hours, that is, time spent on performing services for your clients.

• You furnishes your own supplies. Unless service is one that is performed off- site, you supply your own workspace.

• You have to equip yourself to be in business and provide your services: You must procure and equip your workplace, invest in skill and product development, market your services, purchase business insurance, and handle billing, recordkeeping and collections.

• As a business owner you take on a great deal of risk. It is reasonable, and expected, that your rates should allow for a reasonable profit over and above your expenses and salary.

The above is true for any business. Below are additional costs you pay because you are self-employed.

• Unlike most of your employed counterparts, there is no employer subsidy for your health insurance. And, as an individual, your costs will be higher than they would be as part of a larger organization.

• Aside from Social Security, you are totally responsible for your own retirement nest egg.

• You will pay both employee's and employer's share of FICA tax burden (15.3%); double burden that falls upon your employee counterparts. The IRS allows limited deductions for this tax, but your net share is still far higher than for your employed counterparts.

But you can only bill for services rendered.

The upshot is that as a self-employed service provider you must cover many expenses that employees do not. Therefore you should have no qualms about charging an adequate rate to cover your expenses and make a living.

Ellen Zucker has been self-employed for over ten years.

When is comes to quality vs. cost, direction is pretty clear. Before choosing proper VoIP phone system for your business, you need to figure out exactly what your business needs. If your business relies heavily on phone for prospecting customers, providing customer support, or giving out important information through phone, then you should definitely opt for better quality.

If you use phone for short communication with your business partners or agents, or any other reason which is NOT your main business function, it would be better to save a little and go with low cost option. The difference in quality is not very apparent in most cases.

If you are just starting your small business, VoIP phone cards also provide some sort of temporary solution until you can get enough financing to develop a better system. Phone cards usually let you dial international and national long distance at a lower cost because they use either VoIP as back end provider or through a special promotion or arrangement between telecommunications companies.

Today, you can even get "virtual phone cards" which allow you to make phone calls by dialing a toll-free number in a long list of countries. This is especially useful if you spend more time travelling and doing business overseas than you are at home.

Regardless of which VoIP phone system you choose for your small business, make sure you are getting most out of money you spend for these long distance or international plans. Forget bells and whistles. The purpose of having a good phone system is, and always should be, to communicate and express yourself.