Entrepreneurship is growing in the U.S., and if you’re reading this article, you may be wondering if it’s right for you.
While there are many benefits to becoming an entrepreneur, working a 9-5 job may offer stability and, possibly, less stress starting out. There are certainly pros and cons to each.
So let’s take a look at some important factors if you’re deciding which work life is best for you.
What makes entrepreneurs different from employees?
Entrepreneurs take all of the risks associated with building a new business, but they can potentially enjoy all of the rewards as well.
Regular 9-5 employees will have a steady paycheck for as long as they are employed. However, an entrepreneur may not choose to pay themselves while the business is new and struggling to make a profit.
Plus, being in the world of entrepreneurship can mean many things. An entrepreneur might run their own small Etsy shop, or maybe they are a serial entrepreneur who started multiple multi-million dollar businesses.
Is being an entrepreneur the hardest job?
There are a lot of hard jobs out there. Being an entrepreneur is a grind, to be sure. But the hardest? I doubt it.
It’s difficult to find many actual statistics on this because it is so subjective. And there are a lot of factors at pay.
For example, are we thinking about the hours involved? The stress? The money? Are actual lives at stake? All of those things may contribute to which job is the hardest.
A look at first-page results on Google can tell us that lists of the hardest jobs often include firefighters, military personnel, surgeons, teachers and pilots. I rarely saw an entrepreneur make the list.
I imagine that is likely because an entrepreneur is more likely to work the hardest when their business is small and growing. Once an entrepreneur has “made it”, we imagine that they might have the luxury of scaling back their workload.
So is it the hardest job? I think it depends.
It can be hard, but so can many other jobs. The level of difficulty an entrepreneur faces likely depends on how seasoned they are.
But I think one of the most difficult aspects of being an entrepreneur is that you are never really “off”. There’s almost always something to do, and separating work from personal life can be a challenge when you own your own business.
Are entrepreneurs happier than employees?
Despite the challenges of being an entrepreneur, it looks like they are, in fact, happier. And this doesn’t surprise me one bit.
Feeling like you have control over your work life – arguably one of the things you spend most of your waking life doing – can have a major impact on lifestyle and life satisfaction.
According to an article from Forbes, entrepreneurs have a lower incidence of physical and mental illnesses. It goes on to say that they visit the hospital less often and report higher levels of life satisfaction.
Having a say in how many hours you want to work, a luxury you can have when you’re an entrepreneur, likely helps workers prioritize their own health and family life.
And if you’re able to achieve financial freedom, that can certainly help. Money doesn’t buy happiness, but if you’re struggling to pay your bills with your current salary, it can create a lot of stress.
Can you be successful with a 9-5?
Absolutely. Entrepreneurship may seem exciting, but it’s certainly not for everyone.
There’s success to be had with a traditional 9-5, too.
Is it better to be an employee or an entrepreneur?
There are certainly benefits to being an entrepreneur, as we discussed. These benefits include better health and higher life satisfaction. But is it fair to blanketly say that being an entrepreneur is better than being an employee?
I think it depends on the person. I genuinely don’t think entrepreneurship is for everyone. Some people enjoy the simplicity of clocking in and clocking out every day and receiving a regular paycheck with a traditional job.
Some people do not have aspirations of running their own businesses, and that is more than okay. And honestly, the world needs regular 9-5 workers. We can’t all be entrepreneurs.
That being said, I don’t always love calling myself an “entrepreneur” because it feels like the term can be overused. I classify myself as more of a solopreneur.
I am self-employed and own more than one LLC. But even if a “regular” employer came to me with an offer to make more money than I currently make, I would pass.
Personally, I love being able to set my own hours and be my own boss. I have to ask no one to take time off. The freedom of that is completely liberating. And it has gotten me a lot further than my time in the rat race of corporate America.
Cons of being an entrepreneur
I’m not here to tell you whether or not being an entrepreneur is right for you. That’s a decision you have to make for yourself. But there are a few pros and cons you may want to consider. We’ll start with the cons of entrepreneurship.
1. Dealing with start-up costs
One of the worst things about being an entrepreneur is funding your own business.
Even if you run an online business like me, where the costs are low, you’ll still be looking at hosting fees, funding freelancers and purchasing your own computer and software.
If you are your own boss, there won’t be an IT person around the corner. Unless, of course, you hire one.
2. It’s harder to meet people at work
I’m not going to lie to you, it can be a tad lonely working for yourself. Depending on what type of career you want to pursue on your own, the road to get there can sometimes be a lonely one.
It will be important to prioritize your family and friends outside of work since you may not have typical coworkers.
3. Your startup might fail
I believe in the power of positive thinking and manifestation. But I also believe in being practical. Google tells us that 80-90% of startups fail.
And while we all fail at some point in our lives – and failure can be the best teacher – there is a lot of frustration that comes with that. Sometimes, it can come with financial hardships, too.
I recommend starting small if you’re brand new and making sure you have a proof of concept before diving in too deep.
4. You are responsible for compliance and taxes
It’s not all fun and games. As you form a real business, you’ll likely want to form an LLC, navigate bookkeeping and taxes and make sure that annual business reports get filed.
Don’t let this get in your way of being an entrepreneur, though. Tax services like Collective can make the process much easier if you are starting out as a solopreneur.
5. Access to health insurance and other ‘benefits’
One of the most commonly asked questions I get about solopreneurship is about health insurance and paid time off.
Paid time off is the easy one. When you’re in control, you can work your desired vacation time into your price or rate of service. In fact, you might even find yourself able to take more vacations when you are your own boss.
Health insurance can be a bit more tricky, especially in the U.S.
But with the earnings potential, you can always opt into a private plan. Don’t sacrifice a potentially huge salary bump simply to keep your insurance plan. And speaking of large salary bumps, let’s get into some pros:
Pros of being an entrepreneur
1. Get a potential pay increase
When I left my traditional 9-5 job to pursue self-employment, I got a pay increase of about $10,000 per year. Today, about 5 years later, I have more than doubled my pay from what it used to be.
And I honestly feel that I am just getting started.
2. Choose the type of work you want to do
When you have a boss, you might get stuck with a project or client you do not want.
And while that may still happen every now and then if you are your own boss, you can much more easily be discerning about the clients and projects you want to accept.
3. Set your own work hours
I’ve never been a morning person, and now I don’t have to be. I can – as long as it works with my clients’ schedules – work the hours that best suit me.
Having that flexibility is worth its weight in gold.
4. Choose who you work with
Whether you’re looking for a business partner or an employee or a freelancer, being in control of who you want to work with can be a huge benefit.
5. Never ask for permission to take a vacation again
Even though you have to calculate your desired vacation time into your rates, it’s absolutely exhilarating to be able to take off when you want without having to get permission from anyone.
Are most entrepreneurs workaholics?
Possibly, but it’s hard to generalize any one group of people. Let’s take a look at some stats. According to an article from Inc., business owners work twice as much as regular employees on average.
The survey found that one-third of small-business owners worked more than 50 hours per week, while one-quarter said they worked more than 60 hours a week.
But some would say that if you want to be successful, you should plan for even more than that. Grant Cardone, CEO of Cardone Capital, claims to work 95 hours per week.
“Most people work 9 to 5,” he writes. “I work 95 hours (per week). If you ever want to be a millionaire, you need to stop doing the 9 to 5 and start doing 95.”
If you’re doing the math at home, there are only 168 hours in a week. That would mean you have to put in 13.5 hours per day with no days off.
No offense to Cardone, but I would argue that working that much will not make you a happy entrepreneur. And frankly, it’s not sustainable.
If you’re thinking of entering that entrepreneur life, it’s important to consider productivity. According to an article in Inc., the average American works 8.8 hours per day, yet the average worker is only productive for about three hours per day.
The other time is spent doing activities such as talking to coworkers, scrolling social media or talking or texting on the phone.
The article suggests we all might be better off working a six-hour day instead.
So if you have the flexibility of making your own schedule, it’s important to think about what you are gaining from those extra hours you’re pulling. Because if you’re aiming for 95 hours, I imagine at least a few of those hours will be spent on coffee breaks.
Who cannot be an entrepreneur?
Honestly, I think anyone could be an entrepreneur. Fourteen or so seasons of “Shark Tank” taught us that.
Many people who once started in their garages have successfully built their own brand from scratch and fully transitioned into entrepreneurship.
However, depending on your business model, it may be more difficult for those who are on a low income. Starting up your own business can be a big decision that will often come with extra costs as you’re starting out.
Sufficient funds are an important factor in starting your own business, and the needs will vary depending on your business model.
Can I have a job and be an entrepreneur?
Sure. Many people who have worked their way up as an entrepreneur started their venture as a side project while having a regular full-time job.
If you do begin a side hustle as you work another full-time job, do try to think about how to transition slowly into entrepreneurship to avoid burnout.
How do I start a startup while working full-time?
You find the time when you can. The hardest part is getting started.
If you look at the project as a whole, it might seem too overwhelming to take the first step.
So, make your goal start as something small. Maybe you just have 15 minutes per day. That’s fine.
Set aside 15 minutes to do something that will get you one step closer to your goal. Move it up to 30 minutes per day, then maybe an hour. Some progress is better than no progress at all.
Once the ball starts rolling, it only gets easier from there. Psychology Today says that the whole idea that it takes 21 days to form a habit isn’t exactly true. Instead, it says, something that provides our brain with pleasure can be learned fast, and simple behaviors are also easier to form into habits.
So, having a project that you are passionate about and setting up small, manageable tasks might just be the first right step in your future success.
Have you thought about taking the leap to become an entrepreneur? Tell me about your experience in the comments below.