The idea of being your own boss is undoubtedly romantic. You set your own hours, pursue your passion and potentially earn more than in a traditional job. But new research is shedding some light on what many entrepreneurs already know: it can also exact a heavy toll on your partner’s well-being.
That’s because self-employment can be stressful. Imagine having a full-time job providing a service or product, but then also needing the time to have a second full-time job: the business of managing the business. There is constant pressure to market for new business, monitor expenses, keep on top of accounting and tax filings, being mindful of legal considerations and more. It can be incredibly overwhelming.
The non-self-employed partner can absorb these stresses through what’s known as a “spillover and crossover” model. The demands and stress of the business first spill over into the entrepreneurs’ personal life. The reduced personal time and increased stress then cross over into the partner’s life. The end result? Lower life satisfaction.
Consider a scenario where one partner is deeply engrossed in their business, working late nights and weekends. The other partner, though supportive, starts to feel neglected and frustrated.
Conversations at dinner become dominated by business talk, and financial worries begin to overshadow the relationship. The non-entrepreneurial partner might feel isolated, bearing the emotional load of maintaining the relationship while their partner’s mind is perpetually occupied with business concerns.
An interesting aspect of this new research, published in the latest issue of the Journal of Behavioural and Experimental Economics, was to look at how an entrepreneur’s partner’s perceived importance of non-business-related activities – such as spending time with family and friends – affected the drag on their well-being.
When one partner places a high importance on family life, leisure time and stability, the relentless demands of their spouse’s entrepreneurial pursuits can lead to significant dissatisfaction and emotional distress.
Moreover, the study found that life satisfaction notably diminishes when both partners are self-employed. This dual-entrepreneurial setup can create a perfect storm of stress, where both individuals are consumed by their businesses, leaving little room for personal connection and relaxation.
Of course, there are many households where the relationship thrives, independent of how the business is doing, though I suspect also having a thriving business improves the odds.
And it’s hard to ease the mental toll on couples because there are lots of people who could never go back to employed life.
Many entrepreneurs find immense satisfaction and a sense of purpose in building something of their own, pursuing their passions and enjoying the flexibility that comes with being their own boss. For them, going back to a salaried job working for someone else could be their idea of abject misery.
Still, self-employment in Canada has been on a downward trend for the last 25 years, and perhaps navigating the difficulty of running a small business and its impact on personal lives is a factor. An RBC report declared that “Entrepreneurship is becoming less enticing for Canadians” and noted that the self-employment rate has dropped from over 17 per cent in the late 1990s to 13.1 per cent in 2023.
For those who have chosen this path, or are considering it, addressing the emotional costs of the self-employed lifestyle is mandatory. The research’s conclusions support what I’ve seen are elements in a relationship that can help make it work:
- Set clear boundaries – establish specific times when business talk is off-limits to focus on your relationship.
- Prioritize quality time – ensure regular “unplugged” moments together, free from business distractions.
- Maintain financial buffers – emergency funds (cash, not lines of credit) are even more important.
- Balance roles – consider keeping one partner in traditional employment for stability, especially in the early stages of a business.
Clearly, one of the take-aways is to consider a partner’s perceived importance of family, friends and leisure time. If they put a priority on the business, there’s less of a problem.
But if they put an emphasis on the life part of work-life balance, you’ll want to add that high on the list of the never-ending responsibilities of running your own business.
Preet Banerjee is a consultant to the wealth management industry with a focus on commercial applications of behavioural finance research.