How to Escape the Rat Race
Prepare Yourself Now to Make the Leap!
You've got the itch. You want to quit your job. You know you'd do great as your own boss. But how...and when?
Don't worry -- millions of Americans have successfully made the transition from 9-to-5 to the world of entrepreneurship, and they are out there with lessons to help show you the way.
It can be a lonely, challenging road. But with a little mental preparation, your journey will be a lot easier. Here's how to make a plan to make the leap!
Start Diversifying Now
Now is the time to start freelancing and consulting if you haven't already. You'll need clients and customers, so here's your chance to start building your base before you are out on your own. Start your new business while you are still employed.
In order to successfully make the transition from salary-man or -woman, you'd do well to have a significant cash cushion. Calculate out your rock bottom living expenses and see if you can scrape together a savings of that amount for six months. While people out there have done it on less, it is risky and requires scrupulous planning (and luck!).
You're Free -- Now Deal With It
Many a new freelancer is completely undone by unstructured time. You're going to need a framework for staying productive and it may take some time before you find a system that works for you.
Concentrate on Bringing in Dollars
For many entrepreneurs, the possibilities are intoxicating. Now instead of reporting to a boring desk job, you can do anything you want. You make your own hours, you do it all. You'll want to do it all. This may seem like a no-brainer but it's important: concentrate on bringing in money. As much as possible, as quickly as possible. It's tempting to think about business card design...what domain name you should buy...whether you should be an LCC or a C-Corp.
Stay focused on the money. In her book, The Art of Earning, Tara Gentile talks urges her readers to get creative in terms of how they think about earning. In his book, the $100 Startup, Chris Gillebeau similarly defines a successful business as an enterprise focused on finding customers and making sales. You'll start small, but whatever you do, resist the temptation to get involved in tantalizing but remunerative side projects.
Hold Tightly to those Dollars
You'll quickly find that earning money on your own is completely different than collecting a bi-weekly paycheck. If you're lucky, it'll come in bigger chunks. Resist the temptation to spend like you have a job-job. You're your own boss now. Be a very cheap and stingy boss. Squirrel it away for those lean times, and after many months or even a year, you'll have an idea of the ebb and flow of your cash flow.
Don't forget to pay your quarterly estimated taxes! The smartest entrepreneurs peel a chunk off of every check they get to cover that painful reckoning with that tax man.
Cultivate a Support Network
You are going to need shoulders to cry on when you have twelve jobs and no idea how you'll get through all the work. You'll also need friends to listen to your tales of woe when business is slow or your customers aren't paying you in a timely fashion. Consider forming a business support network.
Another great place to look for support is a coworking space. These are springing up all over the world, and in general, they are filled to the brim with people who are just like you. Talk to them to find out what they wish they knew when they were in your shoes.
Get Health Insurance
This is an area where it pays to shop around. If you haven't taken a look at the insurance market for small business owners in the past few years, you may be pleasantly surprised. If your area has a small business resource center, be sure to see if they can point you in the right direction. Many states now have subsidized insurance plans for those in specific income brackets. Be sure to investigate all possible options, especially in an area that's so critically important, your health!
In order to stay balanced and sane, you'll need to safeguard against working all of the time. Don't forget to take time to smell the roses, take a yoga class, or play with your kids and/or dog.
And smile -- you've made it to the other side!