The Side Business – If You Have a Job, But Want To Do Your Biz

July 8, 2009 at 6:00 am 3 comments

Creative Commons License

Creative Commons License

We have all been there!  (Well, most of us have.) We have all had a day job and wanted to start our business. We have all tried to figure out how we would make that happen.  We have all tried to balance the job and the start of the business (whether it was “on the side” or “on the brain”).

My favorite personal finance blog is The Simple Dollar.  Trent Hamm simply writes an easy, practical, and well-thought guide to financial living.  I love his personal perspective.  He is not a financial planner.  He is not an “expert”.  He is you and me, trying to rub two dimes together.  His blog is one that I follow religiously.  I always learn something new.

Today’s advice for the side business is reposted from Trent’s site.  (A big thank you for all of your wisdom, Trent!)

How to Quit your Dayjob in One Year, by Trent Hamm

No matter what your financial situation, you can quit your job in a year. Anyone can do it as long as they have a plan and stick with it. Here’s what you do:

Step One: Figure out why exactly you don’t like your current job. Is there simply too much work? Too many aspects of work that are outside of your control? Too many responsibilities that you’re uncomfortable with? People you’re uncomfortable with? Your passion is now elsewhere? Make a very, very detailed list of the problems with your current employer. If these problems are one or two in number, you might be better off addressing these problems directly within the scope of your workplace. For example, if your life is hell at work because of a new administrative assistant, discuss this with an appropriate person in your workplace. There might be a healthy solution that doesn’t involve you walking out.

Step Two: Define, with as much detail as possible, what you plan to do in one year when you quit. Obviously, you’ll have to do something. Likely, if you’re quitting your job for stress-related reasons, it’s going to be something that doesn’t make nearly as much money, especially at first. The same is true if you’re quitting to start an individual creative career, such as being a writer; you’re not going to have much money. So you need to consider doing something that maybe doesn’t pay well, but allows you to continue to live while you follow your muse without being burnt out.

Here’s an example: I know one person who worked as a computer programmer for $50,000 a year who wanted to quit so he could do “nothing.” Since “nothing” was pretty broad, I asked him what he meant. He said he wanted to read and enjoy nature and simply unwind. I suggested that he find a job doing something un-stressful where he could probably read while at work, like working at a convenience store. What’s he doing now? He’s behind the counter of a 7-11 and he couldn’t be happier with his life.

Step Three: Figure out exactly how much you spend in an average month. Include everything you ever spend. Don’t forget anything, even if it’s not regular, like auto insurance, taxes, health insurance, and so forth. Look at your pay stubs, every receipt you have, every statement you have, and everything you can remember. Sit down and figure out what you spend on average in a month. It will be surprisingly high; don’t worry, it is for almost everyone.

Step Four: Lower that number as much as reasonably possible. If you want to quit, you’re going to need to get rid of some of the waste. [The Simple Dollar] is loaded with suggestions on how to do this, but the real key is look for ways to zero out (or nearly zero out) everything that is nonessential. Find free entertainment. Eat cheap food. Don’t buy stuff you don’t need.

If you’re really considering this plan, you may want to spend the first month participating in my 31 Days to Fix your Finances program, a series of articles that revolve around re-engineering your financial picture in terms of your true life goals.

Step Five: Take that difference and start putting it in a high interest savings account. Don’t even give yourself a chance to spend it, have it auto-deducted from your primary checking account. Many people can put as much as half of their pay into savings if they buckle down and commit to it. You might also want to pay off any high-interest debt if possible; make those credit card balances vanish.

Step Six: Start transitioning your life efforts towards your post-job life. Let’s say, for example, that you’re quitting to become a writer. Your free time right now should be devoted (as much as reasonably possible) to getting that writing career started. If your plan involves going back to school, you should fully immerse yourself in the process of applying and selecting a school. Meanwhile, gear back at your main job and merely do what’s required. If you’re going to be walking out the door in several months, there’s no reason to kill yourself, plus exerting yourself too much at work will reduce your energy for working at your post-transition goals.

Step Seven: Let the year go by. You can use this time to get used to living more frugally, building up some savings to help you when you quit, and also focus on your goals after quitting your job. For a lot of people, this period convinces them not to quit their job. The simple fact that they’ve readjusted their life priorities and know that they’re setting themselves up to be okay if the job disappears makes much of the stress of the situation leave.

Step Eight: A year later… quit your job. If you’re still miserable at work after a year, but you’ve got money in savings, your worst debt is gone, and you’ve been preparing for a post-job life, now is the time to quit. This really could be the first day of the rest of your life, especially if the stress level of your job was literally killing you.

Remember, no job is worth your life. If you are no longer enjoying life because of your job, get out. Get out now while you still have some life and some spirit left inside of you.

OK, here’s my take on it…

My take on Trent’s post can be summarized as such:

  1. Be ready to sacrifice your money:  You need to financially prepare for this leap (unless you plan on getting some nice investors to launch your biz, which is also a great idea… I’ll post on that some day).  You’ll need to make a budget and stick to it.  You need to save for a rainy day!
  2. Be ready to sacrifice your time: You need to practice, practice, practice your craft until you are ready to go out on your own.  You need to work on your biz in your free time until you are ready to launch.  Before I launched my business I saw my dayjob as something I did, but I told myself (and everyone else) that my job was stationery design.  In my mind, I was already that business owner even if it was after my 9-5.

And, if you are feeling a little scared… you may need to go back and read about The Shy One.

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Entry filed under: Inspiration, Personal Finance, Plan It, Strategy.

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3 Comments Add your own

  • 1. Wendy  |  July 8, 2009 at 11:13 am

    I really like this post. A nice roadmap for people who are “hemming” and “hawing” about making that leap of faith!

    Reply
  • 2. Courtney Fontenot (Alpha Prosperity Events)  |  July 9, 2009 at 8:02 am

    “Before I launched my business I saw my dayjob as something I did, but I told myself (and everyone else) that my job was stationery design. In my mind, I was already that business owner even if it was after my 9-5.”

    I love this statement. It is exactly what I have been doing. I am mentally ready to leave the day job but not financially ready just yet. But I do meditate on my wedding/event planning business, I go home and immediately work on it and I even take time off from the day job to work my wedding business, because I make it my priority.

    Thanks for this wonderful post. It was very encouraging.

    Reply
  • […] more: The Side Business – If You Have a Job, But Want To Do Your Biz … var $j = jQuery.noConflict(); $j(function() { $j("#get-article-code").css({opacity: 0}).hide(); […]

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