A year ago, a good friend advised you to launch your own business and you, again, demurred. You had the inside track on a “good job” and you thought, if it were offered, that would be the better decision to make. It is now a year later and your feelings of financial unease have only intensified. Moreover, you now realize that the job you accepted represented a real (lost) opportunity to lay the groundwork to quit and pursue your dream of becoming your own boss; building your future.
Is it too late to start my own business? You ask. Everything I read suggests it is not. Sally Deneen writes in the July 2013 issue of SUCCESS magazine “there’s pent-up demand from consumers.” If you want to be successful in business, solve a problem or add value. In this instance, understand consumer demand and meet it with a product or service consumers will buy. The health of the economy notwithstanding, consumers will disburse scarce resources for what they want. What about start-up costs? You ask.
While the larger financial institutions may not be providing start-up loans for small businesses, there are other sources of funding. Read Deneen’s article “Why Now’s The Time To Start A Business” – 8 Reasons To Take The Entrepreneurial Plunge. Deneen’s rationale for starting your own business is persuasive to some. To those who remain undaunted in their belief that “solid, middle-class jobs” are still the less risky and preferred choice, I say they may be right. I would, however, caution against optimism. Here’s why.
Defined pension and benefit plans typically offered through employers are a thing of the past. During a company take-over, for example, the employer contributions to employee pension plans then become part of the corporate bonus pool.
The new wrinkle is some employers are now pushing to eliminate paid sick days. Just a few years ago, the Social Security Administration reported in excess of 70 percent of the private sector workforce had no long-term disability insurance; 52 percent had no private pension coverage; and 31% had no savings set aside specifically for retirement. Outsourcing and layoffs are not mitigated by the growth in job creation – at least not yet.
Another factor altering the employment landscape today is the corporate gravitation toward hiring temporary labor – just in time labor when you need it. This is a boon for employers of blue-collar workers in factories and warehouses: no workers’ compensation claims, unemployment taxes, union drives and the duty to ensure that those hired are citizens or legal immigrants. This is how they spell relief.
A job, a career, represents an investment in your future. Declining salaries combined with job insecurity present serious challenges to personal and family financial planning. At some undetermined point, the government becomes part of your financial calculus to survive: unemployment and/or disability benefits; Medicaid, Medicare, Food Stamps, childcare, etc. Even among those who rail against Social Security as a government handout, Social Security remains the quiet bulwark for millions against poverty or destitution.
There is no guarantee you will succeed in starting your own business but, if you are prepared to dedicate your time, talent, and energy to an unreliable employer, why not to building something for which you are the principal beneficiary? I am amazed, concerned even, about the young people of the current generation I continue to meet who are willing to live with uncertainty rather than choose to become responsible for their future. To be fair, I am also immensely heartened by the growing number of those between the ages of 18 and 30 who are entering direct sales and bringing new life, ideas, and force to a rapidly growing segment of our economy. There are dynamic companies out there with new, safe, and affordable products that are transforming lives around the world – thanks to an infusion of energy, vision, and passion from hundreds of thousands of those between 18 and 40 not only in this country but across the globe.
For those hearty individuals still clinging to jobs that are less satisfying, the Social Security Administration also calculated a few years ago that 3 in 10 of the 20-year-olds at that time will become disabled before reaching age 67. Will they be financially prepared for this?
To sum up, the upside of working for yourself is the ability to create wealth. You can generate more income and invest it. You can eliminate debt and interest more quickly, reduce your taxes and invest the difference. You could make the choice to establish a legitimate home-based business for example and start reducing your taxes. The era of achieving financial security through traditional employment is over. Today, your future is up to you.
