(The writer is a Reuters columnist. The opinions expressed are
her own.)
By Kathy Kristof
LOS ANGELES, May 5 (Reuters) - Bobby Hoyt, 27, is living the
millennial dream of being his own boss.
Less than a year ago, Hoyt ditched his day job and launched
Millennial Money Man (http://millennialmoneyman.com/), a blog
that is already paying more than he earned as a high-school band
instructor. His wife plans to strike out on her own in a few
years, too.
"We saw our parents work hard all of their lives and still
not be able to retire," says Hoyt. "For us, work-life balance is
more than a hot button. The freedom of being able to make your
own way outweighs the safety of a paycheck."
When it comes to career aspirations, millennials may well
defy the norms set by previous generations by being happy to
take a pay cut for better work-life balance.
Even when content in their current jobs, nearly half are
actively looking for new opportunities, according to a recent
survey by Fidelity Investments. Previous research also found
that a whopping 66 percent ultimately want to work for
themselves.
Millennials are uniquely well-equipped to do that, too,
experts say.
"They are technologically savvy, and the technology that is
available to them has brought (business) start-up costs down
dramatically," says Duncan Rolph, managing partner at the
financial management firm Miracle Mile Advisors in Los Angeles.
Working for yourself involves plenty of risks. Here are some
tips on how to survive and thrive when striking out of your own:
1. Start with a side-hustle
The low-risk way to determine whether your idea could make a
good business - and whether you like it enough to do it every
day for years on end - is simply to launch it while you still
have a day job.
"See if it is something you can be passionate about - it
needs to be about more than just money," says Hoyt.
2. Build a financial cushion
Few businesses are profitable from the start. Even if you
are lucky or talented enough to build sales right away,
customers do not always pay promptly - and some never pay at
all.
In the meantime, you need to eat. To keep food on the table
and a roof over your head, build up a financial cushion to cover
several months - ideally a year - of living expenses before you
launch, suggests Rolph.
3. Take turns
A supportive, working spouse can take a lot of risks out of
entrepreneurship. If your significant other has a job with
benefits, you may be able to buy health insurance through his or
her company plan, and the cost is often subsidized.
If you can live on one income, you can get away with having
less savings to handle those slow-and-no-pay accounts.
For two partners with the entrepreneurial bug, launch one
enterprise at a time.
Hoyt and his wife made a deal - he would work like crazy to
make his business earn enough to support them both. Once there,
and they are already getting close, it would be her turn to quit
her day job and launch a website.
4. Hire a tax expert
The U. S. tax code can be befuddling for anyone, but there
are few areas quite as murky as deductions for small business
owners.
For example, there is no way to write off the cost of your
summer vacation as an employee. But if you are a business owner
tacking a few days onto the important business conference you
attended in Jamaica, the answer is drastically different.
And each dollar you deduct reduces both your taxable income
and the amount you have to pay in Social Security and Medicare
taxes.
"If you have a good CPA, they'll save you a lot more in tax
than you pay them in fees," says Hoyt.
(Editing by Beth Pinsker; Editing by Diane Craft)