Self-Employment Has Benefits, Drawbacks
Dedication and Resolve are Needed for Successful Entrepreneurs
Self-employment is not for everyone. The truth is that many well-meaning individuals lose their enthusiasm and drive to be successfully self-employed in short order. As one entrepreneur stated: “Since I’m self-employed, I can work ½ days, and it doesn’t matter which twelve hours I choose.” (Tom Coffield, former CEO and owner of Coffield & Sons Marine Services, Inc.)
Personal Characteristics Needed for Self-Employment
Self-employment requires determination to stick with the program. Some find that it’s too easy to slack off when there’s no boss keeping track of production. An afternoon off here, a full day there, and soon self-employment becomes unemployment.
Above all, to be successful, self-employed individuals must have self-discipline. These are the people who can operate without supervision, who can keep themselves motivated, and who don’t give in to discouragement when things don’t go as planned.
Types of Self-Employment
There are two main types of self-employment. One is obviously home-based and may involve some type of computer work. Another type of work, however, requires one to actually own and operate a business. The business may be home-based, but just as often is not. One may work out of one’s van, an office or building situated somewhere other than the home, such as a retail store, or one may offer services and skills, such as housekeeping skills, horse training, sewing, etc.
The person who actually has a business license and is registered as a business may opt to be a sole proprietor, an LLC, or a corporation. Many home-based, computer-based jobs do not require this level of commitment and are more for part-time workers, stay at home mothers, or people looking to subsidize their income.
Benefits and Drawbacks to Self-Employment
There are many benefits to being self-employed, but there are just as many drawbacks. For instance, the self-employed don’t have the advantage of having group health insurance. Nor do they enjoy having an employer who will match their 401k or IRA contributions. In addition, there is no pension plan available except what the self-employed person can manage to set aside for himself/herself. Any “paid” vacation or sick leave comes from oneself, not a generous employer. There’s no unemployment insurance to fall back on when times get tough, and there’s extra fees to pay to social security. For some, working alone is detrimental; for others, working alone is a blessing. (Sometimes the self-employed have employees or subcontractors. This creates another layer of difficulty and responsibility.)
There are, however, some excellent advantages to being self-employed. One obvious advantage is, depending on the job one performs, the ability to work as many (or as few) hours as one needs or wants. If one needs to take a morning off to go to an appointment, one does not have to ask “permission” to take care of personal business. Vacations can be arranged when it’s affordable and convenient, not when it’s dictated. People can work the hours that suit them best, and, there is a sense of accomplishment and independence that comes with self-employment.
Resources
To explore the pros and cons of self-employment, one should take a careful inventory of one’s skills and one’s ability to live thriftily if needed. The 2008 Hot List is a good resource for ideas for potential self-employment. Google also offers a Self-Employment Directory, and Millionaire Mommy may be a valuable book for some to read. While most self-employed people are very happy with their work, many people are unpleasantly surprised at what being seriously self-employed really entails.
Self-Employment May Be More Work than Imagined
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