Staying disciplined when newly self-employed
One of our writers Robert wrote a post yesterday about avoiding costly distractions while working from home and it reminded me of a conversation I had with a friend when I first went self-employed several years ago. At the time I was still quite young and it’s true to say that I was letting costly distractions get in the way of my work schedule much more than I should have. The friend I was speaking to however was very disciplined, quite naturally so in all areas of life and he reiterated some advice that I’d also been given by others. The advice is that when you are self-employed, you need to view it as though you are employed.
One of the benefits of self-employment is that it can give you a lot more freedom to control your work schedule but sometimes this isn’t always a good thing. The temptation to take a day off every time there’s a sunny day, an important sporting event or because you’re simply feeling like you’re not up to it that day can be great. This is where treating self-employment as though you are employed can come in handy. It can work to your advantage to try and give yourself some set working hours and then sticking to them as rigidly as possible. If you get called out to do an extra job or the work has piled up meaning you need to work a little overtime then fair enough, this could often happen if you were employed too. What we’re trying to get across here is the importance of working at least the minimum amount of hours you should be working each week on a regular basis and not just taking a day off each and every time you feel like it. Not only would behaving in an undisciplined manner affect your business and your pocket, it will also negatively affect your mentality as you might lose your overall life balance and structure. Staying disciplined during self-employment can be tough at times but if you want to make self-employment a success then it is vital that you do so.
Managing the money
One of the hardest things for people who are newly self-employed to get used to is the irregular flow of money. When you work for yourself, money tends to flow into your bank account in peaks and troughs, at least that’s my experience anyway. Some weeks you get a big influx and other weeks you might not get anything at all, especially in those early days. Again this is a situation where treating self-employment as though you are employed can come in useful, how so? One thing that can help is to try and pay yourself a weekly wage just as you received when you were employed. That way, when you do have those good weeks, you will not be tempted to go out and overspend only to leave your pockets threadbare the following week. Whenever you do have a good week you can leave any surplus cash in a business account so that you can still take a wage in the bad weeks. If you find that this money starts to build up then great, maybe you will then be able to afford to increase you own ‘salary’ or better yet, why not reinvest some of this cash back into the business.
We also wrote a post in the past about planning for holidays when you are self-employed which fits in quite well with this post as paying yourself a regular weekly or monthly wage should allow you to still get ‘paid’ while you are on holiday and not working.
Enjoy the benefits but don’t abuse them
I really don’t want to be a killjoy here. One of the things I love most about self-employment is the freedom it can offer, the freedom to not miss out on the most important or fun things in life. So I’m not saying you shouldn’t take the odd day off to be at your kid’s sports day or spend the day at Wimbledon. The key is to enjoy the benefits and freedom of self-employment without abusing them. If you can manage to do this then you will stand a much better chance of making self-employment a success.
What advice would you give to a newly self-employed person?