By Catherine Byers Breet w/ ARBEZ
Why do you want to be your own boss?
36% of Americans participated in the Gig economy last year, according to a study sponsored by Small Business Labs, Gallup and the Freelancers Union. Contrary to popular opinion, only a small portion of them are doing gig work as a “side hustle” or part time job: 29% of US workers claim their alternative work arrangement (freelance, contract, consulting) to be their primary job (Small Business Labs, Gallup)
There are many reasons people choose to be their own boss, according to a FlexJobs survey:
● Work Life Balance (70% cite this as their #1 reason)
● Flexible Schedule - choosing when they want to (62% cite this as a top reason)
● More Choice - doing what I want to do (46% say they love saying no to work they don’t enjoy)
● More Money - average annual raise is only 2.9% (Aon Hewitt). Top performers average only 4.5-5% (Towers Watson)
However, being your own boss is a big step for someone who has been an employee their entire working life. Not everyone is ready to quit a job to start a new venture.
There are steps that you can take to ‘test the waters’ if you are not sure you are ready to be your own boss:
Keep your full-time job while you save some money, test the market and test your appetite for multiple ‘gigs’. You know you are ready to quit your full time job when:
● You are making enough money consistently to replace your full time job
● You have enough savings to sustain you while the business grows
Only you can decide what your financial needs are and how much risk you are willing to take.
Become a freelancer or consultant and work as a contractor. Utilize placement firms who specialize in placing contract workers. If you choose to work as a W2 hourly, these firms will pay you regularly and you will not have to worry about many of the day to day aspects of being your own boss that many people find intimidating. Here are some other advantages to working through a staffing or consulting firm as a W2 hourly employee: they have strong sales teams, negotiate the contracts and manage expectations between you and the clients.
If you are not interested in testing the waters, and are ready to start your business right now, you have several options.
1. You can buy a franchise or join a well-established business. This will require a significant financial investment up front.
2. You can start your own business, doing what you love to do, and build it from the ground up. This is exciting and gives you maximum flexibility and freedom, but it also carries the greatest risk.
3. You can become an independent consultant / freelancer / contract, working as a 1099. The neat thing about this is that even though you’ve started your own business, you do have the freedom to work through staffing / consulting firms when they put great projects in front of you.
Regardless of how you choose to become your own boss there are some risks. Get educated on building a business and your chosen industry and figure out what your gaps are (what you don’t know). Get professional advice. As a new business you will need the advice of several experts:
● Lawyer - There will be contracts to create and sign
● Insurance Agent - Business insurance is important to protect you and your client
● CPA/ Accountant - Taxes will need to be paid, expenses, billing etc
● Financial Planner - Plan ahead
● Healthcare Broker - Self -Employed need to find your own health insurance
It is also important to build a network of entrepreneurs that you meet with regularly. This can be coffee once a month or a phone call once a week. Find others who can teach you what they know and help you find solutions. Having other people to discuss ideas or commiserate with difficulties can make the process of building a profitable business easier.
If you are interested in learning more about building your own business check out the training available at Arbez.com.