Larry Brauner

A Brief Historical Note

I’m old enough to remember when the norm in the America was to work 40 years for a corporation and retire at age 65 with Social Security benefits and a company pension. I grew up with such an expectation.

Technology and economics reshaped the workplace during the last part of the 20th century, and nowadays people will necessarily change jobs a number of times during their careers and receive little or no employer help along the way meeting their long term financial objectives.

Employment relationships are severed with little reluctance by either party. Employees have become a commodity. Both job security and employee loyalty are very much relics of the past.

It is certainly difficult to assert that business is risky but that jobs are risk free, especially during troubled financial times like these. People in all sectors of the economy are losing their jobs, and unemployment will get much worse before it gets any better.

Robert Kiyosaki Revisited

Robert Kiyosaki, author of Rich Dad, Poor Dad and Cashflow Quadrant, compares four different ways to generate income:

  1. Job - You work for an employer. You earn income by selling your limited time. You’re overtaxed by the government. You may however acquire valuable skills and receive access to affordable health insurance.
  2. Self-Employment - You own your job and must work very hard. You receive tax breaks but still earn your income by selling your limited time. You pay in full for your health insurance. You have some autonomy but must nevertheless satisfy your clients’ demands.
  3. Business - You own a system, and you leverage other people’s time and various resources at your disposal such as the Internet. You work hard, but you essentially earn your income by selling other people’s time. Since you’re not selling your limited time, your income potential is unlimited. Many types of business are very risky, but there are others that are not very risky at all. Businesses have many tax advantages.
  4. Investing - You own assets that are called investments. You earn income from these investments. Knowledgeable investors use insurance such as stock options to manage and eliminate the risk of investing. They also achieve the most favorable tax treatment for their income.

Where Theory and Practice Intersect

It doesn’t take a rocket scientist to understand that business and investing income are much superior to job and self-employment income — all other things being equal — and having a business and investing mindset is a wonderful personal asset.

Yet there’s a catch.

Most people are not in a position initially to rely either on business or investing to provide the income that they need for life’s basics. Some people may not have the wherewithal now or ever to make a business or investing work for them.

Jobs or self-employment provide immediate income for food, clothing and shelter. In that sense they can be a good thing.

If you have a job and the right mindset, you can use the base of income afforded by your job as a springboard to future business and investing. You’ll seek ways to develop new business, and you’ll use part of your paycheck and business proceeds to buy income producing assets.

Your progress might be slow at first, but it will accelerate over time as your results are compounded.

My Change of Heart

I used to put down jobs saying that J.O.B. stood for “just over broke”. While there’s much truth in that, I believe today that I was stuck in all-or-nothing thinking.

So don’t you think job or business. Think job and business, or whatever makes sense.

Your comments and input are invited.

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43 Responses to “Which is Better Job or Business?”

  1. Roger L Martin on November 16th, 2008 8:07 pm

    Larry - times have changed that’s for sure!

    Some basics are timeless - education to change with the times is essential, if you don’t keep ahead of the changes you will be out of a JOB.

    Some skills and education, will never go away. If you fix a car, you better be able to do it right and at a good price. Money is tight and people online will have to market better information at a better price. Their service will have to be better than before, as well as their products. Online education if its done well will be more valuable than ever before if you can get certified online.

    Still, many skills will only be able to gained in personal training or mentoring and will NOT be able to be done on a computer.

    Other exams will be one easily and more cheaply than in the class rooms, with more flexibility than most colleges can do.

    So the bottom line is, where you can get it done at a good price and service will win out no matter where you are.

    Look at who is doing well in the RETAIL markets, Walmart and Thrift Stores, why of course people want to save on every expense that is coming up, yet some surprises are happening, fast food is still holding up, but in the long run will that just make our health worse etc.?

    No doubt those with LESS OR DEBT free, AND prepared for tougher times will do much better than those loaded down with debt and less prepared ones.

    Its survival of the fittest again!

    Roger L Martin

  2. Woody on November 16th, 2008 8:44 pm

    Hi Larry,

    One of the first lessons I heard was if you can’t afford to get into business, get a job!

    I keep my mind focused on my business, and utilize the contacts and cash flow my “job” provides to promote growth in my business.

    Thanks Larry,

    Woody

  3. Pamela on November 16th, 2008 9:15 pm

    Hi Larry!

    I too was raised with the beliefs about the 40 yr job, retirement, etc. It has taken a lot of work on my “belief system” to overcome these self limiting beliefs that have held me back from having the success I know I can achieve and deserve!

    There is more to being successful than meets the eye!

    Thanks Larry!
    Blessings!

    PAM

  4. Barb on November 16th, 2008 9:43 pm

    Well said.

    I also remember the days when people worked at one job for most of their life. And now even businesses have been using telecommuting and other forms of out-of-office methods to conduct everyday work tasks.

    What you say makes sense about working at your job and working from home to start your business.

    Times have indeed changed!

  5. Tara Colquitt on November 16th, 2008 9:45 pm

    Larry,

    In today’s time when job security is scarce and the higher your education, the harder it is to get a job that pays you adequately, going into business is not just a good idea, it’s sometimes the only option.

    But consider this: Cities and states still have millions of dollars they must spend to keep the system going. Instead of trying to attract people with limited funds, I have found it is more beneficial to help people make money and then help them with their finances. It is impossible to speak to someone about their credit if they don’t know where they will be living in a year.

    This article is timely, and considering there are still challenging times ahead, everyone needs to rethink what they have always done.

    Tara, The Credit Woman

  6. Morgan Mandel on November 16th, 2008 9:56 pm

    I know I can’t afford to retire, but I plan on collecting Social Security and working as much as allowed at 62.

    What I and countless other authors want is to be able to write for a living. So far my job supports my writing.

    Unfortunately, there are not enough hours in the day to market effectively, write, keep up the house and pay attention to my husband and dog. It’s quite a balancing act. I don’t know what I’d have done if I had kids also!

    Morgan Mandel
    morganmandel.blogspot.com

  7. Tim on November 16th, 2008 10:19 pm

    The big catch is — nothing is guaranteed in a job, business, tax breaks, cash flow or investment!

    All are about risk levels.

    Is it riskier to own a franchise or manage one for a salary. Depends on if that franchise takes off — it could fail and the owner loses his investment — manager finds another job — no ties to the investment.

    Is it riskier to hold saved money at low interest rates or buy stocks. Depends on the stock market always going up!

    You cannot say that having a job for 40 years will not be fruitful. Sure your probability for financial success is limited — but only just that — limited.

  8. Larry Brauner on November 16th, 2008 10:25 pm

    I mostly agree with what you say Tim, but you have to admit, 40 year employment relationships are becoming harder and harder to find.

  9. Mel Smith on November 16th, 2008 10:37 pm

    Well Larry,

    I spent the 40 years on the job as a member of the Teamsters Union and had many jobs but doing primarily the same thing, driving a truck.

    Then I decided to retire and draw my SS.

    Six weeks later I was in the VA hospital diagnosed with colon cancer. I guess I was supposed to die and then my earnings in SS would go to someone else.

    I fooled them. I started to think outside of the box. I told the VA after being very sick and in a wheelchair for almost four years to stop trying to make me well.

    I researched why I got cancer, and the answer was, we are what we eat.

    I figured it out and made the change to only what nature provides as best I can, as that is how our species survived for thousands of years.

    That was a great decision for me, as I am now 75, feeling great and doing fine.

    So no matter what decisions you make in your life, you are the one that has to take care of your own health, no matter what.

    There are factions out there that are in business to take your hard earned money in the health industries and keep you sick till you die, BROKE.

    To return your health as it should be, you need to live your life the way nature meant you to. If Mother Nature made it, it was meant to be used by us in our daily life.

    Good luck in whatever you do in life Larry.

    Mel Smith

  10. TeasasTips on November 17th, 2008 12:47 am

    Hey Larry—Great article. I liked the analogy and the way you made me think about the whole self employment thing. I am self employed and I constantly am thinking about tomorrow. I don’t take the time to enjoy today, even though today was a great day. You have given me cause to rethink my priorities before its too late.

  11. Debbie Morgan on November 17th, 2008 12:49 am

    Thanks,Larry, for this great article.

    I too remember my Dad working for the same company for many years, locked into the same basic pay scale. It wasn’t until he started his own business that he was able to get ahead. When he finally retired he drew from his hard earned Social Security and from his IRA for many years. He did lots of fishing!

    I agree. Sometimes we need to start with the JOB and move into business. Very often the JOB gives us the experience and training to launch our own business.

    Only in America are we able to do this. The good ‘ole USA has her flaws but her foundations are good and we can prosper here if we have the wherewithal to try. I love our country!

    Deb

  12. Karen McGreevey on November 17th, 2008 9:45 am

    Hi Larry,

    Oh my, everyone has given such great comments for me to think about.

    This “JOB or business thing” seems a bit like the “what came first, the chicken or the egg?” thing.

    I’m one of those that grew up knowing that some around me would work 30 or 40 years at the same job, have Social Security set aside, then retire. That’s just the way it was.

    However, at the same time that I was growing up I was also seeing that what I was learning was changing with the times. And the more things changed, the more I saw those beliefs would have to change, too.

    Not counting the dire straits of the current financial crisis, it’s been apparent for some time, or so it seemed to me, that it was common to stay in a JOB for 2-3-4 years. That was called longevity!

    Having one’s business, I think, is a better way to assure one’s future. Even more so, when it can be conducted on the Internet.

    Of course, there are drawbacks there, too.

    In the end, it seems the JOB vs business dilemma depends upon the circumstances of those involved.

    Karen

  13. Carole Nantel on November 17th, 2008 10:06 am

    Hello Larry!

    I agree with you also as I grew up thinking that I had to work my “ass” off to get a great paying job, retire and reap the benefits of it all.

    I can understand the frustration of having a job as we change them often because of the economy or direction.

    I think that if you have a home business and that you also have a job that the job is the backup if the home business or online business does not do well or you have just started one. I find that having both is like a security blanket you don’t want to let go of because of changing times. As the business progresses you feel more inclined to let go of the job and go it alone.

  14. Pushhyarag on November 18th, 2008 2:13 pm

    Hi Larry,

    From a non-American’s perspective, the options have been greatly influenced, I think, by the economic model each country follows: In a socialistic pattern, for a long time here in India, government and public sector jobs provided everything an individual needed, notably job security with assured post-retirement pension benefits. So, as it happened in my father’s case for example, no one would ever consider a second option to a job with the government. He, like many others served the whole of his working life with the government. Not even a job with a private firm would have been in the reckoning, except in undeserving cases. Business and investment options were more of a kind of automatic choices and continue to be so largely, even now of some traditional community groups.

    Things have changed here too. India has integrated with the world economy, and it is influenced by free market economic models. Government jobs, being far and few, are not an option any more. It is largely private enterprise which attracts “the cream”. By the same phenomenon, non-business communities have seen their next generation venturing more and more into self-employment, business and investment.

    It is perhaps, in my understanding, a matter of opportunities afforded by the economic environment which the enterprising will grab and make the most of. A fairly higher proportion of would-be employable individuals are contemplating alternatives to jobs today than in the past.

  15. Larry Brauner on November 18th, 2008 4:16 pm

    Hi Pushhyarag,

    Your comment is excellent. It points out both similarities and differences between the United States and India.

    As a side note, it’s widely believed that India has been a major beneficiary of the outsourcing and offshoring of American business that partially contributed to the breakdown in U.S. employer-employee relations.

    Thank you.

  16. krizcpec on November 20th, 2008 8:55 pm

    Just to thank you for the inspiring conclusion — it really might be possible to have both in some cases.

  17. desperateblogger on November 20th, 2008 10:22 pm

    A train of thought is: you keep a job so that you can afford to put up a business later on.

  18. Rick Vaughn on November 22nd, 2008 6:18 pm

    I think a job is no longer safe. Yes, you may be able to bridge the gap with a paycheck but you’re still rolling the dice.

    No job gives you the freedom that having your own business can give. There is no job out there that can give you the security a solid business can.

  19. Larry Brauner on November 22nd, 2008 8:26 pm

    Rick,

    Unfortunately security is elusive.

    Risk is inevitable.

    Why not rather think in terms of developing our potential and managing risks through diversification and insurance?

  20. WillThink4Wine on November 23rd, 2008 9:52 am

    I left a job in 1987 after being in management for 10 years and started my own business. I sold that business after 20 years and moved to another state. I didn’t think I wanted to start another business, but after looking for a job I found that nobody wanted to hire someone who had their own business for so long; they had no confidence that I could still be a “team player”, and I’m sure my age and salary requirements didn’t help. So, 18 months ago I started another business. I certainly have no regrets about being self-employed!

  21. Martin Russell on November 23rd, 2008 10:20 pm

    I remember entrepreneur Brad Sugars explaining that there are only 2 reasons to have a job…

    1. For money - to get enough cash to start a business.
    2. For experience - either to gain specific skills or for testing the waters in the particular industry.

    It’s a bit like when Robert Kiyosaki recommends network marketing. He emphasizes the training and real-life learning more than he does the money you make.

  22. Ask Ms Recipe on December 6th, 2008 1:40 am

    Running your own business is a double edge sword. You can’t just wake up and show up to work. You are required to promote your business and show up. It depends whether you want to be responsible for day to day operations of a business or just show up for 8 hours work and leave.

  23. joemel on December 6th, 2008 1:56 am

    Hi,

    Great article!

    There is a big difference between having a job and business. If you have a job, you have a boss, someone to yell at you, while if you have a business you are the boss.

  24. Amjad Ali Anjum on June 15th, 2009 4:20 pm

    Business itself is a big boss because it brings pain and stress for investor. Investor has to take risk not only for his investment but he also has to provide different tools and environment to achieve set targets and goals. It is very difficult to manage a business when there is no power and there is no gas and in the result there is no production but he has to pay his employees this is also an other stress. In friendly environment business can be fruitful where there are all fundamental resources are available to run a business. In present environment before starting a business you must have examined you nervous system where is has a strength to bear all pain and stress or not. But in my opinion employment is better than to become an employer.

  25. Steve-Success Factors on November 3rd, 2009 11:33 pm

    In my opinion, you have hit the nail on the head, Larry. I don’t think the answer is either or; rather, it is both-and. Having said that, I think that the more you can be learning about business building, the better you will become at your job. The better you become at your job, the more money you can earn, and then invest into either business or real estate. In this era of change, I think this is the best way to think.

  26. Craig Cole on November 4th, 2009 11:29 pm

    Great article Larry!!!

    I believe this wonderful thing called the Internet empowers all of us to do both!!!!!

    That is why I keep reading your articles!!!!

  27. Larry Brauner on November 4th, 2009 11:42 pm

    Thank you Craig. It’s because of people like you that I keep writing them!

  28. chandler on November 24th, 2009 5:51 pm

    I have to say a ” Job ” hands down.
    I have been self employed for the last
    5 yrs, with two different busines..
    2 1/2 years for both. One business a franchise, hated working for the franchisor,
    so i sold it, then opend up the car wash/repair shop. My shop has Bankrupted me. Now, what do I do. Have to rebuild what took me 40 yrs to build. Not only did it bankrupt me, but I lost 5 yrs of my life and losing time with my kid who is now 8. So figure that out. I lost in every direction.

  29. Larry Brauner on November 24th, 2009 6:28 pm

    I had the same experience Chandler. I pursued a business with blinders on for eight of the most precious years of my children’s development. I was also forced into bankruptcy.

    I hope I’ve learned from that ordeal. However, I haven’t given up on business. I’m open to both jobs and business. I also make sure to see my children, eat dinner with them and stay in touch every day.

  30. Farid Khan on August 5th, 2010 4:57 am

    I think a job is a better because we’re secure in it.

  31. Larry Brauner on August 5th, 2010 9:32 am

    I’m sorry to say Farid that jobs aren’t secure any longer.

  32. Watermelon Nutritional Facts on August 16th, 2010 10:13 am

    You do not own your job. It is only being rented out to you temporarily. You may think you are safe and secure on your job if you have been employed for a while, but you better believe as soon as your company needs to cut back on expenses for whatever reason, that they will not hesitate to drop you like a bad habit.

  33. Rekha suthar on October 6th, 2010 1:59 pm

    I think business is best, but we cant say that a job is in vain.. both have their place.

  34. Sunny on January 15th, 2011 3:37 pm

    I am 25 years young, enthusiastic guy doing job in MNC in India and gaining good amount of money as well. However i have something in me that keeps me pushing for self employment. I am yet to get married and unable to understand what to do Job or business? I have good business idea as well and that too very cheap. Please advise!!!! Sunny

  35. Larry Brauner on January 15th, 2011 6:32 pm

    One idea is to start the business on the side without giving up your job.

    If that’s not possible, and you have enough money to run your business for 6-12 months without profit, then perhaps starting a full-time business may be viable.

    Another factor to consider is how easy it will be to find a new job if your business doesn’t work out the way you want.

  36. Atif on April 26th, 2011 11:50 am

    At times, your job creates so much pressure that its starts taking its toll on your health…

    At least in your job u may not be earning much initially…but at least u have mental peace..

    And friend, beleive me, nothing like spending ur time with ur family !!!

  37. Karla Campos on May 17th, 2011 3:19 pm

    Very interesting article and though written in 2008, it is still very relevant. I’ve had jobs in the past and I am currently self-employed, and what I can say is that there are cons and pros to both. It all depends on a person’s current life situation. There are many 2 income households out there and maybe one spouse receives medical benefits for the entire family so the other spouse can be self-employed and even work at home and handle child care (which is another expense that needs to be considered in the equation).

  38. Mudassir on June 13th, 2011 11:02 pm

    Laura,
    That surely is a brilliant advice I must say!! I have just done my Post graduation in International Business Management and with a confused mind. I so want to have my own business but dont have the funds to start one. No matter wat happens, But god willing i want to have my own business!! this would be the best way to grow in the future! rather than staying stagnant in a company or fearing over the job insecurity! I am 23 years of age and dont want to lose time and wants to get up and running with a business!

  39. Ahmed on July 30th, 2011 2:57 am

    I Have just submitted my resignation from my Job. it is the 3rd job I have taken and I cant satisfy myself that a JOB is waht I want to do…. My Father is a bussiness holder and he offered me to run over his bussiness and I directly accepted.
    Im not sure if it is the good decission but Im sure I will comw to know V.soon

    Regards
    Ahmed

  40. Thomas on September 9th, 2011 1:18 pm

    Hi Larry

    I agree with your view, and in fact, more and more people believe business is less risky than jobs. With jobs, you have no control in good and bad economies.

    In bad economy, you can lose a job any day, in good economy, you still have no control over your salary - your income & time are both limited.

    If you have a business - your income & time are limitless. You can earn $10,000 to $1,000,000 or more each year - depends on various factors, but at least you have a control.

  41. Rajinikumar on September 20th, 2011 11:00 pm

    Dear all,

    I want to say something from my experience. I am in business now. I was in a 2-3 jobs few years back.

    Job secure is temporary, but business is permanent. Business secures after retirement.

    People afraid to work hard. They always want easy money.

    They failed to put their effort not even like their in job.

    “LOOSER QUITS WHEN THEY FAIL,
    WINNER FAILS TILL THEY SUCCESS”
    Courtesy from “RICH DAD, POOR DAD - Robert Kiyosaki”

    Best of Luck
    Rajini

  42. PRATHEEP on March 6th, 2012 3:48 pm

    I get confused against business or job which one is best for me plz give me the needful advise.I’m 21yrs old.I had a lack of communications so i didn’t get good job. Now my family members are told me to start the business. which one is best for me?…

  43. ganesh on April 28th, 2012 4:17 am

    Hello everyone,

    Thanks to all for sharing their experience and thoughts.

    I am still doing a job and planning to start a (self employed)business very soon.

    For me business and job both are important, its because everyone is not born with a family business. For starting a business you need fund and opportunity. In a family business you are provided with both and what you have to do is to keep the ball roll.

    And in case of those who does not have enough fund or a family business to start their own, they should start with a job, no matter how low they paid - because you will get better job after you gain experience. And this is the chance to save some money to start your own business later.. and until you do a job you wont understand how a business run. And then when you get enough idea to start a business and have some funds then you should start your own business. And of course until you see your business running smoothly you can keep a part time job, to support your business.

    I wont say job is inferior and business is superior, because job is the starting point to learn something and later to start their own business.. because without learning nos you can not do maths.

    I would suggest to start with a job and then move to business (in case you have no fund and experience) or you can go for business directly (if you have money and opportunity)

    at job - only one source of income
    - you can do only one job at a time
    - for an employer company first you are last
    - you are getting less than you deserve
    - and many more (when you work you will know)

    in business - Many source of income
    - you can do many business at a time (if you can handle)
    - The more you work the more you earn
    - Its also not risk free, but you need to know how to handle problems, whether it is monetary or anything else..

    Everything depends on availability of customers.. if customers are increasing, you have no risk whether you are at job or in a business… else problem may come in both the cases

    If my thoughts are wrong, then plz forgive me

    Regards
    Ganesh

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