You don’t have to wait to know if your SEO is working just based waiting for the first page rankings.
Keyword combination. Go to Google and type in one of your targeted keywords and keep adding more and more to suggest to Google if you want to find your website on the web (example web design: website company, designing sites, etc; do not fully make it 100 percent specific). If you’re showing up it’s a very good sign, name of the place, you have been indexed and the index worked well. If you do not find yourself here it could be a link problem or indexing problem.
Rank tracking. Every 15 days your targeted keywords should be tracked. You should know if there is an increase or decrease or if it’s static. If it’s static and moving back there is a problem; if it moved a couple of notches it’s good. You might be doing good SEO but maybe not good enough, so you have to be more aggressive and focus only a few.
SEOmoz toolbar. This is a great tool because with it you can quickly see a couple of really important statistics. The tool is not really good for aggressive SEO, but you can use this to know if your page rank is increasing if you’re writing good content. Even if after 6 months you have not gotten a page rank 1, things could be suspicious there.
Also check if your Alexa rank did not improve every month. If so, then definitely there is a problem. Although Alexa is not accurate, these tools put together can be used to help you move forward.
Google Analytics and Webmaster Tools. These will actually show you if your SEO is working or not. Webmaster Tools tells you if there is some technical problem in the site, while Analytics tells you if you’re getting visits.
Time. If you’re not seeing progress in two months’ time after SEO starts, that is a big indicator of a problem. In two months you are not expecting incredible results, but a few low competitive keywords should have been acquired within that period.
You may want to read Basic Questions and FAQs about SEO to understand the basics of SEO in the most layman terms.