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Pros and Cons of Being Self-Employed

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The entrepreneurial spirit is a much-admired trait. Some of popular culture’s greatest heroes are self-made people. Oprah Winfrey, Warren Buffet, Jeff Bezos, and Diane Hendricks all made their money working for themselves.

One of the most significant advantages of self-employment is that the sky is the limit when it comes to your earnings. There’s also a lot of freedom and autonomy. However, there are downsides too.

Let’s take a look at some of the pros and cons of being self-employed.

You’re Your Own Boss

You call the shots. You spot the opportunities and develop the strategies for going after them. You decide the nature of the clients with whom you’ll do business and you determine the guidelines within which you’ll conduct those dealings. In other words, you — and you alone — control your destiny.

On the other hand, while it looks to the outside world like you’re the boss, the reality is that your clients become your employers. You trade one boss for many when you quit your job and go into business for yourself — whether you answer to clients, a board of directors, investors, or whomever. Everyone answers to someone, even when it isn’t immediately obvious who that someone is.

You Work When You Want To

Self-employment endows you with the ability to set your own schedule. This is particularly true if your work revolves around taking on new projects. Everybody’s happy as long as you hit your deadlines. If you want to sleep until noon and work until eight or nine p.m., you have the freedom to do so.

However, you may sometimes have to work around the clock to complete projects. While you do get to set your own schedule most of the time, you also have to ensure you meet the contractual obligations set forth in your agreements with your clients.

You Create Your Own Environment

Your settings can be tailored to your temperament when you’re working solo. If you love working with loud heavy metal music in the background, you can indulge yourself accordingly. If you like the fragrance of Star Gazer Lilies in the air, you can have that too. The work atmosphere can be whatever you want it to be.

Of course, that also means you're going to be spending a whole lot of time alone. When your conventionally employed friends are talking about their company picnics, holiday parties, and birthday celebrations, you’ll be all by yourself. This can lead to feelings of isolation for some people.

Tax Benefits

If you run a business developing automotive reviews for websites, everything you do with a car becomes tax deductible, right down to paying parking meters. Similarly, many of the expenses that go along with operating any type of business, including necessities like General Liability insurance, are tax deductible.

Of course, this means you’ll have to keep track of your income and expenses and pay your taxes yourself. Payroll withholdings apply only to people who have jobs with paychecks. When you're self-employed, you’ll have to figure out how much tax you’ll owe on your earnings and pay in one lump sum at the end of every year — or make quarterly payments. Either way, you have to stay on top of this one; otherwise, you could face charges of tax evasion.

These are just four of the pros and cons of being self-employed. Are there other things you appreciate about working for yourself? Tell us about them in the comments section below.

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