There are many benefits of having a full-time job versus being self-employed. Guaranteed income, group benefits and sense of security are among the most important ones. But are they really as certain as many people view them? And what is their true value?

Your employment income is only guaranteed while you are employed. In North America, you can lose your job at any time and for any reason, and your employer is only required to give you a 2 weeks notice. Companies close and downsize all the time. If your job is your only source of income, this loss may be devastating. When you are self-employed, nobody can fire you. You can lose a client or two, but you will likely still have others. From the income security standpoint, self-employment is a much better bet.

Group benefits mainly include extended health and dental coverage which can be purchased individually for a couple of hundred dollars a month. While it is nice to have coverage and feel protected, its monetary value as not as high as many imagine and can be easily compensated for by the tax deductions available to self employed individuals.

Tax deductions are the key advantage of being self-employed. There are many types of expenses that you make regardless of whether you are an employee or self-employed. Part of your mortgage or rent and house related expenses, your car payments, telephone and internet bills, gas, parking, 50% of restaurant bills and many others can be deducted as business expenses if you are self-employed. Of course, there are rules around those deductions, but they are quite flexible. If you are not too aggressive with your deductions, you have a certain degree of flexibility.

Many believe that in order to be able to deduct your car expenses, you have to lease it. But in fact, you can own your car and still have significant deductions. Even if you bought it really cheap or even received as a gift, you can depreciate it based on its fair market value. Again, you have some flexibility in determining this value.

This may sound complicated, but if you use tax filing software (for example Quick Tax) it will lead you through the process by giving you suggestions on what you can deduct. Such software makes filing taxes so easy that anyone can do it. Thousands and thousands of dollars can be saved every year if you simply change your employee status to self-employed. Of course, in order to be able to deduct your expenses, you need to have income. If you are able to earn it on your own and don’t get too aggressive with your deductions (remember, you can be audited at any time), you will enjoy the freedom of being your own boss and save some money too.

Nikolay Sisan is a Certified Financial Planner and freelance writer in Vancouver.