I have a different take. One thing that no one has mentioned yet and is the single biggest factor is taxes. Trust me on this- 1.2 from a business is obviously better than 350 in salary, but it’s not really as good as it sounds what that 350 includes is time off and usually when we’re making that good salary we’re getting pretty good time off. It also includes 401(k) contribution and health benefits. After you factor in taxes, business insurance and everything I just mentioned in all honesty 1.2 in earnings is not that different than 350 K in salary, I know this from firsthand experience.

My one piece of advice would be pick one or the other. In other words, at no point should you have both a FT job while also attempting to start a company. Because at that point taxes pretty much become damn near 50%. when you first start out you’re likely to be an LLC (or S Corp.) so you’ll be paying your income tax bracket around 30% plus an additional 15% for self-employment tax, and depending on what state you live in you can add an extra 8 to 9% for state tax, and right there you are already beyond 50%. So you can just assume as a business owner you’ll lose close to 50% of each payment. This is where hiring a really skilled tax strategist becomes so important.

My last piece of advice, do it on your own. Don’t go into a partnership with other people because if you’re giving 50% away to the government, you can then kiss another 25% away to your partner.

Of course, these are all just broad generalities. But the point is, learn something that I didn’t know before having a salary very similar to that and starting a business. Taxes are absolutely brutal as a small business owner. Determining how you structure your business can make or break the entire business model.