When you go to work for someone else, you’re taking a pretty big gamble. It may seem counter-intuitive, given that being an employee means receiving a reliable paycheck on a regular basis.
But if that paycheck is your only source of income, you could lose 100% of your earnings at any time for reasons far outside your control.
We’ve already seen it happen to hundreds of thousands of skilled, talented workers who believed they had a high amount of job security when the Great Recession hit. Companies had to shed costs – and that started with laying off employees or even shutting down entire departments.
As an employee, you’re at the mercy of what someone else wants for their business. Sure, you can work hard, make yourself a valuable asset, and become a cog in the machine that would be extremely hard to replace.
But at the end of the day, your boss — or the higher-ups in the company, or those that run the business — may decide that it’s best for future growth to downsize, outsource, or reorganize.
So it’s a gamble when you’re working for someone else without any other income sources. Because you can be fired or laid off at any time, your downside is unlimited. 100% of your income is always at risk.
How can employees fix this problem?
How Can Employees Safeguard Against an “Unlimited Downside”?
The solution is actually quite simple. Employees can choose the new form of job security that will prevent a 100% income loss. That security is in the form of entrepreneurship.
Traditionally, starting up your own work as a business or just something on the side has been considered extremely risky. Working for someone else was the safe bet. But times have changed and this is no longer the case. Millennials, those in their twenties and thirties, are likely to change jobs every 1 to 5 years throughout their careers. And pensions? Forget about it. Companies simply don’t value career-long loyalty anymore, and offer no incentive to retain good employees over a 30-year working life.
The best part of all this? Entrepreneurship, full-time or part-time, also comes with an unlimited upside.
Why Entrepreneurship Offers an Unlimited Upside
Theoretically, your earnings potential when you work for yourself is unlimited. This is largely because you’ll likely stop trading time (which is limited) for money in the same way you do to earn a paycheck as an employee. The more value you provide via goods or services, the more others will pay for what you’ve offered.
As an entrepreneur, or someone who has a side hustle that provides various income streams in addition to a regular paycheck, you have more control over your career, your income, and your future.
And sure, you could always lose a client, a few customers, or a side gig. But that’s only one piece of a diverse puzzle that you built for yourself. Losing a job as an entrepreneur or side hustler means losing a percentage of income rather than everything.
But don’t forget, money, while important, isn’t everything. As an entrepreneur or someone with various income streams via side gigs, you have freedom, flexibility, and fulfillment in the work that you’re doing for yourself. That counts for a lot.
As a recent Inc. article explained, working for yourself in some form or fashion is the only way in today’s world to get really, really rich. It’s the only thing that offers the unlimited upside.
And why not give it a try and avoid facing that unlimited downside that comes with the territory when you gamble and only earn an income via one source, working for someone else’s business?
Starting up a side hustle is relatively easy and doesn’t require advanced degrees or expensive training. Creating a digital business can be done with an incredibly small investment of a few hundred bucks (and some entrepreneurs bootstrap for a while on even smaller expenses). It only requires your passion, dedication, and time.
Not a bad trade-off for all the perks, benefits, and of course, that unlimited upside.
What path will you choose? Will you choose the unlimited upside?
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Working for companies going through financial difficulties is always a drag. I’ve done it quite a few times in my career. You always wonder when the shoe will drop. However, working for yourself takes a lot of effort too. Always a trade off.
debs (@debtdebs.com) recently posted…Found money
Agreed – entrepreneurship, either full-time or just on the side, is a lot of work. But I think it’s worth it to have the ability to make your own business decisions instead of being 100% at the mercy of someone else’s.
Mr. 4HWD recently posted…Will You Choose the Unlimited Upside?
I did both things. I’ve worked ‘for myself’ for the past 5 years and, even if I do have good and bad months, I earned WAY MORE than before. Some of my ex-colleagues are shocked when they hear about a ‘bad’ month for me, since many can’t imagine getting this kind of money from their jobs. Not easy to run your own ‘show’, but clearly worth it.
dojo recently posted…Running a home based business while caring for a newborn
I agree, Dojo! It is a lot of hard work — but the rewards you can reap are certainly worth your efforts.
Mr. 4HWD recently posted…Will You Choose the Unlimited Upside?
I’m all for the unlimited upside! Life is too short to waste time being miserable or feeling stuck.
Martin recently posted…How-to Go From Zero to Hero in Real Life (not just the movies)
Exactly! We have to make our own opportunities. The good news is that it’s easier than ever to do just that and avoid those feelings of “stuckness” or misery in a job where we work to enrich someone else instead of ourselves.
Mr. 4HWD recently posted…Will You Choose the Unlimited Upside?