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Are you interested in getting started as a private tutor?
Starting a tutoring business takes a lot of perseverance and patience. Some people compare it to bringing up a child or having a relationship – more often than not it’s a total rollercoaster!
But if you love and believe in what you’re doing, it can also be the most rewarding job in the world.
This article is for those who are brand new to tutoring and want to learn how to start a tutoring business from home. Also it’s useful for those who have done some tutoring already and now want to take it up a level and teach full-time.
Although experienced teachers may find some useful advice here, it’s primarily aimed at those wanting to start a tutoring business the RIGHT way, ensuring success for many years. This guide is NOT for those who wish to set up a tutoring agency and want to learn how to hire/manage teachers.
In this article, you’ll discover 11 essential tips for starting a home tutoring business, as well as some other things you should definitely consider to ensure you’re properly setup and ready to go.
How to start a tutoring business from home
I remember feeling overwhelmed about starting my piano teaching business. Although I had learnt how to become a better pianist throughout my education, I felt at a loss in terms of how to build a career as a private music teacher. But I realized this situation is not only with music degrees. Over the years, I’ve discovered through my coaching that this situation is fairly common in MANY degree courses.
Of course you need to be knowledgeable in your subject, have enthusiasm and passion to help students improve, and possess excellent communication skills, but you need to be business-minded too.
Here are 11 tips to consider when starting a home-based teaching business.
1) Make sure you create a business plan
Before you plunge into the deep end and spend all your life savings creating a top notch teaching studio, you need to bear in mind several factors which can have an enormous impact on your business.
Does a student NEED weekly lessons in your subject?
The last thing you want are students who only come once for a session and then disappear. Although this strategy can work once you have a full schedule with one or two free slots for ‘one-off’ lessons, you want repeat business to get a regular income from tutoring. Therefore, you want students who can come once or twice a week, or once a fortnight and improve their subject knowledge over time. It makes your tutoring business more stable.
How much competition is there in your area?
It’s tempting to fear competition when it comes to starting a business. However, competition is often a good sign as it means there is a market for your lessons. You just need to find a way to stand out and find your space in the local tutoring market.
Is there enough demand for lessons in your subject?
Usually there is, but if you’re teaching something very specific, you might not find enough students in your local area. Sure, you can try tutoring online to widen the net, but I recommend you start in your local area. It’s usually easier to find students this way, and to spread the word about your lessons.
You need to address these important questions before you start. While I believe you can make a success of almost any tutoring business, providing you have the right marketing strategy (see further down), you should definitely come up with a business plan to cover all the important issues.
2) Come up with a name
You should come up with a name for your tutoring business. Of course the easiest solution is to just use your own name, e.g. Joe Bloggs Math Tuition, but you could create a company name, e.g. Los Angeles Math Tuition.
However, make sure you think about branding, and how you can capture the attention of people when they see it. You can use some ‘power’ words in your business name like ‘advanced’. Alternatively you could use a place name to try and build local awareness.
Check out Yellow Pages for some ideas.
3) Classify your tutoring business
Then you need to decide if you want to register as a sole trader or a limited company. Most private tutors go by their own name, as it’s easier to set up. Registering as a limited company is a little more complicated and it will involve different taxes. Don’t stress about this too much, as you can always change later on, but call your local authority if you have any concerns.
3) Set up your teaching area correctly
Make sure you have a neat and tidy workplace for every student who comes through your front door. It creates the right impression and ensures you appear more professional and serious about your teaching.
If you’re tutoring from home, you should teach in a quiet room where other household members won’t interrupt or distract your lesson. This will make it easier for you and your student(s) to focus.
4) Make sure you have the right equipment
This also creates the right impression with your students.
Ensure you have a good computer, or tablet, with fast internet access. You might want to use some interactive games or quizzes online as part of your teaching, or stream videos on YouTube.
If you want your students to take your lessons seriously, having the right equipment is essential. Decide if you’d like your students to buy books and other materials, or whether you’ll do it and invoice them for the bill.
5) Create your payment terms
Don’t be a soft touch!
This is my golden rule with getting paid. If you start being too flexible with payment terms, you’ll make things more difficult in the long run. I suggest asking your students to pay for a block of lessons, rather than on a lesson by lesson basis. You could even offer a small discount to encourage your students to pay for a group of lessons.
Ask for payment in advance
It’s really up to you, but in my experience, overall it’s best to get the money up front.
This saves time chasing students (and parents) for payment once you’ve finished a group of lessons. Phoning and emailing students who haven’t paid is incredibly frustrating and you can waste a lot of time, and nerves, especially when you start teaching a large number of students.
So don’t worry about charging in advance. Furthermore, you might find some students prefer this anyway, rather than having to do a bank transfer, write a cheque or bring cash EVERY lesson.
I use the online accounting software Xero for running my piano teaching business. With this software you can keep track of payments, send invoices and automatically send reminders to students who haven’t paid yet. It’s a real time saver and in the time you save in admin, you can probably teach a couple more students a month which can boost your income.
How much should you charge for tutoring?
Finally, think carefully about how much you want to charge for lessons. Too cheap and you run the risk of undervaluing your business and not bringing in enough income. Too expensive and no one will pay for your lessons. Do some market research and see what the average rates are in your local area.
What payment methods will you accept?
About 90-95% of my students use a bank transfer to pay lesson fees. There are no costs, no hassle, and you can get the money instantly. Also, you can see the name of the person who’s paid on your bank statement, including the invoice number which I ask them to put in the reference.
Of course, I have a couple of students who pay by cheque, which is ok too. But the disadvantage with cheques is that you have to wait for them to clear, you have to go your bank to pay them in, and the student’s name won’t appear on your bank statement. And if you’re charging on a lesson by lesson basis, you’re going to have A LOT of cheques to pay in on a regularly.
If you’re teaching online, you might want to consider using PayPal as a merchant for handling money transfers. However, you will be charged when you withdraw the money to your bank account.
Whatever method you choose, just go for a method which is the easiest, and the least time consuming for you, whilst still offering some flexibility in how students can pay. I write on my invoices that payment by money transfer is preferred, but a student can still pay by cheque if they want to. Since writing this on my invoices, about 25% more students pay by bank transfer.
6) Create a cancellation policy
A well constructed cancellation policy can save a lot of problems down the line if a student becomes unreliable and you start missing out on income.
Write a policy and give it to your student during or before your first lesson. If a student has paid for a block of lessons in advance it’ll make things easier as you won’t have to chase any payment for missed lessons. I know some tutors who are very relaxed about their payment terms, but I also know others who almost never do refunds.
Protect your income
However, from personal experience, I recommend having something in place.
Why? The main reason is to protect your income.
My dad used to teach piano, not as his main business, just 2-3 evenings a week to supplement his income. He taught some of my friends, who I knew from my local football team. I used to be quite a good player back in the day! They were forever cancelling and messing my dad around. Ok, it was partly because he was a ‘friend of the family’ so to speak, but there was no contract to stop this situation from occurring.
So I recommend having a contract in place, which has a solid cancellation policy so you can still get paid if people cancel at the last minute. It’s also why I recommend getting students to pay in advance. If they’ve paid for 10 weekly lessons, and they cancel in week 8 for some reason, there’s no hassle and no frustration.
How much notice should a student give if they wish to stop lessons?
If you’re charging on a lesson by lesson basis and a student drops a bombshell saying they want to stop lessons immediately, there isn’t anything you can do. And unless you have a waiting list of students, you will face a small dent in your income for the near future. It’s another reason why you should ask students to either…
- pay for a block of lessons,
- pay monthly,
- or pay once a term.
If they pay every school term, then I would say half a terms notice is fine. If they pay monthly, then a month’s notice is fine. And if they pay for a block of lessons, half of this period as a notice is fine. This will give you time to find another student to replace them, and protect your income.
Half a term’s notice is a policy many schools use for instrumental music lessons, so it should be fine for you to use it as a private tutor.
7) Setting up a website
Unless you have a queue of pupils lined up for their first lesson, you’ll likely need a website for students to find you online. If you have the budget, you can have one designed professionally, but I recommend you have a go yourself.
If you hire a web designer, chances are you’ll need to contact him or her every time you need to update your content. It’s far better for you to be in control of your own site so you can run things more efficiently.
I use WordPress for creating all my websites, and it really doesn’t take long to get used to the platform. Just watch a few ‘how to’ videos on YouTube and you’re on your way!
8) Applying for insurance
You should consider acquiring public liability insurance for you and your business. Although extremely unlikely, you need some protection just in case any sort of injury occurs with any of your students on your premises or involving your equipment.
It’s not expensive if you shop around, but it will protect you if there’s an incident. Sitting at a desk with a student, or playing a musical instrument might not seem exactly hazardous, but things COULD happen and it’s better to be safe than sorry.
Here are some examples…
- You spill your cup of tea onto your student’s laptop which now needs replacing.
- You leave your briefcase/bag on the ground when your student’s younger sibling trips and breaks their ankle.
- Your file slips out of your hand, landing on an expensive glass desk and causing a large crack
- You drop your student’s saxophone leaving a huge dent in it.
I don’t want to sound like a pessimist as this is all highly unlikely, but as always with insurance, you never know. If you’re reading this, I bet you have home, travel and car insurance, even if you’ve never had to claim for anything. So it’s best to take the same approach with tutoring..
9) Avoid teaching in a student’s home (if possible)
I learnt this the hard way.
When I was a student, I taught a few pupils a week in my local town. I would finish lectures and then drive across town to pupil houses. I was charging a good rate for lessons, making more per hour than my friends, some who were working in local bars and restaurants. And I was earning money doing something I really enjoyed. It felt great! However, when I considered my journey time to and from lessons, with endless traffic jams, suddenly my rate per hour didn’t seem quite as good. Not to mention the lost money due to petrol and wear and tear on the car.
Ok, so I was still a student, living at home with mum and dad. And it wasn’t as though I had a wife and two kids to support. But this experience taught me a valuable lesson.
Time is money.
If you spend 2 hours in total to teach a 1 hour lesson, it means you could teach 2 lessons in the same time if you did it in your own studio. It’s something you should think about very carefully as the amount of income you could be missing out on soon mounts up.
Of course, sometimes it can’t be avoided. If you’re teaching a child, some parents want you to teach in their home so their son/daughter feels more comfortable. That’s understandable, but I would certainly increase your lesson fee if you have to teach in a student’s home, to offset the cost of petrol and travel time.
10) Book lessons back to back
Another tip to show your professionalism is to always book lessons back to back, even if you only have a few students. Showing your students you are busy and in demand creates the impression you are a well respected and sought after teacher.
This can help increase the chances you’ll gain referrals from your existing pupils.
What are the pros and cons of starting a tutoring business?
Here are some advantages and disadvantages when it comes to setting up a tutoring business
- Very low start-up costs. If you plan on tutoring from home, you don’t need to spend much to get started.
- There are lots of different subjects you can teach, from physics to the piano.
- You can always find students, providing you market yourself in the right way.
- It’s a fulfilling and rewarding profession. It feels great when your students succeed in passing an exam, or performing well at a concert.
- It’s not that expensive to advertise, and you can use a combination of online and offline methods to find students.
- You need the right personal skills to be a teacher i.e. patience and good rapport, particularly with children.
- You need considerable knowledge in your subject.
- Unsociable hours. Many clients will want lessons after school, or after work which means working in the evenings and possible at weekends.
- Unstable income. You will likely have dips in your income during school holidays, which is why you should be marketing all year long to keep your pupil numbers up.
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It can be very profitable if you charge a good rate per hour and have a healthy number of students.
Yes. As clients often want lessons after school, in the evenings and at weekends, if you have a full-time job, you can work a bit extra to top up your monthly income. In this case, you can choose how many students to take on each week.
You can do very well financially as a tutor if you have a solid marketing plan, and you’re a good teacher of course! Obviously there is a ceiling as there are only so many hours you can teach during the week. You’ll also have some months where you feel like you’re rolling in it, particularly in the autumn and in the spring, but the summer months can be tough when people go on holiday.
Here in the UK, there are certain child protection checks which need to be done if you are working in a school before you start employment. Some private tutors also have this certificate anyway, maybe as a means to reassure parents, but at present there’s no legal requirement to have it. This may change in the future. I would contact your local authority in any case just to find out more information and for your own piece of mind.