If you’re thinking about becoming self-employed, it’s important to know what the pros and cons are. While there are definitely benefits to being your own boss, such as control over your work schedule and salary potential, the drawbacks are also significant. In this article, we’ll explore both sides of self-employment to help you decide if this is the right path for you.
Self-employment Is a Unique Way of Life
You are your own boss, and that can be a great thing. You decide what the rules are and how you want to do things. You’re not limited by someone else’s vision or expectations—or lack thereof.
You get to come up with your own hours and structure, which is especially nice if you need flexibility in your life. If you want to work from home one day but run out of milk at 2 PM on another day, it’s totally fine! Self-employment can also help protect against wage stagnation: when employers have no incentive to raise wages because so many people are desperate for jobs, self-employment becomes an appealing option for many workers who aren’t willing or able to take on traditional employment roles.
Being Your Own Boss Is a Huge Advantage
The most significant advantage of being self-employed is that you’re your own boss. This means you can work when and how you want to, which is an amazing freedom.
You have immense control over what projects you take on and the clients you choose to work with. You can also set your own hours, which leads directly to another huge advantage: flexibility.
You Can Set Your Own Schedule
Working for yourself means that you can set your own schedule. You are the boss, so you get to decide when to start and when to stop working. You don’t have a manager watching over your shoulder telling you what to do or how long to work each day. As such, it’s up to you how much effort and time is put into meeting deadlines and assignments.
Income Potential Is Limited Only By You
As a freelancer, your income is limited only by you. If you’re willing to put in the work and hone your skills, there’s no limit on what you can earn. On the other hand, if you’re not willing to put in the effort it takes to land high-paying clients and expand your business (or if your skill set isn’t as marketable), there’s also no limit on how little money you might make as an independent worker.
Because self-employment requires long-term commitment (you won’t get rich quick), many people are deterred by this potential lack of financial stability at first glance. But others see it as an opportunity: they know that if they commit themselves fully enough over time, they’ll eventually be able to build up their businesses so much that even small cuts of their earnings will add up quickly into something substantial.
Self-Employment Makes It Hard to Get Health Insurance
Self-employment can make it difficult to get health insurance. We can’t deny that insurance for self employed is very important. If you’re self-employed and don’t have a group plan or other method of coverage, you’ll need to purchase your own health insurance on the open market. Self-employed people often find this process frustrating because they “don’t qualify” for standard plans due to their higher-income or lack of employer-provided benefits, making it hard to find affordable coverage.
Other options include purchasing an individual health care policy from a private insurer; choosing a cheaper option such as catastrophic coverage; or having family members buy into their own family policies so that you can join them on theirs (assuming they’re willing). Depending on what state you live in, there may be more options available than others—or at least different ways of arranging these ones—but no matter where you are, there are always going to be some tradeoffs involved when choosing self-employment over regular employment.
Taking Time Off Means Not Getting Paid
Although it might not seem like an issue at first, taking time off means that you may not get paid. If you have a full-time job, your employer will pay for your health insurance and other benefits. When you’re self-employed, however, this is something that needs to be taken care of yourself. This can be very expensive and often results in having less money to pay others (such as clients).
If you’re thinking about quitting your job to go it alone, here are a few things to consider before making the leap. Remember, the key point here is that no two self-employed people are exactly the same, so don’t be afraid to try things out and find what works best for your own situation.
Article by Emily Lamp
Emily Lamp is a freelance writer, working closely with many aspiring thinkers and entrepreneurs from various companies. She is also interested in self-improvement, entrepreneurship and technology. Say hi to Emily on Twitter @EmilyLamp2