Specifically, I am interested in situations where:
What are the pros and cons of each approach? Are there justifications for both? What is the wisest approach?
Having recently done just this I think the reality may be a little closer to the middle. Honestly I had planned on leaving my "day job" for about 6 months and had planned for the transition and gathered up some contract work to fill the gaps. That said, the last two weeks at the day job were a lot more effort than I was hoping they would be, and the first few weeks of just contracting have been more effort than I was hoping they would be. Ultimately though: I get to take my kids to and from school and do work I love with people I like. I draw inspiration from a quote by Bruce Lee:
"If you wish to learn to swim, jump into the water. On land no frame of mind will help you."Planning can be helpful but until you really let go and make the change you have no real sense of the challenges you will face or the rewards of your effort.
I started making plans to go freelance a good 10 months in advance.
My desire to freelance was driven primarily by my desire to travel the States, and being able to have some kind of financial engine behind that. So that took all sorts of planning, and I don't think I would have been able to do it without extensive planning up front.
I gave my employer 6 months notice when I was leaving, which in retrospect seems like a ton but still felt like the right amount. I worked at a small company, so every person had an outsized contribution in the company.
Having 10+ months in which to plan my escape was the perfect approach for me and I think if I had jumped ship without planning I would have sunk. Two huge benefits were that I was able to build up a portfolio of work prior to leaving (for legal reasons I wasn't able to show any of my inhouse work as my own), and develop client relationships in advance.
When I actually left my company I had two solid clients, each with somewhat sporadic work at first (since they were still adjusting to my fulltime freelance status). It was a rough couple of months when I started, but I was working constantly, and through my existing clients I was meeting new people, which eventually paid off quite well.
Another advantage I had with such a long lead-in period was the research I was able to put into the places I was going. I found an absolutely phenomenal coworking spot, and that was a huge help in getting off the ground at first; I was able to tap into a solid network from day 1 and that really helped me get going.
Everyone is different and I suppose it also depends on your industry; but my full recommendation would be to plan your exit and make sure you have a) money saved up, b) a clear idea of where you want to take your freelance business, and c) you've begun to take the steps necessary to realize your goals and determine whether they're viable. To try and set that all up when you absolutely NEED money would I think be extremely difficult.
There is no answer that is the best for every situation.
Bootstrapping your business part-time while still working a full time job reduces the risk. If you fail, you still have the job.
On the other hand, it also reduces the probability of success. You have less time to work on your business so it'll take longer to succeed. It's especially important in businesses where timing is important (as is often the case with software ideas).
Having the security of a job might make you less aggressive about pursuing your business. A quickly diminishing bank account can be a good motivator.
Your legal situation is also more complicated. While the rules are pretty clear (do not work on your business on your employer's time or equipment) strictly enforcing them is hard (e.g. you can be tempted to answer an e-mail related to your business while at work) and if your company is vindictive, they might make your life difficult even if did follow the rules.
Regardless of what the best approach is, a decision might be forced on you by external factors. For example, if you're in debt, you simply might not be able to afford quitting a job with steady income for freelancing when you don't have any business booked.
Finally, my answer is more about quitting a job to start a business, not to switch to freelancing. Given the question as asked, I don't see much of a difference between doing it on impulse vs. planning it. The only important difference would be: do you have work lined up for your freelance business or not, and that's not strongly correlated with how you decide to quit your job.
I've found the first client when I had fulltime job, so I was sure I will have some money even I won't have fulltime job. I did few tasks for him and then quit my fulltime job.
First year on a freelance was a bit hard though. But I kept pushing and searching the best way to work with clients on freelance. first it was payment per project, and now i'm working with payments per hour with no more then 2 project at once.
So I think you might find some project before you leave your fulltime job. Then you will be less scared to jump to awesome freelance world :)
Either approach can work for the right person, for a given approach, one will be more in line with their attitudes toward acceptable risk.
Slow migration means that you can control the risk trying to gain enough of your own customers before jumping ship. However, that may put you at conflict of interest with your employer, plus you aren't able to devote all your energies toward growing your business on account of your other commitments.
On the other hand, jumping ship means that you need to have a parachute available in case your best laid plans don't hold up in the real world. That being said, the increase in the amount of energy you can focus on your new endeavor may make the difference between being able to succeed and struggling for months or years before you make the jump.