How To Know If It’s Time To Quit Your Job and Go Full Time On Your Business


This article is posted under Business.

Starting a business remains as one of the top aspirations of many employees.

I also had that dream once… a dream that I was able to turn to reality almost a decade ago.

And today, I’m sharing with you how I knew it was time for me to quit my job and become a full-time entrepreneur.

These are the questions I asked myself before I decided to tender my resignation letter to my boss.

Do I have a good, running business?

I highly discourage anyone from quitting their job to start a business. The business should already be running before you resign from work. If you think this is impossible, then you’re underestimating your capabilities.

Before I quit, my software development freelance “business” was already set and I had clients lined up to last me the whole year. Likewise, I’ve met countless business owners who also started their ventures while they’re still employed.

If we can do it, you can too.

Do I have enough savings to last me at least 6 months?

Quitting work will affect your cashflow because you’re losing a good source of income. So be sure you have enough savings to survive at least 6 months. This will allow you to focus on the business without worrying on your own costs of living.

What you can do is to live only with your salary income, then save all your business profits and make it your buffer fund for use when you finally resign.

What will I do when I resign?

Once you get out of the rat race, you’ll get an extra 40 hours a week (probably more). What do you plan to do with all that extra time?

The answer is to come up with a list of tasks that will keep you productive, and more importantly, contribute to the growth of your business.

Design your new, post-corporate-world, daily and weekly work routine.

quityourjob How To Know If Its Time To Quit Your Job and Go Full Time On Your Business

How do I want the business to grow when I go full-time?

The business should not remain the same when you quit your job. If you have no plans of growing it, then there’s very little point in resigning because all you’re doing is just straining your cashflow by cutting off an income source (your job).

So before you quit your job, review your business first, especially its mission, vision and values statements.

Reflect upon them and plan for the “next chapter” of the business.

What’s my “Plan B trigger”?

When you don’t have a back-up plan, you’ll be more determined and focused to make your one and only plan work. However, you should be practical enough to define the situation when drafting a “Plan B” becomes necessary.

Back then, I set a minimum acceptable monthly net profit for the business.

And if I fall below that target for 3 consecutive months, then that’s my signal to consider my available options regarding the business, and my personal finances, including the possibility of going back to employment.

How about you? Any other tips you can share? Please write them below in the comments section and let’s talk more about this.

Lastly, if you want to learn more how you can become a full-time entrepreneur, then please subscribe to Ready To Be Rich.

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Photo credit: quinnanya

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People are talking about this article, join the conversation below.

  1. Hi Fitz, thank you for your above article. Its very enlightening and informative. I just have one concern regarding your recommendation not to quit job unless the business is already operating. I know its important, but given that I am an OFW and sadly, i do not have someone whom i can trust 100% to start my business in my absence. I am still single and my siblings are all busy with their respective lives. Does this mean that i am not in the right time to start my own business? I am planning to return home after a year (last quarter of 2014) and put up my own business. Financial wise, i have everything worked out – emergency fund, projected business capital and the type of business to venture on. Please share your opinion. Thanks, and God speed!

  2. Before someone quits their job, it’s important that they are really REALLY good at what they were doing in the office. Learn everything they can from that job before resigning. Be so good that people will hire you for it as a freelancer. That way if the business doesnt go asl planned and you have to go back to being an employee again, your previous employer will gladly take you back with open arms.

  3. Good day fritz and to all readers, this might not be totally related to this topic, but i think this is the perfect time for me to ask what do you guys think about being an insurance/investment agent as a sideline from my main job? Do you have any experience being an insurance/investment and do you consider it rewarding when it comes to monetary compensation? Pls share your experience if you do.

  4. Dear Fitz,

    I’m working in India rigth now. I’m still planning to quit my job an work as a forex trading online so I can be with my family for most of the year. Since my present employment is allows me only 3 weeks to be with them and then a have to come back againg in India to work. But lately there has so much disparity in the Exchange Rate of Rupees against the PHP. I’m looking for forex Trading as my alternative source of income once Im confident with it and eventually quit my job here in India as Software Developer. Is there a training in the Philippines that would equip me as a successfull forex trader. Knowing that these option is very risky. Please advise me on what I need to prepare. And by the is getting a CMT( Chartered Market Technician ) certification the best way to start with and is there a training Center in the Philippines.

    YOur opinion on this matter is highly appreciated.

    Many thanks and regards,

    Cris Pesaña

  5. @Roel

    You can “set” the business while you’re still working as an OFW. This means polishing the business plan such that all that is needed is execution, which you can do when you finally come home.

    I would advise that you save enough money to last at least a year (business capital not included) so you can have enough time to actually start the business and making it grow without worry about your own costs of living.

    On a side note, maybe you can see if your planned business can be executed online, like putting up an ecommerce website. If so, then you can actually start your business already.

    @carol

    Great advise! Thanks for sharing. :D

    @Gino

    Yes, that is a profitable sideline business and have actually met a lot of people who have later on resigned from their job to go full-time on being an agent. Most of them I met in IMG.

    @Cris

    Yes, I can recommend Mark So for the training in forex trading. I have a special section on this blog about forex trading, just check it out in the sidebar.

    Getting a CMT will be helpful if you plan to become a trainer yourself. Otherwise, it’s unnecessary.

  6. @Roel That is great advise from Fitz regarding the option to setup an ecommerce website. It’s so difficult and not to mention, expensive, to manage a brick and mortar business nowadays. If I could turn back the time I wish I could have put up an ecommerce website instead of buying a small franchise… Franchises are NOT guaranteed to succeed!

  7. Hi Fitz. Thank you for your advise on my concern. You are right on “polishing” my business plan while I’m still abroad and thats exactly what I am getting busy about right now. Fact is, my original plan is to quit my job this year but after thorough evaluation, decided to extend 1 more year to make sure i have all bases covered and polished.
    On the 1 year emergency fund, Its already been done in anticipation for the long months of no income while setting up my business. I too have been living a frugal and simple lifestyle despite enjoying a very good income (10x higher than what i was receiving as a Civil Engineer in the Phil) as an OFW. I firmly believe that living a simple lifestyle while having above enough income will help me develop the right discipline in handling my finances after I quit my job and the salary stops coming in. This too is my advise to would-be entrepreneurs. Develop the discipline to live a simple life while still enjoying having a good salary so when the time comes that you will face some financial constraints being an entrepreneur especially during the start.up period, you are ready and adjustment will not be hard.

    Thank you and God speed!

  8. @Caro
    Hi Caro, Thank you for your insight and opinion. You must have read my mind. I am in fact looking at getting a food franchise as one of my business options. It seems that you’ve been there or are in it right now and speaking thru experience. Forgive my ignorance but to be honest, I have very very little knowledge if nothing at all about ecommerce and how to deal with it. Your follow up opinion to Fitz’s recommendation has in fact sparked my curiousity on that possibility. How and where can I learn about ecommerce and all the things I need to know and do to start my business thru it. What type of businesses that I can venture thru ecommerce. Im all ears and very much willing to learn and explore as this may mean that I dont have to quit my job anymore thus keeping my salary while managing my business. Waiting in anticipation for more advise and assistance. Thank you.

  9. @Roel I bought a foodcart franchise selling lumpiang sariwa as one of my first business ventures. I stayed with it for over one year and it was so difficult. I did not get back the money I invested. It was an expensive education. The only good thing I can say is I learned a lot in a small amount of time – accounting, management, dealing with government agencies, debt management and negotiating w/ mall admin and franchisor. I invested what money I have left in attending seminars about setting up ecommerce websites. I haven’t gone full time in my ecommerce website but it opens the doors to so many other online money making gigs. I’m sure Fitz will have a good recommendation where you can learn about that. Good luck!!!

  10. @Caro. Thank you for your quick response. Sorry to hear about your franchise. Just a note. You mentioned about mall admin, so I can assume that your business is in a mall. I learned from one episode of “On the Money” that it is not wise to put up your food cart/franchise in the mall especially if you’re just starting as the space rent will eat up your profit. Anyhow, I will take your opinion highly, and will push hard to know everything i can about ecommerce. Thank you. Much appreciated.

    @Fitz, I would greatly appreciate if you can give me more specific info and recommendation on how and where I can learn about ecommerce via online as I am not in the Phils right now. Thank you.

  11. @Roel
    You can try the eCommerce Bootcamp of Janette Toral. I’ve taken that course and it’s a good one (I’m a member of DigitalFilipino Club). See it here: http://ecommercebootcamp.digitalfilipino.com/

  12. Good article! I think the most important point is to always have a backup plan and a backup plan of your backup plan. Sabi nga nila prepare for the worst, and hope for the best.


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