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Having a fixed income provides financial security, stability and ensures that people has an income to support their daily expenses.
It does not make them very rich, but it is just sufficient for them to get by. When people have a fixed income, their life is more secure, stable and reasonably comfortable. There are no high expenses or investments required in order to earn the monthly income. Having a stable monthly income enables them to support themselves and family. This is enough for many people.

Having a fixed income is low risk and there is not high responsibility needed as compared to owning a business. This allows the fixed income earner to spend the evenings and weekends with their family and provide for a balanced and generally satisfied life as a whole. When a person is leading a comfortable life, why would he or she discontinue the fixed income and choose to start-up a business from scratch, giving up a cushy job, the good life with a fixed monthly income?

Owning a business can bring great wealth, success and even fame to the founder. However, owning a business is high risk with a low rate of success, it involves a lot of time and effort to start-up. It needs a lot of effort with no guarantee of success or income. In order to own a business, money and time are required. Before people start up a business, they need an amount of money to invest and spend to get their place and hire manpower. They also have to be prepared to go without income for an unknown period of time. This is a risk they must be prepared to take in order to build their business. Not everyone has the money or capital to start a business. Many people cannot afford to be without income. A business takes time and effort to break even, that is, to recover the amount spent on the start-up and overhead costs. It is after the break even point, which can be 1 year, 2 years or for business, it never happen. This is indeed very costly and unsustainable. That is probably why most people are on fixed income as compared to business owners.

As with Maslow Theory, humans need to fulfil their basic needs before they will think of achieving self-actualisation goals. Most people will choose a fixed income to fulfil their basic needs; this is basic necessity for survival and family support. For many business owners, it is either that they have not better option as they are not able to find a job with a fixed income, or they have wealthy parents or spouse or they have earned a reasonable amount of money that enables them to have the time and finances to start their own business.

In summary
We are aware that owning a business is the way to high returns. Those high earners are business owners who succeeded in building and expanding their businesses.
Why most people choose a fixed income over owning a business is due to the need for basic survival and the lack of finances and time to support the start-up of their own business.

Learn more about this author, Tammy Lim.
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