Leaving That J-O-B

Since I'm now fully focused on my marketing communications business, I have had many people tell me that they are thinking about working for themselves as well. They ask me for any tips or things to think about before they take the plunge and leave their full-time J-O-B.

1. Calculate what you need to make as a contractor to cover things like insurance, retirement, vacation and sick days. One of the things I forgot to calculate was vacation and sick days. Yes, I can take a day off whenever I want, but I forgot to add that into my hourly contracting rate.

2. Talk to your financial advisor. Make sure they give you an opinion on your proposed hourly contracting rate and that you're set-up for things like insurance, retirement, etc.

3. Hire a tax professional. Yes, it's an extra expense, but you need to do it. They will be able to help you answer questions you have about running your own business including the best form of business (S-Corp, C-Corp), what you can deduct, what percentage of your home is included as part of your office space, and paying quarterly taxes. Plus they stay up-to-date on current tax laws which may help you even further with your taxes.

4. Pay quarterly taxes! Normally with a full-time J-O-B, you are withholding money throughout the year that will count towards your end of the year tax payment. It will be easier once you know what you should be withholding the first quarter so you know what to expect for the rest of the year.

5. Remember that working from home still requires you to work. I work out of my home office and the first month that I was working for myself, I couldn't make the hours that I needed. Because I was home during the day, it became my responsibility to run errands that were normally taken care of outside of business hours. Just because you work from your home doesn't mean you can't work. Make sure to prioritize what needs to be done so you can still get your work done.

6. Your paycheck won't come twice a month. Working for yourself typically means billing on a monthly basis. Now you can write a contract with whatever terms you want, but typically companies bill once a month, which means you get paid once a month. Work you are completing on June 1 won't get paid until at least the second week of July. It's nice to have a little extra money to cover those time gaps when you first start out.

These are just a few tips for things that I experienced. If you are thinking about taking the jump, talk to people you know that work for themselves and see what their experience was. I will tell you that it gives you greater flexibility to do the things you want to do and greater freedom as well.