Some dream of wanting to own their own business, full of fantasies about freedoms in making their own hours and creating jobs that help stimulate the economy. But few are really ready to make the leap and become a full time entrepreneur. Maintaining a job to fund the dream is key. Finance expert Vicki Brackens, ChFC with brackens Financial Solutions Network, an office of MetLife in Syracuse, New York, gives advice on 4 things to do before quitting your day job to become a full time entrepreneur.
1. Get Your Financial House In order. Continue to run your business part-time until your financial situation has improved by eliminating debt, developing a budget, emergency savings, and a retirement fund.
2. Save. Use Quicken or Mint.com to track business and personal expenses to see where cuts can be made. Keep personal and business finances separate and accumulate 12 months of personal expenses while building a solid financial and client base. And set aside six months of expenses in a business emergency fund to eliminate borrowing needs from personal savings during the ups and downs of business.
3. Ensure Adequate Protection. Research health insurance options to know the true cost and build that into the cash flow. Review auto and renter’s insurance to make sure there’s adequate protection. If using the home or car for business, talk to an insurance agent about personal injury and liability cost. And research disability and life insurance coverage. If running the business with a mate, make sure there’s an operation agreement in the case of separation or disability to address asset division.
4. Study. Read Become Your Own Boss in 12 Months (Adams Media; $15.95) by Melinda Emerson.
The 2015 Black Enterprise Entrepreneurs Conference + Expo hosted by Nationwide, May 13-16, at the Hyatt Regency Atlanta. Expect innovative sessions, high-powered speakers, and an early peek at the products, trends, and services you’ll need to stay ahead of the curve. Be sure to enter our Elevator Pitch Competition to qualify for the $10,000 grand prize. To register and find out more, visit dev.blackenterprise.com/ec/<http://dev.blackenterprise.com/ec/>