I am most definitely biased when it comes to this topic. Ok, pretty much every topic I have written on. However, in the current economic landscape that we live in, the benefits of owning your own business are vast. We live in an exciting time in which technology continues to lower the barrier to entry for creating and operating a profitable business. I will simply cover what I believe to be the top three reasons here.
The flexibility offered through owning your own business is unparalleled in the working world if the business is run in such a way as to foster this flexibility. What time of day do you do your best work? Structure your day around that. What work do you enjoy most? Do that work well and delegate the rest. What is most important in your life (God, family, friends, service, etc.)? Structure your business around these things. There is no passive aggressive boss making you feel guilty for not working 60 hours per week. Just you, choosing how to best spend your time.
Flexibility does not come by chance. You must be intentional in structuring your business to allow for it. Otherwise, you will most assuredly fall prey to the busyness trap.
As information, the world, and progress move faster and faster, those who are able to be nimble and adjust to the changing landscape of business and employment will be most likely to not only survive, but thrive. As owner of your own business, you are the captain of the ship and can make vital changes in shorter time frames. You have much more control than if you are an employee to someone else.
This is why I believe that owning your own business, if operated correctly, is far less risky than being an employee.
Many may disagree with me on this but it really comes back to who controls your income stream. You have much more control as an owner, than as an employee.
I place financial benefits as the last of these top three because in my experience, if this is your number one motivation in owning your own business, the business will consume you and lead you to a place of stress and burnout. However, if you have structured the business to fit the life that you want for you and your family, the financial benefits begin to show themselves in a healthy way.
In a traditional job you are often limited to cost-of-living raises, and some raises or bonuses based on performance. While these raises can be great, ultimately, your boss (nice or not nice), and the health of your employing company have complete control over your income. This is risky in my mind.
On the other hand, when owning your own business, your diligence, learning, serving, and producing compounds over time to build your income. There is no ceiling on what you can earn. If you feel called to build the resources to be able to give to others or organizations in a substantially financial way, this allows you a path to do that.
In our current tax code there are also many, many benefits to being a business owner that would be too detailed for this letter and that will change over time so I won’t address them here except to say that they are indeed beneficial.
I also need to say that having your own business can take many forms, which is the exciting part. You can build it to fit you. It can be anything from an owner of real estate, to a landscaper, to a mechanic, to an attorney (or financial planner ;).
Also, what is often overlooked is that you can be a business owner in a rather simple way while being an employee of an organization. You do this by having a very high savings rate (think 30-60% of your income) and investing what you save. As you invest your savings, whether it be in the stock market, real estate, or other prudent investments, you quickly build a “business” of assets that produce income for you that is reinvested to produce more income. The key in this scenario is a very high savings/investing rate so that you quickly mitigate the risk of being employed by someone else who could easily eliminate your income tomorrow. This is an excellent path if you want to obtain more financial freedom but truly enjoy the working environment with a particular employer.
Owning a business is not absolutely necessary for a good financial life. However, it is most definitely a powerful tool that should, in the least, be thoroughly examined as to how it may fit into your plans.