Costs Involved in Being Your Own Boss

Costs Involved in Being Your Own Boss

By: Jennifer Ruddell

AIU

December 9, 2004

When it comes to being your own boss or self employed, as some choose to call it, there are many unexpected and expected expenses.

I am a carpenter's assistant, so I am not required to have my own tools because I work for my grandfather that owns his own business. But he is a carpenter that has jobs of all types and has to have tools or go out and buy what he needs to perform his assignment at work, wherever it may be. When it comes to costs of getting the basic tools you will have to have at least three thousand dollars just for the basic tools required to perform daily tasks.

For example, we are currently putting cedar on the outside of a three bedroom two bath house. The house also has a two car garage, a garage apartment and two covered and closed in porches that are to be wrapped in cedar.

Men standing in lumber yard. Ozark Lumber Co. Near...

Lumber Yard, City Point, Va - NARA - 525202

English: Lumber Yard in Lockerbie

We will calculate the costs of materials and labor alone since he has all the tools needed for the jobs that he undertakes.

For this size of house for the cedar alone is $7500.00.

Labor is calculated hourly at $20.00 an hour. He pays me out of pocket ever week, whereas he gets paid at the end of the jobs completion.

We use their electricity to run all of the saws and power tools, so that this is not an expense of gas for the generator.

He charges the nails, lumber; saw blades and what ever else needed at the local lumber yard to himself.

And this may not seem practical, but the bill is only paid once a month. If you pay your bill in full before the...