At Ubiquitous, we’ve seen many creators on our platform go from creating content as a side hustle to quitting their jobs to create full time. If you’re reading this, you might be in the same position and wondering when it’s time to get serious about it and what you should do next.
If you're in that position, we want to offer you a generic rule of thumb: if you have been able to support yourself and/or your family for (at minimum) 3 consecutive months in a row from creator income (and you hate your job), it might be time to start thinking about what it would look like to create content full-time. There has never been a better time in history to take the leap and we’ve put together some quick tips for you to think about as you decide if it’s time.
How to go full-time as a creator: 4 steps
1. Form an LLC, set up a separate bank account, and get insurance.
If you’ve never heard of an LLC, NerdWallet does a great job of explaining the pros and cons to getting one set up for your business. The benefit is an LLC allows you to pass on the liability of your content creation to the LLC vs you personally. That means your personal assets (bank accounts, cars, house, etc) can’t get brought into a lawsuit if you get sued by a brand. Trust me, it happens.
The second step would be to set up a business bank account that keeps all things business separate from your personal financial life. It’s a good idea for many reasons, but it allows you to keep track of how much money you are making and is a good signal to a judge that you are serious about your business in the event you get sued.
Once you’ve legitimized your business by setting up an LLC and a business bank account, it’s time for you to get insurance. There are all sorts of policies you could get (and if you talk to an insurance broker, they’ll tell you to get all of them), but at a minimum, general liability and media liability are a must. General liability protects you if someone else gets injured or property gets damaged while you’re making content and media liability protects you from a host of things depending on how the policy is written, but generally reduces risk related to copyright infringement, product disparagement, and breach of license agreement among others.
2. Become a W2 employee under your newly formed LLC and get health insurance through it
A sneaky side benefit that not a ton of people talk about is the ability to become a W2 employee of that LLC. Why does that matter? Well, if you’ve ever tried to get a car or home loan only having 1099 income, you know why it matters – it’s nearly impossible. W2s are the gold standard for underwriters when assessing if you have the income to take on the debt burden and forming an LLC and paying yourself as a W2 employee of that LLC is a great way to solve that problem. It is a little more work to pay yourself and all the taxes related to being an employer, but the benefits should outweigh the work that goes into setting it up.
The other big perk of having an LLC is the ability to shop around for health insurance. Being a sole proprietor, there are only a small handful of options when it comes to health insurance. When you form a company, your options get broader and you can potentially get better rates. Nevertheless, it’s an expense your LLC can take on and deduct from your income to lower the LLC’s tax liability.
3. De-risk your business by generating followers on multiple platforms
This is an often overlooked thing for content creators that is critical to turning your side hustle into a full time gig. We’ve seen creators lose thousands of followers due to a post that didn’t sit well with their audience, platforms taking down content, algorithms changing and not making certain posts relevant, and many other instances where a creator’s income changings seemingly overnight. If you have a strong Tiktok following, start creating longer form content on Youtube and start sending followers there. If you use Instagram for showing off the latest fashion trends, set up a Poshmark account and start buying and selling stuff you’ve found on sale racks or at Thrift stores. If you’re a content creator, you should at a minimum have income streams from two platforms. (If you’re trying to figure out how to build multiple income streams, our Creator Services team would love to help you think through that. Shoot them an email: firstname.lastname@example.org)
4. Find a partner to help you take care of the day to day
If you wanted to source deals, keep up with paperwork, negotiate terms of a deal, or hound someone to pay you, you’d keep your 9-5 job. You want to create full time, not deal with time-sucking tasks that drain your creativity. Finding the right partner to deal with all the stuff you don’t want to is a critical step to making this a career that’s fulfilling. At the most basic level, you should find a partner that: sources deals, negotiates terms, handles the paperwork, and collects payment (or better, takes payment risk and pays you fast). If you find someone to do those four things, you will be well on your way to a fulfilling career doing what you love: creating content.
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If you’d like to talk to someone on our team about any of the following, don’t hesitate to reach out to email@example.com. We love creators and are building the infrastructure for you to do what you love all through an app on your phone.
Disclaimer: I am not a tax, financial, insurance, or legal professional. This is not financial advice. This is not legal advice. I am just trying to help point you in the right direction as you think about taking the next steps in your content creation journey! If you want any advice on any of the above, reach out to your own personal advisor. If you don’t have one, shoot us an email and we’ll see if we can connect you with someone in our network.