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This may be the hardest question an aspiring entrepreneur has to answer. (It was tough for me, at least.)

I’m going to show you one of the main ways I knew it was time to jump from my $53,000 household income to my own company—which made about five times as much in its first calendar year.

That transition I made was still fraught with risk, but I was able to make the leap without a single month of going hungry. I’ll show you how I did it, and give you my advice on how you can do it, too.

But first, let’s set the stage

When you think of the success that could come from going full-time, all-in on your own gig, you picture yourself in a much better place than you are now.


But that’s not the full picture, is it?

You also imagine what would happen if you were unsuccessful. You’d make less money. You’d have to take any job that came your way. The shame, the sense of loss, all the bad feels.

When you look at the risks of starting your own business, it can make staying where you are really, really appealing.


And while there’s a gap of time between you and the successful future, there’s virtually no gap between you and the unsuccessful one.


You know it’s going to take time to work your way into a successful future. But you also have bills to pay. Those financial obligations are going to drag you down toward that Dark Future, unless you work to stop them.

So, how do you make sure you’re “quitting up”?

The trick that worked for me was to define my Minimum Viable Income.

Why you need a Minimum Viable Income

We’ve established that the road to that successful future is an uphill climb. And everyone starts somewhere near zero.


But you can’t live off zero. Not for long.

So you probably don’t want to quit your job tomorrow and then figure out how to make money.

This is why the side hustle is so popular. Scrappy, ambitious people like you begin that journey now, so that they’re closing the gap between them and their Golden Future. You spend the time that you would normally spend binging Netflix on your own projects—winning clients, building your website, answering questions on Quora, etc.

Side hustles bring in the cash now to get you closer to the Golden Future, but if you’re side hustling well, you’re going to run into a terrifying problem:

You’ll run out of spare time.


And then you’ll dip into family, sleep, spirituality, community involvement, etc. You know, the kind of deficits you can’t sustain long-term.

Eventually, you’ll have to pick your job or your side gig.

When that happens—and if you’re doing it right, it WILL happen—you need to be ready to make the right call.

That’s where your Minimum Viable Income comes in.

Your Minimum Viable Income is a number that you and your family set ahead of time. It’s the amount of money that needs to be coming in every month in order for life to go on sustainably.

If you know your MVI, then you’ll know when you can quit your job.

If you don’t set an MVI, then you’ll find yourself in this mental situation:


Those two voices will go around and around and around and you’ll feel sick inside.

But if you have set your Minimum Viable Income, then that scene plays out like this:


How to set your Minimum Viable Income

Here’s what you need to do to set that number for yourself:

1. Tally your fixed expenses.

What do you have to pay in rent, utilities, gas, groceries, debt, etc. every month?

When Laura and I were exploring our MVI, we used the Mint app to track our expenses. This showed us exactly where our money was going every month. If you’re not using some kind of spend-tracking tool, I suggest getting a Mint (free) or YNAB ($50/year) account.

Add up your monthly expenses, and then factor in recurring expenses occur at longer intervals (like car insurance).

2. Tally your generosity spending.

How much are you giving away each month? How much do you want to give away each month?

I don’t advocate for being less generous. Be wise of course. But don’t sacrifice good character for money.

3. Tally your saving habits.

How much are you socking away each month? How much do you need to save each month?

4. Tally your entertainment spending.

This is the non-essential stuff, like eating out, going to the movies, junk food groceries, or Netflix. Tally these up.

5. Add the cost of business tools.

If you’re running your own business, you’ll probably want to invest in some hardware and software tools to help you run more efficiently. For example, Laura and I knew we had to pay for an SEMrush account if we were going to run a content marketing agency. You may have different needs.

6. Research the cost of benefits.

If you’re leaving a steady job, you’re probably leaving behind health insurance, 401k matching, and other benefits. You should meet with an insurance specialist to see what it would cost you to get the benefits you need if you paid for them yourself.

Now, add those up.

7. And then adjust for taxes. =(

Because self-employment taxes will bite you in the butt. I budget for 30% of every dollar I make to go back to either the local, state, or federal government—and I live in a state with no income tax!

So for me, I tallied up my MVI, and then multiplied it by 1.5.

Seriously. Do NOT forget taxes.

What was your number?

You now know how much money you’ll need to make each month in order to sustain your current lifestyle. Write it down.

8. Ask: Can you get by on less?

Remember, your MVI is the number you’re using to gauge whether or not you’re ready to quit your job, make more money, and live how you want to live. So (ideally) you don’t want an MVI so high that you’ll never be able to make it without quitting your job.

Ask yourself, “What non-essentials would I forego for freedom?”

You don’t need to give them up right now. (I never discontinued Netflix!) But you should have an idea of what you’re willing to give up if need be. My guess is that you don’t want to delay your journey to freedom for the sake of a daily latté.

You don’t want your MVI to be too high or too low

There are two temptations I felt when setting my MVI:

I felt the desire to set mine as low as I could possibly make it. The sooner I could get out there on my own, the better, right?

I felt the need to keep it pretty high, so I wouldn’t be giving up any of the comforts I enjoyed.

I found that the key to a good MVI was somewhere in between. Here’s why.

If your MVI is too high:

  • You’re missing the point of “minimum.”
  • You make it harder to leave your job.
  • You end up defaulting to scaling down your side hustle when you reach the time crunch dilemma.

Remember, your MVI is your barrier to independence. If you set it too high, you make it unnecessarily hard to strike out on your own.

Ways to lower your MVI:

  • Eat and drink out less. You’ll spend $10–30 a head on a meal at a restaurant. And it’s easy to spend $10 on drinks with friends (and that’s if you want to drive home). You can save hundreds from your budget if you spend more time eating (and drinking) at home.
  • Cut down on junk food. Chips, soda, and other snackables are super low ROI when it comes to food.
  • Beans, eggs, rice, oatmeal, and spice. Laura and I gamed our spending down to about $1/meal by building a small repertoire of cheap crock-pot meals. We’d crock-pot two or three kinds of meals, freeze them, and just eat those meals over and over and over again.

If your MVI is too low:

  • You’re missing the point of “viable”
  • You’re putting your loved ones at risk
  • It’s easy to undercharge your clients
  • It can be more expensive to scale back up later

Remember, your MVI is the income you’re willing to make for a while in the name of freedom. Don’t let “freedom” suck.

Here’s my MVI story

Laura and I knew that $4,000 a month would let us pay rent, live in the town we wanted, afford the tools we need to do business, go out for a beer every once in a while, rage-pay taxes, and keep some generosity projects running on the side.

We found this number by gaming our spending way, way down. Like I said before, we weren’t spending a lot on food. We didn’t eat out much, didn’t go to the movies, drove an old car, etc. And we knew we could lower our MVI if we moved to a smaller apartment when our current lease was up. (Which we did.)

Meanwhile, I was hustling to get clients on the side. By October 2015, I had the following gigs lined up for the rest of 2015:

  • One client was paying us $25k.
    • We spent $16k on contract labor.
    • This left us with $9,000.
  • Another was paying us $36k.
    • We spent $12k on contract labor.
    • This left us with $24,000.
  • Another was paying us $11,000
    • We pocketed that. =)
  • Another was paying us $18k
    • We spent $9k on contract labor.
    • This left us with $9,000.
  • Another was paying us about $10k
    • We spent $3k on design.
    • This left us with $7,000.

Altogether, that left us with about $51,000 that we could count on for the year. It meant that by the time September was up, we had met our MVI for the rest of the year and then some.

(I should note that I was part of Buffer’s bootcamp September–October of 2015, but I shouldn’t really count that as agency work in this discussion. That was in pursuit of a full-time gig, which didn’t work out. You can read about that story here.)

It all hit us at the same time, so there was still a good amount of risk involved in making the jump. I didn’t know if this was just a season of luck!

But more contracts kept coming in, and we’ve been in business since.

And if we hadn’t set a Minimum Viable Income, we wouldn’t have known that it was safe to continue on our own.

Bottom line:

  1. A Minimum Viable Budget helps you know when it’s time to quit.
  2. Setting an MVI too high makes it harder to focus on your own gig.
  3. Setting an MVI too low can make your own gig suck.
  4. Make it a game to lower your MVI so you can get the freedom you want!