Anyone thinking about making the leap faces a variety of difficulties while working for themselves. For this reason, we’ve put together a list of crucial advice for anyone wishing to escape the corporate world and become their own boss.
Self-employment can be a rewarding experience, but it’s crucial to approach it correctly. With more ways to be self-employed, many Brits are freelancing, contracting, or side-hustling. Research from Deloitte found that 42% of Generation Z had a side hustle in 2023, compared to just over a quarter of Millennials. To help those starting their own, self-employed experts have provided top tips for those setting out alone. While overall self-employment hasn’t returned to pre-pandemic levels, it’s essential to approach it in the right way.
1. Recognize your situation
It’s crucial to think about whether a big, life-changing decision is right for you before rushing into it. Drink & Draw’s founder, Felicity Blades, explains that her low-cost initial business plan made sense because, when she launched the company, she “didn’t have loads of money to sink into something.”
The speaker advises against overextending one’s reach with major events, as it might require expensive staff. She also emphasizes the importance of understanding how committing to a new business or freelancing role could affect personal finances. She advises considering personal circumstances and potential life changes before deciding to start a business, find a side hustle, or leave full-time employment.
2. Show adaptability
Lynnette Hecker, owner of Lovely’s Vintage Emporium, has diversified her business by selling vintage clothing through various channels, including visiting vintage fairs and using Instagram Live to sell directly to her growing social media followers. She advises business owners to be open to change and diversify their offerings.
Lynnette suggests that attempting to make a bad relationship work is futile, as it’s not worth trying to change the person involved. In business, a different model is needed, as adjusting the same model repeatedly isn’t sustainable. Instead, it’s essential to switch it up and start again.
3. Develop a strategy for handling ambiguity
Starting a business or working as a freelancer can lead to a shift from a stable income and regular work schedule to unpredictable periods of busyness and lack of work. It’s crucial to be prepared for this uncertainty and consider how to make it work for you.
Freelance lighting cameraman Mario Genovese emphasizes the importance of balancing work and personal life. He warns that panicking about finding work can negatively impact mental health and suggests embracing quiet times during busy periods. He also emphasizes the importance of saying no to a job, balancing income with family, and taking breaks. Genovese emphasizes the need for flexibility and a balanced approach to work and life.
4. Develop connections
As a sole trader, building trust with clients is crucial for success. Making them understand that you are not easily replaceable is key. This may require giving and taking, as Mario may work longer hours than initially agreed. It’s important to develop relationships with both clients and other stakeholders.
Lynnette suggests that starting a business on your own can be challenging due to the camaraderie of teamwork. To overcome this, she suggests joining a business networking group or reaching out to fellow professionals in your industry. She also mentions that the quality of relationships with vintage dealers can vary, with some being competitive and uninteresting, while others become friends and engage in idea exchange and trading.
5. Become an expert in taxes, or get someone to do it for you
Self-employed workers often find dealing with tax matters confusing, especially dealing with HMRC. However, a proactive approach can help them overcome these challenges and claim significant rebates by understanding self-assessment and claiming tax relief on their business expenses. It’s crucial to learn which expenses can be claimed for different businesses.
Hecker suggests that hiring an accountant can be beneficial, as they can help you identify which expenses to claim. Hiring an accountant normally costs between £150 and £303. However, it’s crucial to note that an accountant cannot do everything, and Lynnette suggests doing as much as possible to reduce costs.
