by Shaheen Darr

Created on: October 22, 2008   Last Updated: November 11, 2009

We would all love to run our own business rather than having to work for someone else, but it is not always that easy to set up a successful business from home.

In the current economic climate it is indeed a privilege to be employed by an established company rather than struggling to survive on your own. Whereas the employed person walks into an already established and running business a self employed person will have to do all the groundwork himself before he sees any results. This is therefore a challenge that might seem very attractive, but brings with it hard work and sheer dedication to make it work.

If you have enough savings or run a successful business from home, then it is a different scenario because that will cushion any shortfalls your self employment might bring along the way but if you haven't, then it is bound to be difficult for you. Your mortgage payments have to be made and the day to day expenses of both the business and the household have to be met. To do this you have to make sure that every month you make enough money through self employment to cover these. Some months might not be as good as others and it is this feeling of uncertainty that can make self employment a risky prospect.

For those who are employed despite the difficult economic times they have the security of having a fixed monthly salary that covers their monthly expenses. In addition to that, working for an established employer means your tax and national insurance contributions are being paid. This provides you with security of a pension later on in life and in the unfortunate case of unemployment you can receive unemployment benefit until you find another job.

Sharing responsibility is another advantage that you can enjoy when you are employed. You work under the umbrella of a company and that is a safeguard for any decisions taken. Work is shared by different departments and areas that you are weak in are handled by those who have sufficient knowledge to run them. When you are self employed you make your decisions on your own and suffer the consequences on your own. Whether you are weak in finance or marketing you still have to manage these aspects of your business and this can be a struggle and sometimes a downfall. As a self employed person you have to be fully aware of all the legalities and the financial aspects that come with running your own busness.

There are also the social advantages of working for a company. You meet different people and can network and extend your business circle. There is more scope of learning new skills and being trained in different areas of business. Working as a self employed person can be a lonely scenario unless you make an active effort to socialise with business acquaintances regularly and any new training has to be budgeted and paid for yourself.

There is a discipline and a routine which comes with employment. You wake up at a certain time, dress up for work and there is regularity about your day which makes you motivated and focused. Even though the same can happen in self employment an element of laziness or distraction can sometimes be caused by other family members and especially if you have very young children.

The perks of working for an established company include a company car, paid holidays, a pension scheme, sick pay, free parking and canteen facilities, free gym memberships, private health care and many others. For self employed people these are luxuries that have to wait until the business is established. For a while until you are established you will have to work both as an employee and an employer rolled into one.

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