- Jean Chatzky built her thriving business after an unexpected job loss.
- When starting your business make sure your idea has business legs, Chatzky says.
- Be sure to take advantage of all opportunities even if it may not seem like a fit at the time.
Before Jean Chatzky wrote over half a dozen books on personal finance and money management, she was a financial columnist at Money magazine. One day in 2008, the company informed her that they were cutting costs and that she would no longer be in a staff position, but she could continue to contribute posts in a freelance capacity, she said.
“They were going through lay-offs and cost-cutting measures and I had gotten expensive,” Chatzky tells Insider of the situation. “They said they would allow me to keep my column as a freelancer, but I was just downsized and there was no other way to look at it.”
The sudden shakeup in her career led her to take a closer look at the different paths that she could take going forward.
“It was definitely unexpected and I tried looking for another job at first, but it wasn’t so easy to replace the level of salary that I was making. I decided right then that instead of working for someone else again, I would start my business,” Chatzky explained.
After searching for a new position and not finding anything that fit, Jean decided to turn her side projects into her main income. She continued her work on the Today television program, where she had been financial editor for 25 years, and then also focused on creating a business doing what she does best: educating people on how to manage their money better.
Her leap of faith in striking out on her own was over 10 years ago. Today, Chatzky is now the CEO of HerMoney, a best selling author, and the founder of a business and a platform that educates and empowers people to make sense of their money and achieve financial success.
When she started building her business it was not fast or easy, Chatzky explains how she did it and what she learned along the way.
Don’t start a business just because you have a good idea.
“I never saw myself as a business owner. I was happy as a financial journalist and I had many side projects and opportunities that supported what I thought was going to be the totality of my career,” explained Chatzky of her past career ambitions. “When I lost my job at Money magazine, I had to pivot, but before I did that, I had to make sure that there was a need that I was filling and that I wasn’t doing this just because I hadn’t found another job yet.” Jean realized that there was a need for good financial advice and that she could turn her skillset into a viable business.
Another thing Jean needed to make sure of, in addition to having a business idea with stable footing, was that she would have enough money to sustain herself and support her business as she grew it from scratch.
“At the time, not only had I lost my job, I had also gone through a divorce so it was vital that I had my finances in order to keep everything going,” Chatzky told Insider.
Chatzky always tells business owners that it’s important to continue to manage your own money while growing your business.
“The biggest mistake business owners make is starting a business with no reserve. I know what it is like to want to go all in on your idea, but you must protect yourself by spending a little time and effort on your own finances,” Chatzky states.
The number one reason businesses fail is due to cash flow issues and Chatzky when starting her business wanted to make sure that her finances were solid. It’s already a big enough risk setting out on your own, but doing so without a safety net can set one up for failure.
Walk through the doors that open.
Prior to starting her business, Chatzky had extensive experience as a freelance writer and had worked diligently to find stories that resonated with people and the media outlets she was working with. Having this experience was a launching pad of sorts, and it also helped that she had already been at the top of editors’ minds for certain pitches and stories.
And well into her career shift, and picking up more freelance work, she had already been confident in pitching herself, so she leaned into it by looking for speaking engagements. But the most important thing she did was always being open to what came her way.
“When you are just getting started, I always advise that you walk through the doors that open. Be willing to check out an opportunity even if it might not appear to be a fit at first glance,” Chatzky said.
Chatzky hosts a radio show called Everyday Wealth and the way that opportunity was presented to her was by chance.
“I got a call from a contact that I hadn’t spoken to in nearly a decade and he stated that they were looking to replace a radio host and asked if I would be interested,” she said of the situation. “At first I thought, ‘I don’t want to host a radio show,’ but I still checked out the opportunity and I am so glad that I did because I love it. Even if something does not seem like it will be a fit, still check it out because you never know.”
In the beginning, bootstrap what you can and do it on the cheap.
Many new business owners want all of the bells and whistles, brand new website, product videos, top notch social media content, but it can be very expensive. You may have to find work arounds for getting what you need or want for your business.
“When I was starting my newsletter, we wanted to use a focus group to tell us what they liked or disliked about the newsletter and how it was going,” she says. “It was suggested that I pay for a focus group and that would have easily cost $10,000 and I did not have that at the time.”
Instead, Chatzky looked to utilize the resources that were immediately available to her to try and seek similar ends but through different means.
“I placed a link in the newsletter asking for people to volunteer to be a part of a panel that would be moderated by me to discuss the newsletter and it worked and it was free. The newsletter has grown so much since then, but if I thought the only way to get it done was to spend $10,000, the newsletter probably would not have gotten off the ground.”
Don’t let the bumps along the way stop you.
When starting a business, there will be plenty of bumps along the way, but what matters is that when these situations happen, you are not deterred from achieving your goal, Chatzky suggests. Many business leaders have to work long hours, build up their contacts list, and sacrifice in order to make it. And it could even take some time before a new business catches on and perhaps more importantly, it is also likely to be a while before one turns a profit.
Erring on the side of caution and taking a conservative approach, it should be assumed that it can take 2 to 3 years — or perhaps even longer — until a new business venture starts turning a profit. Chatzky definitely dealt with challenges in starting and growing her business, but she remained determined and never viewed a bump or challenge as the end of her business.
“There were so many bumps along the way. What I found to be the most challenging was finding good people to hire. For a small business every hire seems vital. The pandemic was even a challenge, not in terms of revenue, but people changed in terms of what they want and expect for their work experience,” Chatzky says of the evolving work environment. “No one wants to be in the office anymore and I grew up in newsrooms, so hiring and interacting with people has definitely changed and impacts how I run my business.”
Make sure your business is actually a business.
Every business starts with an idea. It’s important that before you spend time, money and mental energy that your idea can be a viable business. Are you fulfilling a need? Will you be able to scale your business and can it be profitable? According to the U.S. Bureau of Labor Statistics, 1 in 5 businesses fail within the first year and only about half survive past the 5 year mark. You can increase your odds of success if you take time and plot out your business beforehand.
“Sit down and really plot out what your revenue expectations are, but also understand what your expenses will be,” Chatzky says of the realities of starting a new endeavor. “When you run a business, you will have to reinvest in the business, you will have to get an accountant, pay taxes, increase product and it will take money to grow. You need to have all this down and really decide if your idea actually has business legs.”
Chatzky states that starting her business and seeing it grow into the success that it is today is one of the most rewarding things she has done, but it wasn’t easy and she didn’t start out having it all figured out.
“It was a decision that was motivated out of necessity and maintaining my life. I was responsible for half of my kids’ college education after my divorce while continuing to fund my retirement — but that necessity made me push through when challenges came up, get creative when I wanted to expand, and say yes when opportunities came my way. To be successful, you have to be scrappy.”