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How to Transition from Employee to Entrepreneur

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Do you want to leave your current job and do something wildly different? Making the transition can be tricky. Are you sure you have to leave? Is there a way to be an intrapreneur (someone who pursues innovative ideas within a full-time job)?

Becoming an entrepreneur-or an intrapreneur-starts with setting goals. Begin where you are, and don't worry about where you've been (in the words of Ella Fitzgerald). Hire a coach and/or a financial planner to help you think through all the issues. Find an accountability partner or a mentor to keep you company on the journey.

The shift won't happen just because you wish it to. You need a strategy. The world needs you and your ideas. People need your products and/or services. Blazing your own path can be a wonderful way to maximize your potential, impact others and build communities in new and innovative ways.

Here are some things to thing about before taking the leap:

Determine Your Compelling Why

Making a leap to the life of a small business owner or entrepreneur is easier if you have a compelling reason (beyond "I hate my job"). The book Start With Why by Simon Sinek can be helpful in finding this "why." There are also videos available about the book. Reflect on what motivates you. Do you have a "burning" desire to start a business that is constantly on your mind? Why do you want to pivot into that direction? Is it to gain more control of your time, or to control your own destiny as opposed to allowing someone else to? We live in a time when choices are somewhat limitless if you have the drive to take the necessary risks to become a business owner.

Compare the Risks of Your Current Job to the Risks of Seeking Your Future Fortune Elsewhere 

There is a risk with starting and running your own business. There is also risk to staying where you are. We've seen this time after time, even before COVID. Businesses of all sizes have been impacted by depressions and recessions. You have no doubt heard about companies severing large numbers of employees with little notice. You may have experienced a job loss or be in a situation you consider "safe." That could change anytime. So which carries the most risk for you? Staying or going?

Look at the Relationship Between Goal-Setting and Success

Many employees have thought of starting their own businesses. To transition, it is important to develop a clear understanding of your purpose, vision and mission. After that, set concrete goals for what will happen when. A plan with meaningful goals and action steps that will move you towards hanging out your shingle is essential. Timelines for the actions you commit to taking will help with self-accountability. With no "when" for your "why," your idea will probably remain a dream.

Take Action Now

Here are a few ideas for making a start:

  • Develop a business plan while still working and seek chances to test your business idea. Some people decide to moonlight, taking a part-time job in the industry they want to enter, or create a "side hustle."
  • Think and act like an entrepreneur within your current job. Offer solutions to the problems your department and /or organization faces. See if you like how it feels to go out on a limb while it is still attached to the tree.
  • Network with others who have businesses similar to the one you want to start. Networking widely will allow you to build relationships that will help you transition.
  • If you don't have a financial plan, partner with a fee-only financial advisor to develop one. Everyone needs and deserves a financial plan, especially aspiring business owners. Make it a priority to be disciplined about saving money and executing your plan with the transition in mind.
  • Hire a business or life coach to help you build a plan.

The above steps can help you begin the process. They will also help you build confidence and become more excited about the possibilities for your life. There is a maxim that goes, "If you don't start your own business, you will spend the majority of your life working for someone who did."

Starting your own business is possible, but you must make it a priority and be systematic about taking the necessary steps to do so. Don't live a life of quiet desperation and allow life to pass you by. Moving from wage-slave to entrepreneur is not easy, but it can happen if you decide to shift from dreaming to taking action.

This content is developed from sources believed to be providing accurate information, and provided by Kelly Financial Planning. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.