Students often ask me when they should quit their jobs to focus on their business.
First of all, I say it’s better to keep your job for as long as possible.
This means you have less stress and more money to invest in your business which ends up becoming more important once the business is built.
Next, you need to do a calculation of whether your business can sustainably and consistently fund your current lifestyle.
So, do an in-depth audit of how much you’re making and how much you’re spending personally as well as in your business.
Cut down on as many unnecessary expenses as possible.
Next I recommend keeping a large portion of your income as savings. You should have at least 6 months of income saved up to cover 6 months of expenses should your income be cut off for a period.
Once you’ve got 6 months in savings, then you can think about whether your business is making enough to sustain you.
First work out how much disposable income you need for the wants in your life e.g toys, travel, restaurants, Vodka, whatever you’re into.
Second go through all of your needs, decide which really are needs, the things you can’t get rid of e.g food, shelter, taxes, insurance, family.
Once you have all of these things you can then determine how much you need to make each month to live your current lifestyle or a future desired lifestyle if you do it as a future projection.
