From LinkedIn — Yaseen Dadabhay writes about 10 myths about self-employment. While there are some good insights in his post, the one that I highly recommend: Yaseen wrties:
4. Self-employment means putting all your eggs in one basket.
Ask yourself this: How many people would have to turn against you to shut off all your income? For employees the answer is usually one. If your boss fires you, your income gets turned off immediately. Whether or not it’s justified is irrelevant — you suffer a total loss of income regardless of the reasons. Now that’s putting all your eggs in one basket.
With self-employment, however, you can more easily diversify your income streams and thereby reduce your risk. You have the control necessary to make this happen. Generating different types of income from thousands of customers is a lot more secure than receiving only one paycheck….”
Generating different types of income is a key component of being a successful independent contractor. Not only does it reduce your risk and make you less dependent on one client, it substantially increases your ability to demonstrate that you are truly independent and not a misclassified employee. One of the most important factors in classifying a worker as an employee or independent contractor is whether the worker has more than one client — employees typically have one or maybe two employers while independent contractors have multiple clients. If you are going to be self employed, diversify — generate multiple streams of income; it reduces risks and shows that you are truly independent.
Read the full story at 10 Myths About Self Employment