TAX

As an employee, most you have worry about is paying your state and federal income tax and claiming whatever credits you're entitled to. When you're an employer you have to think about all of that as well as self-employment tax and a myriad of other business-related tax issues. An accountant becomes an absolute necessity. Also, as a self- employed person, no-one's withholding tax from your checks. Make sure you put enough aside to pay tax bill!

SECURITY

Security is relative. For some, security comes only from working for someone else. For others, this is merely an illusory form of "security" since none of us really knows what's around corner. We could be next to be laid off. For some, real security can only come from being in control of their own destiny and that means working for oneself.

SKILL SET

As a self-employed person you need a broad skill set. Not only must you be able to perform main skills inherent in business you have chosen for yourself, you must also be able to handle myriad other jobs around office that your secretary would otherwise do for you if you were in paid workforce. This forces you to be something of a generalist which in turn dissipates your focus from central core of your business. When you work for someone else, you are generally more able to specialize in a particular area and, over time, develop something of an expert status, increasing your marketability in workforce.

WARDROBE

In corporate work-world, you have a certain professional image to uphold. When you work for yourself, at least on days when you don't have to meet with clients, you can wear what you want, even your rattiest sweats, if that's what you feel most comfortable in.

HARD WORK

Some people think that leaving paid workforce to work for themselves from home means they will work less hard and fewer hours. The reality is usually opposite. In early days of a home business you will probably find you need to work harder and longer, only to make less money than you did in your paid job. This will get easier over time but in early days, expect to have your nose to grindstone.

RETIREMENT PLAN

Who's going to provide for your retirement when you work for yourself? You've got it, you! No more employer-funded pension plans for you.

GETTING PAID

When you work for someone else you get paid like clockwork, even if your employer hasn't yet been paid what he or she is owed from clients. When you work for yourself, whether your client pays often determines whether YOU get paid. So you need to be diligent in following up slow payers and take appropriate action in response to non-payers.

OFFICE POLITICS

When you work for yourself you can kiss goodbye endless office politics that used to drive you crazy. On other hand, you're also out of loop.

ISOLATION AND LONELINESS

Along with being out of loop comes isolation monster. Although early days of your home business may be an absolute luxury compared to rigors of your corporate work- life, over time you may find you start missing office politics and lunches with colleagues.

OUT OF THE LOOP

Once you leave corporate life for home-business entrepreneurship you may find it hard to get back in, if that's what you decide to do. Many employers will label you as "not corporate enough" if you've been out of workforce for any length of time. They may also, however unfairly, figure that you couldn't make it in corporate world which is why you left to start your own home business and now that's failed too.

These are just a few of issues you need to think about when deciding whether working for yourself or working for someone else is right for you. It's crucial to be brutally honest with yourself about your particular strengths and weaknesses, as well as your emotional and mental make-up. A good way to dip your toe in is to consider moonlighting - starting a home business on side while you continue to work your full-time job.

Sure, this will mean some both-ends candle burning but better that than making break and then finding out you made a mistake. Another alternative that may work well for some is to telecommute. Work for someone else out of comfort of your own home. These types of positions are pretty rare and usually can only be negotiated by long-term employees in positions that lend themselves to individual, as opposed to team, projects. But don't let that discourage you. If you have particular expertise in a field that lends itself well to telecommuting and your boss won't go for it, start looking around for companies that will hire you on this basis.

FURTHER READING

This article touches on some of major areas that you need to think about when deciding whether self- employed or employed option is best for you. For a more detailed treatment of these and other issues, check out following articles at http://www.ahbbo.com/articles.html : => And Never Twain Should Meet => Checklist for New Home-Based Business => Entrepreneurship: Do You Have What It Takes? => Flipping Switch: How to Turn Off Your Business and and Turn On Your Life => Focus Your Light => Getting Paid ... Minimizing Bad Debts in Your Home Business => How 9 to 5 Grind Could Be Costing You More Than You Earn => Look Before You Leap ... Is a Home-Based Business REALLY For You? => Moonlighting's Greatest Challenge ... How to Beat Time Crunch => One Foot in Each Camp => Overcoming Isolation in Your Home Business => Overcoming Procrastination in Your Home Business => Putting Theory Into Practice ... A Personal Perspective => So You Want to Be a Freelancer => The 9 to 5 Home-Business Tug O'War => The Telecommuting Alternative.

Once Potential Client becomes an actual client and you've proved to his satisfaction that you are professional and competent, you can tell him that you've decided to start working out of your home to reduce unnecessary overheads and give him your direct phone number.

No matter how enlightened your client-base is as a general rule, it is imperative that telephone be answered in a businesslike manner. I don't care how sympathetic, supportive and admiring your clients are of your decision to balance your work and family commitments by running a successful business from home, there is nothing cute about a five year old answering your business line. It's unprofessional, not to mention downright annoying.

So have a separate phone line for your business and lay down law to your household that no-one, NO-ONE, is to answer it but you (unless, of course, you're employing your teenage children in your business in which case they should be instructed on how to answer telephone in a professional manner). If you're away from your office, divert your calls to your answering service.

EMAIL

Something else to think about is image of your email address. Which is Potential Client to consider more corporate/professional: maryann@isp.com or m.entrepreneur@mycompanyllc.com?

It's worth spending $35 a year on your own domain name just for professional email address, even if you never intend to create a website. Mind you if you're going to have your own domain why NOT create your own website? But that's another article ...

STATIONERY AND PROMOTIONAL MATERIALS

It goes without saying that your stationery, business cards and other promotional materials should reflect a professional image. If you have incorporated your business or registered a fictitious business name as recommended earlier, this is a good start. A company or business name on letterhead and business cards can't fail to convey a professional image provided they are professionally printed on quality stationery stock.

OFFICE EQUIPMENT

There's no point having quality stationery if you're going to use a cheap and cheerful inkjet printer for your correspondence. Invest in a medium quality laser printer instead. They don't cost a lot of money these days and you can get a unit that triples as a fax machine and photocopier for only a few hundred dollars.

So, what do you think? You may be thinking "I wonder whether it's really worth effort to try and please just a small number of potential clients". Is it worth it? Well, look at it this way. Are these suggestions really anything more than basic, common sense, professional business practices? Regardless of what your potential and existing clients may think about concept of businesses run out of their owners' homes, first impressions DO count.