Welcome to the all-new Brian Thompson Financial! As you can see, my site has changed quite a bit. After 10 years of practicing law, I’ve decided to take the leap into entrepreneurship and launch my own Registered Investment Advisory firm.
It’s been a decision three years in the making. When I started the Brian Thompson Financial blog three years ago, I wanted to do my part in helping the LGBTQ community navigate this crucial time in history. Now I’ve found a way to pursue my passion full time and help even more people.
The decision to leave a steady, six-figure paycheck for the unknown was not easy. I know a lot of you budding entrepreneurs can relate to this dilemma. Below are five lessons that I’ve learned that can help you navigate making this type of decision for yourself.
Don’t Just “Follow Your Passion”
I’ve written before about the dangers of throwing caution to the wind and “following your passion.” If you’re going to take this kind of risk, you should thoughtfully consider what you want to do and why you want to do it. Address head on whether your passion can provide value to people and afford you enough income to live the life that you want.
For me, the type of planning that I wanted to do – fee-only planning for generations X&Y – was still fairly new. Luckily I come across the XY Planning Network (XYPN), which provided guidance on how to build such a business. I also saw other members of the network that had successfully started their own firms. Even after finding XYPN, it took substantial research and planning to see if that framework would be right for me.
Give Yourself Time to Develop Your Idea
As I said, this transition has been three years in the making for me. I’m pretty risk averse, so it took me a while to get comfortable with the idea of financial planning for generations X&Y. I also knew that I wanted to serve the LGBTQ community, but I wasn’t sure if that niche could provide the income that I would need.
It took the experience of writing about financial planning, figuring out the needs of my community, and experiencing what it was like to create plans for people to develop a real sense that I could do this on a daily basis. The process of trial and error also helped narrow down the direction that I wanted to take.
Give yourself ample time to research whether your idea is feasible as a career. Look online and take business development courses. (I’m a member of Fizzle and have found it extremely helpful.) Also talk with your family with friends to see what ideas and insights they can contribute to your plan.
Even after I got a good idea of what I wanted, it took me about six months to get the foundational elements in place. I had to develop a business plan, register the business with the state, get a business bank account and many other things to make sure the shell of the business was ready. Again, just give yourself the time and space to flesh out your idea fully before you take the leap.
Get Comfortable with Making Mistakes
Even if you have the perfect plan in place, something will go wrong. Whether it’s in business development or implementation, or whether you start down one path or figure out that it’s not something that you want, you’ll likely run into a problem you didn’t even realize existed.
I experienced this several times when I first started blogging. I thought I could just write and readers would come. So that’s what I did. Then I realized I needed to think about the look of the site itself, figure out how to use Facebook and Twitter for developing my audience. I made several missteps with the name, picking pictures and sharing. And I’m still learning three years in.
I also ran into this when I started advising. I would do free work just to get my feet wet and realized that I needed a process and more definition in what I was doing. I also needed a better sense of the value that I was bringing to my clients in order to price appropriately.
Overall, my mistakes helped me grow and develop a better idea of what I wanted to do and how I wanted to do it. But I had to get comfortable with making mistakes. And you will too. Use your mistakes as part of the process. And don’t be afraid of changing your plan to accomplish your overall goal.
Make Sure to Have a Financial Runway…But Not Too Much
One of the best pieces of advice my mentor gave me was to not have too much savings. He made the mistake of having so much saved that he wasn’t motivated initially to do what he needed to make the business profitable early on.
Despite having been unemployed for a little over a week, I’m already seeing just how the financial pressure of having to create your own income can stack up. When doing my personal cash flow projections, I can no longer rely on that paycheck at the end of month to balance out the expenses that continue to mount.
Luckily, Ben and I have some savings to use to keep us afloat while I build up my business. I also supplemented some of the business startup expenses by paying for what I could while I was working full time. And I’m sure I will have some sort of side hustle to bring in some cash.
So keep in mind that your business will be a slow build and you will need savings. But stay hungry for making the business profitable as soon as possible. You’ll also do yourself a huge favor by developing good financial planning habits like keeping a cash flow statement and balance sheet to help keep track of where you are financially.
Take the Leap
Despite taking these first four steps, you still might not “feel” ready. You want to have a couple more things in place or you want to save one more month at living expenses. While these aren’t bad thoughts, you have to realize that there’s never going to be a perfect time or a perfect business to fall into.
I had several false starts before I decided to quit my job. I first thought the beginning of the year. Then it was one last tax season. Then waiting for the summer. Luckily, I had a bit of a push with my firm splitting in two. That gave me the motivation needed to finally commit.
At some point, you will just have to take the leap and get started. I can definitely relate to the fear of assuming such a big risk. I also understand that no matter how prepared you are, you can never be guaranteed success. But I’m super excited to have taken this next step and you will be too.