How much should I save before quitting my job to start something?

Two pots, never one

The most common mistake is a single pool of money covering both the business and the household. It hides the truth from you. You cannot tell whether the business is working, because personal frugality keeps masking the shortfall, and you cannot tell how long you have left, because business spending keeps eating the runway.

Separate them at the start. A business account and a personal account, with a defined monthly amount moving from one to the other as your salary. Then both numbers tell you something real.

Sizing the personal pot

Take your monthly essentials, the number you would spend if everything optional stopped. Multiply by eighteen. That is the target.

Eighteen rather than six for two reasons. Revenue almost always arrives later than the plan says, and the gap between first revenue and sustainable revenue is usually longer than the gap to first revenue. And winding down takes months too. Someone who runs out at month seven closes badly and at a loss, where the same business given twelve more months might have worked.

What to arrange before you resign

Individual health insurance, bought while you are still employed. Group cover ends on your last working day, and buying afterwards means fresh waiting periods on anything pre-existing.

Term life insurance, if you have dependants, for the same reason and because it is easier to underwrite with a salary slip.

Any loan you will need in the next two years. Lenders assess self-employed applicants on two to three years of business returns, so a card or a loan approved while salaried is far easier to obtain than the same product six months later.

Your credit history, kept alive. A card used lightly and cleared monthly maintains the file through a period when new credit is hard to get.

The number that ends it early

Decide, in advance and in writing, the balance at which you stop and take a job. Not as pessimism, as a control. Founders without a stopping rule tend to fund the last six months from credit cards and personal loans, which converts a failed venture into years of debt.

India's formal workforce is absorbing more women than it used to, with roughly 1.56 crore women joining it over seven years. Going back is more possible than it once was. Going back with ₹8 lakh of credit card debt is a different proposition.