Having a home-based business led to massive benefits all over the place for our family. In Part 2 of this series, I’ll review the financial, quality-of-life, and family benefits that arise from having one parent working a home-based business.
Financial benefits
One of the obvious considerations for pursuing a home-based business is money. A job gives you that regular paycheck so that you can buy stuff. A business is all on you to bring in the cash, and that carries with it some risk.
On the other hand, the negative aspect of having a job is that the income is fixed, and rigidly obeys this formula:
Income = Pay Rate x Hours Worked
The only way to increase income with a job is to either increase your pay rate or your hours worked. Usually, either of these is difficult to scale up. Your boss is not going to increase your pay rate by more than a few measly percent. The number of hours you can work has a firm cap because reality. The job model is mathematically bound to constrain your income to the levels of the average wage slave.
A business on the other hand obeys this formula:
Income = Profit Per Sale x Number of Things Sold
This formula untethers you from the bounds of pay rate and the limits of your time. It mathematically frees you to make way more money than you would trading your time for money. It also gives you control over both factors. If you wanted to earn more money, you would increase your sale price or endeavor to sell more of your products. With the right business model, you can be the master of your financial destiny.
At the time of this writing, my wife has fully replaced her income that she was previously earning from her full-time job with her home-based business. The beautiful thing about her current financial situation is that it is entirely possible to increase her income by controlling sale price and/or sales. She can add on more upsells for clients, she can advertise more, she can expand her business to other cities, or she can do more outreach on platforms that we haven’t touched yet like YouTube. This expansion is within her control. On the other hand, with a job upward mobility is in the control of managers higher up the food chain.
To be sure, setting up a profitable business is easier said than done. It took five attempts at business creation before we came up with my wife’s Korean decor rental service. It took a lot of learning and work to set it up. I’ll post in the third part of this series the basics of a home-based business, but for now let’s continue to focus on the benefits.
Quality-of-life benefits
My wife’s quality-of-life increased considerably after she quit her job. In all jobs, there is some amount of unfulfilling work, office politics, and silly drama that no one wants to deal with.
All of that drudgery went out the window when she quit her job.
Running her home-based business meant that my wife could work on her own schedule. Rather than being on a fixed 9-5 work schedule, she is able to work whenever she wants.
Remarkably, my wife now works far less time than she did when working full-time for a boss. Her full-time job was a standard 40 hours a week with 1 hour per day of commuting time, totaling 45 hours per week. Her home-based business takes up around 20 hours per week, less than half the work hours for the same pay. The basic business model enables this liberation. For most of my wife’s clients, she packs the rental decor into boxes, we set it out on our driveway and the client picks it up. Once the decor kit is created, the income is 90% passive, a beautiful feature of a rental system.
Family benefits
The time flexibility and my wife’s massively reduced work hours is pure gold when it comes to fitting in professional life with family life. We no longer have the issue of figuring out how to drop off and pick up the kids from school and activities. It used to be a frantic scramble to juggle two full-time jobs and the kids’ schedules. Moving time blocks and schedules around was like playing a real-life game of Tetris on the highest speed level. None of that exists anymore. When I can pick up or drop off the kids I do that, and my wife can always do it otherwise.
A fact of life is that kids get sick. Like all the time. When we had two full-time jobs, either my wife or I had to take time off of work at the last minute to take care of a sick kid at home. With my wife’s flexibility and reduced work hours, she can simply shift her hours to take care of the sick kid. This conserves my vacation time at my job, which is an important resource for us. In cases when my wife cannot work as much because of a sick kid, I help out more with the business to make up the hours.
Having a parent always at home means that the kids have way more family time. With my wife working when she wants, with no commuting time, and with fewer overall work hours, this just results in the entire family having more time together. I believe it is very important for children to have their parents around a lot. Our current lifestyle allows for that.
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In the third and final part of this series, I’ll describe the basics of what makes a successful home-based business.
My wife quit her job to run her home-based business. Part 1: How she got started