Making Working at Home Work

Anyone who has ever sat in traffic on the way to or from work has dreamed of telecommuting—especially if the gridlock means missing an important meeting or a school play. Others are driven to distraction—literally—by the hustle and bustle of the office and the constant interruptions that punctuate life in the cubicle. And every nine-to-fiver knows that the cost of gas (or bus, train or subway fare) plus dry cleaning and lunches out can put a serious dent in the family budget. Who wouldn't trade a gray flannel suit for casual Friday clothes every day, or the local freeway for the information superhighway?

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In our slowly but surely evolving business culture, work increasingly refers to what you do rather than to where you go. An exact count is elusive, but estimates for the number of Americans working at home at least some of the time range from 16 million to as many as 30 million. In a 2012 study by the Families and Work Institute and the Society for Human Resource Management, 63% of employers surveyed reported that some of their employees work at home occasionally, up from 34% in 2005.

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Another 50 million employees, with jobs that are compatible with at least part-time telework, would jump at the chance to give it a try, according to the Telework Research Network, a business consulting and telework advocacy firm. Some workers even say they'd give up a raise for the chance to stay home sometimes. But before you can join the work-at-home revolution, you first have to persuade your boss, negotiate a mutually beneficial arrangement and execute it smartly so that your career isn’t diminished along with your time in the office.

For Jayme Shuda, 31, the turning point came about a year ago, soon after she got married. She moved into her husband's home in Marine on St. Croix, Minn., 32 miles away from her St. Paul office at Mahoney, Ulbrich, Christiansen & Russ, where Shuda, a CPA, works with small businesses as a tax consultant and QuickBooks adviser. "I was wasting two hours a day commuting," says Shuda, who worried that winter snow would turn the commute into a stressful three hours.

Mahoney, Ulbrich is well known for its workplace flexibility, even winning local awards for its policies. Shuda now works three days at home and two in the office. "We're a small firm," says partner Bonnie Russ. "We have to compete with large firms with big budgets. Our salary levels are not the same, so we have to make ourselves look attractive in other ways." The arrangement involves a high degree of trust, says Russ, but also comes with high expectations. "If someone is working at home, theoretically no one's interrupting them. We expect a higher level of that time to be billable."

Big Savings

The benefits to both teleworkers and their bosses are significant, say advocates. Employees can save between $2,000 and $7,000 annually in transportation and work-related costs, according to Telework Research Network president Kate Lister. You might be able to shave child-care costs (but not during working hours), and some workers can qualify for home-office and other business deductions. The average home-office deduction amounts to $2,000 for teleworkers, says Lister, resulting in a tax savings of nearly $600 for someone in the 28% bracket. But you'll qualify only if your boss requires you to work at home. (Get the details.)

Angela Perkins, 36, a director of quality assurance for Ryan LLC, a tax-advisory firm in Dallas, works at home about 40% of the time. She figures she saves roughly $104 a month in commuting costs, $80 a month in restaurant meals and $50 a month in dry-cleaning charges. Plus, she uses less leave time for personal business. "If I have to take off at noon to go to the dentist, I can start earlier or work later. I'm not taking vacation time," she says. Get a sense of what you might save by working at home at undress4success.com. The calculator factors in expenses right down to the office coffee kitty.

Your employer saves money when you stay home, too. Businesses can reduce operating costs by more than $6,500 per year for every employee who telecommutes just one day a week, say telework advocates. At Ryan, where all professional employees have had the opportunity to telecommute or make other flexible work arrangements since 2008, turnover has plummeted from nearly 20% in 2007 to less than 7% in 2010. The cost of office space shrinks when telecommuters share workspaces or give up desks altogether. That goes for the federal government, too: The Treasury Inspector General for Tax Administration recently estimated that the IRS could save more than $111 million over the next five years by having teleworkers share workstations more often.

When Mike Rogan, 55, a sales manager at IBM, needs to go into an IBM office, he simply signs in and gets assigned a temporary desk and phone line—a practice known as hoteling. The rest of the time he's calling on customers or working in his Pittsford, N.Y., home office, about 30 minutes away from IBM's building in Rochester. "You can still get the job done, but it doesn't have to be nine to five, and it doesn't have to be in the office," he says.

Sought-after workers can often negotiate work-at-home deals. Jason Richardson, 40, is a senior infrastructure engineer in the IT department at Unum, the insurance giant with headquarters in Chattanooga, Tenn. For seven years, Richardson has mostly worked two and a half hours away, in his home in Nashville. "The hiring manager knew me from previous work experience," says Richardson. "He knew that I was self-motivated, had a hard-work ethic and would be able to succeed in a work-from-home situation." With a son in middle school and extended family living nearby, Richardson would not have taken the job without the telecommuting option. He has since been promoted.

Who's Home

The typical teleworker is 47 years old, has been with a company for 12 years and earns $67,000 a year, according to the Telework Research Network. Among workers with small children, the majority of those working at home are women, but otherwise there is no gender gap among teleworkers. You'll find the highest percentage of teleworkers in occupations that involve spending time at client sites—think management consultants, salespeople and insurance claims adjusters.

But the fastest growth is among groups that include insurance underwriters, lawyers, travel agents, human-resources professionals, electrical engineers, and managers and administrators, according to a recent report from the Conference Board, a nonprofit association of businesses focused on corporate research. The increase is fueled by technology: more broadband connections, virtual private networks that let you log in to office computers, and services that allow online collaboration with colleagues, from instant messaging to document editing to video conferencing.

Telecommuting has taken off within the U.S. government ever since February 2010, when a blizzard dubbed Snowmageddon shut down Washington, D.C., for a week. Those who were able to work remotely collectively saved Uncle Sam $30 million a day in what would otherwise have been lost productivity. By the time Hurricane Sandy swept through the eastern U.S. in October, the number of federal employees who telecommute had grown to 168,000 nationwide, according to the Telework Exchange, a public-private partnership to promote telecommuting. At NASA, more than 62% of employees telework, says chief human capital officer Jeri Buchholz. "Our employees are trained and equipped to do jobs from anywhere. Office, dining room or airstrip lab. Sitting in an airport or on a space station. Wherever they happen to be."

NASA engineer Roger Forsgren, 57, has worked two to three days a week from home for the past three years. When he transferred to Washington, D.C., from Cleveland, Forsgren discovered that affordable family housing was hard to come by in the pricey D.C. market. So he settled in Fredericksburg, Va., some 60 miles south, and what had been a 15-minute commute turned into two hours—one way. Besides the time saved, he finds other benefits in staying home. "If I have to write something, I’m alone all day and don’t get interrupted by people wanting to know how my weekend was," says Forsgren. "If I have a cold, I don’t feel right in the office spreading germs, but I can work at home."

Successful telecommuters have similar traits. They're good communicators and have impeccable time-management skills. They're proactive, self-starting and self-disciplined; motivation comes from within. They also don't mind working in solitude, without the camaraderie of colleagues every day. Rest assured, slackers are quickly outed. "If people were at home watching reruns, it would be evident that they weren’t accomplishing very much," says Mahoney, Ulbrich partner Russ. "We know how many hours a particular project takes."

You might be perfect for telework, but your job must be suited to it. Are your client meetings predictable? Are your main forms of contact e-mail and phone? Can you group together duties to be done at home on a regular basis? Do your performance ratings meet or exceed expectations? A yes to all those questions may indicate that telecommuting is a good fit for you. Working with classified information, needing access to paper documents or being an entry-level employee, however, could put the kibosh on your work-at-home plans. (Find out whether your job lends itself to telework by using the Eligibility Gizmo.)

The Pitch

When presenting the case for telework to your boss, remember that even in the most flexible offices, working at home is always a privilege and never a right. Don't ask to work at home full-time. Let your boss know that you have a quiet place to work and that you have child care, if needed. Assure your employer that you'll be the only one using company-provided supplies or equipment and that company information will remain secure. Detail how you intend to meet the needs of supervisors, clients and co-workers, with work that's predictable, on-time and high-quality. Expect to start with a temporary arrangement to be reevaluated after a specified time. (You may have to shell out some cash to stock a home office. Only about one-third of companies buy everything you need.)

Many free or inexpensive tools and apps can make the telecommuting life more efficient. With Google Docs you can collaborate on documents, spreadsheets and presentations. Use Google Talk or Yahoo Instant Messenger to chat with co-workers. Host a video conference with up to ten people with Google Hangout. Dropbox lets you store up to 2 gigabytes of files free, for easy retrieval on any device that connects to the Internet. Stay on-task and keep track of the time spent on projects with RescueTime, which monitors how you spend time on your computer; it alerts you if you linger on sites you've deemed distracting.

Executing a work-at-home arrangement wisely can mean the difference between moving up the ladder and falling off it. Telecommuting works best if you can be evaluated on the results you produce rather than the time you put in—and for some managers that can be a huge culture shift. At Ryan, the Texas tax-advisory service, minimum 50-hour workweeks and mandatory face time used to be the norm. That changed when the firm almost lost a key manager to a competitor offering a more family-friendly schedule. Now, employees are measured by the results they achieve, using revenue targets, for instance, or client-satisfaction scores.

Whether or not your company employs such yardsticks, it's crucial to communicate what you’re working on and to share your progress. "The partners I'm working for know that this is what I did today, this is what I’m waiting on and this is when I think I'll wrap up," says Shuda, the small-business consultant in Minnesota. She is also considerate of co-workers. "My calendar is kept up-to-date—that's key to making work-from-home work for everyone else."

It goes without saying to respond promptly to calls and e-mails. When you are in the office, stop by the desks of colleagues and managers. And make a point of socializing, at least a little. "It's important to show up for key moments when people are bonding—celebrations, parties, the kick-off of a new product," says Ken Matos, senior director of Employment Research and Practice at the Families and Work Institute. Go to lunch with the people you used to bat around ideas with in the break room. Just try to get back to your home office before rush hour.

Dress for Success and Other Advice

For people who want to work remotely, the biggest threat to success is an old-school management structure that may be biased against them. Researchers at the University of California at Davis and at the London Business School found that managers were 9% more likely to unconsciously attribute traits such as "dependable" and "responsible" to people who were in the office during business hours, and 25% more likely to attribute the traits "committed" and "dedicated" to people who came in early, stayed late or came in on weekends. The best way for remote workers to counteract a negative perception on the part of managers is to make regular status reports, be extra visible when in the office and be immediately available at home.

Some remote workers may encounter saboteurs among their co-workers. Maybe they've been inconvenienced by your absence, or they're envious of your arrangement. Bring them around by being available to collaborate virtually when needed, and make sure they see your work as a pilot, the success of which could make flexible arrangements more widespread.

Finally, set boundaries between your work and home life. Although you may be in the comfort of your home, consider dressing for success. Seriously. When you dress in work attire, friends, neighbors and family who equate "working at home" with "not really working" will interrupt you less frequently. It may also help with another problem some at-home workers face: the inability to establish a quitting time. Changing into sweats and slippers at the end of the workday helps set the boundary between work and home.

This article first appeared in Kiplinger's Personal Finance magazine. For more help with your personal finances and investments, please subscribe to the magazine. It might be the best investment you ever make.