When my husband wanted to quit his salaried job and start his own business, he came up with a dollar amount that he wanted to have saved up to cash flow his business. I came up with a plan on how we would get to that amount, and we both agreed that it was worth sacrificing to reach the goal. DH started his business almost 17 years ago, about 2 years after we implemented our plan.
In a nutshell, this is what we did:
- Sold our condo. Took the proceeds and put it in the highest paying CDs we could find.
- Created a budget that required us to live on my income only. We moved to an apartment that was a dump, did not spend on extras like travel & entertainment (and certainly not any crazy stuff like lattes), and cut other expenses to darn near bare bones.
- We saved 100% of DH's income (except contributions to 401k up to company match) and put it in to high-interest savings account.
- We also started a very small side business and the small income it produced went in to savings. The income was so small. I remember my mom saying that we were crazy for doing it. It was hard, and we worked on it together in the evenings after our day jobs. But what we were doing was learning: about keeping books, small business taxes and licenses and processes, etc.
This is what we achieved:
- Savings for the new business cash flow.
- Knowledge about how to run a small business.
- Confidence that we could survive on my income alone. This gave us the courage for DH to go ahead and quit his salaried job and start the business once we had enough saved up.
DH's business, started almost 17 years ago, has ended up being by far our best "investment." It was doing all of the "boring" stuff (working at salaried jobs, cutting expenses, and saving) that led up to us being able to make such a good "investment."
In a nutshell, this is what we did:
- Sold our condo. Took the proceeds and put it in the highest paying CDs we could find.
- Created a budget that required us to live on my income only. We moved to an apartment that was a dump, did not spend on extras like travel & entertainment (and certainly not any crazy stuff like lattes), and cut other expenses to darn near bare bones.
- We saved 100% of DH's income (except contributions to 401k up to company match) and put it in to high-interest savings account.
- We also started a very small side business and the small income it produced went in to savings. The income was so small. I remember my mom saying that we were crazy for doing it. It was hard, and we worked on it together in the evenings after our day jobs. But what we were doing was learning: about keeping books, small business taxes and licenses and processes, etc.
This is what we achieved:
- Savings for the new business cash flow.
- Knowledge about how to run a small business.
- Confidence that we could survive on my income alone. This gave us the courage for DH to go ahead and quit his salaried job and start the business once we had enough saved up.
DH's business, started almost 17 years ago, has ended up being by far our best "investment." It was doing all of the "boring" stuff (working at salaried jobs, cutting expenses, and saving) that led up to us being able to make such a good "investment."
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