Nowadays, opportunities to make money online are much more abundant than ever. It is not uncommon for someone to want to try make it as a freelancer/self-employed individual, especially if they have been denied flexibility and autonomy their whole working life.
These are some things you might want to do before you submit your resignation letter.
#1 – Have savings
Having savings is highly, highly, highly recommended. Why? Because, you don’t want to be in a position where you’re desperate enough to take up low-paid jobs. Not making enough + no savings = extremely stressed and vulnerable you.
How much should you save up? I think 3 months’ worth of expenses is the minimum, if possible 6, 12 or even 24 months.
Note: Save up x months’ worth of expenses, not salary. That means, if your monthly commitment is RM2000, then:
- 3 months’ expenses is RM6000
- 6 months’ expenses is RM12,000
- 12 months’ expenses is RM24,000
- 24 months’ expenses is RM48,000
You can use my Can You *Really* Afford It? Use the 50/30/20 Rule (Free Editable Template) to help you calculate your monthly expenses.
As for where to keep the savings, please refer to 7 Savings and Investments You can Automate, Aside from EPF Contribution article.
Next, Numbers #2 and #3 kinda are quite similar so I’ll explain it together:
#2 – Apply for credit card(s)
#3 – Apply for loans (only if you can afford the monthly payment)
If there is one I miss about being employed, is that payslips made it super easy for me to apply for credit cards and loans. My applications for Maybank credit card and ASB financing that I made in my early 20s went through without a hitch.
In comparison, after becoming self-employed, my agent asked me for additional documents multiple times when I tried to make additional ASB financing application. I also tried to apply for a few credit cards but they didn’t get back to me – presumably I got rejected.
This is despite me making an okay living as a self-employed writer, filing my taxes diligently every single year, and having a pretty good credit score. I’m really not sure where I did wrong tbh.
DISCLAIMER: Now, do NOT take this as ‘oh Suraya say go take credit card and loans’. That’s not what I said. I said it is easier to apply for them when you are employed, so only do so if it makes sense in your situation. Click on the respective links for more information.
#4 – Clean up your online profile(s)
Now, unless you are a super extrovert and attend gatherings/networking events regularly and can find potential clients without relying on online world, I highly suggest you to clean up your online profile(s), stat.
This 5 Ways to Maintain a Professional Online Presence article contains solid tips. It is written for teachers, but applies to every professional out there.
You might also want to create a new email address that sounds more professional-sounding. This is especially true if you’re still using yayang_comel8888 at hotmail dot com or similar.
#5 – Add insurance costs to your monthly commitment
Switching from employed to self-employed usually means you will no longer be covered under your employer’s insurance plan, so you have to get your own.
Happily, nowadays there are many affordable options for you. Find out more in the Best Insurance and Takaful in Malaysia for B40 and M40 On A Budget article. If possible, you’ll want to allocate at least RM100 a month for this.
#6 – Get ready to feel super directionless
The first thing you will lose when you quit your job, aside from the salary and certainty of a paycheck and benefits, is… the structure. Your body and mind are so used to the wake up-get ready-go to work-go home-sleep-repeat grind that it will take some time to get used to the flexibility.
By this point, I’ve been doing this self-employed, soloprenuer thing for 7 over years now, and some days I still feel directionless. Don’t get me wrong, being able to do what I want is GREAT, but the possibilities and options can also be super overwhelming that you just end up doing nothing.
#7 – If possible, secure your customers and clients BEFORE you quit your job
Many people get stressed with their jobs, then think of quitting, then try to figure out what to do.
The safer way is to get the future source(s) of income sorted out first before you submit that resignation letter.
However, despite this and thanks to #1 (having savings), I can say that I don’t regret quitting my job without a concrete plan. It was super confusing at the time but looking back, I experienced so much self-growth while trying to figure my path.
But, you should also know I have the privilege to say this because somehow, miraculously, things worked out. There’s an element of survivorship bias happening here. Maybe it worked out for me, but countless others in the exact same situation ended up going back to the safety of a stable job (which is fine).
Freelancers/ Self-employed peeps, what else do you think you should have done before you quit your job?
I’d really love to hear among the freelancers/self-employed – what advice would you give yourself, if you were to do it all over again?
Please share in the comments so all of us can learn 🙂