Being your own boss offers lots of perks, from not having to put on pants to choosing to work during whichever hours are most productive for you. However, it’s a demanding path that few people take, so it can be intimidating. There are a lot of unknowns and uncertainty you have to face if you want to be a solopreneur. Here are some of the toughest things about working alone and the ways that you can get around these roadblocks.
1] Fluctuating Cash Flow
When you work for someone else, you have a good idea of what your income is from week to week. You have a set number of hours or a salary that brings consistent pay into your life. A solopreneur can have a much higher income potential, but adjusting to inconsistent funds takes some time. Make sure to put money back into savings during the good times so that you’re not as stressed during less lucrative periods.
2] Feeling Alone at Work
When your office is your spare room, you don’t have a built-in group of people that you know you’re going to see every day. Making connections as a solopreneur can be hard, especially if you’ve been in the traditional workforce for most of your life. If you aren’t in an office or running a storefront, it can be difficult to network with others. Trade shows and conferences within your industry are great opportunities to build your industry presence, get to know people, and put your name out there.
3] Paying Overhead Expenses
You’re responsible for putting your company’s administrative systems in place — as well as all the other tasks of running a business. In many cases, administrative activities don’t fall under your core competencies and can end up being time-consuming. If you’re not experienced with certain aspects of business administration, consider outsourcing them to an experienced service provider. Then you can focus on what you do best while resting assured that everything else will get done.
4] Making all the Decisions
For better or worse, you have the final say in everything that happens in your business. You make all the decisions and have to consider the short and long-term effects on your business when you do so. If you find yourself unable to make decisions due to analysis paralysis, reach out to people in your industry to see if they would consider mentoring you. Many leaders also write blogs or offer useful resources on their websites.
5] Navigating Lack of Benefits
Health insurance and other benefits need to be squared away, too. Set up savings accounts specifically designated for your vacation time, retirement, health insurance, and other perks that would typically be associated with a traditional job. The best part about being a solopreneur is that you don’t have to limit yourself on vacation and sick time, which gives you a lot more flexibility in your life.
6] Handling Self-Employment Taxes
Doing taxes as your own boss is a lot different than plugging in some numbers from your W-2. One of the most complicated parts of this process is self-employment taxes. You have to figure out what deductions you can claim, contribute a full amount to Social Security and Medicare, and learn the ins and outs of the new form. Don’t be afraid to let technology do some of the work for you, like an online calculator to help you figure out your tax deductions (this is for the US) and expenses.
7] Keeping Yourself Motivated
You have to encourage yourself to get to work and stick to your deadlines, which is a massive adjustment from going to a job and having every day’s tasks set out in front of you. Try to stick to a routine so that you foster a good work-life balance. Limiting distractions is a key part of this process. Dedicated office space in your home or at a co-working location are two options that can help with this.
8] Moving to a New Location
Relocation is sometimes necessary to become self-sustaining and make critical connections. Both socializing and navigating the business world are a lot easier if you go to a city that has a low cost of living. If you work in tech, think beyond San Jose and Seattle. For instance, Tampa’s STEM job market is growing rapidly, and the city is among the most affordable in the country (this is for the US).
9] Maintaining Solid Cybersecurity
It seems like data breaches are announced every single day, as hackers go after valuable proprietary information. You need a plan in place to guard company and customer information. As a solopreneur, you don’t have the same access to cutting-edge IT security resources that bigger companies do. However, you can store info in the cloud to take advantage of your service provider’s security measures.
This list might seem overwhelming at first, but the feeling once you become your own boss is entirely worth the initial stress. You’re master of your own destiny and you eliminate so many frustrations that are inherent in the modern workplace. Do your research, set your systems in place, overcome your fear, and take your first steps into solopreneurship!
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