3 Surprises I Encountered When I Started a Small Business

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They definitely caught me off guard.


  • Having your own business is very rewarding.
  • But there are extra steps you have to take as a business owner — and costs you have to bear.

Many years ago, I made the decision to stop working as a salaried employee and venture out on my own as a freelance writer. I was tired of having to report to work at preset hours with no flexibility, and I wanted to do work that was more enjoyable and creative. And while I knew I’d be giving up the stability of a steady paycheck, I felt comfortable going that route after spending months upon months boosting my savings.

After a number of years of freelancing, I decided to take things one step further by starting my own business. After consulting with a tax professional, I realized this move made sense financially.

But getting a small business off the ground isn’t easy — even when you aren’t looking at extensive startup costs and you don’t need a loan to get going. Here are three surprises I faced when my business was first starting up.

1. I needed workers compensation insurance

I’m the only employee my business has. In spite of that, I’m required to pay for workers compensation insurance. Now, I’m not sure whether this is a rule in my state versus a universal one, but either way, I was not happy about having to shell out that extra money. After all, it’s not like I would be suing myself in the event of getting injured on the job, so even to this day, it frustrates me to spend hundreds of dollars a year on that insurance.

2. My accounting costs rose a lot

I knew that I’d have to pay my accountant some amount of money to put my business paperwork together. But the actual cost was higher than expected. Plus, it costs a lot more money to have someone file business tax returns than personal tax returns, so that’s an expense I have to budget for on an ongoing basis.

Additionally, sometimes, I’ll get random forms or notices from my state that I’ll need my accountant’s help with. I don’t expect him to work for free by any means — but it’s frustrating to rack up extra bills due to bureaucratic matters.

3. There was a lot of paperwork to deal with

While my accountant handled a lot of the paperwork needed to get my business registered, there was also a lot I had to do myself. And that was a time-consuming process. Meanwhile, as the sole employee of my company, it was on me to find the time to keep working on projects so as to not have an interruption in income. That was a pretty stressful time.

Know what to expect

Starting a business could end up being a rewarding experience for you — and a lucrative one. But it’s also important to know what you’re getting into.

You may end up facing added costs you weren’t expecting, and you may have to put in the time to deal with administrative matters early on. But being prepared could make the process a lot less harrowing. Now that you know what to expect, maybe you’ll avoid the same stress I experienced.

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