[Josh’s note: This is Part 1 of a 2-part post. Part 2 is here.]
A year ago, I wrote a three–part series on how I prepared for losing my job and then how I adapted to maximize my minimal savings and enjoy my time out of the rat race. The story ended when I accepted a job at the company that had previously laid me off.
It turned out I really enjoyed being unemployed. I was very productive and got to spend a lot of time with friends and family, enjoying life. Even when I went back to work, I was already thinking about how I might be able to get back to being unemployed (yes, I know how ridiculous that sounds) or at least not employed by a big company and committed to a 9-to-5 job.
I started thinking about unemployment again, only instead of bracing myself for the possibility of getting laid off, I began planning to eventually leave my job willingly and go it on my own. If I wrote about how I planned for possible involuntary unemployment, I might as well write about how I planned for voluntary unemployment, right?
It turns out that planning for voluntary unemployment is quite a bit less nuanced than preparing to possibly get canned. As I planned for the possibility of quitting, there were two things I felt were necessary but not sufficient:
- Save up money.
- Make sure I would have something to do with all that new free time.
Once those two things were taken care of, I could make a calculated decision about whether to keep my job.
In the job world, money is power. The marginal cost of adding one employee is relatively small for the employer (almost regardless of the salary for the employee), but the marginal gain to the employee of having a job can be substantial. Getting a job means a lot more for the employee than it does for the employer to provide a job. Throughout my career, I had always needed a job to pay bills and buy stuff. I realized that if I had enough money that I didn’t have to have a job, I could change the terms of the negotiation.
So, how much cash would I need to give me the option of leaving my job? I decided I needed enough to survive for a year. A year of expenses (with a buffer) translated to between five and seven months of take-home pay. So I began saving. Fortunately, this was easy because I had already learned how to live lean while trying to maximize my meager savings throughout unemployment. All I had to do was remain disciplined and not blow my money on stupid stuff. Although I didn’t save the maximum amount, I ended up saving about eight months’ take-home pay by the end of April 2011. Worst-case scenario, I’ve got a one-year runway. Best-case, I can probably go 20 months or more without income. Awesome-case scenario is that I can occasionally find supplementary income and survive indefinitely.
Making plans for all that free time
Even if I were able to save up enough money, I’d need something to help me fill 40 hours a week if I decided to leave my job. Really, I had a lot more time to fill because I also finished my MBA, which took another five to 10 hours a week. I’d never had to think about how to fill 50 hours a week before. It was always just full with school, work or some kind of hobby. So, about six months ago I started thinking a lot about what I could do. I decided to start writing down every idea I had, and to ask friends what they thought I could do. It’s always interesting to get an objective third party to think about something like this because they inevitably go in a different direction than I would have. Here’s what we came up with:
- Personal Branding – This could be a great way for me to monetize my education and experience. I think I’ve learned a lot, and my mind is definitely my greatest asset, but it’s difficult to convince people to pay to use my mind if they don’t know who I am or what I know. Writing, podcasting and creating other forms of content would be a big part of this. Building my personal brand is a way to forward integrate – to get my skill-set closer to potential customers.
- Writing – I’ve already been at this for several years in various forms, so it seems logical to continue writing. I’m co-writing a book on Game Theory and Poker, I’ve been creating content for my blog, I occasionally submit articles to blogs, and a couple friends have approached me about writing projects they’re considering. I could definitely spend a lot of time writing, depending on my own capacity to focus. The Game Theory and Poker book could also generate income for me eventually.
- Podcasting – If I’m driving, I’m probably listening to a podcast. I’d like to create podcasts, too. I’ve got 20-25 podcast ideas ready to roll, so I need 25 more ideas before I start. I live right next to The University of Florida, so I could probably hustle and get some professors to do occasional interviews. What I don’t have is any knowledge of the logistics of producing a podcast, but I could learn.
- Travel – It’s been a few years since I left the country, and I’ve been itching to get back to Europe. I’ve got friends in several big cities that I haven’t visited (I’m especially interested in seeing NYC and Chicago). If I can find some cheap travel opportunities, why not go see some more of the world?
- Poker – The World Series of Poker also starts up in June, and I’ve been planning to head out to Vegas for that anyway. If I could play on the cheap, then this could be a good way to have fun and make money. With the recent DOJ crackdown on online poker sites, the World Series of Poker will likely see a steep drop-off in attendance this year. But going to the World Series is still probably in the cards (yeah, that’s a bad, obvious pun).
- Charity – There are a lot of ways I could volunteer my time, and since I would likely stop giving cash to charities, I could try to substitute money with time.
- Friends and Family – It would be great to spend some time with my family. I haven’t lived in the same city with them since I was in high school, so I’ve only seen them on short visits. I could go to Jacksonville and try to spend some time visiting my loved ones. One of my favorite things about my previous stint with unemployment was that I was almost completely unrestrained by time, and I could take any and all opportunities to spend time with friends.
- Fitness – This isn’t really a reason to quit a job, but it would be nice to get into a routine and budget a little more time to getting and/or staying in shape. This could also backfire as I may end up working such odd hours that the routine would be illusive and I wouldn’t get to the gym as regularly as when I’m working full time.
I think I have plenty of things to keep me busy. Ultimately, I would like to enjoy some time out of the rat race and lay the groundwork for rapid career acceleration.
Next time, I’ll explain exactly why I quit, complete with a fancy chart.
Very interesting and insightful Josh! I believe you will do ALL those things and give others the inspiration to do this too!
Dittos on all of the above. You’ve convinced me and now I’m ready for you to quit my job too.