Before you resign to start your own business, do these important things

Owning your business and finally becoming answerable to yourself alone is bliss. However, not so fast!

Being a full-time entrepreneur is a whole new ball game and is quite different from running side jobs.

Being a full-time business owner requires a lot of planning, see some tips to help you get it right.

Have adequate savings:

It is always best to have an emergency fund. This will help you manage your lifestyle in between earnings from your day job and earnings from your new business.

It is usually best to start by opening a separate, dedicated savings account. There is a lot of debate on where you should keep your emergency fund. A good rule of thumb is to have it easily accessible in the event you actually need to tap into it. An online savings account is a good place for that. You’ll want at least one month of living expenses, but preferably three to six to be safe.

Open a business account
It is best to separate from business expenses from your personal expenses. A business account helps solve that problem. When it is time to pay tax, it’ll be a lot easier to deduct the applicable expenses if they’re all being charged to a dedicated business credit card.

In addition, a business account also serves as a revolving source of capital. If you have a business account, you’ll eliminate the need to take out small loans to fund things like a new office or equipment.

Grow your side business first
You may be tempted to quit your existing career before you have your new business up and running. Although you have one foot out the door, I urge you to reconsider leaving your day job so soon. The best way to transition from employee to entrepreneur is to grow your side business first. This way, you can complete all the tasks mentioned above and work out the kinks before taking the big leap.

Growing your business on the side does require a significant time commitment. Consider waking up one or two hours earlier each day to work on your business and sacrificing some weekends to get things done.

Create a business plan
Laying out a business plan for how you intend your business to function is crucial to success. It doesn’t have to be a hundred pages or incredibly formal. It just needs to state your mission, the details of your product/service, how you intend to reach customers, and any plans for expansion. If you want to take it a step further, you can include marketing in your business plan. How do you plan to tackle things like social media, content creation, and outreach?

Many companies don’t need a formalized business plan, but having at least a loose one doesn’t hurt. In fact, it could help you secure financing should you need it in the future.

Do not burn bridges:
No matter how you were treated in your former company, do not leave on a bad note. Be sure not to burn any bridges on your way out.

It’s a small world and you never know when you will meet your colleagues again down the road. They can become future business partners or customers. Make sure you give a full notice and help train the person filling your position, if possible.

Be ready to make mistakes
No business is perfect. In a new business, you’ll need to focus on getting things done rather than waiting for them to be perfect. Waiting for perfection will slow you down and you will not learn anything.

Learn to accept mistakes and keep moving forward. Progressing is a part of entrepreneurship.

Do the necessary paperwork
Ideally, you would have the legal structure for your business set up before you leave your day job. This, however, is not always the case. If you haven’t thought about it already, now is the perfect time to think about how you want your business to be legally structured. Do you want to form an LLC, be a sole proprietor, or create a partnership?

It’s important to accept the fact that you won’t know everything on your first day as an entrepreneur. Much like you required training for your day job, being an entrepreneur will require some time to get into the swing of things.