A lot of work is involved in starting a business, even for such a straight-forward simple sole-proprietor business such as Jodie Toohey Information Innovations or JTII. I have almost no business experience so my first step was research. As with almost all research I do, my first stop was the internet. I then enrolled and completed a two hour “Starting Your Business” class and a full Saturday “Boot Camp for Entrepreneurs” class offered through the local community college and small business development center. I think I learned more in each of these classes than I did in entire semesters of classes at college. This is likely due to a combination of the high quality of the classes and my total lack of knowledge in the class subjects.
After the first class, I had my to-do list set: Get an EIN (even though I technically didn’t need one), get insurance, and write a business plan. Getting an EIN was easy; I went on-line, applied and received the number immediately free of charge. I e-mailed my insurance agent inquiring into business endorsements for my auto and homeowners’ policies and professional liability insurance to cover me in the event someone sues me. The endorsements were easy; I need a small one for my auto policy to cover the occasional use of my personal vehicle for business but I don’t need one for the homeowners’ policy because all of my equipment is used for business and personal tasks. After checking around for a couple of days, my insurance agent returned a quote of $2,000 for professional liability insurance which I feared may scrap my plans.
I recalled from my paralegal education around the turn of the century a sort of controversy regarding the need for paralegals to carry professional liability insurance. By definition, paralegals must be supervised by an attorney which, therefore, transfers any liability for a paralegal mistake to the attorney’s responsibility. There was some discussion if a paralegal really screwed up, he or she could be held personally liable for their mistakes. So, in theory, a paralegal could be sued personally for legal malpractice but at that time and to present to my knowledge, there has been no such case. Finding $2,000 for a policy which nearly certainly would never be used and which has historically never been used a little inflated, I sought a second opinion.
Apparently, this is an issue that has indeed never materialized and an idea foreign in these parts. My e-mail to a large well-known local insurance agency was never answered. One of my e-mails to the paralegal associations I sent replied advising they did not offer professional liability insurance through their organization but $2,000 sounded typical. I received a very helpful and much appreciated e-mail from a freelance paralegal associated with the other organization who advised as long as the attorneys with whom I work carry legal malpractice insurance (which almost always covers work by paralegals), I should not need my own professional liability insurance. Therefore, without that expense weighing down my bottom line, I forged ahead.
I am in the middle of writing my business plan. I designed a logo and ordered business cards. I have partially updated my web-site and created some of the forms I will need to run the business. I’ve made essential business purchases such as a computer, printer with scan and fax capabilities, a real office chair and my own coffee. I created my office space by relocating the scrapbooking portion of my dual-purpose craft room/office to a room in the basement making that area a multi-purpose craft/scrapbooking/exercise room. Bit by bit, I’ve been relocating the mounds of personal stuff I’ve accumulated at my current office over the past nearly nine years to my home office. I still have not figured out how to maintain my office as just my office and not my office/catch-all area. I’ve installed and am learning Quicken to hopefully keep adequate track of my personal and business finances. I’ve figured out how and when to pay my estimated self-employment taxes.
I have a few more tasks to complete. I need to finish cleaning out my office and my business plan. And, of course, it is important I have just the right sweats to wear when I settle into my office chair and switch on the neon “open” sign.
