Do you wish you could be your own boss? If you’re thinking about starting a business so you can leave the nine-to-five grind in favor of being self-employed, you should know that there are both good and bad sides of being an entrepreneur.
Let’s look at some of the benefits and some of the drawbacks of being your own boss, so you can better decide if self-employment is the right option for you.
Benefits of Working for Yourself
Here are some of the biggest benefits of being self-employed:
- You get to set your work schedule (although some businesses will have more flexible hours than others). For example, if you run a retail store and you want to be closed on Sundays, you can be closed on Sundays. And if you offer freelance services you can choose to work in the evenings if you’re more productive then.
- You don’t need someone else’s permission to take time off. While you still have to let clients know if you’re a service provider, you don’t have to worry about strict vacation scheduling rules or getting approval from a supervisor.
- You can work from anywhere you want — from a local storefront to lounging by the pool (depending on the type of business of course).
- You get to make all of the big business decisions and directly influence the company’s growth and success. That includes deciding how profits are spent.
- You have more creative freedom than if you worked in a traditional business structure under one or more bosses.
- Your income potential is less limited. If you work for someone else, you rely on them for promotions and raises. And sometimes those raises can be very small. When you work for yourself, you get to decide when to charge more, so your income can increase more rapidly or at more frequent intervals.
- You can wear whatever you want (depending on the business). For example, if you run your business from home, you can work in anything from business attire to your pajamas. Of course there are exceptions — running a business that’s open to the public might require more professional choices.
Drawbacks of Being Self-Employed
While those are some attractive reasons to consider self-employment, there are also some downsides to being your own boss. Here are some to consider:
- Even though you don’t have a boss, you do have to answer to other people (such as your customers or clients).
- Working for yourself involves a lot of self-discipline. Since no one is looking over your shoulder to make sure work is being done, it falls on you to eliminate distractions and focus on work independently.
- In some businesses (especially early on), being your own boss can involve working longer hours than a traditional job. In those cases, you might not be able to take vacations or other time off.
- As your own boss, you’re responsible for all of the business and administrative duties. That includes filing, accounting, marketing, and much more. You can unload some of these responsibilities by hiring employees or contractors to help, but if you work alone it all falls on you.
- Income can be less reliable. You can’t rely on a steady weekly paycheck anymore when you work for yourself, at least early on. Until your business is earning steady profits, you might not have as much money coming in as you’d like.
- You won’t get any guaranteed benefits. For example, your vacation time isn’t paid time off. And you might have a hard time getting medical insurance when you’re getting started.
Being your own boss can be a wonderful experience. But it’s not for everybody. Is it for you? Make sure you consider both the pros and cons before deciding.
Can you think of other benefits or drawbacks to being self-employed? Share them with us in the comments below.