Episode 53 – When To Quit Your Job To Go Full Time In Your Business
I get asked this a lot, especially by people at the beginning of the journey.
It’s because it’s what we all want – to not be held hostage by our employers and do whatever we want – yay!
So it’s fun to know when this time is coming.
But, it’s also not a great idea to quit too soon.
So let’s dive into when to leave your job and go full time in your business.
While the truth is that all of our situations are nuanced and different, there are some guidelines that you can follow to know if your timing on quitting your 9-5 is on point, or a little on the risky side.
In full disclosure, my own story of leaving my corporate job was more on the risky side and it did make my life a lot more stressful than it needed to be.
But first, let’s look at when it’s a good idea to leave your job.
When you have enough money for a year and have had at least one paying client
What?! I have to have already had a client?
I believe, yes.
The reason for this is it’s easy to imagine that your super original idea or ‘sure thing’ is going to knock the socks off everyone and you’re going to be rolling in cash in no time.
In reality, everything always takes longer than we want it to.
In fact, one of the most commons things that entrepreneurs will say when complaining to each other is ‘I thought I’d be further along by now.’
(Yes, you get to upgrade your complaining sessions from moaning about your commute, boss and working conditions to talking about whether or not you hit your income targets, difficult customers and awkward staffing issues.)
What that means is in all likelihood it’s going to take you longer to get to regular income levels than you might imagine.
Which means you want to have more savings than you might think you need.
So why do I recommend that you’ve had one paying client again?
It’s because then you know you have a business concept that works.
You have something real, someone has paid money for it.
Rather than just a vague idea that hasn’t been proven in the real world.
Getting to that place doesn’t have to take long and it can be done on the side while still working, even if you have a family or a busy life.
But it is really important to be on the path already, if at all humanly possible with the job you have, to give yourself enough time to get your new income source off the ground.
When your business is up and running, you have regular clients, and are at capacity and preferably have a wait list
This is the next option. If you don’t have savings you are going to need more security.
That security can come in the form of more regular income and the knowledge that if you had more time, you would be capable of earning more in the business.
There’s always a time where people feel like they are working too many hours in this process but the ideal situation is to get your new business as stable as possible before saying goodbye to your job.
Remember, many businesses fail, and we don’t want one of them to be yours. A period of juggling both sides is going to help you bridge the gap financially and it’s going to mean you don’t stink of desperation when you speak with prospective clients.
What did I do?
That’s, in my opinion, the best way of doing it.
Sometimes though, life throws you a curve ball and it’s close to impossible to get to those two scenarios I described above.
My situation was that I had a one hour and a half commute each way, if nothing went wrong with the transport system, to a super stressful job in the city.
If that had been the only thing I might have been able to swing starting something on the side but the real kicker was that I was on call every third week.
That meant I needed to work a lot of night hours as well as the day time hours (yes, in the same day) and sometimes I’d work the whole night and then need to go in for a full shift.
So every third week I had no sleep so I was physically not functioning that week, felt brain dead for the next week, felt okay for the third week and then had to do it all over again.
I just didn’t even have the mental bandwidth to find another job or start a new business. Also, I was in a new country and a new city.
Maybe other people would handle that better but I was at mental capacity so after a few months of wondering how to make it all work I just left.
What that meant was I had to act fast to get my business up and running. And this honestly was a huge amount of pressure and it was a strain on my new relationship.
Obviously, I got there but this was far from ideal.
When you should not quit your job
You should NOT quit your job if you haven’t had a paying client yet and you know in your heart you can find five hours plus a week to work on a side business.
Honestly, your future sanity will thank me for this advice.
You don’t want to be desperate for cash and needing to figure out sales at the same time.
In simple terms this means don’t quit your job when you don’t need to.
We only start to value life’s comforts when we risk losing them and having no money is no fun.
It’s all a balance of money and time
If you look at these two examples I have of when you should quit, and then look at how I quit, you can see it’s just a balance of two types of money and time.
1. Potential Money
2. Actual Money (which can buy you time)
I had no idea if my business had potential, because I didn’t even know what it was yet so there was zero potential money.
I also had zero time in terms of mental headspace in my life because I was barely functioning.
But I did have some actual money and I believe close to a year’s savings.
So while this was far from ideal because I had no time I didn’t have a lot of choice in the path forward to make it work.
The two ideal scenarios look like this:
1. A year’s worth of money, at least one client
So you have actual money (your savings) and you have potential money because you know at least one person has paid you. Time is open here, because money buys you time.
2. Regular clients and a wait list, at full capacity with job and clients.
Here you have some money in terms of cashflow with your clients, potential money because you have a wait list, but you’ve got no more time. The only way to grow your business is to quit, get more time and more potential business money.
What does that mean for you?
Your situation will be unique.
The ideal is that you either have a year’s worth of money and have an idea that you’ve tested and gotten paid for.
Or you build the business to the point where your job is getting in the way of you expanding.
But there will be situations where you have to make a judgement call.
Like I did.
The only thing that I ask is you try and be practical with your decision.
It’s easy to get excited about your new future but the truth is it rarely goes exactly as you imagine it will.
In truth, it’s going to be a wild ride with some pretty crazy twists and turns.
And if you stick at it, you can go even better than you ever imagined possible.
But that likely also will take longer than you think it will.
I’d Love To Hear Your Thoughts
When did you quit your job or when do you want to?
How did that go for you?
I’d love to know…