(Or: How To Transition Out Of The Corporate World Into Full-Time Freelance)
Are you in a soul crushing yet high paying job and want out but don’t know the next steps? Are you just bored at work and wish there was more to life? Do you have a passion you wish you could turn into a full time job? (If not, you may want to read “How To Find Your Passion” then come back here.) I’ve transitioned from management consulting to working for myself in the arts, without spending time in a homeless shelter. Here’s some lessons I’ve learned along the way that may help you.
Step 1: Bide Your Time…
…a.k.a. “Save Up Money First.” Be strategic about your next moves. You know you want to quit. Should you tell the boss to fuck off tomorrow? No! Bide your time. Figure out your exit strategy whether it’s save up a year’s worth of expenses before quitting, get laid off and collect unemployment or shift to part time, figure out the softest landing. If you quit without financial room to maneuver, you might get cold feet, and even if you do quit, you’ll be more likely to start at another job you dislike sooner than later because the money will get tight.
Even as I joined Accenture, I knew that I wouldn’t want to be there forever. (Although many of the people who I know that have stayed there for 20+ years also felt that way when they started.) My original plan was two years. It turned into three. Knowing that I wasn’t going to be there forever, and that the money wouldn’t be coming in forever, I set up a savings account. In a different bank than my checking account. And I had part of my paycheck auto deposit into the savings account (hat tip to Ramit Sethi’s automating post). And I wouldn’t look at that account for months at a time. (Unless my car needed repairing or something.) This way I was already used to living on 20% less than I was making. After three years of saving like this, I had enough cushion to be able to pay my expenses for over a year, even if I didn’t make a single cent doing other things.
Step 2: Hold On For As Long As You Can Take It…
…but not so long that you lose your guts.
Basically don’t quit until you’re making a partial side income, or at least have a few clients signed up. Do your passion project work on the weekends and evenings for as long as you can. (Or during work hours if you have some downtime and discipline.) Hold off on quitting until you have something resembling clients and a small income. It’s easier to go from making $100 a month freelance to $2,000 a month in freelance than it is to go from $0 to $100. (Not that either part is easy, and all income is gradual improvements in my experience.)
When I quit consulting, I had a smaller income lined up as a grad student. I quickly realized I didn’t want to be there and had saved up enough money that I could just quit without worrying about immediate employment. Before I moved back to NYC, I talked to some comedy places that had already been using me and paying me a few bucks to make sure I’d be welcome back. So when I first went to “full time artist” I had my beer and food expenses covered and was paying rent out of savings. After two years, my monthly income wasn’t high enough that my savings got really low, so I had to take on an additional consulting like gig, but this time I did it as a freelancer. And it had a finite end date after 9 months. I was making more money in comedy at the time, but not enough to cover all expenses. So I built up my savings again in those nine months. After working from 7am to 1am nearly every night for those nine months, I had enough comedy income (and motivation to never go back to an office) that I’ve been surviving ever since.
Step 3: Live Below Your Means Before You Quit
Even when I could afford to live in Manhattan (where it’s $2,000+ for a studio) I choose to live in Astoria ($900-$1100 for a 1br). Then I found a roommate to split costs even more. When you’re freelancing, you’ll have some slower months than others. Knowing that you can at least cover your rent helps you sleep at night. And you’ll need that sleep because all you do is work. This is the most important thing: Finding the cheapest place you can see yourself living in comfortably for five plus years. Because it will probably take you much longer than you expect to get to a similar financial foothold as some of your peers who’ve stayed in the safer waters of a steady paycheck. All other expenses (like going out to eat) you can cut down on quicker during lean months. Rent is the one that will get you the quickest. I wouldn’t advise moving back in with your parents, as it might kill your motivation. Knowing you have to make some money every month will keep you hustling harder.
Step 4: Show Up Every Day
So you’ve finally quit your structured job. Now what? Figure out your daily process. And stick to it. (See Scott Adam’s book and The Jerry Seinfeld Method.) I have a huge board where I have six daily goals: Write, Perform, Exercise, Eat Right, Make Money and Meditate. I put a check mark next to each day when I do that activity, and an X when I don’t. I don’t do all 6 activities each day, but I do most of them, and I’m at least aware of the minimum I should do to have had a “successful day.” I also have a daily to do list, things that I should get done that day. Although it usually takes me 3-4 days to finish it. But it’s right by my computer. So I know what I should be doing. It stares me down when I start dicking around on the internet too much.
Have a place where you can interact with like minded individuals daily. For me, this was easy because I’d be at comedy shows every night. If you’re in a different field, perhaps you schedule yourself to attend a different meetup or networking event every night. Or if you can afford it, shared office space. You want to avoid a situation where you have no human contact weeks at a time and where the Chinese food delivery guy is your only source of news from the outside world. This step should really be four steps, as it’s the most important thing when you’re trying to establish yourself. People need to see that you’re serious and always around before they give you a break.
Step 5: Be Open To Niches You Didn’t Originally Consider As A Possible Business
Even if you’re not in a tech startup, think like a tech startup. Twitter wasn’t twitter when it first started, but it noticed its early users were using their system and made changes accordingly. Keep your head on a swivel and notice what’s working, then put more effort into that.
I originally bought a very nice video camera because I wanted to film and review my comedy performances. (I still had my consulting job, so it didn’t hurt that I could spend more money.) I had no other motives for buying it other than my own video review. Soon after getting it, other people started asking if I’d film their performances. This quickly turned into an accidental business and a nice source of side income. By showing up every day and keeping my eyes open, I pretty much created an extra job for myself where none existed before. From this, I also taught myself video editing and how to shoot sketches and short films. People started paying me to do that. Then they realized I was good at computer stuff, so they asked if I could build their websites. Three businesses that I didn’t plan on doing just from being aware of what was going on around me.
Step 6: Create Multiple Income Streams
Until you’re sure that you have enough business coming in from doing only one thing, do a few different services so that it averages out into an income for each month.
Last year I got paid for doing the following things: performing comedy, voice over work, video filming, producing comedy shows, website design, video editing and selling copies of my book. Each month had a different percentage breakdown of which activity brought me the most money. If you work freelance and for yourself, you’re gonna want to have as many income streams as you can until one of your businesses really takes off. Is it a lot of work? Yes. But it’s still better than not controlling my own schedule and working on things I want to work on.
Step 7: Find Mentors
If you’re showing up every day, you’ll be meeting people. Some of them doing what you want to be doing. Some subset of those, you’ll be on the same energy vibe. Try to eventually start working with or for them. Ask for a piece of advice here or there, slowly they’ll become your mentor without even realizing it. Have a few people like this to bounce ideas off of.
Whatever you’re trying to do, someone has done something similar before and succeeded. If you don’t know who that is in your field, have you been showing up every day? I’ve found people are happy to share their experiences and advice when you remind them of a younger version of themselves. Hell, that’s what I’m doing right now.
Step 8: Have Gratitude
You’re gonna be annoyed that you’re not living a baller lifestyle for a bit like some of the people you keep in touch with. They’ll be buying a house or having a kid while you’re giving birth to your projects. Remember that people only post the highlights on Facebook and not their miserable minute to minute daytime existence. Remind yourself that if you don’t have to go to a job you hate, you’ve already won.
Thank you to Ishita Gupta for prodding me to write this post.