Are you thinking of quitting your job to start a business? You’ve come to the right place. In this article, I’ll share my advice in the hopes that it’ll help you.
I remember dreading coming to work every morning. Like, it had started to become physically draining.
Spending 40-plus hours a week contributing to a company that could replace me faster than Trump’s Twitter fingers simply wasn’t cutting it anymore.
I felt that my hard work was under-appreciated, and there was rarely any room for rewards or (cough) a salary increase.
Having ten years of experience in the finance world, I was beyond afraid to quit the comfort of a steady salary and leave the home where I had honed my skills.
Starting a business and becoming my own boss sounded like a great idea, but what happens when your best idea frightens you the most?
Quitting your job to start a business
Many of us sit behind a desk in the comfort of our 9-to-5 set salary-paying jobs. We wait for Fridays to arrive and dread Mondays.
Everywhere you turn there are constant reminders of your corporate allegiance, whether they’re the countless memes saturating your social media timeline or small talks had during happy hours.
We’ve all thought about it. You know … the “Q word.” Quitting a corporate job. Having a really cool business idea is not the determining factor for making such a risky move, though.
Money is ultimately the scariest component we tend to focus on when we think of leaving the security of a job.
Now, there are many articles online that will convince you to take the leap, that your life will never be complete working for someone else, and that you will never make as much money as you want unless you become your own boss.
But what no one ever tells you? How much money you should save before quitting your corporate job to start your new business.
For starters, let’s focus on the word “comfort.” Though in the long run, staying in your comfort zone will hinder growth, just to begin you need to have a certain comfort level where money is concerned.
How much money do YOU need?
Everyone’s situation is different. Some people may be married with kids, while others may live alone. The important thing is to get fluent with your monthly expenses.
This is when you acknowledge areas you can cut back on. The goal is to invest in you, so you must make some sacrifices.
The easiest thing to attack is unnecessary recurring payments coming directly out of your bank account(s). After this is done, be sure to give yourself a personal goal and/or timeline for exactly when you expect to see a monetary gain from your new business venture. Six months? 18 months? Three years?
This may change throughout your journey, but for now, you’ll use it as a guide. With this answer, you can make a more solid calculation.
You should cover the basics when you’re calculating your savings goal. So, shelter, food, and communication expenses (such as your phone bill) must all be at the top of the list.
Realistically, the average adult has more monthly expenses than what falls into these three categories, but let’s just treat this as a beginner’s guide.
Depending on what industry your new business belongs to, there will also be some start-up fees. Some of the start-up fees can be anything from website development to marketing and promotion. Be sure to add these expenses to your savings goal.
Now, depending on the timeline you set for yourself, you should be able to take care of your basic needs for that amount of time. The amount you’ll need for those basic needs should be based on your current income and the cost of your needs.
Here’s an example:
12 months of basic living expenses + estimated start-up costs = what you need to save if you’re thinking of quitting your job to start a business.
Remember, this is mainly to allow yourself some mental comfort in letting go of your corporate job. The honest and harsh truth is that this decision is the scariest thing in the world.
Most people don’t reach their saving goals before taking the leap. There isn’t a one-size-fits-all answer for when the right time to leave your job is. What you do have full control over, though, is your level of preparedness.
Final thoughts on quitting your job to start a business
What you have to keep reminding yourself of is that there will be unexpected bumps in the road to building your own business. A lot can happen without anticipation, but that’s part of the journey. You’ll learn and grow and overcome.
When you’re no longer a slave to the 9-to-5 workweek, you’ll be free to strategize contingency plans. Keep in mind that the reward is always greater when you invest in yourself. You’ve got this!
