Is it better to start my own business or to work for somebody else?
This is truly a personal question. Each individual will have their own goals in life and their own definition of success. Each person should take a close look at themselves and determine how they define success in their life.
You may feel comfortable working for someone else, and you may have been raised to believe that loyalty to your employer is a must. We believe that there are good employers out there who treat their employees well. We also believe that anyone has the opportunity to reach their personal and professional goals either through employment or through building their own business. The question here is what format is best for you? And to answer that you need to know the facts and clarify some of the myths.
Myth #1: Very few people want to start a business.
If you are wondering if you should start a business, you are certainly not alone. The University of Phoenix released the results of online survey (1) of more than 1,600 U.S. employed adults. The results show how many workers hope to own a business in the future by age group:
- 55% of workers in their 20s
- 48% of workers in their 30s
- 36 % of workers in their 40s
- 39% of workers in their 50s
- 26% of workers age 60 or older
Myth #2 Employment provides the best tax benefits.
So what if you find yourself among the percentage of people who are content or even happy as an employee? Robert Kiyosaki (2), a well-known speaker and author offers some insight as to why this may not be as advantageous as you might think.
He explains his observations using the Cashflow Quadrant described in his site at
“The CASHFLOW Quadrant is divided into four types of people.
- E is for Employee
- S is for Self-Employed or Specialist
- B is for Big Business
- I is for Investor
On the left side of the quadrant are Es and Ss. They pay the most in taxes and trade their time for money.
On the right side of the quadrant are Bs and Is. They pay the least in taxes and create or invest in assets that produce cash flow for them even when they’re sleeping.”
Kiyosaki explains that employees work and time is highly taxed, and employees receive less benefits than those who choose to build a business.
Myth #3 Employment is more secure than owning a business.
Employment gives the person a false sense of security. But fact of the matter is that there is little security no matter what your job is. In the companies eyes, everyone is expendable and can be replaced regardless of how important you think you may be to them. And in today’s global economy, where companies merge or get acquired, anyone’s job may be eliminated leaving employees without recourse.
Another aspect to consider is that employees are often given a false sense of loyalty. For example, most companies will require the employee to give a two week notice before leaving their employment. However, if the company decides to let go of the employee for any reason, employers hardly ever give advance notice.
Myth #4 Employment is fair and pays me what I am worth.
Employment gives people a false sense of fairness. When you work for a company, you may have a coworker next to you doing the exact same thing for the same or more pay than you, whether you work just as hard or harder than that person. Many employees across the world get paid regardless of their performance. When you build your own business, if you build the right kind of business, you earn what you work for and get rewarded for what you develop for yourself.
Once again, you should take a close look at what your goals are, and who you should be most loyal to: your own goals or a company’s. If you come to the conclusion that you should at least explore starting your own business, you are not alone. We are here to help you explore your options. Contact us to get started with a free consultation.