Many people dream of being their own boss and having the freedom to choose when and where they work. And it is a dream that more and more people are turning into a reality.
For some, it can turn out to be the best thing that they have ever done. For others, it can be the start of somewhat of a nightmare; this can be especially so for the sole trader.
Here are five ways to ease the pressure of being a sole trader:
Building up a cash reserve
Moving from being in full-time employment where you receive a weekly or monthly pay packet to having to rely on your own efforts to earn money can be somewhat daunting. To ease the pressure of doing this, it is prudent to attempt to build up a cash reserve. When the business is thriving, you can save some of your profits with the aim of building up a reserve of at least twelve months of what you currently need to earn to live comfortably.
If the business has a slow period, this cash reserve will mean that you do not have to worry, well at least not as much as you would have done.
The bigger the cash reserve you can build up, the more you will be able to relax of course.
Know your limits
As a sole trader, it is important to know your own limits. If you have, for example, a full client bank and you are then offered additional work it can often be difficult to turn this down. To politely say that you are unable to take on clients at this stage can be better than spreading yourself too thinly.
To take on too many clients may well end up in a lowering of the quality of service you provide.
A significant disadvantage of being a sole trader is the fact that it can be rather lonely at times. There is often nobody to bounce ideas off, and people often find that they spend long periods on their own.
By networking with other local businesses and sole traders can help to alleviate this and can also potentially lead to additional work. Attending a local business networking breakfast is an example of this.
Social media can also be of benefit, for example, by being a member of a Facebook group in your business sector.
Achieving a work-life balance
When striving to make a success of your business, it can be all too easy to neglect other aspects of life such as family and friends. This can lead to additional stress and even burnout.
Taking time out to focus on your personal life can help to avoid this.
Hire an accountant
Well, we had to mention this one! Now, of course, it is not necessary for every sole trader to hire an accountant; however, it can be extremely beneficial to many.
We will not overdo the “plug” here however we welcome you to contact us if you have any questions.