The 7 benefits of being an entrepreneur
In general, being an entrepreneur gives you unique advantages
AS a former employee turned entrepreneur, I have experienced the pros and cons of working for others and being my own boss. In terms of personal finance, these are the seven advantages of entrepreneurship:
1. Equity. The No. 1 benefit of being a business owner is equity. Whatever idea, project, or revenue you contribute is yours. If you’re an employee, it belongs to your employer. More important, as your business grows, so does your equity, and therefore your net worth.
2. Higher income growth. Let’s face it, if you’re employed, unless you work in certain sales or executive positions, your salary increase is limited to a certain rate. As an entrepreneur, there are no limits (which explains why most of the Forbes richest are entrepreneurs).
3. Tax advantages. You can’t deduct your business expenses as an employee. You can as a business owner. It’s also possible to be taxed at a lower tax rate as an entrepreneur.
4. Good debt. Banks will lend money to your business for working capital or expansion. They will not lend money to you for your career growth if you’re an employee.
5. Managed risk. You may be an excellent employee but if your company goes south or is acquired, or if your position is deemed redundant or obsolete, there goes your job. Yes, running a business is also risky. But you have greater ability to minimize those risks.
6. Control. As an entrepreneur, you can decide when, where and how long you want to work. You decide which customers and employees to work with. You control what to sell and how to sell them.
7. Diversification. Once you have a moderately successful business, you can launch other businesses. Once you have a moderately successful job at your company, you cannot work in other jobs for other companies.
Of course, there are exceptions to these, as when you work for an employer who encourages entrepreneurship within his company and offers some of the perks of a business owner, such as equity, higher income growth, control and diversification. But, in general, being an entrepreneur gives you unique advantages. The main downside, however, is income stability. You don’t get to enjoy a regular, fixed income, at least at the start.
This is not to say everyone should be an entrepreneur as it is not for everyone. Some people thrive better as employees—and highly paid ones at that. There are also many financially struggling entrepreneurs, so it’s not always the best route.
But if you have the characteristics of an entrepreneur—you like control and flexibility, you are good at spotting opportunities and working with limited resources, you like taking risks and doing things your way—then you should give it a try.
FROM November 18 to 24, 2013, over 130 countries will join together to celebrate entrepreneurship during Global Entrepreneurship Week (GEW).
During one week each November, GEW inspires people everywhere through local, national and global activities designed to help them explore their potential as self-starters and innovators.
Founded by the Kauffman Foundation in 2008, world leaders such as US President Barack Obama, former US President Bill Clinton, UK Prime Minister Gordon Brown, Japanese Prime Minister Yukio Hatoyama, French President Nicolas Sarkozy and Prince Charles, among others, have supported GEW. Global entrepreneurs like Richard Branson, Michael Dell, Mark Cuban, Russel Simmons and Muhammad Yunus have also endorsed GEW.
The Philippines is joining GEW for the first time this year. Hosted by Young Entrepreneurs Society (YES) Philippines, Filipinos all over the country will celebrate Global Entrepreneurship Week for the whole week.
In 2014 YES Philippines, with partners like my company Learning Curve, will hold a series of yearlong events, competitions and activities, including Global Entrepreneurship Congress, Business Start-up Expo, Start-up Open, Creative Business Conference, Creative Business Cup, etc., culminating with the Global Entrepreneurship Awards in November.
It is a privilege to be part of GEW in the Philippines. If we can get hundreds of thousands of aspiring Filipino entrepreneurs, including students, homemakers and professionals, to seriously consider entrepreneurship or even launch their own business, then we have done our part in encouraging
“innovators and job creators who launch start-ups that bring ideas to life, drive economic growth and expand human welfare.”
Heinz Bulos is a Registered Financial Planner of RFP Philippines. He is the Chief Executive Officer, Creative Director, Curator, and BPG (Big Picture Guy) of Learning Curve, overseeing strategy, product development, and marketing.
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