I picked up this new word today, "WANTREPRENEUR." This refers to all people who talk about wanting to do something, make something, sell something, or even those who have great new ideas but fail to even try to execute them. So many ideas, so little time. Sounds familiar?
It's so cliche when you hear everyone talk about these, but don't act on it. There'd be all kinds of excuses: "I need to have a steady income," "I have kids," "I don't have time," "I'm too busy with 'life,'" and so on. These "problems" don't solve themselves. You have to figure out what holds you back, and try to address them in a way that suits your current situation (and personality).
Let's talk about the first hurdle I hear most about: money. I wish I can tell you that money is just money, but it isn't. But in case you're one of the lucky few who have enough moolah to start a business... seriously, what are you waiting for? For everyone else, let's talk.
You "need money, and a steady source of income." Don't we all? Let me ask you, do you know how much you need to live comfortably? Take into account your monthly expenses: which of those transactions are just for careless shopping, excessive nights out, or even money you spend in the mall when you're just waiting for traffic to subside? Do you really need that upsized soda when you eat out? (It's bad for you, too, y'know.) How many times have you wandered aimlessly at stores (bookstores for me) getting something you think you might need sometime?
Two years ago when I thought about quitting my day job to focus on art, I knew I needed money to make sure I survive despite having no steady income. The suggestion was to have 6 months of living expenses in the bank, but my venture is art-related so I aimed for one year's worth. But, uh, I didn't actually have money in the bank. What a downer; If I can roll my eyes at myself, I would have. Good job, self *insert sarcasm here.* So, I opened up a separate checking account (that didn't come with an ATM card) and dubbed it my "Resign Fund."
I downloaded an expense manager app and noted every transaction I made. Every. Single. One. Even that hairtie that I bought from 7-Eleven because I forgot one hundred others at home. The biggest culprit for me was dining out. I lived on my own, and I was too lazy to cook so I always dine out or have food delivered on most days after work. The next month, I made a conscious effort to stick to my budget, and allotted P4,000 per month on restaurants, fast food, food deliveries, and happy hour. The following month, I cut that budget to an even lower one. I turned down invitations that I deemed too often, ate at home more, and suggested budget-friendly restaurants when dining out with friends, telling them I want to save up for my fund. Often I would get replies like, "Oh gosh, I should do that too, because I want to do this, blah blah blah..." Well... most of them still haven't done that til now.
MY RESIGN FUND COMPONENTS
Truth be told, I realized that my job actually was paying me more than what I NEED in a month, but I had lived a life that I knew I can afford with that steady paycheck. OK, now the adulting part: How much do I need for a year once I'm finally unemployed? Cutting it down to basics, here's what I came up with and how I adjusted them to a more cost-effective, yet comfortable, budget.
- Apartment Rent - My apartment then was good and cheap so I didn't have to move. (If you're also renting, but can find a cheaper alternative, consider that option.
- Groceries. Conscious effort on not wanting to buy everything you *think* you need.
- Internet - I knew I need this, but I downgraded to a conservative 2mbps.
- Mobile Phone - Downgraded my postpaid plan to the best promotion there was, which was half of what I was used to paying. Swore I wouldn't get a new phone when my contract expires.
- Electricity - That A/C usage needed to be regulated.
- Automobile Maintenance & Fuel - I switched to a 1.3L M/T sedan from a 1.8L Automatic small SUV! (If you don't drive, consider your transportation expenses.)
- Dining out with friends: Max 4x a month!
- Insurance payments - Fixed and non negotiable.
- Installments that I'm paying for on my credit card - Fixed and non negotiable.
- Medical / HMO card - Find the best coverage for an individual plan (You need this!)
- Social Security - To continue my contributions after I quit my job.
- "Investments" - A laptop, a lightpad, a worklamp, etc. things I need to create my output for clients.
- NO EXTRA BUDGET FOR MORE NOTEBOOKS, PENS, AND INK. I NEED TO EARN THEM FROM COMMISSIONED WORKS.
I then calculated this monthly cost (averaging from my months of tracking) and added about Php 1,000-2,000 for miscellaneous unpredictable expenses (like gifts, donations, etc.) and multiplied it by 12.
In short, I had a lot of saving up to do. Resign Fund Goal divided by my Monthly Savings Target produced a feasible goal of TEN months of saving up for a year's worth of living expenses. I'm a bit on the impatient side and ten months sounded like a really long time, so I upped my game and scrimped a more. I reached my goal in seven months time.
WHAT THIS MEANS FOR YOU
So maybe you're not looking into quitting your job, but still want to be an entrepreneur. That's great, too, if you can do it at the same time! Start your "Business Fund." Your "Entrep Fund." Your "Build My Empire Fund." Whatever you want to call it. By being conscious about your expenses, you have the opportunity to identify how much you can allot for establishing the business you have in mind. Stop waiting to have that "extra money," these don't fall from the sky, nor come in the form of lottery winnings. Start tracking and analyzing your spending habits. Staying within budget will ensure you have some to set aside for the dream venture, without sacrificing your family's needs. Work on a few side projects and add that to your fund, instead of splurging on a new pair of shoes.
Give yourself a goal on how much you really think you need for the business, and not a conservative estimate. At the monthly rate you have come up with, how many months would it take? Gather these data for your own awareness. Saving up money without a goal is like receiving a text message from a friend who's running late for a meetup saying, "I'll be there in a bit," you'd just be there waiting unsure how long it's going to take.
If you're reading this and still find yourself thinking about more excuses on how you can't do this financially, this may all just boil down to the fact that you don't really want to be an entrepreneur. Because if you want to, you'll at least start to try to figure it out.
Next week: The wantrepreneurs who don't have time.
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