8 Steps To Becoming Your Own Boss

AAA

Working in your pajamas, setting your own hours, having good coffee at your desk for a change... there are lots of reasons people dream of leaving the traditional workplace and becoming their own boss. The perks are great, but the work is still hard. If you're serious about being your own boss and working from home, you can definitely do it—here are the steps you need to take.

Step 1: Know Your Financial Situation

The essential first step to becoming your own boss is figuring out how you're going to write your own paycheck. You need to know how much money your own business will have to make to keep operating and providing you with a livable wage. Before you start mentally decorating your new home office, sit down with your financial records and your calculator. You need to consider not only your personal finances, but also the projected financial situation for your new business. How much money do you need to get started? How much money do you need to keep operating week after week? With these numbers in hand, you'll be able to see if your business is financially viable.
 

Step 2: Consider Your Stability and Personal Discipline

Money isn't the only factor when it comes to being your own boss. You need to have stability in several areas of your life:

Your emotional state: Are you easily upset? Do you panic in times of crisis? How do you respond to pressure?

Your personal support system: Do you have support from your family or close friends? Do you have at least one business-minded, trustworthy person to talk to about decisions and options?

Your time management skills: Do you overload yourself constantly? Do you meet deadlines? Can you make yourself stay organized? Being your own boss means keeping track of your own time, money and projects.

(For related reading, see: Are You an Entrepreneur?)
 

Step 3: Decide What You Want to Do

If you're going to be your own boss, you'll also be the employee, so what work are you going to do? Hopefully the answer is based not only on your professional skills but also your personal passions. If you can find something you love to do, you do it well and you can make money doing it as your own boss, you've found the sweet spot. Be specific, don't just decide you'll be a business consultant. Decide what kind of consulting you'll do and who your ideal clients will be.
 

Step 4: Start Part-Time

Unless there is an ethical or legal reason for not doing so, take several months to start being your own boss on a part-time basis. Set aside an evening or two a week and a day out of each weekend to start building your business. Why do this instead of jumping right in? The simple truth is that it takes time to build up a regular client base large enough to provide you with the income you need to live. So start part-time, hang on to that stable income and squeeze your "extra" work in on nights and weekends. Yes, it means you will be busy, but that won't change once you quit your job to run your own business full-time. Doing both for a while will simply help you hone those time-management skills.
 

Step 5: Figure Out the Transition

As you build up your client base, you'll start feeling the pull of your home office more and more. At this point, you need to figure out how you'll transition from your office job to your be-your-own-boss job. Talk to your boss about cutting down to half-time or part-time at your current job. Being able to maintain some of the income from your regular job will relieve some of the financial pressure and allow you to save whatever is extra. If there is no part-time option at your job, figure out a timeframe for quitting and where you need to be in terms of clients and money at that time. 

(For related reading, see: Starting a Small Business: Making the Leap.)
 

Step 6: Set Up Shop

Once you've got a timeframe in place, you need to get serious about becoming a legal business entity, keeping tax records and financial documents organized, and having adequate space in which to work from home. If you haven't already, look into the options for legal business structures; you can choose anything from a simple sole proprietorship to a C corporation. All have different benefits, drawbacks, requirements and, of course, taxes. Get professional help if you're uncertain about any of the options, because this is one thing that needs to be done right. Along with your legal structure, you'll also want to take some of that transitional time to make sure your home office is set up for productive work. If you're having problems finding quiet time, private space or regular hours to work at home, you'll want to start figuring those problems out now and working on a solution.
 

Step 7: Don't Burn Your Bridges

When the time comes to say good-bye to your old job, do it graciously, even if you hated everything about it. Chances are your old employment somehow relates to your new business and you'll run across some of the same people. There's no need to tell people off or leave everyone with an unprofessional memory in their minds. Be courteous in your leaving, stay in contact with the people important to your new endeavor, and don't slam the door on your way out.

(For related reading, see: 3 Key Steps to Take Before You Quit Your Job.)

Step 8: Keep the Work Coming

The main secret to successfully running your own business is to keep the work flowing in. Make it a priority to spend time cultivating new work, even when you're already swamped. Work tends to ebb and flow; if you don't hustle before the ebb, you'll be living on rice and beans until the flow comes back in, because it's up to you to keep the flow going. 

The Bottom Line

The beauty of being your own boss is the more you put into it, the more you really will get out of it. It isn't easy forcing yourself to be organized and on top of time management—even if you are organizing in your pajamas—but it's worth it to reap the benefits of a business that is successful, profitable and gives you the freedom to take it in the direction you find most rewarding. You may find the best boss you've ever worked for is you!

(For related reading, see: In Small Business, Success Is Spelled With 5 "C"s.)

  1. No results found.
Related Articles
  1. Personal Finance

    3 Key Steps To Take Before You Quit Your Job

    Leaving a job on the best basis means thinking through everything from professional etiquette to what's financially adequate.
  2. Small Business

    5 Signs You're About To Be Fired

    These red flags might mean it's time to start looking for a new job.
  3. Managing Wealth

    Things You Didn't Know Could Get You Fired

    You can be fired for a number of reasons not yet outlined in your company handbook.
  4. Small Business

    Start Your Own Small Business

    Quit your job, be your own boss and earn a paycheck. Find out what to do to make it happen.
  5. Small Business

    5 Bad Habits Every Entrepreneur Should Avoid

    Learn how to avoid specific bad habits that plague entrepreneurs, such as failure to plan, bad associations and not keeping a good work-life balance.
  6. Personal Finance

    Calculate Your Self-Employed Salary

    Deciding on a salary is tough when you're self employed. There are several factors to consider before setting a price on your services.
  7. Small Business

    Starting A Business? Consider This First

    Going into business for yourself can be a fantastic, liberating experience. But beware of the hidden pitfalls.
  8. Managing Wealth

    Job Hunting On The Sly

    These tips will help you look for a new job while keeping your existing one.
  9. Personal Finance

    Can't Get a Summer Job? Be Your Own Boss!

    Find out how to get started and what resources are available to help you become a successful entrepreneur.
  10. Personal Finance

    2 Statements to Help You Understand Your Finances

    A balance sheet and cash flow statement will help you understand where you stand financially.
Hot Definitions
  1. Ethereum

    Ethereum is a decentralized software platform that enables SmartContracts and Distributed Applications (ĐApps) to be built ...
  2. Cryptocurrency

    A digital or virtual currency that uses cryptography for security. A cryptocurrency is difficult to counterfeit because of ...
  3. Financial Industry Regulatory Authority - FINRA

    A regulatory body created after the merger of the National Association of Securities Dealers and the New York Stock Exchange's ...
  4. Initial Public Offering - IPO

    The first sale of stock by a private company to the public. IPOs are often issued by companies seeking the capital to expand ...
  5. Cost of Goods Sold - COGS

    Cost of goods sold (COGS) is the direct costs attributable to the production of the goods sold in a company.
  6. Profit and Loss Statement (P&L)

    A financial statement that summarizes the revenues, costs and expenses incurred during a specified period of time, usually ...
Trading Center