Business Opportunities Versus Employment: Which Is Right For You?
When it comes to making a living, there are two options: being in business for yourself or being employed by a company or an individual. Of these two options, there is great latitude in what is considered being in business for yourself, especially if you take advantage of business opportunities. In fact, some business opportunities so closely mirror employment, that many people mistakenly consider them ‘jobs.’ But in reality business opportunities are not in this category. To understand the difference, read on as this article will explain in detail how things work with business opportunities versus regular employment.
Firstly, most business opportunities will require a person to fill out a 1099 versus a W-2, which is the tax form used for regular employment by companies. Both forms will alert the IRS that you need to pay your taxes, but the 1099 does not actually allow for deductions like a W-2 does. When you use a 1099 you have to pay for your taxes on your own. This is one of the major disadvantages to working with business opportunities, especially if you make a lot of money. To try to avoid problems, make sure you keep a close record of all of your business transactions. Also set aside 35 percent of your salary for taxes. You can put this in a savings account so you can accumulate interest. Hopefully, you will have enough write-offs that you’ll be able to pocket your savings once tax time comes.
Secondly, most business opportunities do not offer ‘guaranteed’ 9-to-5 employment, as most hire you as an independent contractor. This is the case whether you are working business opportunities at home or in an office. Basically, if you have to fill out a 1099, you are in business for yourself. Anyway, some business opportunities offer such a steady stream of work that you not being hired as an hourly employee is not a problem. However, there are many others that have work every now and then. In these cases you will want to try several sets of business opportunities, so you can always have a steady stream of work to support yourself.
Lastly, business opportunities tend to not offer health insurance. Granted, nowadays there are many ‘regular’ employers that also won’t offer health insurance, but being able to get some form of health insurance seems to be more typical with full-time jobs. With most business opportunities, you will not get health insurance no matter how many hours you work. However, there are the exceptions but they are exceptions that are quite expensive. In these situations all that has happened is that the company offering the business opportunity has struck up a ‘deal’ with an insurance company. You are still paying as if you had signed up for the insurance yourself without the aide of a company.
In conclusion, the main differences between business opportunities and regular employment can be found in the areas of taxes, work structure and health insurance. Indeed, these differences may make some conclude business opportunities are not for them. For others it may not matter as much because the freedom offered through business opportunities outweigh the disadvantages.