Self Employment: An Introduction to the Benefits and Downsides
Self employment is on the rise in the United States. In fact, self employed people in America have increased by more than a third since 1995. Selfemployed.com says there are over 15 million self-employed individuals in the U.S., and that number is expected to grow even more.
Self employment opportunities are becoming increasingly popular because they offer benefits that include being able to work from home, setting your own hours with flexible schedules, being your own boss with minimal supervision requirements and spending more time with family members or friends who you might not otherwise see if you were an employee at someone else’s company.
This article will introduce you to self employment: What it means to be self-employed, how self-employment works, the benefits and downsides of being your own boss, and more.
What is self employment?
Self employment is the self-directed labor of an individual in a profession or trade. It can also be known as freelancing and contract work.
Individuals who are self employed set their own hours, manage their own time, choose where they would like to work from (home office vs. local coffee shop), and determine how much money they would like to make.
Is there a difference between self employment and self employed?
The terms self employment and self employed are often used interchangeably, but there is a slight difference between the two. When someone who has their own business or is an independent contractor refers to themselves as self employed, they mean that they have no other employees working for them except themselves (i.e., self-employed).
When people refer to self employment, they may be referring to the self-employed individual or their business (i.e., self employed).
Self employment is a term that relates more to individuals, whereas self employed can refer both to individuals and businesses.
How do self-employment and self employed work?
When self-employed individuals work, they are paid by the hour or project. The self employed may not receive any benefits associated with typical employment such as health insurance and retirement plans unless they form an LLC for their business to provide those services.
Self employment opportunities often take longer to start off because of financial concerns that self-employed people must deal with on their own.
Financial self employment is an option for individuals who are self-employed and want to start a business, but don’t have enough money saved up yet (i.e., bootstrapping).
For example, if you wanted to open your own bakery shop or coffee shop that only served the best desserts in town, self employment opportunities may be the best way to start because you will need some time to save up money for your business.
Self-employed individuals work independently and provide their own benefits (i.e., Social Security) if they do not form an LLC or corporation that provides those services on their behalf
In order to be self employed, you can either start your own business or become independent by working for yourself as an independent contractor. In this case, you would need to find ways in which you could establish and maintain relationships with clients who will hire you on a project basis. This type of self employment is commonly known as self-employment.
What are some types of self employment?
There are self employment opportunities in many different types of professions, including the following:
- Freelance writer: A freelance worker sells their product or service directly to consumers instead of having an employer handle all transactions for them.
- Copywriter: A copywriter is an individual who writes for various types of media and advertising outlets. These self employed individuals may work as full-time employees, contractors on a project by project basis, or they might run their own self employment business where they charge clients on an hourly rate.
- Wedding planner: A wedding planner is self employed because he/she works independently with self employment opportunities.
- Event planner: An event planner takes care of all details involved in planning and running an event or meeting, including budgeting, location selection, invitations, decorations etc. This profession is another example of self employment because the individual has their own business where they are self employed to make decisions for themselves without having anyone else telling them what to do.
- Freelance photographer: A self employed individual in the photography field works on a project basis for clients who need their services.
- Virtual assistant: A virtual assistant is self employed because they work independently on a project basis for different clients.
- Personal assistant: A self employed personal assistant works independently and charges their client(s) hourly rates instead of an annual salary.
- Teacher/Professor: An individual in this profession can be self employed by teaching classes at a local college or university in the evening or on the weekends.
- Landscape gardener: A self employed landscape gardener can make their own hours and be self employed because they work for themselves without having anyone else tell them what to do.
- Athlete or coach: An athlete is self employed when he/she runs a business that allows him/her to train, travel, and perform in sports. A self employed coach works independently with self employment opportunities to train athletes or teach them how to play their sport better.
- Personal trainer: A personal trainer is self employed because he/she charges clients hourly rates for training sessions instead of having an employer pay a salary each month.
- Yoga instructor: A self employed yoga instructor runs his/her own self employment business where he/she can teach classes or hold individual sessions with clients.
- Life coach: A self employed life coach is self employed because they work independently to help others achieve their goals without having an employer telling them what to do each day.
- Graphic designer: A graphic designer self self employed because they work independently on a project basis for clients.
- Web designer: A self employed web designer can be self employed by working as an individual or an agency that sells their services to businesses who need website design.
What are the tax obligations for self employment?
All self employed individuals who are working for an independent company or solo self-employed must pay taxes on their income at the end of each year (i.e., self employed tax obligations).
This is why it’s essential to keep track of your self employment expenses and revenue so you can file them correctly with the IRS.
Self employed individuals must pay self employment tax, which is an additional Social Security and Medicare fee that self employed people are responsible for paying. The self-employment tax is commonly known as SECA (self-employed collective agreement). A self employed individual pays this self employment tax instead of having their employer take it out of the paycheck they receive each month.
What are the benefits of being self employed?
In self employment, individuals have the freedom to work from anywhere in the world with an Internet connection and a laptop computer.
For example, if you are self employed as an online writer or editor, all you would need to do is sit in your pajamas at home while completing assignments for clients! The possibilities are endless when it comes to self employment.
Other advantages of being self employed include being able to choose your own hours and work on projects that interest you.
For example, self employed graphic designers can focus their self employment business around a specific niche or industry that they are passionate about such as fashion, fitness, sports, education, etc. This gives them the opportunity to spend more time doing something they love while making money.
As self employed individuals, people are able to reap all of the benefits that come with running their own company without having an employer tell them what to do.
As a self employed individual, you can choose your clients and projects which means no more annoying office politics at work!
Self employment is for people who are motivated, independent, productive workers with excellent time management skills. If this sounds like something that interests you, self employment could be the perfect option for you!
What are some downsides of self employment?
One downside to self employed people is that they have more responsibility when it comes to their business. For example, if a graphic designer has an important project with a tight deadline due in just one week, he/she must meet this deadline at all costs with no one else to rely on.
The self employed must also market themselves and their services in order to find new clients or projects, which means a lot of time spent marketing online instead of completing work for paying customers. This is why self employment can be both exciting and challenging at the same time!
One other downside to self employed is that self-employed individuals are responsible for paying their own taxes at the end of each year. This means self employed people must keep very accurate records of everything they spend money on related to their business in order to file these expenses with the IRS during tax season.
How do you know if self employment is right for you?
Self employment is right for you if you are self-motivated, creative, and independent. You must also have excellent time management skills to be able to work well with minimal supervision as a self employed individual.
Another factor that determines whether self employment will be right for an individual or not is the amount of money they want to make each year.
Some self employed people make enough money to live comfortably and enjoy their work while others may not be able to meet all of their expenses with the amount of income they bring home each month as self employed individuals. This is why it’s very important for self-employed individuals to keep detailed records, track spending habits, and save money for a rainy day.
Working self employed is not right for you if you need to be told what to do every step of the way! In order to be successful with self employment, self-employed individuals must have excellent self discipline and be able to work well with minimal supervision.
What you should do if you’re interested in becoming self employed
If you’re interested in becoming self employed, I Buy I Review is a website that regularly reviews self employment opportunities so people don’t waste money on scams or legit companies with products that don’t work! We also regularly post self employment reviews on the blog section of our website.
We recently reviewed Dubli. You can find the review here.
I buy and review courses so you don’t have to. Sometimes, I even find courses that are legitimate and worthwhile; and that’s how I accidentally came across one that led me to building a 6-figure business in a little under 5 years. Now, I still review courses because it’s my favorite hobby. 🙂 Learn more about me here.