Young Go Getter, one of my favorite blogs, posted an article detailing six different reasons why you should start your own business RIGHT NOW.
Robert Kiyosaki did a great job detailing how much of an employee’s income is given to the government, versus how much a business pays in taxes. My favorite diagram from Kiyosaki was the difference between an employee’s and a business’ cash flow:
Employee’s Cash Flow:
Earn – Tax – Spend
Business’ Cash Flow:
Earn – Spend – Pay Tax on whatever is left over
Even if you are just a small, home based business, there are a ton of tax benefits to working for yourself. A lot of people will nay-say, and explain that a self-employed individual pays 33% of their income to taxes. This is true. However, self-employed people and businesses pay 33% on their income AFTER they pay all of their expenses, instead of an employee who pays 25% to 50% of their money before they get a dime!
Self-employed people and businesses keep 100% of their money when they get paid. If I charge $500 for a website, I get a check for $500 when I’m finished. Then, I get tax-deductions for my mileage, for buying a computer to do my work, for taking the client out to eat, for the phone I used to speak with them, and for the internet connection I used to do the work. Personally, I do not take a home office deduction, but that is another option. Finally, whatever income I cannot deduct away, the IRS will tax me 33% on. I’m fine with that!
This is the largest draw for myself personally, and is probably the biggest benefit to most self-employed and business owning individuals. Web Design is my passion. It’s something I love. Speaking with people, getting them setup on the internet, and helping small businesses is something I love doing, and I get paid to do it!
Whatever your passion is, more than likely you can make money at it. You like painting snail shells, put some of them on eBay or Etsy.com and get started today!
Timothy Ferriss (my god second only to The God) first introduced me to the idea of opportunity cost. While it may look like not starting a business shelters you from any risk, you face the biggest risk of all. The risk you face is missing what could be the greatest opportunity of your life.
A simple analogy for everyone. A creek divides a wood you’re walking through. You are terrified of water. On the other side of the divide are the most delicious apples waiting to be plucked from their tree. Not crossing that steam because of fear looks like it’s not costing you anything. The real truth, is that it’s costing you a very tasty and refreshing snack.
How much larger is the chance of working for yourself, being financially independent, following the beat of your own drummer, and any other cliche I can use for owning your own business? Fear is fine. Everyone has it. Letting that fear hold you back from the opportunity of a lifetime is irrational.
My whole life I’ve known and been around business owners. They are the most wonderful group of people imaginable. Sure, there are some bad apples, but they get cut out pretty fast in the small business culture. No group of people are so quick to help another person get started, and no one else is as fast to encourage others as business owners. Everyone knows it can be difficult. Most have walked the road more than once. That experience makes them different, wonderful people. Join the group!
Fear holds more people back everyday than any debilitating disease in the world. As far as I’m concerned, FEAR is the most widespread and infections killer of humans today. Timothy Ferriss explains a great exercise to put yourself through that is certain to squash your fears.
Picture the worst possible scenario starting your own business could cause.
You start working on the side, turning a hobby into a small business. This goes on for about a month. You have little to no sales. Your boss finds out you’ve been doing something to make money outside of work. He is furious and fires you. You’re business isn’t making enough money, you have no job, and your spouse’s income is not enough. You look for other jobs, no one will hire you since you’re tainted goods. Soon all the utilities are shut off, the bank has foreclosed on your house, you and your family are now living in a homeless shelter living off food stamps.
If this actually scared you, stop reading and leave now…
If you realize the likelihood of your worst fears coming to fruition is tiny compared to the possible benefits of a future working for yourself then carry on!
What is the benefit of waiting? I’ve been told I’m impatient and I need to change that aspect of my personality. My response, “Being impatient has helped me a lot more often that it’s hurt me.“
Tomorrow will never come for you. Put the wheels into motion today! Paint another snail shell, take a picture of it and put it on the internet for sale. Who knows, someone might actually buy it. If not, you’re out no money, and you can continue to enjoy painting snail shells.
The room is warm and several people mill about talking, and sweating. One lone individual takes the initiative to pick up the fan, plug it in, and aim it (selflessly) at themselves.
Soon after, the other warm individuals try to cluster around the same fan. Obviously the fan is too small to support all the people, and the person who plugged in the fan to begin with leaves the comfort of the cool air flow.
Every great idea begins with one person, or a small group of people. Later others see this good idea and flock to it, attempting to mimic the success of the first person or group.
If the initial idea people are smart, then as soon as they see the crowds coming they move on before it becomes congested. The first people have gained as much as possible, made all their money, or reaped whatever benefit they desired. The crowd who followed are now going to force one another around, and slowly kill the opportunity.
Do not be a member of the group who sees a good idea and then flocks late. Robert Kiyosaki hammers on this point again and again in his book Rich Dad’s Cashflow Quadrants. Kiyosaki explains that the rich will find a new opportunity and move in ahead of the crowd, taking small risks to reap large rewards. The poor and middle class will move in at the height of the wave when there is nowhere for the idea to go but down, or to continue making incremental gains. Nothing compared to the the gains initial investors made. If a lot of people are talking about an opportunity. If you’re seeing advertisements for something. Then odds are the benefits have already been tapped and drained dry. Do Not Be Part of the Crowd.
Hopefully you have learned to be sepparate from the crowd and are looking for those new opportunities. Again, act like the rich do and get out when the wave has reached it’s highest point. This takes some failure learning to figure out, but those losses are just investments into educating yourself. Learn to spot those approaching crowds and get out before they flock onto the barren landscape. Even if there is more incremental gains to be made, take the small loss to count your already great gains!
Failure is Never Failure, When You Learn Something
Thursday I attended Pat Gruber‘s seminar “Filling Your Sales Funnel“. He had some wonderful advice about how to make sure your business does not run dry on customers.
A popular blog I read FreeLanceSwitch.com wrote 10 Lessons Every Successful Freelancer has Learned. For those who do not know what a Free Lancer is Wikipedia.org has a great definition:
A freelancer, freelance worker, or free-lance is a person who pursues a profession without a long-term commitment to any one employer. The term “freelance” was first coined by Sir Walter Scott (1771–1832) in his well-known historical romance Ivanhoe to describe a “medieval mercenary warrior” (or “free-lance”). Read Whole Wikipedia Article
Much to my delight Free Lance Switch pointed out almost the exact same things Pat suggested in his seminar. They were:
Make sure you are taking care of your customers, and they will become Center’s of Influence for you. They will proselytize your company or product for you, having new customers come to you instead of having to chase them down.
Like the Show Me Business Network I attend, a BNI group, a LEADs club or any situation that puts you in contact with prospects (people who might need your product/service, can afford it, and can make the final decition), make sure you are maximizing the benefit you’re getting out of these interactions and opportunities.
A spiel to answer the question, “What do you do?” which should take less than the time it takes an elevator to travel from floor to floor. Don’t try to shove your product/service down their throats in this time, just inform them.
I had never heard this phrase before taking Pat’s seminar. How true it is, how true it is. If we didn’t know that a big rig diesel truck only got 5 miles to the gallon we wouldn’t know how much money we were blowing on gas. While this is an absurd example, how much are you doing in your business that you’re not measuring?
FreeLaceSwitch.com also had some other tips that grabbed my attention.
This is one of the most valuable lesson’s I have learned from Timothy Ferriss’ book “The Four Hour Work Week” and Robert Kiyosaki’s books “Rich Dad Poor Dad” and “Rich Dad’s Cashflow Quadrant.” Failing is the best form of learning. Do it often. Don’t be discouraged. When you fail, you learn.
Again, Timothy Ferriss introduced this to me first. 80 percent of your income comes from 20 percent of your customers. 80 percent of your problems come from 20 percent of your customers. Evaluate the first 20 percent, and find more customers just like them. Figure out who the second 20 percent are, get rid of them, and then avoid any customers like them in the future.
This I had not heard of until reading FreeLanceSwitch’s article. The idea is to pretend you have courage even when you don’t, or whatever else you lack. Fake it, and then you will make it come true.
Another analogy I’d not heard before reading this article. Make sure you don’t fill your life with sand, and leave no room for the gems. Fill you jar with gems, and then fill the spaces with sand.
We are all circus actors, master jugglers. Especially those of us who are currently sole-proprietor self-employed people who wear every single hat in our business. FreeLanceSwitch recommends knowing which balls you’re juggling will shatter if you drop them, and which are rubber. Focus on the glass balls, and pickup the rubber ones later.
All in all, a fantastic article from a great blog. I’m happy to see that what I learned at Pat Gruber’s great lunch and learn seminar (PDF) is being reinforced in other parts of my world. Pay attention to these ideas and watch your business blossom. If you don’t have a business, then you need to realize Hard Work is Useless… so Do What You Love
In the past week I’ve read Timothy Ferriss’ book The Four Hour Work Week (for the fourth time), Robert Kiyosaki’s Rich Dad, Poor Dad and Rich Dad’s Cashflow Quadrant and Michael Gerber’s The E-Myth (entrepreneur) Revisited.
All three of these New York Times bestselling authors make the same claim:
Hard Work is Useless!
The Agricultural and Industrial Ages have come and gone. The days of long hours and back breaking work yielding a fair wage and supporting a family have passed us by. Today we stand in the Information Age where Thinking is valued.
This is the title of a book that I have not yet read, but Robert Kiyosaki recommended. He makes it a special point to highlight the fact that this book is not titled Work Hard or Get a Job and Grow Rich.
Working hard at a job no longer holds any security, and with the economy being the way it is today it’s less secure than the past decade. Before reading Kiyosaki’s books I never thought about the fact that layoffs and downsizing are horrible for employees but great for owners and stockholders. Employees lose their job, their sole source of income, while owners and stockholders have one stream of income increase. Some will scream about the unfairness of the situation, but THINK and you’ll grow rich.
Michael Gerber teaches someone how to create a business they can own instead of operate. In The E-Myth Revisited Gerber explains the big difference from owning a job and owning a business. Self-Employed people often fall into the owning a job category, while employees cannot even own the job they are in.
Michael Gerber explains that the real value of a business owner is not being the best at their particular craft. He uses the example of a young woman who owns pie baking store. She is a great baker, but her real value is in THINKING about the business, not baking pies.
Most likely you have a job currently. If you’re self-employed then you probably own a job. You do all the work yourself and are the sole employee of your business. I know I am. However, the majority of the people reading right now have a job where they work for someone else. It is probable they do not like their job, and almost impossible they could love it.
Your value is not in doing your job and “working hard.” Your value is in thinking. Anyone will say that loving what you do, being passionate about your work, is the only real way you should live life. Wasting away your best years waiting for old age and retirement is criminal. Being excited to continue what you started yesterday, having free time to look around and enjoy life is the only option.
Timothy Ferriss specifically teaches how to create a muse, or a stream of income that is primarily or completely self-sustaining and self-ran. With a muse or two, which you develop by THINKING not hard work, you could do almost anything you wanted. How can you accomplish this?
And you’re wasting it WORKING HARD. STOP! You are going to die. Do you want to work until you’re 70, then try to start enjoying life? Change your thinking.
Start THINKING instead of WORKING HARD!
GM Says Driverless Vehicles May Be On Market In 10 Years. And if it’s on TV, or GM says it, then it MUST be true!
We have BMW’s that can parallel park. We have Volkswagens that will slam on the brakes if something moves in front of us. We have backup sensors to ensure we don’t hit that other car or the back of our own garage. We have rear view mirror cameras. We have side view cameras. We have night vision cameras which look left and right at intersections. We have infrared cameras with overlays on windshields to identify heat signatures of animals and people at night. All of this helps people drive better, but it seems to me that it should help a computer drive our cars!
WHOOPS! Too late, you already do! If you go to a hospital, computers monitor your status and IV fluids, adjusting as necessary. Anything financial is computer ran and monitored. Your business information is all on a computer’s hard drive. You primarily communicate via email. Even if you use a phone, computer’s run the phone system. The military and government all use high level computing to run their most expensive equipment, monitor threats, direct troops and so much more. I hate to surprise you with this, but computers already control your life. Have you watched Live Free or Die Hard?
When NASA launches a space shuttle, the only “piloting” a human does is press the start sequence button. Computer’s take care of the rest. And if we’re trusting a computer to guide a multi-billion dollar rocket into space, why can’t we trust them to handle our commute? A computer does not get distrated with the radio. A computer does not have to put on makeup, or adjust it’s hair. A computer does not talk on a cell phone and ignore the road. A computer does not get tired or fall asleep at the wheel. A computer cannot become inebriated (drunk!) and kill innocent people. But people can… Why do you trust them to drive?
Were a computer driving a car it’s reaction times could be instantaneous. No more worrying about slamming on the gas instead of the brake, or calculating the time it takes to lift you foot from the accelerator to the brake. Instantaneous reaction to whatever situation. If a child runs in front of a new Volkswagon SUV, it stops the vehicle for you. Let the computer go forward, left and right as well.
A person can see, hear, and feel. However, we are limited on how many of those we can do at one time. A computer has no such limitation. There are no blind spots for a computer. Imagine a machine that has a 360 degree view of your vehicle at all times. It can “sense” via proximity detection any other vehicle or object withing a hundred feet, or more, of your car. This machine would not attempt to make a lane change when it knows there is another car right next to it. A deer runs in front of the car, the machine noticed it one hundred feet into the woods because of it’s heat signature and immediately slowed when the deer dashed onto the road. All this time, you’re sitting in the drivers seat, reading a book or watching the news.
A stoplight turns green. The first 10 vehicles accellerate at exactly the same time and speed. Three times as many cars can make it through a stoplight each cycle. Your vehicle is driving you to work this morning and receives a message for a car 5 miles ahead that a traffic accident has occured and you should immediately detour. The car makes the necessary adjustments, and you keep sipping your coffee. All this would be possible if computers drove instead of us.
It’s time to relieve your lead foot and the control freak, white knuckle grip on the wheel. Computers already handle and control every aspect of our lives. It’s not going to change. Having a computer drive is a far better idea than a person. Hopefully GM delivers sooner, and I would love to be reading instead of driving!
Macintosh delivered the Mac Book Air in January, with no optical media (CD/DVD) drive. Many are singing their praises, many are cursing them. I fall into the former group. The Pirates Dilemma has a great quote:
Moving to all-digital media formats isn’t just the most efficient thing to do economically, it’s the right thing to do environmentally, and it wouldn’t be happening as quickly without companies like Apple accepting the reality of the situation when most media and technology companies won’t.
Optical Media needs to be dead…
At my house are over 1,000 old CD’s that are stacked and awaiting their recycle date. CD’s and DVD’s are terrible for the environment and not terribly easy to recycle. I burned a CD for the first time in months last week when I downloaded the newest Live CD of DSL to install on an old laptop. I hated that I had to do it, but I could not boot such an old machine from a usb thumb drive, unfortunately.
Why use something that is one shot?
We have long since retired single shot firearms, why are we holding onto this archaic media? I understand there is such thing as a re-writable disc, but they are much more of a pain than they are beneficial. Like the semi- and fully-automatic firearms of today we have new media to replace the CD/DVD. Hard drives are dirt cheap and flash media is coming down in price while also being faster than both disc drives and optical media. Flash / USB Thumb Drives are nearly indestructible (I’ve seen someone wash his thumb drive 3 times), have much higher capacities than CD’s or DVD’s, are compatible with nearly every operating system and computer, are 100% reusable, and are far smaller than optical media.
You have 1,000 DVD’s and 1,000 CD’s at your house?!
Personally I don’t have a single CD anymore. iTunes, Napster, and more have changed the landscape of music and no longer do CD’s hold our music hostage. I have a central entertainment server at my house which cost me just a few hundred bucks (far less than your CD collection). It houses all of my music and movies to stream across my network to any laptop and my two Xbox Media Center enabled consoles. Netflix has rentals which don’t require media to be mailed, try that for starters. You can legally rip all of your DVD’s onto a machine and we all know hard drives are dirt cheap (500 gigs for less than $100).
I’m weaned of Optical Media, so should you be.
My flash drive never leaves my side. My MP3 player keeps me rocking the time away. The internet holds all the files I need. My server feeds up my Movies and Music. While there is no optical media to be found! Join the Revolution!
This morning I took the plunge, and for the first time I rode my bicycle to work. Presently I am working for a local CPA office at their front desk. Lucky for me, they also have a shower in the basement.
Bicycling is a wonderful recreation, but it’s also phenomenal transportation.
For the better part of this past decade I’ve logged around 300 – 500 miles a year on my bicycle. It’s nothing special, a 6 year old Specialized I purchased from Cycle Extreme here in Columbia for $200. Since then I’ve put around $100 more into it including tires, tubes, new petals, new seat, and routine maintenance.
You Cannot Beat Free!
In 6 years I’ve spent $300 on a transportation medium that is 99% free. It requires no gasoline, very little maintenance, zero insurance, no licensing or taxes or any other hidden fees you find in vehicles.
Push Pedals and Get Healthy
You do not have to be Lance Armstrong to ride a bike for transportation. Anyone can pedal a bike. I don’t care how overweight you are, how out of shape you are, or how little you exercise currently. Bicycles can support 500 pound people, are the easiest exercise form and make it painless for anyone to start exercising.
Bicycling is Easier and Faster than Walking
I cannot stress enough how easy it is to begin exercising on a bicycle. Bicycling is easier than walking because you don’t have a gear system to your legs. You can pedal up hills easier than walking as you just have to shift into a higher gear and make it less difficult. Bicycling is very low impact. Running, Weight Lifting, Jumping Jacks, Aerobics, and more are all very high impact. When you run weight is transfered into your joints called impact. Bicycling has no such impact, making it easier on your feet, ankles, knees, hips, back and neck. You can pedal much faster than you can walk. My personal best top speed on flat ground is 28 miles per hour. Maintaining 15 miles per hour over a distance does not take much effort, while the average person can only walk around 5 miles per hour. That’s three times as fast. This morning my commute of 5 miles took less than 30 minutes. However, I did not want to sweat much, and was not pushing myself at all. Also, there were two huge hills on my route, which I’ve found ways around.
Start Today!
I would bet money that most of you reading this article have bicycles in your garages collecting dust. If you don’t then there are hundreds of free resources on the internet to teach you how to purchase the best bicycle for you. There is also the tried and true method of walking into a store and talking to a sales person. Never purchase the first thing you look at, and make sure you go into an actual bicycling or outdoor sports store. The sales people are usually cyclists as well and have the inside track.
Save Money. Exercise. Help the Environment. What’s stopping you?