Why You Should Consider Starting Your Own Business After a Career Setback

This week we’re back with Jim McKinley of Money With Jim, who has some awesome advice for those of you who have had a few career setbacks. Take note of what he’s got to say. It could change your career path.

Whether you didn’t get the promotion you anticipated, your company cut salaries, your job is becoming stagnant and uninspiring, or you lost your job, a career setback can be an opportunity to do a little soul-searching and consider starting your own business. While it’s a lot of hard work, being an entrepreneur is one of the most rewarding things you can do with your life.

Even though you’ll be logging a lot of hours (especially in the beginning), being your own boss can ultimately give you more freedom. Considering nearly one quarter of U.S. companies don’t even offer paid vacation—and those that do only offer an average of 10 days a year—having the ability to control your own schedule can be great for your mental health. If you’re considering starting your own business, don’t rush into it. Careful planning is the key to success.

Choose Your Business Model

Before you can implement a strategic plan, you have to decide on what type of business you want to run so you know the funding and resources you’ll need. Here are some ideas:

Turn a Hobby or Passion Into a Career

Transforming something you’re passionate about into a way to make money is the ultimate dream. In the words of Confucius, “Choose a job you love, and you will never have to work a day in your life.” So, if you love animals, consider becoming a dog walker. If you’ve been making jewelry, start selling pieces to boutiques. Love to cook? Become a personal chef. You get the idea. Just make sure you’re being true to yourself about whether you are good at your passion—this is key for success—and that you’re willing to incorporate the right business acumen to avoid financial ruin.

Do Something You Already Know

Sometimes it can make sense to capitalize on a strength from your previous career. For example, if you worked for an accounting or money management firm, consider starting your own business as a tax professional or financial advisor. Since you already know the ins and outs of the job, it can be easier to start the business.

Consider Starting a Sharing-Economy Business

Ride-sharing programs and house-rental agencies are more popular than ever. Experts predict the concept of building easily on existing businesses will continue to grow by leaps and bounds. Other attractive reasons to start this type of business include: peer-to-peer financing opportunities, low startup costs, bartering options, and access to millions of people who are buying into a shared-economy concept.

Getting Started – Have a Clear Plan

Before anything else, it’s pertinent that you have a business plan that includes financial projections, goals, and a strategy to get from point A to B. It’s not a bad idea to meet with a business advisor, mentor, or coach to ensure you’re on the right track. The government provides numerous resources to help you find someone in your area.

Get Funding Early

The amount of money you’re going to need depends on overhead costs, location, and the scope of your work. For example, a home-based web design business will have less costs than a landscaping business. If your business requires special equipment, vehicles, or employees, you’re going to want to secure funding as soon as possible. Options include applying for government grants, using a crowdfunding website, getting a loan, or pitching your idea to investors.

Second-guessing your dreams will only bring you back to where you started. Starting a business can be daunting, but don’t let that scare you away. Stick with it and hold yourself responsible for continuing the process through good times and bad.

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About the author:

Jim McKinley
A retired banker, Jim loves the feeling of helping people make the most of their hard-earned money. It's that sense of accomplishment that inspired him to start Money With Jim. He may be retired, but that hasn't stopped him from wanting to make dreams come true.