Have you given serious thought to how much money you need to make online in order to feel comfortable making the leap from cubicle dweller to full-time entrepreneur? Read on, that number may not be as big as you actually think.
Is It How Much You Make Or How Much You Spend?
When it comes to quitting your job in order to focus on making money online, how much money do you need to make to get by, feel secure, or feel as though you are prospering? For many, this magic number is usually what it takes to replace what they are making at their current job…and this number can be dauntingly big.
For me, I would need to be making nearly $6,000 a month in order to replace what I am currently making at my job, even more if I took into account insurance, retirement, and unemployment benefits. If I were to include all of these perks, we’d be talking about more like $8,000 a month.
If I needed to get to that place (eight grand a month!) before quitting my job, working in the evening and on the weekends to build my online business, chances are I would probably never get there. Unless one hits a serious streak of luck, that’s borderline impossible to do without putting in some serious time. And as you know from reading my blog, I’m not just looking to trade my current stressful job for another one just like it.
So, how do you do it? How do you get to the place where you are making enough money on the Internet where you can quit your job so you can really pursue your passions and build a legitimate online business? It’s really quite simple…I don’t need to give you Scotty’s eight step plan to quitting your job and making money on the Internet. It really just boils down to two things…
#1. Get Out Of Debt Fast!
Debt is dumb and is a stronghold that will keep you from ever reaching financial freedom. Pay off as much of your debt that you can and don’t accrue anymore if at all possible.
Does that sound harsh? Borderline impossible? If you are looking towards or already involved in Internet marketing, you are well ahead of the curve. Have you ever listened to the people on the Dave Ramsey Show? They wipe out their debt by simply buckling down and making hard choices (beans and rice anybody?). Most of them don’t know anything about generating extra income online. As an Internet marketer (or blogger or ecommerce website owner or whatever else you are), you essentially have the ability to generate an extra paycheck every month by . This makes paying off debt happen that much faster.
Once you are out of debt, don’t accrue anymore. There would be absolutely no way I could be planning to quit my job in the next six months if I was sitting on a bunch of credit card debt and car payments. If you are of the mentality of needing to keep up with the Jones, always buying stuff you don’t need with money you don’t have, you will never have the financial independence you need to be your own boss.
Once your debt is paid off, you really don’t have to make much every month to make ends meet.
#2. Start Saving Today!
If your debt is paid off, you need to start saving a significant part of your income (both online and offline). Having a nice chunk of change sitting in the savings account will allow you to sleep so much better at night when your monthly income is not guaranteed. This number is different for different people and for different financial situations. For me, I believe I will feel comfortable with between $30,000 and $40,000 in the bank. To you, this may sound like too much (is that even possible?) or not enough, but like I said, it’s different for everybody.
Now, Quitting Your Job Is Not That Hard
See, I told you, it’s really only two steps that can be boiled down to this:
- Spend less than you make
- Save a chunk of what you make
Once you have significantly reduced your debt and have a nice saving built up, you will probably feel pretty good about quitting your job with far less than your current monthly income coming in. My goal is to have $1,000 a month coming in passively from my online efforts before I quit my job. This is a far cry from the six grand I’m making now. The reason I can feel confident making this bold move is because I have a good sized savings built up and little debt besides my mortgage.
Now It’s Your Turn
So how much money would you need to have coming in before you could even think about quitting your job? Would you have to have all of your debt paid off? What size savings account would make you feel “comfortable?” Comment and let us know.