At some point when building your own business, you have to ask “Is it time to give up my day job?”. How you answer this question will depend on a number of factors, such as:
- Do you have at least six months of expenses saved?
- Are you ready to spend a lot more time in your home or on the road?
- Do you have childcare set up for when you switch careers?
- Have you cut back to the bare minimums until you are sure your business will cover all of your expenses?
- Do you still need costly equipment or technology?
- Are you in the right mindset?
- Have you stocked up on necessities?
- Do you have a plan for socialization?
Answering questions like these will give you insight into whether or not it is time for you to give up that day job. Let’s explore the questions above together.
Do you have at least six months of expenses saved?
Having six months of expenses saved will be a huge help in case things pick up more slowly than expected with your business. Having nine month’s or a year’s worth of expenses would be even better. What expenses should you save for? All of them.
- rent or mortgage
- other utilities
- heat & system cleanings/inspections
- car/home/medical and any other insurances, including deductibles
- prescriptions/expected co-pays/and other medical related possibilities including eye and dental care
- home and car maintenance needs, and a bit more in case something goes wrong, and gas/public transportation costs
- clothing and accessories
- school and business supplies
- other business expenditures
- household cleaners
- personal hygiene needs, hair cuts, etc.
- paper/plastic products for the home
- school lunches
You may have other expenses. This is a lot. Keep reading for ways to cut expenses while saving.
Have a house phone? Give the company a call. I did this years ago and cut everything, except the maintenance fee because if something happened to the phone line they would take care of it. I was only paying a few dollars a month. Or, give up the house phone all together. Many people don’t even have them any more.
Are you ready to spend a lot more time in your home or on the road?
Traveling for your own business can be taxing if you don’t like to drive or be away from home most of the day (or longer!). And being home all day may not be your cup of tea. Consider whether or not you are prepared to do either of these things daily.
No? Try one or both of these:
- Limit days on the road to two or three, doing other business related tasks on the two or three days you are home.
- Find a few places outside the home where you can bring a laptop, your business meeting notebook, or even your planning journal. Perhaps the local coffee shop, a park near the river, or a favorite restaurant. This will help you to get out of the house to socialize sometimes.
Mixing things up, and working in other places, will be a big help.
Do you have childcare set up for when you switch careers?
You should know who will be caring for your children, where the care will take place, and have a couple of back-up plans for the childcare provider’s vacations and sick days. You can also expect them to take at least two personal days a year, and to only work certain hours.
If their hours don’t fit yours exactly, you should also have a plan set in place for someone to pick your children up and care for them until your work day is done.
A mother’s helper is another option, if you will be able to focus with the children at home. And this person can also help with a few cleaning tasks and have the children help.
If you agree to send meals and snacks with your children, you might be able to negotiate a bit lower childcare bill.
Have you cut back to the bare minimums until you are sure your business will cover all of your expenses?
This is one of your first moves when deciding to save to give up a day job. I’m going to give you some ideas, but sit down with pen and paper to figure out exactly what you need to do.
- Figure out if it’s cheaper to buy school meals or make lunches for your children.
- Decide what steps to take to cut back on electricity, water, and heat use.
- Will using coupons really save money? Sometimes it does not.
- Will buying in bulk really save money?
- Can you run all your errands one day every week or two to save on gas and wear-and-tear on the car?
- How can you cut back on food expenses? Grow your own herbs on a windowsill, and dry or otherwise preserve them? Grow at least some of your own food? Buy during sales?
- Utilize back-to-school sales to buy school and office supplies you need at that time, then use the after-back-to-school sales to stock up on what you will need until the next back-to-school sales begin. This requires a bit of planning and organization.
- Utilize yard sales, thrift stores, and clearance sales when buying clothing for school, work, and leisure, before buying what you still need new.
- Come up with at least five thrifty recipes that your family will love. Try these recipes out on them.
- Teach children to be independent, helpful, and responsible early on and you will save on childcare when they are a bit older. This works especially well if you work from home.
- Do you really need all those fancy personal hygiene products?
- Make the easy cleaning products yourself.
- Get a prepaid plan for your cell phone if you have one, if it will cost less than what you currently have. Sell the old phone and put that money toward a new one, or do what I did and wait for the pre-black Friday sales. Or donate the old phone.
This is not an exhaustive list by any means. In what ways can you cut back?
Do you still need costly equipment or technology?
If you don’t have the item(s) yet, or you know it will need replacing in the coming year, you might want to wait to give up that day job until you have the cost covered. You don’t want to have to use your expense savings for this type of thing.
You should also have an emergency fund for your business.
Are you in the right mindset?
First, you need to know what you want and be willing to work hard for it. You need a business mindset. Second, it might not be a good idea to quit your day job if you are severely depressed. I suggest incorporating mindful activities into your daily life, such as meditation, yoga, and positive thinking exercises. And find time to pamper yourself.
I have a friend who is severely depressed. He tries to tell me that he has tried all the positive thinking stuff and it just doesn’t work. For years I thought it didn’t work. Then I went to my doctor, who told me she didn’t really like depression meds and why. She said she’d put me on them, but only for a limited time. In that time, I had to find ways to deal with my depression and anxiety issues on my own. I got serious about it, and it didn’t happen over night – or in a week or a month. It took a long time of daily walking to clear my head and daily positive thinking to get me out of that depression that I had been in for so many years.
I did it. By the time the doctor took me off the meds, I was dealing with issues in far healthier ways. I’m not saying I never get upset or have an off day, because that would be a lie. But I taught myself ways to handle my feelings and emotions. And I’m glad I did. I have not been on depression meds for more than a decade, and I’m doing just fine.
I know another person who is fine as long as she is on Prozac. That’s what works for her. But she does not let depression drag her down. She is doing what works for her.
A positive mindset will help you to get through the struggles, the bad business periods.
Have you stocked up on necessities?
Do you have a pantry system set up. Three to six months of food items, cleaning supplies, paper and plastic products, and personal hygiene items will go a long way when you give up that day job.
- Only stock items your family likes and will use.
- Utilize sales when possible.
- Couple coupons with sales when coupons will actually save you money.
- Check out the dollar store, particularly for non food items. Some food items might also be found, but ask yourself if those are the healthiest options for growing a strong, healthy family. Also, Wal-Mart sells toothpaste cheaper than the dollar store. Comparison shop so you know when you are getting the best deal.
This step will require planning and organization, but being well-stocked will benefit you a great deal during those initial months after leaving your day job.
Do you have a plan for socialization?
If you are used to working with others (coworkers or the public), it may be difficult to get used to working on your own. Even if you are fed up with working with either of those two groups. It’s a lot different being home all day with no interaction.
How can you counteract this? By being social.
- Create a portable office in a tote bag, brief case, or back pack.
- Take your work to the local cafe for an hour or two a few times a week. Chat up the barista’s. Say hi to other people there. When you notice certain people are regulars, make small talk for a few minutes before starting in on that day’s work. Then get down to business.
- Take your work to the park, walking around for ten or fifteen minutes before you begin work. Talk with people during that time.
- Take a walk each morning. Shoot for an hour, and make small talk with people as you walk by them. Use this as a time to record ideas when you have stretches with no other people in site.
I’m sure, once you get started, you’ll come up with other little ways to socialize a little.
I hope this article has got you thinking about the steps you can take to break away from your day job to make that side hustle a permanent career choice. Share your tips and concerns below. If after you’ve considered all of these things, and anything else necessary, you don’t think you are quite ready, then refrain from giving up that day job right now.
If you feel confident that you have all this taken care of, and your side hustle is proving to be successful, then by all means give your notice for that job and be ready to throw yourself into your business full-time.