7 Obstacles That Prevent People From Starting Businesses (And How To Overcome Them)

Millions of people dream of becoming entrepreneurs, but they never take that all-important first step. Too many things get in the way of their pursuit of business ownership, or they keep convincing themselves that their dream isn’t realistic. 

If you ever want to move past this phase and found your own business, you need to acknowledge the specific obstacles that are holding you back and work to resolve them. Here are seven of the most common challenges that may be standing between you and your entrepreneurial dreams—and ways you can kick them to the curb. 

1. Financial limitations

Launching a business takes money, and most people don’t have ample cash to throw at a startup. There are several options here. First off, you could begin saving now for the funds to establish your business. If you shop for a better mortgage and reduce your house payments by refinancing, you can sock the savings away in your startup fund. You can trim costs in other areas to put away a few hundred dollars each month or save even more by picking up a side gig.

Barring that, you can secure funding in a variety of ways, such as borrowing from friends and family, crowdfunding, seeking loans and grants or even working with angel investors and venture capitalists. There’s always a way forward. 

2. Inexperience

Becoming a successful entrepreneur typically demands experience; you need to understand your industry and business management in general if you want to earn a living from your venture. When you have limited experience, you may be reluctant to move forward, and understandably so.

You can make up for this, however, by actively seeking the experience you lack. Take an online course to gain a grasp of business management basics. Strive for a leadership position with your current employer so you’ll acquire strategic planning and people management skills. Work with a mentor or shadow an entrepreneur you admire. 

3. No standout idea

You can’t build a business if you don’t have a promising idea for a product or service you can sell. Without a solid business plan, you won’t be able to convince investors or partners to join you—and you won’t even know where to begin. Unfortunately, this is one of the least “fudgeable” obstacles on this list. Without a good idea, you can’t start a business, period.

Luckily, there are ways to stimulate better idea generation, such as talking to a broad range of people, reading entrepreneurial content and taking a more robust approach to brainstorming. Techniques like mind mapping and word banking can get your creative juices flowing. 

4. Current responsibilities

Some people avoid starting a business because of existing responsibilities or constraints on their time. Their current full-time job, their status as a parent or other personal responsibilities hold them back from their entrepreneurial ambitions.

Here the best approach is to determine how much of an impact these responsibilities have and consider ways to delegate or remove them. Could you realistically quit your day job, for example, or hire someone to help with household duties or childcare?  

5. Fear of failure

Lack of confidence is an entrepreneurship killer. It’s true that the failure rate for new businesses is relatively high, with half of new companies failing within five years. To buck those odds, you’ll need a healthy dose of confidence in yourself and your idea. 

The only solution to a fear of failure is to change your mindset. You have to see failure as an opportunity for learning and growth and stop seeing it as the end of the road, an indictment of your abilities or a stain on your character. Reading accounts by successful entrepreneurs will inspire you to see the possibilities rather than focusing only on the risks.  

6. Aversion to stress or hard work

Starting and running a business demands a lot of effort. You’ll likely be putting in long hours and dealing with stressful issues. On top of that, your first few years are apt to be highly inconsistent, with your business only making a profit some of the time. This can wreak havoc on your finances and peace of mind. If you’re not feeling up to this kind of pressure, or if you’re loath to work more than 40 hours a week, entrepreneurship may not be for you.

Again, the only way around this obstacle is to change your attitude. Remember that all this hard work will be in service to yourself, not an employer. While the risks are on you, so are the rewards.

7. Poor timing

One of the most common excuses you’ll hear (or hear yourself saying) is that it’s “just not the right time” to start a business. The truth is, there’s never a truly “right” time—you can always find some reason that today, or this month or this year isn’t ideal for launching your venture. 

But like beginning a diet on a Wednesday or joining a gym in February, the trick is to make your own right time. Microsoft was born during the oil crisis of the 1970s, while Airbnb and Uber were founded in the depths of the Great Recession. Remind yourself that the success of your business will depend not on “the times” but on you.

The Realities of Entrepreneurship

It’s true that anyone can become an entrepreneur with enough grit and persistence. Most entrepreneurs with solid ideas have a good chance of becoming successful if they remain adaptable. But it’s also important to realize that not everyone is cut out for entrepreneurship

If you’re intimidated by the stress, inconsistency and long hours associated with startup life, or if you truly love your day job and you’re afraid to leave, maybe business ownership isn’t right for you. That said, if you feel the pull of entrepreneurship but keep making excuses to avoid getting started, you owe it to yourself to challenge those excuses and try to move past them.

This article was written by Serenity Gibbons and published on Forbes.com.

INVEST IN YOU: READY. SET. GROW. Looking for a job? Coronavirus-related layoffs expanding roles for freelancers in these hot sectors

Maskot | Getty Images

Thursday’s report from the Labor Department that 1.5 million people filed new state unemployment claims last week serves as a stark reminder that the impact from the Covid-19 economic fallout is very much persisting.

For those seeking work amid the coronavirus pandemic, there is a bright spot: According to the annual “Future of the Workforce Report” from Upwork, opportunities abound right now for the independent professional. With the unemployment rate at 13.5% and a rapidly changing labor market, hiring managers are accelerating the use of freelancers, says the global freelance job platform.

The survey finds that 45% of hiring managers expect freezes on new staff, while 39% expect layoffs to continue in the coming months. At the same time, close to three-quarters (73%) of hiring managers are looking to maintain or expand their hiring of independent professionals, with a typical employment length of about four months. Nearly half of all hiring managers surveyed said that they are now more likely to use these freelancers as a result of Covid-19.

Upwork’s annual report surveyed 1,500 hiring managers, once in November of 2019 and again in April of 2020, after the coronavirus outbreak. 

“This remote work experiment will also have long-term implications for the traditional ways of hiring,” Upwork’s chief economist Adam Ozimek told CNBC in an email. “As companies embrace more remote work, they will also see that this opens up opportunities for how they think about hiring, recruiting and their workforce as a whole. They will no longer be confined to just their local labor markets but can find the most skilled talent, regardless of their location, that best meets their business needs.” 

Flexible work: Not just a short-term solution

The most popular fields for short-term project work are writing, creative, web and software development positions, according to the Upwork survey. Hiring managers cited projects focused on motion graphic design, front-end data development, internet marketing and web analytics.

“For many the reliance on independent talent and a more flexible workforce is not just a short-term solution but a long-term strategy that will enable businesses to stay competitive and agile as they accelerate into the future,” Ozimek said. 

Employers are also on the lookout for candidates with transferable soft skills and more foundational skills, such as customer service and problem solving

The growth rate of full-time remote work is expected to more than double from 30% to 65% within the next five years.

With the coronavirus pandemic making in-person hiring impossible in many cases, recruiters and hiring professionals are adopting virtual platforms to conduct interviews and speak with candidates.  

WATCH NOWVIDEO08:25Searching for a job? The answer might not be online

The transition to a remote working environment for most white-collar and corporate employees has several benefits, including no commute, less time spent on nonessential meetings, and limited distractions that are typically commonplace while working in the office. Working remotely has provided employees with increased flexibility, and 59% of hiring managers expect that companies who do not adapt to these more flexible conditions are at risk of becoming less competitive. 

“Covid-19 has thrown many companies and workers into the deep end when it comes to trying remote work. But what most are finding is that remote work really does work. … Lack of commute, reduction of nonessential meetings, greater autonomy and, most importantly, increased productivity. … These benefits will be hard to give up,” Ozimek said.

This article was written by Nicole Dienst for CNBC.com

What To Do With Your 401k When Changing Jobs

a plant growing to symbolize the growth of a 401k investment

What To Do With Your 401k When Changing Jobs

By Mike Desepoli, Heritage

Last year, millennials were nicknamed the ‘job-hopping generation’ after a Gallup report revealed that 6 in 10 millennials are open to new job opportunities.

According to this report, millennials have a reputation for job-hopping and are said to move freely from company to company, more so than any other generation.

That being said, I don’t think switching jobs is a trait unique to millennials only, even though they are said to job-hop three times more than other generations.

The job market is ever-changing and is not like it used to be. Fewer companies offer pensions and some entry-level jobs offer very little benefits or stagnant wages. Self-employment, temporary work, and side jobs have all become increasingly popular work options.

Also, there is less loyalty among employees who realize they can be laid off at any given time.

At the end of the day, if you come across a better job opportunity that you think you’ll be happier with and has better pay and benefits, you may feel tempted to switch jobs and there’s nothing wrong with that.

If you have a 401k however, you may be wondering what you can do with it when you do secure another job. You don’t want all the money you saved for retirement to go to waste, so here are a few options.

 

Keep the Money in Your Old 401k

Most companies will let you leave the money you saved for retirement in your 401k where it is. In other cases, there may be a balance requirement.

Employees who move on to another company may choose this option out of default especially if they have no idea what to do with their 401k. The major downside is that you won’t be able to contribute to your 401k anymore and you’ll have to keep track of more than one retirement account.

If you tend to switch jobs every couple of years, you could wind up with multiple 401k plans that you can’t contribute to which is why it’s best to consider some of these other options first.

 

Roll Over Your 401k to Your New Company’s 401k

If you had a good 401k plan with your old employer, you can easily roll it over to your new 401k. Check to see what the investment options are along with the fees with your new company. If you don’t like your current options as much as your old plan, consider rolling it over.

Most employers will accept a 401k rollover. As long as you have at least $5,000 in your account, it’s your legal right to do roll it over. If you have less than $5,000 in your account, your employer will have the option to cash you out of the plan.

If you’re going with this option, always ask for the rules to be clarified since you may have limitations since you’re no longer with the company. For example, you may be charged extra fees since you no longer work there.

Move Your 401k to an Individual Retirement Account (IRA)

This is another option you’ll have especially if you don’t like your new company’s 401k plan or even if they don’t have one. IRAs and Roth IRAs are great options that typically have lower fees and allow you to have more control over your investment options. With an IRA, you will just have more control overall and can choose low-fee investments and won’t be limited to name just your spouse as your beneficiary like with most 401k plans.

Keep in mind that there is a difference between a traditional IRA and a Roth IRA. With a traditional IRA, you contribute pre-tax dollars and pay taxes on the contributions and gains once you start withdrawing the money at age 59 ½. If you withdraw funds before then, you’ll most likely have to pay a penalty fee.

With a Roth IRA, your contributions are taxed when you make them so your earnings will be tax-free along with the withdrawals you make starting at age 50 ½.

There are also income limits to be eligible for an IRA. In 2017, you must earn less than $118,000 if you’re single and less than $186,000 if you’re married. The maximum contribution you’re allowed to make per year is $5,500 and $6,500 if you’re 50 or older.

Cash Out Your 401k

This isn’t the best option, but it is an option nonetheless. If you want or need the money in your 401k account to pay bills, meet other expenses you have, or even to reinvest another way, you can simply cash out what’s in your retirement account.

A major downside is that you will have to pay taxes on the money along with a penalty fee so if you cash out a smaller amount, what you receive will be even smaller and if you cash out a large amount, it won’t really be worth it due to your large tax bill.

You could also destroy your retirement nest egg in the process especially if you received a nice 401k company match.

Depending on how many times you switch jobs that provide you with a 401k account, you may need to make the decision of what to do with your old 401k more than once. To determine which option is best for you, determine your current and future needs and consider factors like fees and along with your investment options.

I’m sure everyone wants to retire some day so it usually the better option to keep money from your 401k and roll it over or put it in an IRA.

 

For more info on this topic, check out this cool video: #AskTheAdvisor 54: What to do with your 401k when changing jobs.