If you’ve ever considered becoming a freelancer or solopreneur, you’re not alone. The “gig economy” is growing and, as a result, millions are making the leap from employee to self-employed. Entrepreneur points out a 2018 survey found close to 55 million Americans — 35 percent of the U.S. workforce — are working in microbusinesses or as freelancers.
And why not? There are some amazing perks that come with being your own boss. You can work in comfy clothes, set your own hours, and choose the projects you want to work on. However, despite the benefits that come with being self-employed, the job also presents real worries to address.
There are many unknowns — unreliable income, self-employment taxes, loss of security and/or benefits, and isolation, to name a few. Collectively, these can make it difficult to decide that making the plunge to running your own business is a smart move. But don’t let fear hold you back! For every worry you might have about going solo, there is a potential solution.
1. Fear of failure
Making the leap to self-employment is scary. There is no one to fall back on, no one to “fix” things when they go wrong, and the ever-present possibility that the business won’t succeed. To overcome these fears, ask yourself this: If failure is the result, what is the worst thing that will happen? You’ll clean up and move on, knowing you tried. It can help to get some perspective on this fear and look at it from another angle: Any level of failure can be a grand learning opportunity, and the hiccups you encounter along the self-employment journey often can help propel you to success.
2. Committing to the dream
While some people have an almost uncontrollable desire to launch their own business, they fear making the commitment. Deciding on a niche and sticking to it can be scary because once a business is launched, it’s no longer as simple as switching jobs if you change your mind. To overcome this fear, it’s a smart strategy to do some self-reflection and evaluation before finalizing plans. This way, you go in knowing exactly what it is you want to commit to.
- List your talents, interests, and hobbies. Are any of these something you see yourself doing long-term?
- Identify your professional skills. How do they fit into the picture? Do they align with your interests and hobbies?
- Research your idea and make sure it’s viable. Is there a market demand?
- Once you’ve chosen a niche, be sure to protect your intellectual property by securing the rights to any inventions or designs you create.
Once you tackle the fear of commitment and identify a niche and a market for your work — and realize you can do this — you’ll be able to move on to the next phase of achieving your entrepreneurial dreams.
3. Money fears
Not knowing how much income you can count on can be daunting. Uncertainty about your next paycheck is a realistic fear of most freelancers. The key to overcoming this fear is to be proactive and plan ahead.
- Save a few months of living expenses before quitting your day job.
- Research small business loan opportunities.
- Explore crowdfunding funding options such as Kickstarter and GoFundMe.
- Determine whether you should pursue angel investors or venture capitalist funding. There are pros and cons to each, so be sure to do your research.
- Once your financial plan is in place, you’ll need to address the issue of self-employment taxes. A great place to start is by using a free online calculator to figure out how much to set aside and using filing software to set up your quarterly payments.
By setting up a realistic financial game plan before you jump into starting a business, you can mitigate the money fears because you’ll have solutions lined up. Once these are securely in place, it’s easier to mentally move forward on any other fears or reservations you might have.
4. Searching for space
According to the Small Business Administration, 60 percent of self-employed persons work from their homes. One of the biggest hurdles solopreneurs and freelancers face is finding space for their business. At a minimum, you’ll need a physical workspace and, if you sell a physical product, room to package, move, and store inventory. This is often especially challenging for people who live with family or roommates because space already may be at a premium. Potential solutions include:
- Designating a room in the house as a home office.
- Co-leasing a workspace.
- Renting a storage unit to store your inventory.
- Building a small structure in your yard to serve as an office space.
To plan for needed space, factor in considerations such as your spatial needs, work habits, and type of business. Once you get the basics squared away, it’ll be easier to move forward.
The loneliness associated with working in isolation is a reality most every solopreneur or freelancer faces. No lunch hours spent with colleagues or hanging out at the proverbial water cooler for socialization. Fortunately, there are other solid solutions to offset the pitfalls of working alone.
- Create an active social media presence and develop relationships with like-minded people.
- Attend local meetups for other small business owners.
- Look for industry or small business networking events in your area.
- Join a co-working space so you aren’t totally alone during your workweek.
- Get involved with your local chamber of commerce.
- Find a business coach.
In addition to combating feelings of isolation, by pursuing new ways to meet people, you’ll likely develop some good business relationships. Never discount the value of bouncing ideas or problems off one another.
Many people worry about leaping into their own business because statistics indicate most startups fail within the first few years. However, the rewards often can make the risks worth it. The aforementioned survey reported by Entrepreneur also found that five out of six freelancers reached their income goals within two years, and many continued to steadily grow beyond the $75,000 income range. Other research finds the highest earning independents, 3.3 million of them, earn more than $100,000 per year. As the economy shifts, technologies such as cloud storage and mobile access are creating an increasingly favorable environment for freelancers and solopreneurs.
Being a 9-to-5 employee isn’t for everyone. If you’re passionate enough about self-employment and setting your own work conditions, you shouldn’t let fear hold you back. Research your options carefully, devise a workable plan, address your fears, and take the plunge. By doing so, you can ensure that you won’t look back later in life and experience pangs of regret. Instead, you can reflect on what an amazing journey you’ve had.