Ever play the card game "BS."
The rules are simple. You try to discard all your cards. For example, you need to discard any 7's you have. You only have one, but you can try and discard two cards. If someone doesn't believe you, they call "BS," and you flip over your cards. You then have to take all the cards that have been discarded since you didn’t play two 7's.
"Eric, what does a card game you didn't play have anything to do with self-employment?"
Everything!
The world is playing the biggest game of "BS." with you when it tries to pass off cards saying that self-employment is terrible, risky, and only for the special few.
In this post I give you the 7 main categories of lies, scare tactics, and misinformation you might have heard regarding self-employment.
We can overcome the lies being told.
Reason 1:
You Don’t Know How To Do Everything.
While it is true that when you start out on your self-employment journey, you are responsible for everything in your business, you do not need to perform every task.
Sales
In order to make money, someone needs to create the services (or products) that you will offer.
The easiest transition to self-employment is offering a service.
The next easiest is to offer a product that some one else makes and where you are paid a commission. This is call affiliate marketing.
Taxes
You must pay both sides of FICA tax, self-employment tax, and quarterly estimated taxes. You will need to collect sales tax on products you sell, but not on affiliate sales.
With the exception of the sales tax, the other taxes you pay are done quarterly or annually (atleast the first year).
Having a qualified and competent accountant is key, regardless of whether or not you are in business for yourself.
Legal Compliance
For more than 90% of self-employed individuals I know, the legal compliance issues are minimum.
Most start out as sole proprietors which does not need any legal setup.
Record Keeping And Paperwork
It is vital in life to keep good records.
This can be done with an accordion folder, a Google spreadsheet, or other free way. You do not need, at least initially, a complex bookkeeping software or a hire bookkeeper.
Customer Service
You will be the face of your company and will also be the chief customer service person.
But in more than a dozen years as a full-time web designer, I have never had a serious issue with customer service. I have given refunds and hand clients break out of contracts, but most of these times things were resolved amicably.
Running Your Online Presence
As much as I, as self-employeed web designer, do not want to admit this, you do not need an online presence to become self-employed.
For the first 12 years of my wife’s self-employment as a Math Tutor, she did not have a website. It wasn’t util 2020 during the COVID scare that she started a Facebook business page.
You will need a business email account to keep things separate from your person emails.
Finding A Workplace
You do not need a rented office when you become self-employed. You just need a designated spot from which to do your work.
My wife tutors at our dinner room table or at her 3′ x 4′ desk on Zoom.
I know many folks that also work from coffee shops, public libraries, and more.
No IT(Information Technology) Department
Oh no! No IT! How can that be? Don’t worry about your tech.
Your personal computer, smart phone, and internet connection is all the tech you need to start.
As you grow your business and need more help, there are people that can help you. In the meantime, there is YouTube.
Reason 2:
Your Income Will Be Erratic
It’s true, there is no such thing as a steady paycheck when you are self-employed.
That said, there are many ways to get a steady income.
If you offer a high ticket service or item, you can deposit that into a business bank account and then on the 1st and 15th of the month, you have your “paycheck” moved to your personal account.
If you offer a membership you can get paid monthly.
Reason 3:
You Will Be All Alone
You will live in isolation since there will no longer co-workers, lunchroom chats, and idle talk around the water cooler.
There are plenty of off and online communities to be a part of in your area.
I was part of several networking groups and met with groups of business people 2-3 times per week. Frequently we did one-on-one meetings where we exchanged leads and compared stories.
If married, you will have your spouse to talk with, and family as well.
Reason 4:
Most Businesses Fail
According to an article on LendingTree.com, close to 21% of private sector businesses in the U.S. fail within the first year. After five years, that number is just over 48%. After 10 years, nearly 65% of businesses have failed.
What if you started a business that sold a cleaner that could remove grime from wallpaper, but later stopped selling that product and moved into selling children’s’ toys?
Did the first company fail or pivot?
Statistics would say it failed. I say that Play-Doh pivoted.
Reason 5:
You Will Lose Benefits
Don’t you lose benefits when you move from one company to another? Yes. When you get to the new company, you look at the benefits they offer, make a decision, then pay your part.
The same holds true when that new company is YOU!
Regarding health insurance, you can go through the ObamaCar (ACA) exchange OR you can go through underwriting and possibly pay substantially less.
The “free” benefits like sick pay (a.k.a. long or short-term disability coverage), free or discount gym membership, a company car, “free” swag, etc. all equal a dollar value you can reproduce with savings from working from home and the extra income potential of self-employment.
Reason 6:
You Must Work 24/7
Unlike having a 9-5 job, there is no set schedule when you are self-employed.
You make the schedule. I do and so does my wife.
I get up around 5:30 and work for a bit, drive my daughter to school, come back and eat. Then I work until 2 PM when I go pick her up from school. My work day roughly 8 hours, but it is focused time which allows me to be more productive than when I was in a corporate setting.
Voucher Cloud determined that the average office worker is only productive for two hours and 23 minutes each day. Assuming an eight-hour workday, office workers are generally unproductive for five hours and 37 minutes each day… In contrast to the typical office worker, the typical freelancer is productive for about 36 hours each week.Source
Reason 7:
You Don’t Have The Right Personality
Regardless of how you see yourself, you can be successful being self-employed if you have the right mindset.
People that enjoy being around people AND those that like to work alone can be successful.
You do need to have focus and be self-disciplined. There is no supervisor/manager monitoring you.
Doing what you want and at the time you want can be highly motivating.
