Quitting your day job isn’t going to stop your bills from coming in, so before you hand in your resignation you need to know how you’re going to be able to cope financially!
1. Start earning money on your own
Before you even begin to start thinking about quitting your day job, you need to figure out what you’re going to do to earn money once you quit. And once you’ve figured that out – START DOING IT RIGHT AWAY. Do not fall into the trap of daydreaming about all the wonderful, glorious things you will do once you’re free from the shackles of the 9 to 5. You need to get started right away. It means you’ll start earning extra income that you can put towards savings or paying off debt, and you’ll be able to start gauging whether or not your idea is actually going to work as a substitute for your day job.
Do not, I repeat, do not say that you don’t have time. Start doing it on your lunch break. Start doing it at 5am. If you can’t or won’t make time, self-employment probably isn’t for you. I worked as a freelance graphic designer while working full time at a design agency. If I had to work back until 7pm at my day job and then come home and do 6 hours of freelance work, then so be it. If you want something badly enough you will make it work. And if not, maybe self-employment isn’t the right choice for you.
1. Know exactly how much you money you NEED to spend each week
Write out a list of all your weekly expenses. Calculate the weekly cost of any other expenses that are coming up in next year and add those too. Write down essential expenses only. But when I say essential, I mean things that are essential to you. Be honest with yourself. If you lost your job tomorrow, what would you viva video app keep spending money on no matter what? If you know that there is just no way to you could give up your nightly glass (or bottle) of red wine, it has to go on the list. It’s better to be honest with yourself now than go and quit your job and realise you’re spending a lot more than you thought you would be.
3. Wipe out your debt and dramatically cut down on your expenses
If you’re like most people, your list of weekly expenses from step 1 is probably very long and very expensive. Essentials like rent/mortgage, car repayments, credit card repayments, food, fuel, and insurance. And then the not-essential-but-essential-to-me expenses like take away coffees, hairdressing appointments, clothes, takeaway, wine, etc. These types of expenses are all pretty typical, but unfortunately all these “essential” expenses play a major role in keeping people trapped in their 9-5 jobs, and most of these expenses aren’t even “essential” at all.
I’m not going to go into depth on how to wipe out your debt and drastically cut down on your expenses, because there is already plenty of great literature on the subject. Here are a couple of great books that I highly recommend:
- The Barefoot Investor, by Scott Pape
- The Total Money Makeover, By Dave Ramsey
- Money, A Love Story: Untangling Your Finances, Creating the Life You Really Want, and Living Your Purpose. by Kate Northrup
2. Save enough money to cover your essential expenses for 6 months OR already be earning at least that amount of money through self employment
By the time you’ve finished with step 2, this goal should be pretty achievable. If for example you’ve followed the above steps and you’re feeling confident that you can survive on $500 a week, you should be looking to have at least $12,000 in a high-interest savings account before you go and hand in your resignation. This is a very, very conservative estimate. It’s assuming that no major expenses are going to come up in the next 6 months, It implies your router dlink login administrator board administration address. These days all organizations occupied with the assembling of gadgets and it’s assuming that it is only going to take you 6 months to consistently start earning this amount of money each week. Ideally you should have a combination of the two – be earning enough money to cover your expenses, and have a good chunk of money in a high interest savings account as well.