MONEY

You’ll Never Guess the Latest Victims of the Student Loan Crisis

hand reaching out of hole using adding machine with rolls of paper
Renold Zergat—Getty Images

A fast-growing number of seniors are hitting retirement with a student debt burden. Even their Social Security is at risk.

Most debt you can get out of—painful as it might be. Credit card debt can be cleared in bankruptcy. A mortgage can end in foreclosure. But student debt is more sticky, and it turns out it can have big consequences in retirement.

Last year, Richard Minuti’s Social Security payments were cut by 10%.

The Philadelphia native was already earning only a bit over $10,000 a year, including some part-time work as a tutor. “I was desperate,” says Minuti. “Taking 10% of a person’s pay who’s trying to live with bills, that’s the cruelty of it.”

The Treasury Department was taking the money to pay for federal student loans he had taken out years before. Just before age 50, Minuti had gone back to college to get a second bachelor’s degree and a better job in social work and counseling. But the non-profit jobs he landed afterwards were lower paying, and he defaulted on the debt.

Student debt’s painful new twist

Minuti is one of the small but expanding group of seniors who are hitting retirement with a student debt burden. Over the past decade, people over the age of 60 had the fastest growing educational loan balances of any age group, according to the Federal Reserve Bank of New York. The total amount grew by more than nine times, from $6 billion in 2004 to $58 billion in 2014.

SeniorEduLoanGrowth

Only about 4% of households headed by people age 65 to 74 carry educational debt, according to a 2014 U.S. Government Accountability Office report. But as recently as 2004, student loans balances in retirement were close to unheard of, affecting less than 1% of this group.

Educational loans are very difficult to pay off when you are in or near retirement. Unlike a new college grad, there’s little prospect of years of rising salary income to help pay off the loan. That’s one reason older debtors have the highest default rate of any age group. (Also, most people who can’t pay off a loan will eventually age into being included among older debtors.) Over half of federal loans held by people over age 75 are in default, according to the GAO.

Student loan debts can’t be discharged in bankruptcy. And, as Minuti learned, federal tax refunds and up to 15% of wages and Social Security can be garnished.

This can be devastating, says Joanna Darcus, consumer rights attorney at Community Legal Services of Philadelphia.

“Most clients find me because the collection activity that they’re facing is preventing them from paying their utilities, from buying food for themselves, from paying their rent or their mortgage,” says Darcus, who works with low-income borrowers.

The number of seniors whose Social Security checks were garnished rose by roughly six times over the past decade, from about 6,000 to 36,000 people, says the GAO. Legislation from the mid-1990s ensured recipients could still get a minimum of $750 a month. At the time, this was enough to keep them from sliding below the poverty threshold. But to meet the current threshold, Congress would need to increase this to above $1,000 a month.

In other words, with enough debt, a Social Security recipient can be pulled into poverty.

“That’s pretty stressful for seniors when they understand that,” says Jan Miller, a student loan consultant who has seen a rise in his senior clients.

What’s behind the rise?

It’s not, despite what you might guess, only about parents who are taking on loans for their kids late in their careers.

Listen: How to decide if you should take out loans for your children’s education

In the GAO data, about 18% of federal educational debt held by seniors was from Parent PLUS loans for children or grandchildren. The remaining 82% was taken out by the borrower for his or her own education. (The GAO data differs from the New York Fed’s, showing lower total balances, so it may be missing some parental borrowing.)

SeniorLoansforOwnEdu

Darcus says many of her clients turned to education as a solution to unemployment and long-stagnant wages. Enrollment for all full and part-time students over age 35 increased 20% from 2004 to its recessionary peak in 2010, according to the National Center for Education Statistics.

“Among many of my clients, education is viewed as a pathway out of poverty and toward financial stability, but their reality is much different from that,” Darcus says. “Sometimes it’s their debt that keeps them in poverty, or pushes them deeper into it.”

And in recent years, both tuition and older debts have been especially difficult to pay, as home values and household assets took a hit in the Great Recession. Meanwhile, of course, the cost of higher education has soared. Tuition for private nonprofit institutions is up 78% in real dollars since 2004, according to the College Board.

What may be changing

New regulations and legislation this year may bring some relief to educational loan borrowers. The Senate in March introduced legislation to make private loans, but not federally subsidized loans, dismissible through bankruptcy.

For federal loans, more favorable income-driven repayment plans may be extended to up to 5 million borrowers this year. These plans, which have been growing in popularity since launching in 2009, adjust monthly payments according to reported discretionary income. The Department of Education is scheduled to issue new regulations by the end of 2015 that may allow all student borrowers to cap payments at 10% of their monthly income.

But it is unclear what percentage of that 5 million people are older borrowers who would benefit. Some borrowers have also complained that income-driven repayment plans require too much complex paperwork to enroll and stay enrolled. Borrowers who want to find out if they are already eligible for income-driven repayment plans can go here.

Parent PLUS loans would not be included in the new regulations. However, Parent PLUS loans can still be consolidated in order to take advantage of a similar, albeit less generous option, called the Income Contingent Repayment plan. This plan allows borrowers to cap their monthly payments at 20% of their discretionary income.

Still, some feel the best way to help seniors with student loan debt is to stop threatening to garnish Social Security benefits altogether. This spring, the Senate Aging Committee called for further investigations of the effects of student debt on seniors.

“Garnishing Social Security benefits defeats the entire point of the program—that’s why we don’t allow banks or credit card companies to do it,” said Sen. Claire McCaskill of Missouri in a statement.

Getting out from under

Richard Minuti was able to enroll in an income-based repayment plan last year with the help of a legal advocacy group. Because Minuti earned less than 150% of the federal poverty level, the government set his monthly obligation at $0, eliminating his monthly payment.

“I’m appreciative of that, thank God they have something like that,” Minuti says, “because obviously there are many people like myself who are similarly situated, 60-plus, and having these problems.”

But Deanne Loonin, director of the National Consumer Law Center’s Student Loan Borrower Assistance Project, says she doesn’t see the trend of rising educational debts ending any time soon. And some seniors will struggle with this debt well into retirement.

“I’ve got clients in nursing homes who are still having their Social Security garnished and they were in their 90s,” she says.

MONEY Travel

5 Things American Travelers Should Know If They’re Visiting Greece

Supporters of the NO vote in the upcoming referendum, gather during a rally at Syntagma square in Athens on Monday, June 29, 2015. Anxious Greek pensioners swarmed closed bank branches and long lines snaked outside ATMs as Greeks endured the first day of serious controls on their daily economic lives ahead of a July 5 referendum that could determine whether the country has to ditch the euro currency and return to the drachma.
Petros Karadjias—AP Supporters of the NO vote in the upcoming referendum, gather during a rally at Syntagma square in Athens on Monday, June 29, 2015.

Greece-bound tourists could be in for some hassles—or worse.

The crisis in Greece has caused the closure of local banks and brought about the worst day of the year in the U.S. stock market. Concerns are also being raised that the situation could ruin the vacations of tourists dreaming of exploring the culture, history, and warmth of Greece during the height of the summer season.

Here’s what travelers should keep in mind if they’re heading for Greece anytime soon.

Arrive with ample cash. Starting on Monday, banks in Greece were closed, and ATM withdrawals were being limited to €60 (around $67) for cards issued by Greek banks. Withdrawal restrictions don’t apply to foreign cards, but many ATMs have reportedly already been emptied and have no cash to dispense.

“Automated-teller machines are running dry and many businesses are no longer accepting credit cards,” the Wall Street Journal reported.

The bottom line is that the situation is fairly chaotic and very much in flux. Greece-bound tourists from Germany, the UK, Canada, Australia, and elsewhere have officially been given some variation of the warning to arrive with “sufficient euros in cash to cover the duration of your stay, emergencies, unforeseen circumstances, and any unexpected delays.” Ideally, bring cash in lots of smaller denominations, as it may be difficult for taxi drivers, restaurants, and other local businesses to provide change for big bills.

The advice of the U.S. Embassy in Greece is that Americans should have plenty of cash, and should certainly not rely on any single form of payment: “U.S. citizens are encouraged to carry more than one means of payment (cash, debit cards, credit cards), and make sure to have enough cash on hand to cover emergencies and any unexpected delays.”

Be extra vigilant. “The State Department recommends you maintain a high level of security awareness and avoid political rallies and demonstrations as instances of unrest can occur,” the U.S. Embassy states. “Exercise caution and common sense: Avoid the areas of demonstrations, and if you find yourself too close to a demonstration, move in the opposite direction and seek shelter.”

What’s more, pickpockets and thieves will surely be aware that tourists have been advised of the necessity of having plentiful cash on hand. So there will be extra reason for tourists to be targeted for theft. It goes without saying you shouldn’t stroll around casually with all of your cash in your purse or back pocket. Stash the bulk of it in the hotel safe, and divide walking-around cash among your party—ideally, safely kept in a money belt or neck wallet—perhaps with some emergency bills in the sole of your shoe. Don’t make it easy for pickpockets to rip you off.

Expect long lines and possible delays. There have already been huge lines at ATMs and supermarkets, with worried shoppers stocking up on essentials in the same way that Americans hoard milk and bread when a big snowstorm is in the forecast. There has also been plenty of speculation that strikes, demonstrations, and a squeeze on fuel could cause travel disruptions within Greece. So far, this has only amounted to speculation, and ferries, gas stations, and such have not been affected.

Tour operators are reporting (mostly) business as usual. “We were in touch with our hotel and our tour director earlier today, and both report that daily life is going on normally,” Tim Armstrong, a spokesman for the Tauck tour company, which had a group on a cruise just finishing up a three-night stay in Athens, said on Monday, according to the (Canada) Globe and Mail.

Likewise, Greek tourism officials maintain that the current events will have no impact on foreign visitors. “The tourists who are already here and those who are planning to come, will not be affected in any way by the events and will continue to enjoy their holiday in Greece with absolutely no problem,” said Elena Kountoura, Greece’s minister for tourism, according to the Independent. “It should be also noted that there is ample availability of both fuel and all products and services that ensure a smooth and fun stay for the visitors in every city, region and the islands.”

At least some of this seems like overstatement, considering that tourists and locals alike have already been affected by long lines. Credit and debit cards are still being accepted by most hotels and other businesses, but the fact that some are only accepting cash as payment is obviously another way that travelers are being affected.

Travel insurance probably won’t cover you if you cancel. If you’ve booked a vacation to Greece and purchased travel insurance for the trip, it may be time to look at the fine print. Most policies will reimburse a cancelled trip if there’s been a death in the immediate family, or if there’s been a natural disaster, terrorist attack, or large-scale civil unrest. But nothing that’s happening in Greece right now qualifies as a standard reimbursable situation.

“If you do cancel your trip it will be subject to the terms of the deal, and you stand to lose money,” one UK travel agent explained to the Guardian. Unless you’ve paid extra for a “cancel for any reason” upgrade to the insurance policy, in all likelihood your travel insurance would not cover you if you decide to cancel a trip to Greece right now.

Read next: What the Turmoil in Greece Means for Your Money

TIME technology

Uber Offers Free Rides to Its New York Protest

US-ECONOMY-TRANSPORT-UBER
ANDREW CABALLERO-REYNOLDS—AFP/Getty Images An UBER application is shown as cars drive by in Washington, DC on March 25, 2015.

uberPOOL will pick up participants on Tuesday

Uber is using an unusual resource to protest a New York City proposal: its own cars.

Protesters attending an Uber rally outside New York’s City Hall on Tuesday can get free rides to and from the event through the company’s carpooling service.

The company is organizing a protest against legislation backed by Mayor Bill de Blasio that would limit how much large car services in the city could grow each year in order to limit congestion on city streets.

Uber says the bill “would stop thousands of new drivers from joining the Uber platform … destroy 10,000 job opportunities for New Yorkers in just one year, and result in longer wait times, higher prices and less reliable service for riders.”

Uber says anyone who takes a cab to or from City Hall on Tuesday between 10:30 a.m. and 2:30 p.m. will get a free ride through uberPOOL—though theoretically that means some City Hall employees could get swept up in the mix alongside protesters.

TIME Careers & Workplace

6 Tricky Interview Questions (and How to Answer Them)

businesswoman-interview
Getty Images

"What are your salary requirements?"

Have you ever walked into a job interview feeling totally prepared, only to be stumped by a tricky surprise question? You’re not alone.

Two recent Quora threads discussed the questions, “What is the toughest interview question thrown at you, and how did you answer it?” and “What are some examples of great interview questions?” To help you tackle your next interview with confidence, we pulled together some of the most surprising Qs being asked behind closed doors—as well as Quora users’ interpretations and real-life answers.

1. “Do you think you’re a lucky person?”

There are two things you want to avoid here: attributing all of your successes to luck and coming across as cynical. “I thought about this for a few seconds and came to the conclusion that they must be gauging whether I’m an optimist or a pessimist,” Quora user Philemon Onesias says. “I decided to show them I’m the former, but still quite realistic.”

2. “If you could relive the last 10 years of your life, what would you change?”

If you think this sounds like a spin on the classic “greatest weakness” question, you’re right. “Professionally, I answered, ‘I don’t think I’d change anything,’” Erin Millano says. “‘I’ve learned a lot in the past 10 years and [it’s] all helped me grow.’”

3. “What are your salary requirements—both short-term and long-term?”

Talking salary is tricky, but talking salary for both the present and future is even trickier. Kate Ross Myers took an open and honest approach with her answer: “I just truthfully said, ‘I did not expect this question.’ I guess it worked, because I’m still working for the same company.” Our take: Give a short-term range, and keep the rest vague. Something like, “I think starting in the range of X and Y is fair—and of course I’d expect an appropriate increase after my annual performance reviews.”

4. “Tell me about a time in your life when you actually failed at something.”

The best way to answer this toughie? ’Fess up about your failures. “After interviewing over a 100 people in my career, this is the question that literally separates contenders from pretenders,” James Hritz says. “It’s interesting how many candidates are loath to admit they have ever failed at anything!”

5. “What can you teach us?”

This question can be pretty illuminating for both the interviewer and interviewee: When Divya Prabhakar was asked, “What can you teach us?” in a job interview, she realized she actually wasn’t a great fit for the company. “It showed me the company valued an interactive and mutual working environment, and if I wanted to have a positive experience there, rather than feel inferior, I should be able to answer this question easily,” she says.

6. “Tell us the most effective approaches for managing you.”

What management style helps you work best? This question, from Quora user Branko Marusic, forces you into the shoes of your potential superiors. “The company wants to ensure that every new employee has the best chance of succeeding,” he explains.

This article originally appeared on Levo.com

More from Levo.com:

TIME Greece

Meet the One Greek Business Profiting From the Run on Banks

“Everything has its risks”

The last five years have not been kind to the nameless little shopping plaza off of Lekka Street in central Athens. One after another its shop windows have gone dark and its merchants have gone out of business, acting out in miniature the way the Greek economy has contracted under the weight of its debts. But way in the back of the dusty arcade, the cluttered shop of George Moschopoulos has never seen better days. Every corner of the place is packed with one of the few durable goods on which Greeks are still willing to splurge: safes and strongboxes with solid metal walls.

Over the past few years, several aspects of the Greek financial crisis have aligned to boost demand for these unusual appliances. For one thing, public faith in the Greek banking system has collapsed, prompting Greeks to withdraw more than one billion euros from their accounts on Friday alone. The Greek government’s desperate push to raise tax revenue has meanwhile made people question the wisdom of storing their money in safety deposit boxes, where the tax police could still seize it. And the fact that people all over Greece are stashing their savings at home has driven an epidemic of burglaries. Put all that together and a strongbox starts to seem like a good investment.

“Everything has its risks,” says Moschopoulos, who has been in the safe business for nearly 40 years, according to the licenses that hang on the wall of his shop. “If you stuff your money in the mattress, it’s a thousand percent certain you will get robbed.” The most secure option, he admits, is still a safety deposit box inside a bank vault. “But there’s always the chance that some law will get passed to investigate what’s inside all those boxes, and they could all be frozen.”

Nor is there much security for Greeks in keeping their money in a savings account. As of Monday, the Greek government imposed capital controls on the nation’s banks, limiting how much their clients can withdraw to 60 euros per day, which is hardly enough to fill up the tank of a mid-sized sedan. Long lines had formed at ATMs around Athens in anticipation of this measure, and those who managed to withdraw their savings were among the lucky ones.

Now all they have to do is keep that money safe from thieves. According to the latest figures from Eurostat, the E.U.’s main statistical agency, Greece saw the worst jump in domestic burglaries of any E.U. member in the years after the financial crisis hit. In 2012, the most recent year for which Eurostat has published data, Greek police recorded almost 88,000 cases of burglary, up 76% from fiver years earlier. Police in Poland, whose population is 3.5 times larger than that of Greece, recorded less than half as many burglaries that year.

Greek media have meanwhile reported a change in the burglars’ tactics. If before they would wait until a home was empty before breaking in to ransack the place, they now prefer to have at least one person at home during the robbery to show the intruders where the money is hidden, according to a reported published Monday in the left-wing Avgi newspaper, which cited sources in the Greek police. (The press service of the national police did not respond on Monday to TIME’s request to comment on the article’s claims.)

If the report is accurate, the thieves in Greece would seem to have found a way to crack the safes that homeowners are installing. But Moschopoulos has yet to see a drop-off in demand. In the last five years, he says, his sales have grown roughly five-fold compared to the years before the financial crisis. “The reactions of Greek people are not always logical,” he says. “They are not patient enough to wait. They panic and withdraw everything right away.” But after this week’s capital controls, it’s hard to blame them for that kind of panic. The hoarders of cash would seem to be the clever ones in Greece this week, especially if they invested in the roughly 250 euros it costs to install a safe in their bedroom wall.

TIME Greece

Dow Plunges 350 Points as Possible Greek Default Looms

Eric Thayer A trader on the floor of the New York Stock Exchange.

Uncertainty rattles global markets

The uncertainty surrounding Greece’s ongoing debt crisis choked global markets on Monday, extending recent losses for the world’s stock exchanges.

The Dow Jones Industrial Average closed the day down 350 points, or 2%. The S&P 500 dropped 2.1%, ending the day at 2,058 points. Meanwhile, the tech-heavy Nasdaq composite was hit hardest, falling 122 points (or 2.4%) to end the day under the 5,000-point mark for the first time since early-May.

It was the worst day of the year for U.S. stocks.

Earlier, volatility struck markets around the world, as global markets felt the impact of the uncertainty in Greece, where banks are closed and ATM withdrawal limits have been imposed. The Chicago Board Options Exchange Volatility Index (VIX) — also referred to as the “fear index” — soared on Monday, rising by nearly 5 points, or 35%, to reach its highest levels in about four months.

Greek citizens will vote this weekend on a new bailout proposal that could bring billions of dollars in additional aid into the troubled country while installing strict austerity measures. A “no” vote on the bailout extension, meanwhile, would likely pave the way for Greece’s withdrawal from the euro zone.

Also, on Monday, ratings agency Standard & Poor’s once again downgraded Greece’s credit rating — to CCC- — in an assessment that predicted a Greek default within six months.

S&P said there’s now a 50% chance Greece will leave the euro.

In addition to fears about Greece, investors are concerned about Puerto Rico’s ability to pay its debts and continued weakness in China.

TIME Greece

This Nobel Prize-winning Economist Says Greeks Should Vote ‘No’

HONG KONG-ECONOMY-FINANCE-FORUM
PHILIPPE LOPEZ—AFP/Getty Images Paul Krugman

It could result in an opportunity for the nation

Who should the Greek people listen to when they vote in a referendum on their country’s international bailout: international leaders, or New York Times columnist Paul Krugman?

Here’s what is at stake: Greece’s Prime Minister Alexis Tsipras has announced a July 5 referendum on the nation’s creditors’ proposals to resolve its debt crisis, which has plagued the country for several years now. A “yes” vote would back the bailout measures by international creditors, while a “no” vote would likely lead Greece to exit the eurozone, making it the first nation to ditch the single currency and throwing the European nation into uncharted territory.

Noble Prize-winning Krugman says he would vote “no,” arguing two reasons for that case. Within the first point, Krugman acknowledges that leaving the euro is scary, but could result in an opportunity for the nation to rethink how it can tackle its woes and that a devaluation of its currency could pave the way for a recovery, as such a move has helped other nations many other times in the past. Secondly, the economist says a yes vote essentially is a move to replace the Greek government.

Unsurprisingly, Europe’s top leaders don’t agree with the “no” vote crowd. Jean-Claude Juncker, the president of the European Commission, has aimed to persuade Greeks that the budget cuts and policy overhauls their government has rejected are good for the nation. He says a “no” vote means the nation “is saying ‘no’ to Europe.”

MONEY Autos

The Case for Buying an Electric Car Is About to Get a Whole Lot Better

2015 Chevrolet Bolt EV
Luke Ray—Fuel Press Chevrolet Bolt EV Concept all electric vehicle with more than 200 miles of range and a price tag around $30,000.

Drive 200+ miles on a single charge, without paying Tesla prices.

Electric car sales have stagnated through the first half of 2015. Sales have slumped for several reasons, including cheap gas prices and increased fuel efficiency among gas-powered automobiles.

In May, dramatic price cuts helped boost sales of models such as the Chevy Volt, and the month saw the most EV sales of 2015, according to InsideEVs. Still, the May 2015 EV sales total of 11,540 was 7% lower than May 2014. The Nissan Leaf, the overall electric-car category leader, has been struggling in particular. After failing to cross 2,000 unit sales in any month in 2015, the Leaf finally hit the mark in May. But through the first five months of the year, only 7,742 Nissan Leafs have been purchased, a decrease of more than 25% off last year’s pace.

Over the next few years, however, advances in electric car technology could very well turn skeptics into plug-in adopters.

While purchase prices have decreased, EVs remain impractical for many households for the time being. Presumably, a large portion of drivers is reluctant to go electric because of limited driving range. Unless you’re willing to pay $70,000 or more for the likes of a Tesla, you’ll be limited to driving 70 or 80 miles per charge with the Leaf and nearly every other reasonably priced purely battery-powered vehicle. That’s just not enough for drivers who want a car that’ll be worry-free on road trips, longer commutes, and long days full of running errands.

Soon, though, the so-called “range anxiety” factor could be reduced significantly. Earlier this year, GM introduced a concept called the Chevy Bolt, an all-electric vehicle that should appeal to the masses seeing as it’s expected to be both affordable (around $30,000) and practical (200 miles per charge).

Chevy hasn’t said when, exactly, the Bolt will be available for purchase, but it’s been widely reported that the likely date is sometime in 2017—probably late 2017. According to industry analysts cited by Automotive News, buyers could be behind the wheel of Bolts sooner than that. Production of the Bolt is expected to begin in October 2016, and sales would commence shortly thereafter.

By then, there could be even more compelling reasons to wait a little longer for what Nissan has in the works for the Leaf. Another Automotive News post notes that Nissan is working on a next-generation battery that would allow the Leaf a driving range of roughly 310 miles per charge. Such an impressive range won’t be available in the forthcoming 2017 Nissan Leaf, which should hit the market next year with an expected range of 105 to 120 miles.

What’s more, next year Tesla, which thus far has focused on the high-end market, is expected to introduce the Model 3, a mass-market vehicle rumored to have an impressive driving range and starting price ($35,000) that could come to dominate the field.

Overall, one or more of these new vehicles could be real game changers, with affordable prices and vastly improved driving ranges that’ll make the best arguments yet for switching to an EV.

Read next: Cheap Gas Helps Pull the Plug on Electric Cars

TIME Careers & Workplace

12 Steps to Go From Employee to Entrepreneur

One step at a time

If you’re fed up with your job, it may seem like there are only two steps to becoming an entrepreneur. The first is to quit your job, and the next step is to start a company. While it is possible to transition successfully from employee to entrepreneur, it’s a little more complex than that.

Here are the 12 steps you’ll need to take to become your own boss.

1. Determine what you’d like to do.

Some people call this finding your passion, but it’s more than that. Think about your skills, abilities and experience. Consider what you can realistically see yourself doing for hours each day, for weeks and years.

2. Think about what others will pay for.

A viable business is the intersection between what you’d like to do and what others will pay for. Remember the “Jump to Conclusions Mat” from the movie Office Space? Todd loved building it, but no one was going to buy it. It wasn’t a viable business opportunity.

3. Interview ideal customers.

Find a few people that you think would be your ideal clients. Ask them about their biggest needs, fears and aspirations related to the business idea you plan to pursue. Are the benefits of your product or service in line with their real needs? Also, make a note of the words they use, as they’ll eventually help make your marketing more authentic.

4. Design your marketing and business plans.

Today’s marketing involves content creation, social media, email outreach and more. Make sure you know how you’ll approach each of these alternatives to introduce your idea to customers. At the same time, lay out a business plan that details how you intend your business to function. It doesn’t need to be super formal, but it does need to cover your operating structure, product, delivery systems and expansion plans.

5. Set up your business on a small scale.

If you can, test your company idea by launching on a small scale on the side, while still working your day job. This gives you a no-risk opportunity to test your ideas, get your first clients and see if the business will hold up over time before you leave the security of your current position.

6. Assess feedback and adjust.

Running a small-scale operation will help you determine which parts of your idea are great and which ones need adjusting. Take customer feedback seriously and make any necessary changes before you begin scaling up.

7. Assemble a team.

If your idea seems viable, determine who you’ll want on your business leadership team when you eventually launch full time. Depending on your personal experience, you may need help in areas such as finance, marketing, customer service and production.

8. Secure financing.

For a small venture, this might mean saving up some money to get through the first few months or taking cash from your 401(k). If your aspirations are a bit larger, you may need to think about how to procure venture capital or other outside investment.

9. Set up the structure of your company.

At the same time, you’ll also want to decide what kind of company structure to register. Do you want to incorporate, form an LLC or create a partnership? Get this taken care of legally and carefully define the roles and investment of each of your leadership team members.

10. Leave your job.

When you’re ready, leave your day job. This may feel like an amazing relief after all the work you already put in, but trust me, more work awaits. Although it may be tempting, be sure not to burn any bridges as you leave — you never know when you’ll encounter former bosses and colleagues again, and you may need to work with them in the future.

11. Set up a working budget.

With your full-time schedule now devoted to your business, set up a company budget. This should include payments for marketing expenses, salaries and other important purchases. Just be sure not to waste money on frivolous expenses!

12. Scale up your business according to your marketing plan.

Finally, all that’s left to do is to work the plans you’ve carefully laid out for yourself. Of course, that plan may change over time as you encounter and overcome obstacles. But, this is it — you’re a full-fledged entrepreneur. Congratulations!

As you can see, becoming an entrepreneur requires a lot of work before you even consider quitting your day job. However, if you follow each of the steps listed above and your idea still seems viable, you can leave your life as an employee and become an entrepreneur instead.

There are still many challenges you’ll face, but for most entrepreneurs, the benefits of meaningful work and self-direction are much more important.

This article originally appeared on Entrepreneur.com

More from Entrepreneur.com:

TIME Uber

Two Uber Executives Arrested in France

Photo illustration of logo of car-sharing service app Uber on a smartphone over a reserved lane for taxis in a street in Madrid
© Sergio Perez / Reuters—REUTERS

Arrests come just days after fierce anti-Uber protests

Uber has encountered roadblocks in cities not keen on unregulated taxi services, but it might finally have met its match in the streets of Paris.

Two Uber executives were arrested in Paris Monday for running an illegal taxi company and concealing illegal documents, according to TechCrunch.

The arrested executives — Uber France’s CEO Thibaud Simphal and Uber Europe GM Peirre-Dimitri Gore-Coty — have previously said that Uber would continue operations in the country until a court rules against their service, UberPOP. Although UberPOP has been illegal since late last year, the country has had trouble enforcing the ban since Uber reportedly pays off drivers’ fines and encourages them to continue working.

The arrests come just days after fierce protests plugged up major traffic intersections in Paris. At one point, police in riot gear deployed tear gas on the taxi driver protestors, who say that Uber represents unfair competition.

But even arresting Uber’s executives won’t do much to stop the irreverent service: Simphal and Gore-Coty will probably be released within days, the report said, and France will have to let the case wind through the country’s courts.

Your browser is out of date. Please update your browser at http://update.microsoft.com