Emergency Funds, Sump Pumps, and Side Hustles

I was ready to hit the sack when my phone buzzed with a text from my neighbor:

“Hey, don’t know if you know… we are under water.”

A creek runs behind both of our houses. When we talk about the weather, it’s not just small talk - we’re prepping each other for a possible flood insurance claim.

Sure enough, the backyard was a swamp. The water was already beginning to recede, but it looked like it had come up at least a foot, and a few inches had pooled in the basement.

Not nearly as bad as the flood a few years ago (that one left three feet of water downstairs).

Thankfully, no major damage was done. The sump pump kicked in, and we learned a while ago not to keep valuables on the basement floor. We were ready. And we didn’t know we needed to be.

Life is unpredictable. And when you’re self-employed, unpredictable hits harder.

If you’re unprepared, a small set back can put you in a serious financial and time bind.

Here are four safety nets every solopreneur should have in place:

1. Emergency Fund

Your first line of defense is cash.

An emergency fund gives you breathing room when life doesn’t go as planned:

• A client bails.

• A laptop dies.

• You get sick and can’t work for two weeks.

Start small. $1,000 is enough to stop panic, but work toward 3-6 months of your essential expenses. Make sure it’s easy to access when you need it (in a high-yield savings account), but leave it alone unless it’s an actual emergency.

The new iPhone is not an emergency.

2. Insurance

Insurance is one of those topics I’m hesitant to touch with a ten-foot pole. Health insurance especially gets everyone’s knickers in a twist. And the rest - life, auto, business, homeowners, etc. - aren’t exactly anyone’s favorite monthly bill either.

But if you ever need it, you’ll be very glad you have it.

Now, what you actually need is going to vary greatly from situation to situation. I’m not going to drop any quick, universally actionable bullet points in this section. But I will say, take some time and make some calls. Prioritize learning about your options, how much it’s going to cost (and what all it’s going to cover).

It can be overwhelming, but don’t let it keep you from taking action.

I’ll be honest, I dragged my feet here. It kept me from shifting to full-time self-employed earlier than I did, because I was terrified of losing employer-sponsored coverage, and I assumed buying my own insurance would be prohibitively expensive. But once I finally dug in and did the research, I found a plan that worked for my family, and it was about the same cost I was already paying as an employee.

The takeaway: Explore your options. Ask for guidance. Get the coverage that matches your risks.

The only thing worse than paying for insurance is not having it when you need it.

3. A Sump Pump Side Hustle

Early in my self-employment journey, I didn’t have a business. I had a thousand different side hustles. I was juggling all kinds of projects to make ends meet, but over time, I pared things down, and streamlined my business. In stead of spinning a bunch of plates, I want to spin one powerful flywheel. But it’s good to keep the plates on standby.

Kinda like how the sump pump kicks on when water starts to rise in the basement, if income dips or expenses rise unexpectedly, I can take on a website project, do some video editing, and bring in a little extra cash to help keep my family high and dry.

Diversify your income, but keep things aligned as much as possible. Find work that draws from your existing toolkit and skill set. If your primary gig is digital marketing, an extra copywriting or design gig makes more sense than dog walking or power washing.

Remember, the goal is temporary relief, not permanent hustle.

4. Community

The most powerful safety net of all is other people.

During our worst flood a few years back, friends showed up with industrial-grade pumps, rolled up their sleeves, and waded in to help clear out the basement. Friends offered my family a safe place to rest while we dealt with the disaster. Friends gave me the peace of mind that even though I had to deal with really sucky, overwhelming problems sometimes - I didn’t have to deal with them on my own.

Those kinds of relationships matter just as much in business. A strong community is what keeps you encouraged, accountable, and supported when the inevitable storms come.

That’s one of the reasons I started the Sidekick Mastermind. It’s a group of solopreneurs who show up for each other, troubleshooting problems, and sharing expertise and resources to help everyone keep moving forward.

As I like to say, self-employment doesn’t have to be “by-myself-employment.”

Reply to this email if you’d like to learn more about the group!

Your Turn

Which safety net do you need to set up (or strengthen) right now?

• Cash buffer?

• Insurance?

• A backup income stream?

• Or a circle of people who’ve got your back?

Don’t wait for the flood. Put your nets in place now.