Self employed? Your Feedback is Helping Us Advocate for Small Business Owners of All Kinds

Are you using a small business or side hustle to get by? At SaverLife, we’ve uncovered that many of our members use microentrepreneurship (like a small business, gig work, or a side hustle) to increase their take-home pay and maintain financial stability.

In fact, over two-thirds of SaverLife members say that their business and personal finances are closely intertwined. This means that they often move money back and forth between their personal and business accounts depending on where it’s needed most at any given time.

Through focus groups, surveys, and interviews, SaverLife has learned that our members are pursuing microentrepreneurship in growing numbers. This feedback inspired SaverLife to conduct a research study in Fall 2022 to learn more about the realities, goals, and challenges that our members experience when deciding to pursue self-employment.

From this research, we confirmed our members’ feedback that they often use their small business, side hustle, or gig work to improve their financial health — and that there’s no one way to do this. We also learned from our research that there are multiple opportunities for the financial system to better support self-employed people on their financial health journeys.

But why does it matter that we talk about our members’ feedback and SaverLife’s research on microentrepreneurship? Because we can use these learnings to advocate for a more inclusive financial system — for self-employed individuals and people living on low-to-moderate incomes.

No policy should be created unless it’s informed by the individuals who will be directly impacted by it. And by using member feedback (like yours!) To inform our research efforts, we can ensure that the financial system always supports microentrepreneurs to achieve financial stability and health.

Read on to learn more about SaverLife members’ insights on self-employment and our research on microentrepreneurship, as well as how you can help us advocate for change.

Self-employment comes in all shapes and sizes

What we learned from talking to SaverLife members is that there’s no one way to start a small business or take on gig work. You can be a hairdresser, bookkeeper, delivery driver, caterer, or dog walker: there really is no limit. But this diversity of experiences can also cause challenges when it’s time to file your taxes, calculate your monthly income and expenses, or just plan for the future. Because microentrepreneurship can take so many different forms, it can be hard to know exactly how to map out your unique self-employment journey and access the right tools for your goals.

Take SaverLife member Shari, for example. Shari is a mom, student, copywriter, and microentrepreneur. She would love to take her life coaching business full time, but recognizes she can’t rely on her small business income to support her family. Shari has to balance her entrepreneurial goals against her financial health to ensure she and her husband can still make ends meet. And she’s figuring this all out by completing research and tracking her income on her own.

Shari says: “My financial goal is to be able to have consistent income, so that we would know more about what’s going to happen month to month and week to week. That way, everything’s not so up in the air.”

To Shari, her journey as a microentrepreneur is going to look very different to someone with different financial health goals and self-employment options.

Identifying as a small business owner has many benefits

Through conversations with people like Shari, we’ve learned that many SaverLife members don’t see themselves as small business owners. Why? Because they see their self-employment as a means of getting by, not pursuing a dream of entrepreneurship.

But here’s how we see it: if you’re taking on self-employment to pursue entrepreneurship or to improve your financial health, you are one — no matter if you take on work from a small business, side hustle, or gig work. And there are many reasons why you should embrace this title:

• You earned it. It takes a lot of risk and work to even plan to start a business, side hustle, or gig work. Take credit where credit is due. 
• You’re eligible for tax benefits, including credits, rebates, and write-offs.
• There are programs, products, and resources designed for your work. You may be exactly who they’re looking for, and we want you to have access to those tools. 
• You’ll have a lot more success (and a lot less grief) if you structure your work like a small business, including completing tasks like tracking your revenue and expenses and separating your personal and business finances.
• You’ll get more funding and support if you understand the value of your small business, side hustle, or gig work and you can show other people why your work matters.

We’ve heard from SaverLife members that it can be intimidating to embrace the title of “small business owner” or even “gig worker,” especially if you’re using self-employment to increase your monthly income. But the many benefits that come with the title will almost always outweigh the initial effort.

Self-employed people often pay their own way

Have you used a credit card or personal savings to finance your small business, side hustle, or gig work? You’re not alone.

In a 2022 research study, SaverLife learned that of our self-employed members:

• 82% are using their own personal money to finance their business or side hustle
• 49% are using a personal credit card
• 42% have borrowed money from friends and family

Additionally, 6 out of 10 microentrepreneurs shared that they’re unable to access traditional financing options, like personal loans, to help them maintain their business and still improve their financial health.

What does this mean in the long term? 

While SaverLife members often use their small business, side hustle, or gig work to improve their financial health, their personal finances are actually being negatively impacted without the right financing tools available to them. This could be corrected with accessible financing options that don’t require a high credit score, a certain annual income, or minimal debt obligations — among other rigid expectations.

Tax time could do more for microentrepreneurs

Filing your taxes is already a process that takes effort to complete. But SaverLife members have shared that accounting for 1099 earnings in their tax returns can be even more time consuming when filing on their own. This is largely because they have to spend additional time researching topics like:

• Itemizing or writing off their expenses
• Claiming tax credits for small business owners
• Calculating total revenue against their business expenses

Without clear guidelines for how to file as a self-employed person, SaverLife members often leave money on the table at tax time. We discovered that less than half (43%) of members who identify as a microentrepreneur are writing off their expenses from their small business, side hustle, or gig work.

Tax time can be a major opportunity for SaverLife members to improve their financial stability and maybe even take the next steps toward their long-term goals. With the right information available, self-employed people could ensure that they maximize their tax refunds to benefit their businesses and improve their financial health.

Guarantee microentrepreneurs (like you) get the right support

Self-employment is just one component of financial health. But for many of our members, it’s the missing piece to achieving their long-term goals: whether that’s maintaining lasting financial stability or building a successful business.

When our members share their experiences with their small businesses, side hustles, or gig work, they highlight key opportunities where the financial system can be improved to better support their financial health — and the financial health of all people living on low-to-moderate incomes.

SaverLife is working to advocate for systemic change for our self-employed members by continuing to deepen our understanding of microentrepreneurship and by sharing our research findings with our members, policymakers, and key decision makers.

But we could use your help making sure this work reflects your goals and priorities. Our research wouldn’t be possible without the input and stories of SaverLife members like you. If you would like to share your experiences with a side hustle, small business, or gig work, we would love to hear from you. Complete this brief survey to connect with a SaverLife team member.