In 2007, I lost my full-time job, and I started selling books full time on Amazon. I thought it would be fun to try this for a year to see what happened. In the back of my mind, I always thought this was temporary and that I would get back to regular life and get a regular job soon. Well that was four years ago, and I’m still selling on Amazon. I found that the more successful I became – the harder it was to get motivated to send out resumes and go to interviews. After all, I’m not a morning person, and I hate getting up early to an alarm. Here are the pros and cons of working at home as an entrepreneurship.
With a traditional job there is happy hour after work, holiday parties, and break-room camaraderie. Without this social interaction, it’s easy to feel cut off from the rest of the world. Many people enjoy the ebb and flow of interacting with co-workers on a daily basis. If you think about it, all the extremely successful entrepreneurs had a partner who shared the same creative vision. There was always a left-brain and right combination. Bill Gates and Paul Allen come to mind.
This can be important to some people. I’ll have to admit, when I tell people that I sell on Amazon, and that I mostly work at home – I’m not exactly wowing people at dinner parties. Back when I was a middle school teacher, I sensed an immediate overflow of respect and status when I told people what I do.
When you work for yourself, you have to pay taxes on all your net income. This means if you have 50,000 in one year, you’re supposed to pay about 20% of that to the IRS the following April. That’s a big chunk of change – $10,000. Even if you take some creative liberties and “write off” a number of expenses, you may just end up cheating yourself. Let’s say you get your net income down to $10,000. Now you only have to pay $2,000 to the government. Sure this sounds good, until you want to get a new apartment, house, or take out a loan. They will always ask for the previous year’s tax forms for proof of income. Chances are pretty slim you will get approved for any of the above making $10,000 a year.
Lack of Steady of Income
Being an entrepreneur can feel like a professional poker players sometimes. Some months, I may make 2-3 times more than my average monthly income. Other months, I may just break even (or even take a loss). Plus, money management is extremely important. Just because money is flowing in from my Amazon payments account, doesn’t mean I’m making money. A large percentage of that money needs to be reinvested back into the business (ie. buying more products for resale). Not to mention living expenses.
It takes a lot of discipline to get things done when there are no deadlines. Sometimes I’ll find myself mindlessly clicking the Gmail Inbox – just waiting to get that next “good” email. Or I will find myself in a never-ending loop of checking Facebook, Amazon sales, Affiliate Sales, Facebook, Gmail, Facebook, Gmail, and so on. Before I know it, two hours have gone by, and I have done nothing productive.
I can wake up whenever I want. I’ve probably had to set the alarm maybe 3 times in the last four years. I’m not a morning person. I can come and go as I please without a boss looking over my shoulder. I’ve also make able to take several mini-vacations. I’ve been to San Francisco, Portland, Florida, Denver, Austin, San Diego, and LA – all in the last 18 months. This was done while Amazon was doing all the heavy living for me. There is no need to give a two weeks notice or get permission from anyone.
Unlimited Income Potential
While I mentioned that lack of a steady income is a pitfall, it can also be a great advantage. There is no limit to the amount of money you can make when work for yourself. You can be wrong several times, but you only have to be right once to find that financial windfall. When you work for someone else, the income is usually set.
Opportunity of Self Development
When working from home you have the freedom to “find yourself”. You can try new hobbies and activities that you may have been putting off your entire life due to the restrictions at your current job.…