Reasons to Start a Business

Today’s economy is uncertain, and the future is difficult to predict. Many believe that in an increasingly digitized age, machines will gradually take the place of workers, and corporations will continue to look for ways to operate more efficiently. This means likely increases in downsizing and outsourcing, making jobs far less secure. Purchase a Business

One positive trend in the digital age is the rise of entrepreneurship. All this downsizing and outsourcing has prompted a growing number of individuals to explore going into business for themselves. In addition, countless new industries have been created, and Americans have access to more business models than ever before.

There are several advantages to owning your own business verses working for someone else. Here are five of the most important:

The Opportunity to Create your Own Job Security: When you are an entrepreneur, you not only own your own business, you also own your own job. This means no one can lay you off, outsource your job, or replace your job with some type of automation. You own the business, and you make the decisions. And if you have the skills to make the business work and successfully adapt to (sometimes rapid) changes in the marketplace, you will never be out of work.

The Opportunity to Challenge Yourself and Rapidly Expand your Skillset: Being in business for yourself is highly challenging, especially at first. As the owner, you may have to wear many hats, which will require you to learn far more skills than if you are working for someone else. In the beginning, this might mean putting in long hours, but the payoff is the opportunity to expand and grow, making your skills much more marketable to your chosen industry.

The Opportunity to Become an Expert in your Industry: In Malcom Gladwell’s best-selling book Outliers, he popularized the theory that it takes roughly 10,000 hours of practice to make an individual an “expert”. This means that if you put in just 40 hours a week, 50 weeks a year (hopefully you can find at least two weeks to go on vacation) for five years, you would have spent 10,000 hours working in your industry, putting you at or near expert status.

It should be noted that this theory has been disputed by some scientists who maintain this cannot be applicable in all cases, such as someone with very little athletic talent trying to become a world-class golfer. But this is still a good benchmark for most who decide to go into business.

The Ability to Take Advantage of Numerous Tax Reduction Strategies: As a worker, your taxes are likely fairly simple and straightforward. You have your income, deductions, and credits. If you own a home, you probably itemize your deductions, deduct charitable gifts, contributions to your IRA, etc. When you become a business owner, you are opened up to a whole new world of tax advantages. From home office deductions to travel and lodging to advertising and other business-related expenses, there are countless ways a business owner can reduce their tax liability.

The Opportunity to Become Financially Free: When you work for someone else, you are paid a pre-determined salary; and if you’re fortunate, you might have the ability to earn commissions and bonuses. Whatever the case, as an employee, your income is limited to whatever your employer is willing to pay you. For entrepreneurs, it is a different story. If you are in business for yourself, your income is only limited by the amount of effort you are willing to put in. In virtually any business or industry, the potential is there to become financially independent and achieve an income level that provides you and your family the standard of living you have always dreamed of.

Owning your own business offers numerous advantages, but there are some challenges as well. For example, when you start a business from scratch, it may take several months (or sometimes years) before you reach the break-even point. For this reason, you need to make sure to have a financial cushion in place when you start out.

One way to bypass the painful startup phase is to purchase an existing business. A business that is already established and profitable allows you to take over and immediately enjoy the independent lifestyle you are seeking. To ensure you find the right business to purchase, it is best to work with a business intermediary, and particularly one who specializes in your chosen industry. A reputable business broker can scan the market for available businesses for sale and find the opportunity that best fits your passion, skills and budget.

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