This piece is part of my 2016–2026 archive migration. Some original formatting, content, and external links may be missing, changed, or not be optimized.
Create a solid financial foundation first
I put “financial security” in quotes because a person never really has financial security if they work for someone else unless they have an emergency fund, retirement savings, and a low debt-to-income ratio to help them withstand financial storms.
The only ways to create genuine financial security for yourself is by:
Creating multiple income sources.
Eliminating all of your debt.
Building a 12-month emergency fund.
Staying on track with retirement.
If you require employment from someone else, you are not financially secure; you are financially reliant on others.
Embarking on a side hustle or starting your own business changes this.
Side Hustles Are One Thing
Side hustles are exactly what they are: SIDE income. But many people give up full-time work or avoid acquiring part-time work to focus on their side gig.
There is nothing wrong with this if your side gig financially supports you, but this is far from the case for many people.
If your current side gig income does not cover your expenses, then there are only a few ways you’re covering your expenses each month, which include:
You’re utilizing previous savings.
You’re receiving support from others.
You’re over-leveraging with credit cards or personal loans.
If you fall into numbers two and three on this small list, it’s time to get another side gig, a part-time job, or a full-time job.
Continue waiting to build a sustainable income source, and you risk running an out-of-control debt bill or subjecting yourself to losing funding at any point (if you’re relying on others’ support).
Don’t Leave Your Job TOO Early
I meet with entrepreneurs almost daily who tell me they desire a full-time job because their income is unstable.
Even if they’re earning large sums of money, they still have not reached financial security.
The problem people frequently run into after leaving their jobs is not earning enough consistent income.
Or they notice they’re starting to earn income from their side hustle, and instead of scaling the income first, they leave their jobs and then try to scale their side income.
There is no problem with this strategy – if you have savings to hold you down – but if you don’t, you run the risk of running out of financial resources, which puts you in an even worse spot than before you left your job.
When To Relinquish Your “Financial Security”
1. You’re consistently earning enough monthly income to cover your expenses.
2. You have a 12-month emergency fund in place. It is recommended that entrepreneurs have emergency funds with at least a year’s worth of expenses.
3. You’re debt to income ratio is less than 10%.
4. You have at least three income sources.
This content is for informational purposes only — not professional advice. Consult a qualified professional before making any major decisions.