Getting into self-employment

Working for yourself can be an exciting and successful career path but it won’t be right for everyone. Find out about self-employment to help decide if it could be right for you.

What is self-employment?

Self-employment means working for yourself rather than for an employer. You provide products or services directly to customers.

If you are self-employed, you are responsible for all aspects of your work.

Self-employed people work for, and are paid directly by, their customers. Examples of self-employed roles include freelance writers, independent consultants, artists, and tradespeople such as plumbers or electricians.

You can be both employed and self-employed at the same time. For example, you might work for an employer on certain days and run your own business in the evenings or on other days.

Could self-employment be right for you?

Advantages of self-employment

Being self-employed offers benefits including:

• Flexibility over when and where you work
• Freedom to make your own decisions
• Following your passions and turning your skills and hobbies into a source of income

Challenges and responsibilities of self-employment

If you’re thinking about self-employment, things to consider include:

• Unreliable income, especially in the early stages of the business. Your earnings rely on your ability to find paying customers. You might have time with little or no income, which requires careful financial planning
• Longer working hours, especially during busy periods or when trying to get your business started
• A lack of benefits. If you are self-employed you typically don't receive employee benefits such as health insurance, retirement contributions, sick leave or paid holiday leave
• Managing your finances, tax, insurance and legal responsibilities

Useful skills and qualities

While it's important to have a foundation of useful skills and qualities, remember that many of them can be developed and improved over time.

Skills and qualities that can help to do well running a business include:

• Self-motivation. You'll need to set your own goals, create plans, and stay focused on tasks without anyone prompting you
• Time management. You'll be responsible for handling all aspects of your business, so you will have to prioritise tasks and meet deadlines
• Adaptability. Self-employed individuals often have to deal with change. Being adaptable and open to learning new skills or changing your approach is vital for success
• Understanding basic financial activities. Budgeting, invoicing, and managing cash flow, are essential for keeping your business going and making informed business decisions
• Promotion. You'll be responsible for getting customers. Networking, sales and marketing skills can help with this
• Communication skills. Clear communication is important for dealing with clients, customers, suppliers, and potential business partners
• Problem-solving. Being able to identify issues and find solutions will help you overcome challenges
• Confidence and resilience. Confidence in your abilities and being able to keep going when you face setbacks are important qualities. The ability to bounce back from failure is needed for long-term success
• Organisational skills. Being organised is essential for managing your business efficiently
• Passion and commitment. Having a real passion for your work will push you to put in the effort that is needed

Experience, learning, and seeking feedback can all help to recognise where you may need to develop. Talking to other people who are self employed can help to learn from their experiences and things to avoid.

Starting a business

Your business idea

• You will need a product or service that there is demand for and people will pay for.
• It should be matched to your skills and interests.
• Think about what it will cost to provide your product or service. Would you need investment? Consider if it is realistic and would make you enough money.

Business Wales has lots of information to help with the early stages of?starting up and business planning.

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Setting up a business

There are different legal structures for businesses in the UK. Each of these has its own tax, liability and administration considerations. Business Wales has information about?your legal obligations and choosing a legal status.

Gov.uk has information about?working for yourself which includes setting up as a sole trader and other business structures where you work for yourself.

Get help

Starting and running a business takes hard work. Before making any big decisions, do your research to make sure you understand your choices and what they will mean.

Business Wales has lots of?information and support for self-employment.

The?Development Bank of Wales?is backed by Welsh Government and can offer finance to new and growing businesses. They might be able to help even where other lenders could not.

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Contact us?if you would like to speak to a careers adviser to explore self-employment.

Find out more about working for yourself: Careers Wales | Careers Wales (gov.wales)