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Not having to participate in boring and pointless staff meetings

Once you’ve decided on a business to pursue and your home business starts to show an income, you may begin to think about quitting your day job. You may notice that the more hours you put into your business, the more money you make, which is something you probably can’t say about your day job. You may start to think that you’d be better off putting in full-time hours where your heart is.

But before you rush into that decision, there are some other things to consider carefully.

How much do you make?

You may think you know the answer to that, but your salary is probably only a small part of what your employer is paying you. While it’s true that some companies don’t offer great benefits, if your company offers any benefits at all, you have to consider their value, and what it will cost to replace this benefit to yourself with your home business.

Some things to consider are:

Health insurance: Purchasing health insurance as a self-employed person is considerably more expensive than purchasing group care through an employer. If you have a lapse in coverage, premiums go up and there is usually a waiting period for coverage.

If you are married and covered under your husband’s policy, don’t think this is something you don’t need to consider. Women tend to outlive their husbands. A smart businesswoman always considers the possibility of having to be completely self-supporting, because most women are self-supporting at some point in their lives.

Also consider costs of dental and vision insurance coverage.

Life insurance: If your company has offered life insurance coverage, find out if it is possible to continue this coverage if you leave. If not, look into the cost of adequate life insurance coverage.

Paid time off: For any disgruntled employee, it may seem that paid vacations, holidays and sick time offer little consolation for the lack of freedom that goes along with a full-time job. One thing that you have to keep in mind is that when you work full-time at a home business, often in the early years, there are no holidays or vacations, and if you do manage to arrange time off, unless you have a business that earns on automatic pilot, you will not get paid for that time.

Disability coverage: If your company offers short or long-term disability coverage, you don’t have to worry about an unplanned illness or accident – your income will continue. Not so for a home business. Think about what you will do if something catastrophic occurs.

401K: Don’t forget to plan for retirement. Many companies offer 401K matching. Can you afford to give that up?

Lack of a steady paycheck: Although your business may seem solid when you first begin to consider quitting your day job, businesses often run into unexpected bumps in the road. You can no longer count on a paycheck on a particular day. Make sure you have a cushion in the bank of at least three to six months salary before you even consider making the leap.

Income taxes: Working for an employer doesn’t prepare you for the responsibility of monitoring your own income taxes. You have to remember that you don’t get to keep everything you earn from your business, and you have to anticipate deducting 25-30% of your income and setting it aside to pay taxes. If you’re making a significant income from your home business, you should consult with an accountant to setup quarterly tax payments for you.

Leave on good terms: Certainly you want to believe that it’s ok to give notice and walk out one day without looking back. Becoming 100% self-employed is an exciting decision, but make sure you’re ready. Don’t burn your bridges. You may find you don’t like being self-employed as much as you think you will, or you may find you might want to get a part-time job to supplement your income at some point. Good references are always something to be coveted.

Your dream of working from home full-time can become a reality. Make sure you’re really ready when you take the leap.

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Janet Giacoma is a long-time home business marketer. You'll discover more work from home information on her home business blog. An excellent resource for additional information.

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