Using Virtual Assistants to Reduce Payroll Costs
If business is picking up and you can’t do all the things you need to get done by yourself (or with your existing staff), consider outsourcing some work to a virtual assistant (VA). No, the assistant isn’t an avatar; he or she is a real person that works remotely from you. The VA is not your employee but rather an independent contractor with his or her own business, and there are many benefits to working with one.
Why Use a VA
Increasing the number of people on your payroll may add more costs to your overhead than salary alone. In figuring the cost of an employee, to the salary you pay also add the cost of workers compensation, unemployment insurance, and the employer’s share of Social Security and Medicare taxes, as well as any benefits you provide to your staff.
Even though there’s a payroll tax holiday in place for any new employee you take on before the end of 2010 (you don’t have to pay the Social Security portion of FICA for the balance of this year), the tax break doesn’t amount to savings sufficient to offset all of the tax, insurance and benefit costs of an employee. For a VA, you have no tax responsibilities, other than to provide an annual Form 1099-MISC if your VA is a sole proprietor. You don’t pay insurance and benefits either.
Saving money isn’t the only reason to use a VA; space may be a consideration for you as well. Instead of obtaining larger quarters, your assistant occupies his/her own space (and the costs associated with it). Your VA also supplies his/her own computer, Internet access, and other supplies (although some costs may be billed to you per agreement).
Finding a VA
As with an employee, you’ll want to find a VA with whom you can work well and who is qualified to do the work you need to have done.
Find VAs through:
Post your needs here and receive responses from interested prospects.
Check listings under skills. Note: There are no listings under certain skills, such as social networking.
- International Virtual Assistants Association
Check a directory to find VAs who are members of this association.
- Virtual Assistance Chamber of Commerce
Select a listing from the directory of members, or submit a request for partnership and receive responses from interested prospects. To guide you through the selection process, a handy and informative client’s guide (www.virtualassistantnetworking.com/find.htm) is available.
You’ll want to make your needs clear from the start so you can find the appropriate person to work with. Do you need a VA to do bookkeeping? Social media work? Scheduling? While some people may be able to provide an array of skills, make sure you find someone with expertise in the areas you deem most important for you.
A personal interview—by phone—is highly useful to make sure you can communicate well with each other. Some VAs, for example, may be on the other side of the world and English may not be their first language; decide whether this is a problem for you.
Important: Determine whether time differences between you and the VA are important to you. If so, then don’t engage anyone who is more than one time zone removed from yours.
Working with a VA
The key to working successfully with a VA is communication. Make sure you and your VA are on the same page with respect to:
- What needs to be done
- Applicable deadlines
- The hours you are prepared to pay for.
Generally, you’ll pay a monthly retainer that guarantees you a set number of hours—5, 10, or any other amount agreed to. Then, if the VA works additional hours, you’ll pay by the hour. The hourly rate for VAs in the U.S. typically ranges from $30 to $75/hour.