The Difference Between Working for a Boss, and Working for Yourself

I know, I know, I keep banging on about the difference between working for a boss and working for yourself (if you don’t believe me, click here and here and here!) – and what a steep learning curve it’s been.

So why IS it actually so different?!

Perhaps the biggest difference is that public holidays tend to lose their meaning.

If you don’t work, you don’t get paid. And at this time of year there tends to be a lot of public holidays with Easter and Anzac Day.

There have been many times when I have worked on a public holiday because there was just so much work that I couldn’t afford to take the time away from my desk! (Thankfully this is becoming rarer)

However this is just the tip of the iceberg, when it comes to the difference between working for a boss, and working for yourself!

The Negatives of Working for Yourself

Here are just some of the others:

1. You have to set your own pay rate. Forget what you earned in somebody else’s employ; it’s a whole new ball game. Not only do you have to price yourself competitively, you also have to make sure you pay yourself enough! It’s not just your time that you should be reimbursed for – it also includes the training, skills and expertise you bring to your role. To you, it might seem like easy work, it’s not exactly rocket science. The thing is, to other folk it may as well be rocket science, because they can’t do what you do – and that’s why they hire you!
2. As mentioned above, you don’t get sick leave, long service, holiday pay or leave loading (so make sure you remember all this as well, when you try to calculate your pay rate!).
3. Your employer no longer has to kick in a certain percentage for your super. Now, it’s up to YOU. Another reason to think very carefully about the pay rate you set!
4. Oh, and while you’re at it, don’t forget you will need to make sure you are protected with business insurance.
5. You have to pay for IT support services, as there isn’t a handy IT department for when technology or equipment lets you down!
6. You have to keep excellent financial records for tax purposes.
7. You don’t have income tax taken out of each pay packet for you; so at the end of the financial year, instead of a bonus, you get hit with a bill. (And if you earn enough to include GST, your book-keeping will include a quarterly BAS and other headaches).
8. And – book work isn’t billable! A lot of your work you won’t be able to bill clients for / get paid for – not just book-keeping, but wooing prospective clients at meetings, preparing quotes and proposals, marketing and promotion.
9. As an employee I was able to attend conferences, and attend Writing for the Web, or Microsoft Excel training – at my employer’s expense. These days, I’m the one that has to wear these costs!
10. You have to find the work yourself, and get your own clients.
11. If you get a personal phone call, or somebody drops in (and they do when you work from home) – guess what, you’re not working. And not working = no pay.
12. You work a darn sight harder – and longer hours – than you ever did for somebody else! (Definitely at first, hopefully you will get a better work/life balance as you go along). Don’t get me wrong, I always worked hard as an employee – but there is a BIG difference.
13. It can be really hard to switch off from work mode – and especially if you work from home …
14. You don’t have a regular pay day. In fact, often you will have to chase up clients for payment – so don’t expect anything in your bank account until it actually hits your bank account!

It’s a lot to think about, and so far I’ve focused on the common pitfalls of working for yourself.

The Benefits of Working for Yourself

There is an upside, and although there aren’t as many points, they more than balance things out in my view:

1. If you don’t like your boss (a client) – it’s simple – you don’t have to take the job or work with them.
2. You don’t have to ask anybody if you can take a day off, or leave early, or take a holiday.
3. You don’t need to go to the doctor just to get a medical certificate if you are sick.
4. Your time is a lot more flexible. Doctors or hairdressing appointments – you can make them whenever you like, because you are not limited by 9 to 5. And you’re already at home, working, so it doesn’t matter if the tradesman or repairman doesn’t turn up on time.
5. You can be there for your family (if you have one). Although of course my kids have left the nest, even as teenagers / young adults they still needed their mum – like when our daughter had her tonsils out at age 17. She needed constant care for at least 10 days, and I was able to give her that and still do my work.
6. You get to do what you love!
7. And finally – the sky is the limit! YOU are the one to reap the benefits, not your boss (I still remember one job I had where a staff member left, so I took on her duties on top of my own workload – and she was never replaced. Did I get any thanks, kudos, or extra pay for it? Of course not! Only later did I find out that the boss DID get a bonus – for budget savings from not filling that position! It still makes me steamed all this time later!)

The difference between working for a boss, and working for yourself, sounds quite simple now I’ve put it down on paper.

But the reality is, I’d never even thought of any of this when I was an employee.

Have you ever thought about working for yourself? I hope I haven’t put you off – despite the negatives, I really love that I no longer work for a boss