Should I Run My Business From Home?

March 6th, 2009

If you are one of the many millions of Americans who has recently lost your job, or if you’ve just always wanted to be your own boss, you may be considering starting a business of your own. Should it be in your own home? With credit so tight these days, maybe so. Let’s look at the pros and cons.

Pros:

• You will minimize start-up costs. This is especially important these days given the credit crunch, and there will be no costs associated with renting office space and paying utility bills if you run your business from home. A computer, printer, fax machine, and some office furniture and supplies are all you need to get started.
• You can get started part-time. Grow your business gradually and see how things go. Find out if your idea is really going to take off.
• You can enjoy more flexibility. Choose your own work hours while taking time for family as desired.
• Say goodbye to the commute. No more travel time or gasoline costs.
• Save money on child care. Or even adult care, if you chose to care for an elderly or handicapped adult in your home.
• Employ your family members. Integrate your family members into your business.
• Enjoy tax benefits. There are many write-offs to take advantage of when you run a business from home. You can determine what percentage of your home’s square footage is dedicated to your business and deduct that percentage of home expenses. Think mortgage interest, home owner’s insurance, repairs, and utilities. And that same percentage of your house that you dedicate to your business can also be depreciated.

Cons:

• Your space will be cramped. The business and family will have to share space, which limits the growth potential for both.
• Your business might disrupt family privacy. Personal and family lifestyles will be interrupted.
• Your family might disrupt business privacy. This is likely to be an issue particularly if you have young children at home. And think about your pets; if you will have clients to your home, they might not be as fond of them as you are.
• Decreased social contact and opportunities to network. And your family might demand more from you if you’re home all day.
• Discipline is needed to establish steady work hours. With personal distractions around, this can be tricky. Balancing family and business needs can be stressful.
• Neighbor conflicts. Your business activities could cause problems with neighbors.
• Too much time working. If your home is your office, you might be inclined to work too many hours.

While there are many benefits to running a business from your home, there are also problems, and most of these problems are related to balancing the needs of family and business. Experts recommend involving the family in the business wherever it makes sense, while maintaining a clear distinction between business life and family life. They also recommend scheduling regular family vacations and limiting business hours to specific times of the day and week. And lastly, they suggest that you consider starting your home business when your children are older, or running the business part-time while they are still young.