April 16, 2016
Have ever looked at someone and wondered how much money they have? Of course you have.
You start by examining where and what they spend their money on. If they have a nice house, buy a new car every year and always dress well you can guess that they must be well off. Are they taking frequent vacations? Do they own a pony? They must have even more money. But how much, six figures? Or more? How much more? In the back of your mind you wonder if they are foolishly financing their lifestyle with double mortgages and credit cards.
So I am offering you something you rarely get…
Pssst… hey buddy, you want a peek into my wallet? 😉
I quit my six figure job almost a year ago to become an entrepreneur. I have a family, a mortgage, and a bit of denial right now about my financial situation. The main reason is I did not ramp up my business and start it on the side. I didn’t grow into it and quit when I felt comfortable.
I went from a nice monthly check to COLD TURKEY HOLEY SHIT THERE IS NOTHING COMING IN THE NEXT MONTH.
I started by cashing in my 401k. I paid penalties, went all in. I had about 150K. With penalties and taxes that came down to around $120K. I had around $30K in savings on the side.
My wife and I ran numbers and realized if we had $0 income we could float on $100K for about 2 years. That means keeping the same house, medical and dental insurance and primary expenses. However, we would not vacation or spend on anything unnecessarily.
My first focus was to get my consulting business up to speed. I know that I can grow this more quickly than starting a new company (product/service) from scratch. I can start quickest by leveraging my network and my expertise.
I am fortunate that my only debt is my house. I have a 30 year old mortgage with a decent interest rate. I own my own cars, house crap (lawnmower, snowblower, etc)
My consulting business is finally ramping up. I am now transitioning off of the oh shit mode and starting to bring in more money. I currently have a couple of larger projects and a few smaller ones.
2015 income: $2,000 (no this isn’t a typo and this is from August-December)
2016 income: ~$14,200.93 (as of today)
Reach out to me if you want any more details on my finances. I will give periodic updates but I will largely focus on the income from my new businesses. Which brings me to the next phase…
Follow me to get updates on how my wallet is getting thicker (or thinner, gasp).