I Quit! Things To Think About Before Taking the Plunge

quit-jobThere are many paths people take when beginning to freelance or starting a business. Some people are laid off from their primary jobs when they decide to work for themselves. Other people juggle full-time work while they freelance on their own time. Others leave their full-time jobs entirely to focus on developing their own businesses. And some people actually do their own thing from the beginning of their career and never even work for someone else.

My journey was a combination of getting laid off, finding another job and starting my business on the side while I worked in the corporate world and built up the confidence to take the plunge. However you get there, it can be a very scary (and exciting) prospect to consider leaving your job to go out on your own. Based on what I’ve experienced, here are some things you should think about before handing in your resignation.

Finances

The most important factor to consider before quitting your job is money. If you have been freelancing on the side, it will probably be easier for you to gauge your financial situation, at least in the short-term. If you are thinking about quitting cold turkey and then working to establish your business, be realistic. It can take months, but usually years, to see a profit from working on your own, so make sure you have enough financial reserves for at least six months of living expenses, 18 months if possible.

And don’t forget about the cost of working for yourself – equipment, software, legal fees, marketing activities, etc.

Healthcare

If you don’t have a spouse or partner with benefits who can claim you as a dependent, you will need to set aside finances to purchase health insurance. This can be extremely costly, and it is sometimes difficult to find adequate coverage at an affordable price.

A Plan

Even if you don’t have a formal business plan, you should create some kind of written document that outlines what you want to accomplish on your own and how you plan to do it. What will it cost to start your business? How much do you need to make? What products and services will you offer? Who will you be targeting and how will you reach them? How will your services fit into the current market? Where will you work from and when?

Support

It can be a constant struggle to make it work on your own if you do not have the support of your loved ones. If they are on-board, your family members can be your biggest cheerleaders. Make sure they know all of the elements of your plan and agree it is the right time before you go for it.

Personality

Do you have a personality that supports self-employment? You will need to be able to focus and keep yourself going, even when you hit a roadblock. You should also be able to effectively work alone, or have a plan for finding a collaborative work environment. Keep in mind that working on your own takes a tremendous amount of discipline. If you aren’t able to complete work and meet deadlines, you will face a difficult time.

Although it seems like there may be a lot working against you when you’re considering working for yourself, it definitely is possible if you put in the time to plan and position yourself for success. And once you take the plunge, and experience the freedom of doing the work you want to do when you want to do it, you will never want to go back to the corporate world.

What path did you take to self-employment? What would you add to this list of considerations?

Image credit: Johnny Magnusson

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  • Argenis

    This is quite accurate. I had freelanced for quite some time while working for a corporation, and when I decided to take the plunge and start my own company, It sure was not as easy as I thought. It took me about a year to get this stable enough (income wise) to say that we are actually turning a profit.

  • Quest

    I would also add that making sure you are passionate about your work is very important. That passion will sustain you through the toughest of times. Work in your arena of passion. Remember, don’t pursue a paycheck, but pursue passion and the paycheck will follow.

  • mastermindxs

    I started as an IT Technician, I was able to develop dozens of close client relationships. And when I got fired for doing stuff “on the side” I took all those clients with me and began to freelance (sucked for my past employer). Then my cell phone account was deleted by accident by my provider and I was never able to get my old number back. I lost touch with a lot of people who had my number but was not yet in my contact database.

    I started all over again. I found another IT job, learned to make websites, got laid off, started freelancing. This time making websites rather than fixing computers. This seemed more promising to me, and a lot more rewarding and gratifying. So I made it official and incorporated a business name, made myself a website and started trying to get leads.

    What I really wanted to do was more ambitious than merely making website after website. I wanted to develop helpful web apps. But, being self taught, I didn’t have the know how. So I found a new job, this time as a web developer. I did it because I wanted to get experience – while still making websites on the side – so I can eventually come back to working on my own, doing exactly what I want to be doing.

    Hope I made the right choice :)

  • http://www.tyssendesign.com.au Tyssen

    I was working fulltime and freelancing in my time for about 2 years before deciding to ditch the ‘day job’. It had got to the point where I was going to start having to turn down freelance work if I didn’t do it fulltime.

    It came at a time when I thought I wouldn’t really want to go freelance fulltime because we’d just had our second baby and my wife was going to be off work for a year. But we had a fair bit in the bank and all the signs were there that work was only going to increase (despite the financial climate).

    And in my first year I’ve made more than I did in the day job while working less hours and having the freedom to do what I want during my days (including being around with the kids), so it’s definitely turned out to be a good move so far.

  • W2ttsy

    I work in a full time job as a software engineer to pay the bills and am developing a web application in my off time with a friend. Once the revenue from my app allows me to draw a salary I will leave my current job to spend more time supporting my app.

    The only downsides to this are working effectively two full time jobs and since both are in IT it’s hard to get away from it all. Plus I’d rather use my personal days and weekends for relaxing instead of writing software but the pay off will be worth it.

  • Good working

    Actually, this style of home computers to work at the beginning güzel.Türkiye ‘This new event is being discovered, of course, we celebrate a good working .

  • Geoffrey Gordon

    I absolutely agree with the article, i have done such a thing 2 months ago and it is tough, but I have no regrets, the personality issue resonates with me,if your not everyone is cut out to be business owner, it requires guts, a lot of initiative, belief in oneself and a fierce determination that you will prevail no matter what. Follow me on twitter

  • Janak Porwal

    I am a computer scientist, and had some nice algorithmic ideas for a challenging software. I also had a well paying job with challenging work which I enjoyed. For about an year, I worked on my software simultaneously with the job (weekends and all). Slowly, my performance in the job was not upto my own expectations (though okay otherwise) and I started feeling the pressure.
    I had so much confidence in myself, and I quit – with about 10 months of finances worked out. Its been about 4 months. Working alone is more challenging than I thought, but very exciting. Discipline is the key as Alyssa said. Also motivation – its easier to do something when the rewards are “instantaneous” (like paycheck). Also, it helps to consider the “worst case”. In my case, I calculated the worst case would be spending my 3 years of savings and starting afresh (I am 26). Everyones ‘worst case’ may be different.
    Another point is, give yourself a ‘fair shot’. Dont give up, till you must (your worst case is reached).

  • shockbotkins

    I’ve never worked for someone else before. I developed my first website at age 12 and now at age 23 my web design company is doing great.