Authors: When to Leave the Day Job
Being “funemployed” once meant enjoying the freedom of unemployment between jobs before your money ran low. These days, however, the definition has evolved. Many entrepreneurs now attribute it to the state of living on your own terms, having quit a job you hate to focus on a side hustle you enjoy. There’s a good chance the idea of funemployment resonates with you if you’re an author and want to go full time, waking up every day with no boss and no forced schedule.
Right now, with the Great Resignation in full flow, the idea is more mainstream than at any time in living memory. According to a Bureau of Labour Statistics released in January 2022, over 4.5 million Americans have walked out of their jobs since the pandemic began. And with so many employees having the time to pursue creative pastimes after being told to stay home in 2020, many of those who’ve left the day job are authors. They’ve entered the creator economy, alongside a whole new generation of bloggers, social media influencers and creator-entrepreneurs. What’s more, anecdotal evidence tells us many of them are richer and happier as a result.
We can all agree that Covid-19 was bad for the world on the whole, but lockdown gave some authors the perfect conditions they needed to quit “normal” employment and thrive. It might have helped you grow your author business, too. But does that mean now is also the best time for you to hand in your notice? The answer: it depends on your situation. Yes, now is a great time to quit for many, but it will only be for you if you’re in a position to stick the landing. Today we’ll explore a checklist of criteria you can run through to help you decide when you’re ready to quit you day job and pursue your author business full time.
You Have an Emergency Fund
Traditionally, financial experts considered an emergency fund to be a spare $1,000 an average family could save to use during emergencies, like a car breakdown or an unexpected bill they would otherwise have to go into debt to cover. You might think $1,000 is too small an amount to offer any real security, but a 2022 survey conducted by Bankrate explains that 56% of Americans don’t even have that much saved. Most live paycheque to paycheque, and citizens in other developed countries share a similar existence. If this sounds like you, you’re probably not ready abandon the day job because a dip in book royalties could leave you in a vulnerable position.
According to Rachel Cruze, a bestselling author and financial expert at Ramsey Solutions, you should ideally aim for far more than $1,000. She explains:
“If you’re part of a two-income household or you’ve had a steady job for several years, then three months of expenses in your emergency fund is probably just fine. But if you’re a one-income family, you’re self-employed, or you earn straight commission, then a six-month emergency fund is better.”
The exact monetary figure you need depends on your living costs. Yes, those in the US or UK might need a war chest of thousands, but you might need less if you live in a cheaper country. Work out how much money you spend in an average month. If it’s $2,000, you probably need a $6,000-$12,000 cushion. If you only spend $500 then $1,500-$3,000 should be enough. Save whatever your figure is and it’ll give you the enough time and resources to course correct should you encounter an unexpected problem after going self-employed.
You Have Positive Cashflow
Have you ever met a gambler who loses often but only seems to remember their big wins? It’s a common phenomenon, with many gamblers believing they’re in profit when they’ve actually lost a small fortune. As authors, many of us look at book production and marketing with a similar perspective. We see our annual sales increasing and remember the BookBub Featured Deals that shifted 800 copies but forget about all the failed marketing tactics. We think we’re in the black because of our career highlights but, if we looked at our accounts, we’d realise we’d be in a hole if not for our day job salary keeping our author dreams alive.
Billionaire Sir Richard Branson once rightly called cashflow “the lifeblood of business”. After all, it doesn’t matter how big revenue figures get; a business won’t survive long enough to see a profit without adequate cashflow. According to a 2022 article at Fortunly, “29% of businesses fail because they run out of cash” and “67% of owners use personal funds to deal with their financial crisis”. These are stats we can’t ignore because, without good cashflow, you might have to spend your personal savings faster than you think if your business demands a cash injection. Hoping to “figure it out” after you’ve left the day job is risky. So, unless you’re prepared to re-enter the rat race after you’ve left, it’s wise to stay employed until your books can pay for themselves.
You’re in Profit
Having a six-month emergency fund to pay for your lifestyle and a business that covers its own costs will help you transition into full-time authorship. Your new lifestyle as an author-entrepreneur, however, won’t last forever unless your business also generates enough profit to cover your personal monthly costs. As Wharton psychology professor Adam Grant explains, “The most durable businesses are typically started by people who play it safe…don’t go in all guns blazing. Start it as a hobby and see if it takes off.” This is sage advice for any over-zealous author who is considering taking the leap; only do it if you’re confident your books can support you before your emergency fund disappears.
When it comes to jumping ship to a side hustle, caution is prudent. Even our very own Mark Dawson admits he didn’t leave the day job until his author income outpaced his monthly salary. It’s understandable if you’re frustrated, sitting impatiently in a nine-to-five when you could be building your publishing empire. But approaching your author business with a long-term view is necessary. Remember, having extra time is useful but having the luxury of being able to reinvest profits can also help you scale faster. Hold on until your annual profit is at least half of your usual salary and it will make transitioning into a full-time author much less stressful.
You Have a Sustainable System
Xero, the accounting software company, conducted a 2022 study of small businesses that concluded 8% of failed new ventures ended because of burnout. 53% of small business owners also told them it was essential to relax with family at some point every day to remain efficient. Authors are equally at risk. Due to the nature of our work, many of us:
- Spend lots of time working alone
- Make ourselves a major operational bottleneck
Why do you think so many authors report burnout? It’s because we lock ourselves away from friends and family and have no fixed workmates. We also often feel the need to micromanage every task.
If you think leaping from your day job would isolate you and leave you barrelling towards burnout, you’re likely not ready. In that case, instead of quitting work immediately, how about you first build your business for longer as a side hustle, systematise regular tasks anyone can do and outsource them to affordable freelancers? That way, when you do go full-time, you’ll find the workload more sustainable and have built-in social elements. Consider it doing your mental health a service. Taking action in this way beforehand isn’t essential, but it does make you less likely to loath your author dream just as much as a day job when you do make the leap.
You Can Do It Again
If you’ve spent time lurking in author Facebook groups, reading blogs like this one or listening to podcasts, you probably remember writers who used to do well but have largely disappeared. That’s because the book trade is constantly evolving. What worked last month might not work tomorrow. Can the average author still coast for a year on the success of a BookBub Featured Deal? It happens, but not often anymore. How about relying on one ads platform to generate consistent profit? Again, it’s uncommon. Many must platform hop to stay in business. If you want to go full-time and stay there, you must not only know how to be successful once but how to do it on a recurring basis.
Learning the principles of success that underpin marketing across several platforms, rather than mastering one strategy, is an effective way to achieve longevity. Knowing how to build a mailing list, create sales funnels and analyse marketing metrics, for example, are transferrable skills that will give you a sustainable business. Or you could build a subscription business model to ensure long-term success. Martin Zwilling, a startup expert writing for Forbes suggests, “everyone loves the subscription model, since transaction costs exclude the cost of acquiring a new customer.” If you can prove to yourself using data and a sustainable business model that you can repeat past successes, that typically means you’re in a position to let go of the day job handrail and go it alone.
Quitting your job to rely on yourself as an author-entrepreneur can be scary. Follow the guidelines highlighted in this article, though, and you should be able to make a relatively smooth transition. Waiting might be frustrating but, in some cases, it’s necessary to ensure you enjoy funemployment, not just for a few months, but forever.
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