When your hobby turned side hustle starts growing, you might start thinking about taking it full time. What started as something small to make extra money on the side—to pay for the kids’ piano lessons or save up for a vacation—is now making hundreds or even thousands of dollars per month! Being your own boss sounds like a great idea, but how do you know when it’s time to quit your day job and take on your side hustle full time?
With a little passion and self-confidence, you can do it!
Henry Ford started his automobile company while he was still employed by the Edison Illuminating Company. Steve Wozniak continued working for Hewlett-Packard for quite a while after cofounding Apple with Steve Jobs. And eBay was launched while Pierre Omidyar worked for a software-development company. These are just a few examples of some of history’s most significant companies that began as side hustles.
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A study conducted by The Academy of Management Journal confirms that businesses grown gradually on the side while the business owner is still employed full-time at another company are 30% less likely to fail. I like those odds!
Making the switch from side business or hobby to full time isn’t something you can take lightly. The obvious question is, do you reasonably see yourself making enough money working for yourself? Here are five things you should consider:
Step 1: Ask yourself if this is what you really want.
Many women don’t want to run their own business full time, open a storefront, or have employees. Scaling, expanding and hiring may not be on your list of goals and dreams at all—and that’s okay! I always encourage people to chase their version of success, otherwise, you will end up crossing someone else’s finish line.
Maybe your business is growing fast, and your friends and family are encouraging you to expand or hire help. But if that’s not what you want to do with your business, you don’t have to go that route. Be successful on your own terms. Regardless of your background, industry, number of team members, or level of revenues, you know what’s right for you better than anyone else does.
Step 2: Build up your side hustle to the point that it feels like you’re working two full-time jobs.
If it feels like you’re working two full-time jobs right now, that’s a good sign—because you kind of are! You can absolutely juggle both for a season; in fact, I teach that things will be crazy busy when you’re ramping up your business. It will be stressful at times, but if you’re passionate about what you’re doing, then the late nights, early mornings and working weekends will eventually pay off!
If you’re turning down work because your plate is overflowing, you’ve got a hot business on your hands. It may be time to take it to the next level! Watch my video below for more on this:
Step 3: Calculate if you can reasonably live on what your business makes right now.
If you invest more time (and/or money) into your business, don’t assume you’ll see a bigger return.
I remember coaching someone who worked on his side hustle ten hours per week, and the business earned him $10,000 for the year. He assumed that if he quadrupled his time working on his business, the income would quadruple as well. So he quit his full-time job and worked on his side business full time. But the demand wasn’t there for forty hours per week yet, so he only earned slightly more than the year before.
But keep in mind that you don’t necessarily have to replace your full-time income. What you can do is reassess your budget and decide if you can live on less. Maybe you’re bringing home $50K from your full-time job, and you’ve built your side gig up to $30K. Can you make it on $30K? If you’re married, talk with your spouse about it. Maybe you can make some cuts and live within a smaller budget because running your own business full time is worth it to you!
Just don’t forget about the extra expenses you’ll have to take on that full-time employers generally cover, such as:
- Health insurance
- 2% of Social Security tax
- Matched 401(k) contributions
Down the road, your business may continue to grow and you could make the income you did before. That’s what you and I both hope for you! But it’s not wise to bank on that scenario if it’s nowhere near the case now.
The point is, you want to build your revenues up high enough so that it doesn’t feel like a terrifying leap when you leave your “safe” full-time job for your side business. You want to pull the boat up close enough to the dock so that when you take that step, you don’t fall into the water.
Step 4: Have a business savings account.
If you don’t wait for your side business to replace an income you can live off of, but you have money saved up to make it work for a while, that’s okay too. If you’re debt-free and have the savings to invest in your business, it’s completely your call. It’s not wrong; it’s a value decision. It’s your business, so you get to decide!
Regardless, it’s wise to have a business savings account on standby. If you and your family’s livelihood will depend on the success of the business, you have to be ready for a rainy day, season or quarter.
Step 5: Look for ways to work smarter, not harder.
A lot of people make the mistake of believing that if they quit their full-time job to work on their business, they’ll have all this extra time to make the business even better. What they don’t realize is that when it’s your full-time gig, you’ll likely have even more demand (based on Step 2) and things to keep up with than when it was just “on the side.”
Your time is finite. You can’t physically do it all. And just because it’s your main gig doesn’t mean you’ll never want a day off, right? It’s important to have systems in place that prevent your business from coming to a grinding halt when you’re away.
So, before you make the switch, have a plan in place as to how you’ll be able to handle it all. Here are some ways to save yourself time:
- Start automating your social media
- Look into hiring a virtual assistant.
- Find ways to streamline your process. For example, create a policy that you’ll only ship products on Mondays and Thursdays.
Is your side hustle ready to be a full-time gig?
So, should you take your side hustle full time? The biggest thing I want you to remember is that when your side thing becomes your main thing, it’s no longer just an optional, fun, part-time side gig bringing in bonus cash. It’s your real job with a real boss (you), and you can’t afford to take your foot off the gas. If anything, since it’s your only source of income, that’s when you need to go for it like you never have before!
It’s hard to start a business, and it’s hard to keep it up and running while you’re in the trenches. But here’s the thing: You don’t have to be on this journey alone. With the right training and support, you can create a successful business—and you don’t need a degree to make it happen.
For the complete plan on how to start or grow a business and make money doing what you love, pick up a copy of Business Boutique.