Our very own Tracy recently said, in a Facebook status, “Just realized I am making more freelancing part time than I did at my last full time job. Kind of neat.”
I loved that status, because my own experience has been similar. Since starting my own business, I’ve been making more, and with far more flexibility and control. Another colleague/friend who took the plunge a couple of years ago, Kim, shares our experience. Her business is thriving, her expenses are kept to a minimum because she works from home, and she’s able to spend more time with her daughter.
Of course, working from home is not for everyone. If you’re a very social person who needs daily adult interaction, it will be tough on you. But to those who can manage the isolation, starting your own business and working from a home office offers plenty of advantages, including saving on commute and on work clothes, a low overhead (we don’t rent an office, don’t have employees to worry about) and – of course – plenty of flexibility.
Even if your dream business does require an office, employees and maybe even a manufacturing line, starting your own business and growing it is an amazing experience and is worth considering, especially if you’re unemployed, or unhappy with your current employment situation. In fact – right after finding a great partner and experiencing parenthood – I consider starting and growing my business as the most intense experience of my life so far.
But what about security? Starting a business is risky, certainly in the United States where it often means no social benefits – right?
It depends. The way I see it, a home-based business with little or no overhead, that does not require you to take out a loan, is not very risky. If you have an emergency fund that can sustain you for a year even if you don’t have any income during those first few months of growing your business, and if you get health insurance – either through your significant other or a high-deductible private insurance, you should be OK.
As a business owner, you won’t be any less secure than as an employee, because – let’s face it – except for very few instances such as receiving tenure in the academia, a nine-to-five job offers no security whatsoever. Any safety you have in this situation is an illusion, as we’ve all learned during the Great Recession. Even those “safe” jobs with fat pensions are going to disappear eventually, as pension plans run out of money.
The only security comes from YOU being smart about YOUR money – saving enough so that you can survive several months – ideally a year – of unemployment.
Which is kind of good news, because if you always wanted to start a business, but worried about security, then you should realize that being a business owner isn’t “less safe” than being an employee. Current unemployment rates are still high, and as this “jobless recovery” is expected to continue for several more years, now is the time for anyone who has entrepreneurial inclinations and can’t find a job to start their own business. Start slow, don’t grow too fast and certainly avoid debt if you can.
There are plenty of things to worry about when starting a business. But losing your “job security” isn’t one of them, because if you’re a US resident, you never enjoyed much of a safety net anyway.
{ read the comments below or add one }
Many valid comments here, but, in my case I am not only unemployed (made redundant from Govt) but I also have health issues. I have chronic fatigue which means I can “crash” at any time. I also have a quite serious congenital hearing loss and with it a less than stellar speaking voice (which if you weren’t aware is a biofeedback mechanism, so you repeat speaking wise what you can, or cannot, hear).
In my early working life (I’m now 60) I was a screen printer. Obviously can’t do that with chronic fatigue. Add to that become intolerant to solvents and lost the enthusiasm for the job anyway. Plus, it is a process in rapid decline due to changes in technology.
What skills do I have? Honestly, I don’t know… and therein lies my problem. Work counselors have been of no use. They can’t think of anything that remotely enthuses me AND that I could do. So, where do I start/go? And, I don’t live in the States.
Good article, but it’s just on the “job security” part of owning a business. Don’t assume that is your biggest hurdle. You actually have to make a profit, pay taxes, deal with employees, customers, vendors, landlords, sub-contractors. At the same time, there’s sales, marketing, accounting and business management to do. You’ll probably work at least 60-80 hrs a week including many weekends. I’ve been there, am still doing it. I became a multimillionaire by being self employed. Just don’t let anyone tell you its easy. There’s still stress and worries and deadlines and unhappy customers , etc. To me, it was worth it. To many people it won’t be.
I have been self employed for over 20 years. and with exception of the first 2-3 years of business did fairly well. Some common-sense rules such as do not over/under pay yourself. If you are able try something you can work at part time try it out. even if it is starting a mowing service, go for it. It will teach you how to deal with people and situations and responsibility.
Job security is an obsolete concept. The social contract between employer and employee began breaking down in the 1970’s and at this point it is more of an curiosity than a common reality.
Career Security is still possible, either self-employed, consulting or as a full time employee, but one has to let go of the notion that security is tied to a 3rd party. Career Security begins and ends with you. If you are truly exceptional at what you do and what you do is relevant (sorry VCR repair technicians) then while one job, assignment or particular client my dry up, there will be plenty of other standing in line to take their place.
No one gains job security because your boss can fire you anytime he wants to if he needs to. So, job security definitely doesn’t exist in this world. Security is in businesses. It will give you more profit, more time for your family and more time for yourself. Financial freedom is the newest trend.
This is exactly why I’m using this unemployment period as a time to truly pursue entrepreneurship. You’re right; it’s not less secure. I’m going to take this time to do what I truly love and possibly make the money I really want to make.
Add me as another person who took the plunge and ended up with more flexibility, money and security. I’m truly a lucky person, and it just goes to show that it can certainly be done.
When I work with clients to help them start their business I actually advise them to not quit there day job until their business can pay for itself and you at a minimum (unless the client has a lump sum of cash to live off of for a while.)
Once their business is profitable… keep up the diligent work… having a business is a smart retirement plan.
Susan
Susan, I hope you have someone else create your written proposals and advertising materials. “…quit there day job?” That kind of error would have me saying “No, thanks” to your service.
Initial presentation is *huge.* A typo on a resume or a piece of promotional literature (or a blog post, for that matter) gives the impression of someone who does sloppy work.
Thanks for this inspiring piece. I don’t think enough people include business ownership or self employment in their decision matrix when working out what to do. Nothing ventured nothing gained.
There are also some careers that even highly motivated, organized, non-social people like me would not really be able to do being self employed. I suppose I could be a contractor, but that could involve a lot of downtime between contracts and it seems that companies like mine prefer their own employees. Perhaps it’s something to think about for supplementing incoming when I go off to pursue a doctorate, but then I would have to find something that people need – it seems that all of those niches I would be interested in are filled.
This is great – showing examples of how being your own boss can be profitable. And I think besides the money, people soon realize they control their own time. You work as much (or as little) as your personal needs require. After leaving the regular work grind, I created several service businesses that I was the sole employee – and CEO =) . I enjoyed it so much that I knew there was a need out there to help others. So I started writing about it and helping people get there. Thanks.
Tracy, Kim and there are thousands of other examples. Freelancing is better then many jobs and businesses.
Starting a business can be risky, especially if you don’t understand how to speak the language of business, aka accounting. The Weekly Marketeer recently posted an overviewvof accounting that can greatly aid newcomers in organizing their business costs, and explaining how the company will make money, both visually and conceptually. Swing by when you get a chance.
Cheers. The Marketeer.
Thanks for giving people the kick in the butt they need to take control their futures. I will definitely forward this post on.
so true. I read something from Seth Godin on this….basically that the new “safe” is starting your own business and it’s more risky to be employed because you’re not in control. Of course this mentality works for highly motivated/disciplined people, so not everyone. Anyway….if you’re one of those people, it definitely resonates and makes complete sense.
LOVE this post. Printing out and tacking to wall.
Please don’t waste more paper by printing this. Here’s the message, commit it to memory: Job’s aren’t secure unless you’re in control. Spend your money wisely. If you have what it takes to start a business then do so.