I sometimes get into debates with people about whether or not starting a business is financially smart.
The truth is, I get a lot of pushback on this. People often cite all the statistics as to how many businesses fail. Then they usually on to tell me about how they tried and it just didn’t work out for them. And finally, they say that not everyone is cut out to run a business.
I agree with the last part. Not everyone should be starting a business because not everyone can handle it. However, for those who are cut out for it, here’s why starting a business is one of the best financial moves you can make.
Your earning potential is unlimited.
Why is starting a business a good idea? Because you can earn whatever kind of money you want. In 2018, I’m projected to earn six-figures which is four times more than I was earning at my last job. According to the Freelancers Union, respondents to their annual survey stated they earn more money than they did at their last job too.
And you bet I’m going to keep earning more money. The more I learn, the better I get at making it. If I want to earn more money I just decide to do it and take the necessary action steps.
Now compare this to a job where you have a set salary and have to wait for someone to approve your raise. Even if you get one, you’re looking at a small percentage increase whereas business owners can give themselves a massive raise with a little extra elbow grease.
You’re building something you own.
The next reason why starting a business is because you’re building something you own. Plenty of business owners have a strategy where the build a company to then sell it. While this isn’t everyone’s plan, the fact of the matter is you’re still building an asset for yourself instead of building someone else’s.
The internet has made it easy.
If you want to run a business with low overhead, the internet has made it easy to do so. I only spend about $3000 a month on my business and that’s on the high end. It’s also because I’m always experimenting with new things and I believe in the power of outsourcing.
However, there are plenty of business owners out there who spend far less money than I do on their operations. This, in turn, leads to higher profit margins.
Think about it. Starting an online business means you don’t need an office. That alone is a savings of possibly tens of thousands of dollars per year! There are also several tools out there that allow you to automate business processes at lower costs. For example, you can easily streamline your payments process.
Starting a business is a financially smart move for many. It certainly has been for me. That being said, this is assuming you can handle running a business in the first place.