By Gladys Edmunds

Dear Gladys,

I am a regular reader and appreciate your advice. I have plans to go into my own business. Right now I am working full time. My question is, what are some of the things that I should consider before saying goodbye to my regular job and launching my own business? I have friends that say I should have a couple years’ worth of living expenses saved. Others say three months of savings is good, but I must make certain that I have no credit card balances. I am looking forward to the days of working for myself. What do I really need to do to get ready to take that leap? Thanks for your time

Thanks – Henry

Dear Henry,

If every entrepreneur had waited until he had two years of living expenses and no credit card balances, we would have very few businesses available to us. However, there are some people who save considerably before launching a business.

There is no right, wrong or easy answer to your question. Each situation is unique. However, I can give you a few things to consider.

Sometimes you don't have to give up one for the other. Are you buying a business or starting one from scratch? The answer to that question will help you in your decision-making. Quite often, when a business is started from scratch you can begin building it part-time and slowly while keeping your day job. Many entrepreneurs have done this. It can be much easier to build a business while you have a steady income. If your job offers benefits, that's an additional plus.

When I was growing up, there was a family a few doors from our house, the Wilsons. Mr. Wilson wanted to be in the catering business. He worked all day in the steel mill and on the weekends he would cater private parties. As time went on, he continued working his day job and his business began to grow. In time, he hired people to work with him and he grew from weekend business to catering gigs during the weekday. Once he had built a good business, Mr. Wilson left the steel mill and opened a restaurant and banquet facility and experienced many years of success. The business passed on to his children after his death.

In another case, I met a woman who spent five years working two jobs and saving. She managed to save $175,000. She and her college roommate came together and purchased an office supply and copy center franchise. They have successfully been running their business for the past 11 years.

Do you have a business that you can start part-time while you work and build it up? If not, I would suggest you make certain that you pull together a good marketing plan so that whenever you decide to take the leap, you will hit the ground running with clients and customers. And, if you want to leave your job before you start your business, then saving enough money so that you feel a sense of comfort is not such a bad idea.

At age 15 Gladys Edmunds developed a travel service that would prosper for more than 30 years. She is a national award winning entrepreneur, keynote speaker, author and columnist.

 


The information provided is presented for general informational purposes only and does not constitute tax, legal or business advice. Any views expressed in this article may not necessarily be those of Nevada State Bank or its affiliates.