There’s probably never been a better time to be self-employed. I know that sounds downright loony to some, but it’s the reality of our time. On the plus side, the internet has opened up opportunities for small business ventures because it provides incredible leverage and it can make the little guy look like a big guy. On the negative side, employment has never been less certain or less satisfying, at least not in the past several decades.
Not convinced? Consider the following reasons—you can probably come up with a few more.
A sense of control over your future
When you’re on someone else’s payroll, you’re also beholden to them. Your employer can change your work assignments, your seating assignment, your title, your pay, or even eliminate your job. In any of these instances, you may have little or no say in the decision making process—especially if you’re about to be fired or laid off.
Being self-employed gives you a strong measure of control over all of that. Many people are willing to make less money to be self-employed precisely because it provides a greater sense of control over their careers, and by extension, their lives.
Unlike a job, self-employment isn’t “either/or”
Jobs are very much either/or arrangements; either you have a job and all is well, or you have no job and desperation is a constant traveling companion. In most instances, self-employment doesn’t put you in that position, especially if you have income streams coming from different sources.
In the worst of times you’ll probably have an income, even if a reduced one. What’s more, self-employment can give you the flexibility to pursue other income sources as needed. With jobs, you often don’t have the time, and some jobs even restrict your ability to earn money apart from your job.
The self-employed mindset
Back when I was in the mortgage business, an attorney I did a lot of business with made an astute comment over lunch one day. We were complaining about how clients often asked us to perform extra services without additional compensation, and he said “People who are in salaried jobs don’t understand; they get paid no matter what. We only eat what we can kill.”
If you’re a salaried person that comment might sound harsh, but if you are or ever have been self-employed you know exactly what he meant. The last sentence is an obvious reference to predatory animals and while graphically extreme, it serves to highlight the vastly different mindsets between people on salaries and those who are either self-employed or on commission. When you’re self-employed, there’s nothing “automatic” about your income—you have to earn it everyday.
On the surface, that sounds like an obstacle and I suppose it is. But once you grasp the concept that your paycheck is somewhere “out there”—in the community, on the web, on the phone or where ever the client base happens to be—and you learn that getting it is actually doable, then the whole process becomes liberating!
Once you learn how to make this happen, and that it can be repeated, you’ve crossed the line into self-employment. You begin to realize that anything is possible and you see opportunity all around you. There’s no security—but there are no limits either. That’s the self-employed mindset; you’re no longer looking for a job—you’re seeking opportunities. That’s a mindset that can be learned only by doing it, and once you have, it changes everything.
A built-in retirement income stream
A lot of people fret over having enough money to retire comfortably, but here’s the reality for most people: you’ll never have enough money, so get over it! The rising cost of living will just about guarantee that the vast majority of people—outside the richest 5-10% of the population—will ever be able to enjoy a full retirement with no financial worries.
The best remedy to that problem is to have a business of your own, one you can work at for as long as you live, with no threat of being “put out to pasture”—as is the case with jobs. If you’re self-employed, you won’t ever need to retire from it and it can provide for you for many years past traditional retirement age.
Self-employment opens the potential for unlimited income
Ever wonder why you reach an income ceiling on a job? It’s not your imagination—most jobs are “static” (I read that in a how-to-get-a-job book by an HR guy). An employer—any employer—will only pay so much for a given job, even if you’re doing the best work possible. Worse, once you reach the top earnings threshold, you’re trapped in the job because a move to another employer may mean a decrease in pay.
When you’re self-employed, you can earn as much as your time, talent, and effort will allow. In theory at least, there is no limit as long as you continue to grow and expand your business and your abilities.
You don’t have to quit your day job
One of the great aspects about being self-employed is that you don’t need to quit your job to do it. As we discussed above, self-employment isn’t either/or, and often involves the pursuit of multiple income streams.
You can start and build your business as a side venture until you’re ready to go full time. Maybe you never go full time, but you’ll have it as a second income and as a place to do the things you never could on your full time job. Sometimes having a side business makes your full time job more tolerable because it gives you what your job can’t.
One thing to keep in mind though; when filing taxes each year, working with a single employer and W2 forms, you can use a simple free IRS efile and do your own taxes online. Being self employed often opens up the possibility for significant deductions, and with multiple revenue streams. It may be in your best interest to consult a tax professional if you don’t feel comfortable doing it on your own.
Advance preparation for a job loss
This reason almost makes a necessity of being self-employed. This isn’t your grand-father’s economy—it isn’t even your father’s economy. The rules have changed and are still evolving. The past ten years have been very unstable and the future doesn’t look any better if “stable” is your definition of normal times.
Every one of us needs to have a plan (or better yet, plans) for a job that won’t be there in the future. Just because you kept your job through the last recession doesn’t mean you’ll have it until you retire. No job is safe any more, and the worst part is that if you do lose your job it will probably come at a time when thousands of people in the same line of work are losing theirs. That means there will be long lines of candidates applying for any job available.
Being self-employed, you can (and should) develop multiple income streams that will provide you with at least some income, plus the ability to find new ones. You can even take a part time job to help in a pinch.
There are businesses and industries that grow even in recessions. I’m doing freelance blog writing, and that business has actually grown substantially during the recession. There are opportunities for growth all around and by being self-employed can help you find them. If you’re doing it right—meaning you’re always searching out opportunity rather than a job—you have a good chance of surviving and even thriving, what ever happens in the economy.
If you’d like to start a business of your own, but don’t know which to go into, check out my post, The Freelance Blog Writer Side Hustle. Blog writing is a chance to try your hand at being self-employed and to grow your business–risk free. Even if you’ve never written professionally in the past, this post can get you started.
Charting Your Own Course with a Side Business
Why Most New Businesses Fail – And How Not to Become One of Them
A Successful Online Business Requires Realistic Expectations
A View From the Economic Cliff
7 Ways to Improve the Success of Your New Business
How to Start Your Own Online Store
The Perfect Side Hustle: Freelance Blog Writer