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If the ups and downs of the past few years have you seeking a little more control over your destiny, you're not alone.
Entrepreneurship is up. According to numbers from the Census Bureau, a record 5.4 million applications for new businesses were filed in 2021. For comparison, that's up from 3.5 million before the pandemic.
When you can be your own boss, you decide what time you wake up in the morning. (Spoiler alert: When it's all riding on you, you might find yourself getting up early!)
Still, when you're your own boss, you decide what time you want to start working. Even if you start early, or work late, you are building your own business and can structure your own creative flow. You can enjoy the freedom while working on things that matter to you. You choose your work and pursue achieving your most ambitious goals.
But you don’t just wake up one morning and become your own boss. Getting there requires courage and planning as you take that leap. Depending on your financial situation and what other support you have, it isn't all freedom. And there are many ways to be your own boss, big and small.
We’re here to talk about the pros and cons of the entrepreneurial path and offer some tips on how to make the jump.
Being your own boss: the good and the bad
Like any job, being your own boss has perks and pitfalls. There’s no cookie-cutter formula that everyone can follow. But with hard work, a solid business plan, and dedication, your new business will enjoy some good times.
Let's start with the positives. Here are four pros to being your own boss:
1. Your earnings could be limitless
At your current job, you probably earn a set salary. Or, you might be paid by the hour. Maybe you saw a few bonuses at some point or sometimes earned overtime. In general, full-time workers are kept to a specific and set salary.
If it's a dependable amount, that's harder to give up than if your current situation is unpredictable.
When you're your own boss, the thinking goes, you decide how much you earn. Since you're self-employed, the harder you work, the more money you make. In some ways.
It's true that there’s no limit on how much you can work to create a successful business. It's also true that hard work doesn't always equal a payout, especially at first.
2. You’ll control when you work
Have you ever had plans canceled last minute because a coworker called in sick and you had to take their shift? That doesn't happen when you're your own boss. Whether it's your full-time job or a side hustle, you're in control.
You can sharpen your self-discipline and time management skills as you work to your schedule. Feeling like you want to work longer on a Wednesday night or take Friday off? That’s your call.
Many entrepreneurs can work from home, too, or run most of their business from home. This adds more flexibility to your schedule.
3. You’ll be able to pursue your passions
Everyone strives to follow their dreams. You can do the work that stirs your passion and feels meaningful. Being your own boss lets you start your new business just as you envisioned it. Your marketing plans, social media accounts, and even your office space can be precisely how you'd like them to be.
Seeing your dreams become a reality is fulfilling and can improve your wellness.
4. You’ll feel accomplished
Everything you do for your business is because of you. Your hard work could make a customer's experience much better, and your efforts are what make your business move forward. This is your area of expertise, and you're the one who can make a difference.
Now for the negative aspects of being your own boss:
1. You may find progress is slow
Everyone wants to reap the rewards as fast as possible, but that doesn't happen on the first day of being your own boss. Finding potential clients and building trust in your market can take time.
Some of your business plans may fail the first go around. Other times, startup costs can stand in the way of plans or growth.
2. You’re in charge of everything
You have a lot of responsibility on your shoulders as your own boss. If you don't know how to do something, you need to learn. Too much responsibility can kill your curiosity and ability to appreciate the learning.
Early on, you can't necessarily afford to hire help. Social media work, bookkeeping, and minor details are all up to you. The same goes for mistakes and accountability.
One option is to hire someone to take on tasks. But keep in mind that hiring is time-consuming and can be costly. You may feel even more responsible for someone else. It isn't all or nothing. There are many alternatives that let you hire expert freelancers, at a reasonable price, to handle some of the necessary tasks.
Eventually, unless you want a single-shingle business, building a solid team is crucial. It’s overwhelming enough to have your future in your hands, let alone someone else’s. That's why you'll need to develop strong leadership skills, too.
3. Your income can be inconsistent
Some months you could exceed your target goals, and others you may not. For a small business, it's essential to have solid management skills to plan for dry spells. Your personal finances could feel it when you have an idea that will take time to work out.
4. You will still answer to someone
You may not be working directly under someone, but that doesn't mean you won't ever have to work collaboratively again. You'll still have to interact with clients, customers, or other business partners. Some of them may be a pleasure to work with, but others may give you a headache.
If your vision is to build a successful startup, you will be answering to even more people: investors, advisors, and your teams.
After reading the cons to being your own boss, know that you don't have to navigate those struggles alone if you're feeling uneasy. When you work with a BetterUp coach, you'll have someone to help guide you through the ups and downs of being your own boss and meeting your goals.
Traits to have to be your own boss
Not everyone can be their own boss. That's okay. Just because you don't check off every characteristic now doesn't mean you never will, since many of these traits develop over time.
Not all of the essential traits relate to trained skill sets, either. You can develop these traits from any life experience and work background.
Here are five traits to keep in mind when being your own boss:
How to know it's time to be your own boss
At some point, you may decide you’d like to be your own boss.
Maybe you've had a great business idea for quite some time now but could never execute it. A contract ending or changes at a full-time role could be an opportunity to start your new business. Or maybe you’re eager for the potential benefits from being your own boss — more money, freedom, and flexibility.
Whichever way you decide it's time, you need to have one thing set: your business plan. If you'll be selling products, how will you make them? What supplies do you need constant access to, and how will you keep up with production? Do you need employees or experts to consult, and if so, how many? Think about the small details you'll need to sort out to start being your own boss.
7 ways to start being your own boss
Now that you've empowered yourself to become your own boss, you can begin to think about how you're going to do that.
Here are seven ways that you can start being your own boss:
- Research your idea thoroughly and understand the target market
- Plan how you're going to transition from your previous job to self-employment
- Figure out what kind of business model you want, such as freelancing, consulting, or e-commerce
- Get access to the resources you need to run your business
- Network within your industry to find potential business partners or mentors
- Choose your business name and work on branding and marketing materials
- Register your business and get a federal tax identification number
BetterUp can help you decide whether being your own boss is a viable and satisfying career choice. Find out what it's like to have an expert coach empower you through your new journey today.
Content Marketing Manager, ACC