If you read this blog, it is highly likely that you are either an entrepreneur or someone who dreams of — or plans on — being one. According to a recent report by ReportLinker, 65% of people believe that those who freelance (in this case people working as their own boss as independent contractors) are happier than other professionals.
Why Do People Dream of the Freelance Lifestyle?
What fuels that belief? Several things:
- The appeal of being your own boss (29%)
- The ability to balance work and personal life better (23%)
- Flexible work hours (17%)
- Freedom (10%)
- Better compensation for the work you do (8%)
- More interesting challenges (6%)
- Your skills are better used and seen (4%)
Although I’m currently working a full-time job and re-building my business on the side, I spent more than 10 years on my own and I can attest that all of those perks are possible — if you set up and manage your business correctly.
But there are downsides to being your own boss that you need to take into account when making the leap from employee to entrepreneur:
- Lack of retirement benefits (27%)
- Low financial security (19%)
- Lack of job security (18%)
In my experience, all three of those can be managed and reversed by proper planning. Frankly, my biggest beef with being my own boss was self-employment tax! There were years where my self-employment tax was half my year’s income because I was making so little. So, don’t even get me started!
A Significant Number of People Want to Make the Leap to Entrepreneur
Anyway, ReportLinker’s survey found that 73% of freelancers say they feel a sense of purpose working independently.
At present, 77% of survey responders work in a full-time job, 15% work part-time and only 8% were freelance. If all these people believe that freelance lifestyle is better, why aren’t more people leaving the traditional workforce? There is evidence that they are and we’re just in a transition mode. An Intuit study predicts that by 2020 (only three years away!) freelancers could make up 40% of the workforce.
ReportLinker’s survey found that 26% of respondents said either they were somewhat or very likely to move to a freelance career. I believe this is very much driven by Millennials, who perceive the work world rather differently than previous generations. Here are some relevant statistics reported by Gordon Tredgold on Inc.com:
- 64% of Millennials would rather make $40,000 a year at a job they love than $100,000 a year at a job they think is boring.
- 74% want flexible work schedules.
- 69% believe office attendance is unnecessary on a regular basis.
- 35% of employed Millennials have started their own business on the side to supplement their income.
- 54% either want to start a business or already have started one.
So what does this all mean for you?
If you want to be a part of this growing trend, and you don’t want to end up like me and so many other entrepreneurs who have to go back to a day job because of a failed business, then you need to make the transition strategically. Here are recommendations based on my personal experience, that I’m doing right now (and didn’t in the past, which I believe lead to my business being such mess):
- Start your business as a side hustle.
This way to can work out the bugs before you are dependent on the income to keep a roof over your head and food in your stomach.
- Get VERY CLEAR on the basics of your business:
Who you serve? How do you serve them? And why should they chose to work with you?
- Create a game plan that progressively leads you from where you are to where you want to be. The plan can change as you move through it, but you need to know where you are going and have an idea of how you are going to get there.
- Be true to your core values. You are your business, therefore your business needs to be in alignment with who you are. This is not only important for your own sanity but because authenticity is an important selling point, it will also make your business much more successful.
I help my clients do all of the above, while creating a legacy that they can be proud of. So, I ask you: Where are you on this journey? What are your thoughts on these survey results? I encourage you to share your thoughts in a comment below.