Is Good to Be De Boss – Solopreneur Success Gives You Back More Than a Salary
Author: Nicole Chaitan-Kissoon
What makes entrepreneurs leave a sure salary to set up shop in their own business? Most of the time, it’s because the pain of the j-o-b got worse than the fear of what could happen if we left. The pain: the realization that, ‘nah boy, I really can’t keep doing this ‘till 60, nah.’ The fear: ‘At least I have sure salary here, a couple weeks’ vacation every year, and I’ll retire with a pension…what go happen if I leave?
It’s accepted that paid leave benefits the entrepreneur. But how to make that happen?
Let’s start with those vacation days – Hold on, bosses could get paid days off?
Yep. The simplest solution for a small business person is a Sinking Fund. (Doh worry, it sounds bad but it’s really a good thing and, ironically, could keep you afloat.) A sinking fund is simply savings that are designated for one specific expense. It’s not just a savings account you drop money in willy-nilly though and it’s separate from your emergency fund. It could pay for that new computer, updating the sign in front of your location or…pay yourself for your time off.
To start your sinking fund, decide what you’re saving for, how much you will need, the timeline by which you’ll save and where you’re going to save it. Here’s a good resource to understand the difference and steps for starting your sinking fund.
The fund has to be liquid because the goal you’re saving for is usually short-term. We’re not going straight to the mattress though. Think money market funds or mutual funds that don’t have penalties for withdrawals after a short time. (Why money market funds are good options.)
You also want to be saving sinking funds where you can still earn some interest. Just because it’s a short-term fund doesn’t mean you have to give up making some money from it! Good options would be accounts that pay some interest monthly if the timeline for your goal is under a year.
When you work somewhere with paid vacations, the boss factors in that cost when they agree to your compensation package. When you have your own business, you’re the boss now. With some prudent planning and smart saving, this is how you create paid vacations for yourself.
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