How to Start an LSAT Tutor Business

Start an LSAT Tutor Business by following these 10 steps:

1. Plan your LSAT Tutor Business
2. Form your LSAT Tutor Business into a Legal Entity
3. Register your LSAT Tutor Business for Taxes
4. Open a Business Bank Account & Credit Card
5. Set up Accounting for your LSAT Tutor Business
6. Get the Necessary Permits & Licenses for your LSAT Tutor Business
7. Get LSAT Tutor Business Insurance
8. Define your LSAT Tutor Business Brand
9. Create your LSAT Tutor Business Website
10. Set up your Business Phone System

We have put together this simple guide to starting your LSAT Tutor Business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas.

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

• What will you name your business?
• What are the startup and ongoing costs?
• Who is your target market?
• How much can you charge customers?

Luckily we have done a lot of this research for you.

What will you name your business?

Choosing the right name is very important. Read our detailed guide on how to name your business. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.

What are the costs involved in opening an LSAT Tutor Business?

Many LSAT tutoring businesses are managed from a home office. This keeps startup costs low and increases your potential for profit. You made your first investment in this new business venture long ago when you attended law school and worked as an attorney.

To launch your business, you’ll need a startup budget of $1,000 to $2,000. This covers your business tools, study materials, liability insurance, and advertising materials. If you elect to operate outside the home, you’ll need to add at least $10,000 to your startup budget. This covers the lease deposit, first and last month’s rent, furniture, and utility deposits. Exact costs from region to region will vary.

What are the ongoing expenses for an LSAT Tutor Business?

Like your startup business costs, ongoing expenses are directly tied to your business structure. Operating out of a home office will reduce overhead costs and increase profits. Your monthly home-office budget will look similar to the startup costs. It will include testing materials, liability insurance, expenses for continuing education, website maintenance, travel expenses, and marketing.

Once your business is established and it’s time to take on employees, your monthly budget will increase. You can avoid some payroll-related expenses by hiring freelance tutors.

Who is the target market?

Your target market is pre-law students who are preparing to take the LSAT exam. Since the LSAT is the same for every state, you don’t have to limit your marketing efforts to your home state.

How does an LSAT Tutor Business make money?

Your LSAT tutor business will make money by charging a fee for your test preparation services. Many tutor businesses offer one-on-one coaching sessions and a variety of packages that meet every student’s budget. This ensures every student has a positive experience and is set up for success.

How much can you charge customers?

LSAT tutor pricing varies widely from one region to the next. Some tutors charge an hourly rate of $50, while others charge over $100 an hour for their services.

Pricing will directly impact the quality and amount of business you receive. When creating your price sheet, research what your competitors are charging. While it’s okay to beat their prices, do not undervalue your time and expertise.

How much profit can an LSAT Tutor Business make?

As a whole, the test tutoring market is a billion-dollar industry. It is recession-proof and provides ample opportunity for profit, with all indicators pointing towards continued growth. Established LSAT tutors report monthly profits of over $15,000.

How can you make your business more profitable?

LSAT tutors seeking opportunities to increase profits should consider hiring employees with expertise in other standardized tests. BAR tutoring services are an excellent complement to any LSAT tutoring business. You could also offer your services assisting students in finding grants and share your experience and knowledge through paid webinars and ebooks.

STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship, partnership, limited liability company (LLC), and corporation.

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your LSAT Tutor Business is sued.

You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history, which can be useful to raise money later on.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

Is this Business Right For You?

To position yourself as a successful LSAT tutor, you should have a legal background and extensive knowledge on the LSAT exam. You should enjoy the process of helping others achieve their dreams of attending law school and have an innate ability to help others understand complex concepts.

What happens during a typical day at an LSAT Tutor Business?

As an LSAT tutor, you’ll help your clients prepare for the law school entrance exam. While no two days will be exactly alike, your schedule will include the following tasks:

• Answer prospective client questions
• Address concerns and questions about current clients
• Assess each student’s strengths and weaknesses
• Identify the client’s learning style
• Develop personalized study strategies based on your assessments
• Research innovative study and test-taking techniques and present them to your students
• Keep clients motivated and accountable for their progress
• Encourage clients and help boost their confidence levels
• Travel to students and conduct one-on-one coaching sessions

When you aren’t working directly with students, your focus will be on networking and marketing. It’s also important that you remain abreast of LSAT testing changes and researching new ways to help your students improve their test-taking skills.

What are some skills and experiences that will help you build a successful LSAT Tutor Business?

To be a successful LSAT tutor, you should have a legal background. You should also be educated in innovative test-taking strategies and have strong writing, critical thinking, and problem-solving skills. Experience teaching individuals at varying skill levels will also set you up for success.

Your students are under a lot of pressure. You can gain trust and a positive reputation by striving to always provide a safe space for your clients. The energy you put out is the energy you receive. If you fail to provide an engaging environment that’s conducive to learning, you are not doing your job as an LSAT tutor. Patience and empathy will go a long way in building a trusting relationship.

What is the growth potential for an LSAT Tutor Business?

Between 100,000 and 150,000 LSAT exams are administered in the US each year. Each of these students are vying for a coveted spot in law school. The pressure is immense, even for the strongest students. To ease the pressure and boost confidence, many students turn to tutors for guidance and support. As a result, this can be a lucrative and scalable business venture. Business owners now have the option to coach online and in-person, positioning tutors for nationwide growth.