Possible variations of income



Instead of having a 'secure' regular weekly or monthly income, a business owner depends for his income on the success of the business, and this is likely to vary from month to month.

Of course, an employee's sense of security may well be illusory; if the company employing him is unsuccessful, he will soon find himself out of a job. However, a large business is often able to absorb a temporary downturn in its fortunes by cutting costs and drawing on reserves, so employees are less quickly and directly affected by their employer's difficulties. A business owner, on the other hand, suffers an immediate loss of income if his business passes through a difficult period.

Sacrifices

Starting a new enterprise may involve sacrifices both for you and your family. Many businessmen and women have sacrificed their career prospects in a large organisation in order to go out on their own.

If you decide to be your own boss and it doesn't work out, you may find it difficult to re-enter paid employment for someone else. During the business's first few years it may be difficult to find time for a holiday or leisure activities. There may also be financial sacrifices, as in the early years most of the profits from the business may have to be re-invested or used to pay off loans. In the short term, you and your family's general standard of living may well be reduced.

Hard work and stress

In spite of the apparent freedom of being your own boss, the early years of a new business generally require you to work longer hours than you did before. You will have to bear all the stress and worry of the business, and will probably carry this with you even when you are not actually working. There can also be a sense of loneliness and isolation.

Many people who decide to set up in business begin (at least) on their own. One common complaint among such people is that they miss the day-to-day banter of the office or shop floor. They also miss having colleagues to turn to when it comes to making difficult decisions or solving problems.