Three financial steps to launching your one-person empire.
The path to entrepreneurship is different for every person.
For me, I was restless as an employee. I had an excellent bare minimum: a decent salary, an expense account, a short commute, a profit-sharing plan, fun co-workers, a cool title, and the work didn’t kill the planet.
It felt selfish to want more than that, especially as a daughter of an immigrant.
But my heart kept chirping at me, like a smoke alarm with a dying battery.
If this is the rest of my life, am I okay with that?
I sabotaged my plan to think of being my own boss a million times over.
I had a loop of reasons: the money was sweet, the perks were excellent, my company paid for fancy health insurance, job security is great, I don’t know anything about being out on my own, I’m not a salesperson, I could fail, and the list would keep going.
But, that chirp.
I decided it didn’t hurt to do some tiny steps to explore the idea, at least.
When I asked myself what I was most worried about, money dominated the top of my list.
I wrote down three basic questions based on my excuses to address my fears, which all had to do with money.
1) How much money do I need to live comfortably?
I created three budgets: 1) Not lean, 2) Lean, 3) Hella Lean. I had a lot of conversations with myself about needs and wants.
I played with ideas of how to handle my largest expense: rent.
Spoiler alert. It didn’t happen right away, but I ended up moving into my car and thus began: trailer life. (Unplanned adventures are my specialty.)
2) How much is health insurance?
I ended up on ehealthinsurance.com. (This was before the ACA.) I learned that I could pay out of pocket for comparable health insurance for not a devastating amount, and it was a personal tax write-off for the self-employed.
Pro-tip: check with your alumni office to see if they have a health insurance program.
3) What is my net worth? (How much do I have in my Savings Account? How much debt do I have?)
This was by far the most painful and the easiest, and the best thing I did. I don’t know what story I had told myself, but I sure did tell myself a story that I had nothing, that I couldn’t “afford” to take risks.
I calculated three numbers: 1) cash available, 2) debt, 3) big-ticket items I could resell (I used $5,000 as a minimum for an asset).
I wasn’t rich. But I sure wasn’t poor. Based on my Hella Lean budget, I had enough money to at least consider taking the risk.
And after I had those three pieces of data and was grounded in my for-real life, and not something I made up in my brain, I marinated in many questions.
I carried a Moleskine with me at all times and wrote down questions and thoughts that came up.
How much money do I want?
How much money do I need?
How much backup cash would make me comfortable?
How much do I need for startup costs?
If I didn’t save money for two years, could I get back on track for retirement?
What is my earning potential?
What could I do?
Where do I want to live?
What would my life look like if I could start over?
The list kept going, and the questions only got bigger as possibilities came over me.
I look back on that time fondly. I was so scared. And I’m so very happy I took it one moment at a time to fight through all that fear.
I am fascinated with what happens when we move from theorizing, reading, researching, and move to the doing. The “big-ness” of going out on your own, quitting your job, starting a new business is overwhelming. It can cause paralysis. And it did for me, for many years.
It makes me think of wise counsel I once received when I was resisting doing a big project, “Well, Lauren, how do you eat an elephant?”
Also published on Medium.com.