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Benefits of working from home

home worker

Donald Trump once said in an interview: "If I was to lose it all and I had to start from scratch, I would start in the home-based business industry."

An onerous financial burden can put off many would-be entrepreneurs, so working from home, which enables you to negate the considerable initial and ongoing overheads associated with leasing or buying premises, is a desirable option for many.

Mark Zuckerberg created social media phenomenon Facebook in his dorm room at Harvard, while Larry Page and Sergey Brin developed Google in a friend's garage and eBay emerged from Pierre Omidyar's pad in Maryland. Even the tech empire Apple was born in Steve Wozniack's garage.

A key advantage of buying a home-based business is avoiding many of the typical costs of a bricks and mortar business. The average rent for a one-person office in the City of London is roughly £10,000 per year, not including extra expenses such as maintenance, utilities, insurance, travel and eating out.

Competitive advantage

Lowering your overheads not only saves money, it can also have a knock-on effect of giving you a competitive advantage over office-based competitors, as cutting back on office expenditure allows business owners to either lower their prices or offer higher quality services.

Lowering your overheads not only saves money, it can also have a knock-on effect of giving you a competitive advantage over office-based competitors

Being better able to fulfil family commitments is another reason why many entrepreneurs decide to work from home. Business owners, especially in the formative stages of their company, work long hours, spilling over into weekends regularly. Work from home and you automatically truncate your day as you eliminate the commute to and from work, and, if you're a parent, you can do your work and be with your children.

Former social worker Maria Osbourne started an internet business with her husband David. "I was looking for something flexible in terms of working round the children," she says. "Now, if the kids happen to be ill, we can sit on the settee with a blanket, watch the telly with them, or just pop in and check they're ok. The childcare responsibilities can be divided equally."


There is also a sense of personal freedom when working from home, and many entrepreneurs enjoy being able to shape their daily routine without having to consider, for example, traffic, or getting home in time to look after your children.

Gillian Nissim founder of, runs her web business from her home in London. "The advantage is the flexibility. I have two young children who I need to collect from school and I can fit my work around that," she says.

A shorter working day, greater availability to your family and lower overheads can amount to lower stress levels for home-based business owners. Some studies have backed this up, although isolation levels may increase and of course the spectre of cabin fever is always there, but there are ways to counter these problems.

Making phone calls in the morning, going for a walk at lunch time, and going to networking events are just a few of the ways to beat cabin fever.

Jo Dodds, founder of three home-based marketing businesses, proves there are ways of reducing the isolation. "I do a lot of networking online, so although I'm on my own and I'm not physically interacting with other people, I am interacting on my own terms," she says.

In the US, the Home Office deduction allows home-based entrepreneurs to deduct some or all their home-office expenses. To qualify, the home office must be the principal place where your business is done, and the space must be exclusively used for business purposes only.

The Home Office Deduction cover costs such as repairs and improvements to your home office, mortgage interest, home owner's insurance, even taking a prospective client out to lunch to talk business is often deductible, just like a bricks and mortar business. Many US small home-business owners miss out on these deductions by not claiming on deductions they are legally entitled to, and it is beneficial for all home-based entrepreneurs to research tax advantages. There are many equivalent tax allowances in other countries, so check out the website of your tax authority.

Jo Dodds advises: "You should also check with the local council if there are any legal requirements in terms of how you can operate from home. If you don't have clients visiting you at the house regularly there shouldn't be any major issues, but it's worth checking out the conditions."

Working from home appeals to a range of demographic groups. There are plenty of over 55s who want to scale back their working hours, escape the commute and office politics. Meanwhile, at the other end of the spectrum, many debt-saddled students are setting up online businesses to keep their costs down and reduce their financial risk.

Chris Wickson, co-founder of says: "We kept the costs low and took a salary from our other jobs until we reached the point where we felt we could quit those and concentrate on the business. Once we started to generate some revenue the company reached a stage where it could support us."


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