Should I quit or should I stay in my job?

[Reality Check]

Hi all

I'm a long-time follower of Mr MM and the forum here but first-time poster.

People here seem sane and like they think through decisions, and I have a dilemma that could use some community brainpower. I have a day job as a lawyer for a medium-sized company on about 100k/year as well as a side-business with a friend where we outsource some types of legal services. As I'm currently part-time in the side business, I only take 30% of the profits, which means about 50k/year, but I would take 50% if I were to go in full time, so about 80k/year. Put another way, I currently make about 150k and would be going down to 80k/year if I went all in on the side business.

The day job is not too demanding, but it does come in the way of me doing lots of things that the side business needs doing and there's limited opportunity for pay increases. I am thinking of marketing, client outreach, holding myself out as being part of the business, as well as recruitment, content development and working on getting funding and coordinating some software development. It's hard to say where the business would be if I were all in on this - maybe it would make a big difference and maybe it wouldn't. There's also a big risk in that we have a single customer that accounts for about 60% of our revenues and only 2-3 other clients making up the rest.

My question is if I should quit to focus on the side business or carry on as is for a while? If I should carry on, when would you decide to focus on one over the other and what would you take into account?

Thanks!

[BicycleB]

Hi all

I'm a long-time follower of Mr MM and the forum here but first-time poster.

People here seem sane and like they think through decisions, and I have a dilemma that could use some community brainpower. I have a day job as a lawyer for a medium-sized company on about 100k/year as well as a side-business with a friend where we outsource some types of legal services. As I'm currently part-time in the side business, I only take 30% of the profits, which means about 50k/year, but I would take 50% if I were to go in full time, so about 80k/year. Put another way, I currently make about 150k and would be going down to 80k/year if I went all in on the side business.

The day job is not too demanding, but it does come in the way of me doing lots of things that the side business needs doing and there's limited opportunity for pay increases. I am thinking of marketing, client outreach, holding myself out as being part of the business, as well as recruitment, content development and working on getting funding and coordinating some software development. It's hard to say where the business would be if I were all in on this - maybe it would make a big difference and maybe it wouldn't. There's also a big risk in that we have a single customer that accounts for about 60% of our revenues and only 2-3 other clients making up the rest.

My question is if I should quit to focus on the side business or carry on as is for a while? If I should carry on, when would you decide to focus on one over the other and what would you take into account?

Thanks!

I would take into account both personal and financial factors such as:

1. Do I know how much income it takes to cover my minimum and desired living expenses?
2. If yes to 1, how much income is needed for each level, and therefore (using the 4% rule) how much investment capital to be FI?
3. Am I debt free? If so, how close is my investment stash to the desired level in 2?

Obviously, if I'm at minimum funding of financial independence and close to desired FI funding, I'd probably do the new project because there's no risk. If not, tougher question and I'd lean towards keeping both jobs while building up the side gig, based on my assumed answers to the questions below.

4. Am I so respected in my legal specialty that I can easily replace my 100k job, or given the eternal erosion of pay for normal lawyers, am I giving up an income stream that would be hard to replace?
5. How good am I at marketing?
6. Did the big customer drop into our laps and would be hard to replace?
7. Do I have a reliable way of building up business for the side gig?
8. How much do I like working on my side gig vs my day job?
9. Based on best estimates, how long would I need to work as is to reach FI, vs how long in low/medium/high scenarios of only working the side gig?
10. If I quit the day job and the side gig peters out, does that mean I'm doomed to decades of doc review?

[scottish]

What's the obligation to your current employer?    Did you agree to work solely for them?   I don't think 150K is alot for a lawyer, but it is alot in absolute terms.

And is there any conflict of interest between your day job and your side gig?

Aside from all that, the small number of customers would need to be addressed ASAP (preferably before) if the side gig was to become your sole source of income.

[Villanelle]

Need lots more info to make the call. What are your current expenses, and what are your current bare bones expenses?  Are you single or do you share household expenses (and income) with someone else, and if so, does that person also have an income?  How much do you have saved, and how much debt?

Those things wold influence my answers, but most likely, I'd hit the gas pedal on the side-job, while still working the current FT one.  Do that for one year, which will kind of suck, but it's only a year.  I'd focus on getting more clients so things were more diversified and less risky and also pays slightly more, and if that happened in the year, then I'd quit the FT job.  (This is assuming that there's no opportunity to go part-time in your current role.)

[clifp]

I think BicycleB gave a really good outline of things to consider To be honest, you are the only one who is the right position to make an educated guess about how much money you, make.

Let's say you are working 40 hours in your regular job, and 20 part-time, using basic math. I think you'd make a 100K if you go full-time, and probably 150K if you work 60 hours.

Your chances of making a lot more are significantly higher doing your own business than working as corporate counsel. Your chances of working much harder and making a lot less money (e.g. you lose the top client) are also increased.

The main question is what does your partner friend think?  If this is really your idea,and he is reluctantly going along, then that would give me pause. On the other hand, if he has been badgering to quit and go full-time, and you are getting tired of being badgered. If on the other you both are excited about the opportunity.

I think it is interesting that you describe the other person, as friend rather than your partner.  I think working with friends has a lot of benefits, certainly bets having a boss.  Even though my friendand my business ultimately failed and we both lost a lot of time (mostly his), and some money (mostly mine).  Our friendship never suffered and it was fun.

[Ron Scott]

I like the side business because it gives you opportunity to scale it as an owner. But like you, I am concerned about the concentration of revenue in a very small number of clients.

Is it possible for you to work on that business problem while you maintain your day job and switch over to your own business full-time when the issue is corrected?

[dmd149]

If the 80k is okay enough to live on, at least for a little while and you like the excitement and opportunity of growing your business, I'd leave but see if you can keep your current company on as a client in some way. THat could mean a client of your side business (to be full time business) or as a separate 1099 opportunity.

Could be the best of both worlds.

[Finances_With_Purpose]

Sending you a PM with some thoughts.