I don’t aim to make this into a listicle post of the pros and cons of working for yourself. I’ll probably write another one talking about the great things that are possible if you’re not stuck in a cubicle. There’s already a few of those. However, not enough folks write about the other, nonexciting aspects and I think it’s time we did.
How I Started Working For Myself
I’ve been self-employed for more than a decade, and so far it’s been great. I started off as most people do – working as a full-time employee right out of college. One of my first jobs after moving to the US was with a full-service “interactive” agency as a programmer. It was a small firm, and I made some great friends there – most of whom I’m still in touch with almost 2 decades later.
After a few years, most of us had moved on to other employers and jobs. I had gone to work for a much larger firm in NYC that was made business intelligence software and had just broken the 6-figure salary mark. Then my ex-boss contacted me as he had a need for someone with my ‘ninja’ programming skills. In reality, I was mostly a self-taught programmer and got 90% of my work done using Google and Stack Overflow*. That said, I was pretty good at figuring stuff out so did have that going for me but I digress…
I started freelancing for my ex-employer on the side and 2 ½ years later had quit my stable job with benefits and started my solopreneur journey. I was young and scrappy with very manageable expenses and worst-case scenario could get a job within a month if needed.
That was almost 14 years ago.
Being self-employed has a lot of pros AND cons. Since the grass always seems to be greener on the other side, I routinely get friends/acquaintances/strangers I meet at birthday parties gush over at how wonderful it must be to ‘be your own boss’.
Yes, it is. And no it isn’t.
The Reality Of Self-Employment
Your income will be unpredictable
This is probably the one you would have already known about out of the gate, irrespective of you ever considered going off on your own seriously.
There are good months and bad months. The good months will continue for a while and then you’ll suddenly get hit with a bad quarter. This, in turn, translates into good and bad years.
Over time you learn to save and build a cushion when the dam bursts and you have an abundance of cash. That cushion then proves to be really useful during the lean years and months.
Financial planning is tougher
Remember all those blog posts and articles that talk about ‘save first and spend the rest’? Well, they don’t always apply to you because you don’t know how much you’re getting paid until the month is over. Why? Because a lot of self-employed work is project and milestone-based which means you get paid when the milestone is hit or the project is complete. So it’s very difficult to put a fixed percentage away every month.
You end up putting a lot more away when times are green and a lot, lot less when they’re lean. Overall, you hope to balance out but it makes planning every very difficult. I would like to walk away from full-time employment in 9 years when I’m in my early fifties. Unfortunately, any spreadsheets I put together are all ‘projections’ and not ‘reality’ unless I actually make that much.
Your friends won’t understand the challenges you face
Folks you went to college with, or friends you made along the way are all in stable jobs with health insurance, paid vacation and office politics. Your challenges are different. You understand some of theirs but they understand very little of yours.
So when they ask about work and joke about you being the ‘CEO’ over beers, you shrug and give a meh response.They don’t want to hear about a new CXO at your biggest client who wants to bring his own people in or the vendor who has suddenly stopped responding to your calls. Those are probably left for a mastermind or a business coach (if you have one).
Then talk invariably turns to their latest vesting schedule and what the stock price is and how they’re going to use that bonus to prepay their mortgage or take that vacation to Puerto Vallarta you still trying to travel hack your way to. (Four economy tickets here I come… uh sometime in the next 12-18 months!)
It’s difficult to ‘stop working’
You’ve got deadlines. There’s always something that needs to be done.
You need to respond to some emails before your offshore vendor gets to work. Or finally put that presentation together that you’re going to deliver to the client tomorrow trying to convince them why your recommended approach is better in the long term even though it costs more upfront. At the same time, you have this nagging thought that you should spend time with family. Your kids will be ‘little’ only for a short while longer and if you lose those precious moments you’ll never get them back again.
In essence, your brain will never stop working and thinking about work unless you make an active choice to do so. Yes, one could argue that this applies to cubicle-dwellers too and you wouldn’t be incorrect. However, you are the *only* person in your business and there’s no one else who’s gonna do it. If you don’t get to it soon, the world might end – period. You wear multiple hats and sometimes more than one at the same time.
In reality, you may find yourself like a pendulum – sometimes finding you’re doing way too much and other times getting burnt out and doing too little. You’ll eventually find balance until you lose it again.
Some days feel like this
Doubt, Uncertainty, and Depression
That sounds like a horror movie but thankfully it isn’t. Yes, you will experience doubt and uncertainty and occasionally a few bouts of depression. I know I do.
You will get lonely, and it’s not because of a lack of social contact.
You will be uneasy about taking time off for yourself. Either there’s a project going on that may need your attention or there’s nothing in which case you’re actually not earning anything while spending on that vacation.
Clients will be friendly and awesome when things are going right and downright horrible when they’re not.
You’re always expendable – always and instantly.
You’ll find yourself under- or unappreciated.
See where this is going?
Projects will take longer and Clients will pay late, or sometimes not at all
That says it all. Projects take longer either due to delays by the client (more common) or because that freelancer you hired to help you has taken on more projects than they can handle. That means that if it’s a fixed-price project, and chances are that it is, you’re losing money the longer it takes.
In my experience, most clients pay on time but there will always be some that don’t and will drag it out. Then there will be those that will want you to do more work for free, or will suddenly want their attorney to review the contract. I have only one advice to deal with the latter kind – cover your ass from the beginning. Make sure everything’s in a written, signed contract and get professional liability insurance. Just the idea that you have it is worth it. I know, because I’ve been there.
So About That Grass…
The correct answer – like everything else in this universe is – it depends.
Yes, the grass can be greener but it’s not for everyone. You need a certain mindset, and an inner strength to overcome the above-mentioned landmines. The best part is that the mindset can be developed, and there are ways to solve or prevent most problems. You just have to be flexible, faith in yourself and work hard and smart.
There’s a lot of positives too, but we’ll leave that for another post. One could say that it’s likely playing the mini-lottery, except with much better odds.
Are you currently self-employed, or have been in the past? If so, would love for you to leave your thoughts below – even if you disagree with any of the points I’ve made.