My Online Business is Doing Well – When Can I Quit My Day Job?
Millions of people dream of owning their own businesses and being their own boss. This explains why droves of people get online to try their hand at internet marketing.
The unfortunate truth is that most people will fail at it because they either don’t persevere through the learning curve… or they just don’t take action. Many quit too easily and rob themselves of the chance of succeeding.
But this article is not about them…
It’s about those who do succeed. It’s about the man whose ecommerce store is doing thousands in sales a week. It’s about the lady whose ‘women entrepreneur’ blog is earning $5K a month.
Once you succeed in your online business and you’re making a consistent income, your next thought will probably be about quitting your day job, assuming you have one and your online business is a side hustle.
Before you hand in your resignation, there are a few important points to note…
Do you have an emergency fund set aside?
- You’ll need to have about 3-6 months of expenses saved up. For example, if your expenses are $2K a month, you’ll need to have 6K-12K saved up in a certificate of deposit (CD) so that you earn a higher interest rate.This is your emergency fund. In case something adverse happens in your online business, these funds will tide you over while you scramble to fix things and get your business running again.
Ideally, you should have about 12 months of expenses saved up to be really safe. But if you can’t wait to quit your job, 3-6 months is the bare minimum.
Are you earning 1.5X to 2X?
The income goal of your online business should be 1.5X to 2X what you’re making at your day job. If you’re earning 3K a month at your day job, your online income should be making 4.5K to 6K a month.
Once again, this is just to be safe. Very often beginner marketers aim for $100 a day. The goal is to earn the same amount that they make at their day job.
However, what they fail to realize is that an online business can be volatile. For example, if you have a blog about Christmas toys, you may see your income skyrocket from October to December – but come January, your sales slow down to a trickle.
So if you quit your day job based on your income in the final quarter of the year, you may discover that the remaining 9 months you barely earn anything.
Make sure your business is evergreen and earning you a consistent income throughout the year. Don’t quit your day job in haste or you’ll repent at leisure.
Is your business sustainable?
As mentioned above, the business needs to be sustainable. In other words, you need a solid and proven business model.
Ecommerce, affiliate marketing, Kindle publishing, etc. are proven models. Even then, you’ll need to see if it’s sustainable.
For example, fidget spinners were a hot trend for a while and dropshipping them was profitable. No one talks about fidget spinners these days.
So, while the business model is sustainable, the sales were not. You’ll probably need to find new products to dropship to generate a consistent income now.
Leave on good terms
When quitting your day job, no matter how much you hate the management or the job, try and leave on a positive note.
In future, if you decide to quit online marketing and get a new job, you’ll have references from your old job. Success is the best revenge… and if your online business does well, your success will speak so loudly that you won’t have to.
So don’t burn your bridges.
Can you handle the lifestyle?
Online marketing for all its perks has its downsides too. Initially, you may find yourself working far longer hours than you used to. Yes, you’ll have more freedom, but you’ll also have more responsibilities to make the business work.
There’s also an element of loneliness because you’ll be mostly working alone. Some people may not be able to handle that.
So be aware of all the downsides and weigh the pros and cons before quitting your day job. If you’re in debt, you’d be wise to make money from both your day job and your online income to pay of the debts first. Then when you quit your job, you’ll not have to deal with the burden of debt.
Ultimately, make your decision logically and not emotionally. You must know when you’re ready to quit – and it must be a financially-wise decision and not one based on your deep hatred of your job and/or colleagues.
Never let emotions overpower your decisions here.