You’ve decided that working as an employee doesn’t create the job satisfaction you want. It’s time to change.
So you want to become your own boss, start your own business and reap the many benefits of running your show that self-employment brings? What are the pros and cons of creating your path?
Let us elaborate on the pros of the self-employed and the cons you must consider when excited about your new life.
#1 Pro: Be your own boss
Somewhat of an obvious statement, but now you have the autonomy to make decisions and shape your business the way you want.
You don’t need to ask for permission or wait to see if your boss allows your new idea—no more sitting in on meetings and waiting for approval from the board. You can truly shape your own destiny.
You’re 100% responsible for everything now.
The advantage of owning a business is the freedom, but you must be aware that if it fails, it’s all down to you and your decisions.
It can be daunting for some, so make sure you go into this with both eyes open.
#2 Pro: No need for approval from a manager
Speaking of being your own boss, you can make decisions quickly without consulting with others or waiting for approvals.
You now make the rules, and if something isn’t working out, you can change it immediately without hoping your manager will be on board.
The danger here is that you make too many changes at once or are too quick to give up on something before allowing it time to work.
It’s important to remain consistent and have patience when running your own business.
#3 Pro: Flexible working hours
You can set your own hours and work at times that suit you best.
Are you a night owl or a morning person? This means more time to devote to your interests and hobbies or simply spending time with family and friends.
If you want to take a break, you only need to plan around your work. That four-day workweek is a possibility!
When you plan your schedule, you can also dictate where you work. Perhaps you are most productive when you work from home or the local coffee shop. There are endless coworking places to work from, too.
The disadvantage to having complete control over your working hours is that it’s very easy to slip into bad habits.
It can be difficult to remain disciplined when you are the one setting the deadlines.
#4 Pro: Opportunity for growth
As a business owner, you can be creative and experiment with new ideas, using innovation to lead to extraordinary opportunities for success.
You can create a business that is truly unique and stands out from the competition.
You’ll also benefit from your business’s revenue and potential tax break advantages for being self-employed.
Speak to an accountant, but you can benefit from a home office, expenses and other “business” perks to reduce your tax bills (in the UK, and no doubt elsewhere).
The risk here is that you may fail or not make enough money to support yourself. It’s important to take the time to research your market and industry before investing too heavily in your new enterprise.
Being an entrepreneur requires taking risks, which can lead to real financial trouble if you haven’t got a backup plan.
#5 Pro: Creative freedom
Being an entrepreneur allows you to explore and develop innovative ideas without restrictions. You have complete control over your product or service direction.
You can build something from scratch and make it your own.
The downside is that you may become overwhelmed with ideas or lack creative direction.
A plan is crucial for success and can help reduce stress levels when starting.
#6 Pro: Variety of tasks
Entrepreneurship provides multiple challenges and responsibilities; this makes every day different and exciting and gives experience in various areas like marketing, finance, operations, etc.
Entrepreneurs often become masters of many skills, which can help them discover their true passions in life.
The downside is that you may lack the skills and knowledge to handle all these tasks, so it’s important to assess your current level of competence and be willing to invest in learning new things.
As business owners, we can quickly become overwhelmed by mundane and trivial day-to-day work tasks.
Be careful not to make yourself just another 9-to-5 job!
#7 Pro: Sense of satisfaction
Building something from scratch provides a deep sense of achievement that an individual cannot gain through traditional employment roles alone.
You are no longer a cog in the machine – you now get to be whatever you want.
You can reap the rewards of your hard work and dedication, keeping all the profits, knowing you created something from nothing.
The downside is that it can be very easy to become obsessed with your project or overwork yourself without realising the consequences.
Without anyone telling you to stop, take a break or a vacation, you can quickly join the ranks of burnt-out entrepreneurs.
#8 Pro: Increased earning potential
Owning a successful business can bring considerable financial rewards over time if done correctly.
As long as you can scale your business, take on staff to do the work and find time to manage it all, it’s pretty limitless.
You have the potential to make more money than you would in a regular job, and you can tap into a broader range of markets.
The downside is that it takes time to build up your customer base and get a steady income stream. There is no guarantee of success, and knowing how much of your income goes to taxes is important.
If your business succeeds, you must pay income, corporate tax, and maybe VAT and other taxes.
Being entirely responsible for your paycheck is one of the biggest cons of self-employment.
#9 Pro: Networking opportunities
Meeting other entrepreneurs and industry professionals are great ways to learn more and gain valuable contacts in the same field of interest or industry expertise.
You’ll make new friends and contacts in all kinds of industries through meetups, networking events and even through clients.
The downside is that some people may be out to take advantage of you or give you false information to benefit themselves.
It’s important to do your research and verify any resources before taking advice from others.
Remember, you’re now in business, and so are the others around you – so be mindful of whom you work with.
#10 Pro: Contribute positively to society/economy
Creating jobs and developing services and products people need/want is key for economic development in any area or country.
Often, grants are available for product or service development if your business can create and sustain jobs.
As an entrepreneur, you can make a real difference in people’s lives and contribute positively to society.
The downside is that it can be challenging to get started, as there are often high barriers to entry and much competition. Having realistic expectations and being prepared for failure is important.
Any mistakes you make could severely impact those who work and depend on your business to pay their salary.
Becoming self-employed has many advantages and disadvantages, and you must decide if running your own business, freelancing, contracting and being your own boss is right for you.
Weigh up all the pros and cons, write a list and decide if it’s about time you called the shots.
If you are ready to take the plunge, keep an eye out for our upcoming guides on starting your own business.
#11 Pro: Bonus: you don’t have to go it alone
Rather than becoming a solo entrepreneur, consider co-founding a business with a trusted friend or colleague.
Starting a business with a partner shares the responsibilities of running a business and can help you manage the pros and cons above even better.
Good luck, entrepreneur!