The charity sector is very mobile. Many of us have had more than one job. And for some, the idea of going to an office every single day is unappealing. 

If you are business-minded, you may have considered becoming a consultant. After all, working for a charity, you often have to hustle for grants and to stay current. Working in the nonprofit sector requires very strong people skills which is key in business as well. In addition, you are great at making a dollar s-t-r-e-t-c-h. All of these factors translate well to your business.

If you have strong experience in the sector, you may be able to make a go of it. Bear in mind that the part of Canada you live in will have a big impact. I have a friend in a medium-sized city who has more work than he can handle - only downside is that his hourly rate is less than in a major city.

Here is some small business math to consider before you leap into consulting in a major city. Bear in mind that these numbers will vary but this is a sobering way to think about your work. Another factor to consider is your expertise. Who will be your clients? You may be able to find more work with grassroots charities but their budgets are more limited so you may have to work more hours.

Here's the small consulting business math courtesy of an expert in this field.

You will need to spend 30-50% of your time on marketing. This will be especially true for the first year or two of your business. And the challenge is that when you are working a lot this can slide leading to gaps when you have too much work followed by gaps with too little.

You will need to spend 5% of your time on administration. Billing clients, paperwork, all those things take time. Letting them slide will hurt you in the long run.

That leaves you working 45-65% of the time.

Finally, out of 52 weeks in a year, how many weeks do you want to take vacation? Out of 24 hours in a day, how many do you want to work?

Now, take the amount you want to earn a year and do the math

Example

• $50,000 earned a year (gross)
• 4 weeks vacation a year (52 weeks - 4 = 48 weeks worked)
• 7 hours a day for 5 days a week (48 weeks worked 35 hours per week)
• That leaves you with 1680 hours you plan to work a year
• If you work 45% of that time, you will get paid for 756 hours. 
• Now, that means for you to gross $50,000, you need to charge $66/hour
• To earn $75,000, you need to charge $100
• To earn $100,000, you need to charge $125.

Depending on your family, mortgage, and retirement, this may be a great income. Or that may be barely enough to scrape by, particularly if you live somewhere that housing is expensive or where there are already a lot of consultants in your area.

Before you take the leap to become a consultant, do the math. And remember, 1/3 to 1/2 of your time will be spent marketing. Be sure you know what you are getting yourself into before you take the plunge.

Ann Rosenfield, MBA, CFRE has worked as an employee and a consultant. She likes both but leans more towards working with colleagues in a full-time job.