For me, it was to make sure I felt financial comfortable leaving the corporate world.
First and foremost, I needed to know what the reality was money-wise if I completely fell on my butt in my pursuit of being a freelancer. I needed to know my survival benchmarks.
I looked at scenarios such as:
- How many months can I have zero income and still pay my mortgage and take care of my home expenses (including property taxes) based on my savings?
- How low am I willing to let my savings get before seeking employment?
- Do I want to sell my house to reduce expenses?
- Do I want 1 or more roommates to help me keep my home?
- At what point would my savings have to be before nervousness set in? Before concern set in? Before panic set in?
- How could I lower my current bills? (For instance, a higher auto insurance deductible can lower the monthly premium; did I really need cable TV?)
(Some things to note: I was only responsible for myself, I owned my car, and I only had 1 credit card, which I paid off each month. So other than my mortgage, I was debt-free – and it had taken several years to get to that point.)
After considering those questions (and more), figuring out the answers, and making adjustments to my current bills, my biggest concern became health insurance. It was affordable through my employer. But the COBRA offering did not fit my budget whatsoever. I don’t know how employed people would pay those rates, nevermind unemployed!
Before I could leave my full-time job, I had to have affordable, comprehensive coverage for peace of mind. So, I spent time researching.
- I spoke with a representative from my employer’s EAP (employee assistance program)
- I did some Internet research and found options (eHealthInsurance, Health Insurance for Writers, About.com article on this topic)
- I got quotes for health insurance through writing associations (whether I was a member yet or not)
- I looked through the Yellow Pages (amazingly, yes, I really did) to find local options
- I paid attention to health insurance ads in newspapers
It pays to compare. There were a lot of avenues and I checked out everything I found. And, happily, I found the type of coverage I wanted and a policy that was quite affordable to me.
With that final piece of the puzzle (for me) solved, I moved forward in my pursuit of self-employment.
Everyone is different – some people freelance part-time and build up a clientele. Some folks jump ship, hit the pavement, and move forward without a plan but with an intense drive to succeed, even if it meant not sleeping.
I needed a safety net and a certain comfort level and I didn’t want to work 24-hour days. I was going freelance to be happy, to enjoy life, and to savor each day as I pursued my dream. April 1 is my 7-year anniversary and all is well.
Questions? Comments? If you’re already your own boss, what was your biggest concern before you made the move?
Next up: resources for the small business owner.
Lisa J. Jackson, MBA, is a small business owner specializing in writing solution briefs, case studies, white papers, e-books, and more. She also loves writing and talking about New Hampshire and plans to complete several 5Ks in 2013. She drinks iced coffee year-round, and needs a stash of Peppermint Patties in the fridge at all times. You can connect with her on LinkedIn, Facebook, or Twitter.