So you’re ready to take the dive and hand in your 2 weeks notice.
Let me congratulate you for getting to this space. But before you turn in your notice, let me share with you some steps that helped ease that transition for me - the second time I took the leap to become a full-time entrepreneur.
You heard me right! I went back to the 9-5 grind to reset and have a redo.
But you don't have to go through the same growing pains I did.
What made a difference the second time around is I took these measurable actions to go from being a 9-5 employee to becoming a self-employed CEO:
1. Create a budget and save to cover expenses.
This will help you to identify how much it will cost to cover all your business operating expenses. Then, you will need to identify how much you need to make to fulfill your personal household expenses and stack some savings.
Cause last time I checked, the rent will still be due every first of the month and Wells Fargo does not close their doors, even in a pandemic, to ask for their cut.
2. Do an income analysis projection.
When I started out, I mapped out each of my income streams and their potential. For example, I have two podcasts ("Financial Fancy" and "Business After Dark"). For simplicity, let's say I make $10 each time someone streams an episode. If my goal is to have 100 streams for each of my two podcasts, monthly, I can project my income from my sponsorships for the month and the year.
In this example it's $10 per stream x 100 streams per podcast x 2 podcasts = $2,000 a month or $24,000 a year.
3. Take tax accountability from the beginning.
If you sell a product, you might be responsible for sales tax. Even if you are a service based business like myself, you should include taxes in your financial plan.
If my goal is to take home $100,000 for the year, I need to make $125,000 if the tax rate is 20%.
For example: I make $125,000 after expenses.
I have to pay 20% or $25,000 in taxes.
I'm left over with $125,000 - $120,000 or $100,000 in income.
The Wrap Up
To become a successful entrepreneur requires that your intentions now will set you on the path of being available and ready to reap the rewards from opportunities when they come.
Before I go:
- You can do anything - with proper planning. We make entrepreneurship hard because we think there is some magic process and the magic is all in the preparation.
- You will sometimes have to make space for not reaching your goals on the timeline you originally thought. Be flexible enough to pivot your actions, but keeping the same goal in mind.