How to Financially Manage a Career Change

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 Budgeting and money management involves more than just tracking your expenses. It demands making sure than any major life transition that you make – whether it's buying a home, moving to a new state, getting married, having children, or changing careers – is managed in a way that's strategic and money-savvy.

In fact, wisely managing your finances during these huge life turning points might have a significantly bigger impact on your finances than pinching pennies or clipping coupons ever could.

We've written many articles about other major life transitions – from preparing for home expenses to  finding your financial soul mate to planning for baby-related costs – and in this article, we'd like to focus on how to manage another major transition: changing careers.

It's tempting to believe in clichés like 'leap, and the net will appear,' but the reality is that your career transition needs to be financially managed and well-planned, particularly if you have a family relying on your income.

Here are a few tips on how to manage this phase of life.

1. Start with Side Work

If you want to change careers – but can't leave your current job without something else lined up – start gaining experience by working part-time, on the side.

"For me, ‘side-hustling’ was the best way to explore a new direction while still keeping the bills paid," says Kelly Gurnett, who transitioned from a career as a paralegal to a career as a self-employed freelance writer.

She recorded her own transition journey on her blog Cordelia Calls It Quits.

She recommends that people who want to make a career change take an online course, participate in networking events or take on a second, part-time job in their new field to test the waters. 

"Putting in the hard work now will pay off in the long run," Gurnett says, "when you’re able to transition to your new career without all the financial strain and stress that would come from quitting abruptly and trusting fate to provide you with a new opportunity.”

2. Relax About Small Details

How can you balance working during evenings and weekends with your family demands?

Gurnett says you need to let go of the small stuff.

“Don’t feel guilty if you have to skip a few dinners or parties," Gurnett says. "Ask your family to pitch in a little more and ask your friends to be patient with you while you work towards your goal."

Bear in mind that this won't last forever. When you emerge on the other side with a job you love, your life can get back to their normal schedule. 

"Until then, learn to be OK with not ‘doing it all.’”

3. Step Down Strategically

As her freelance business grew, Gurnett slowly decreased her hours at her day job—first taking Fridays off, then working part-time, then finally quitting altogether.

If you don’t have this kind of flexibility with your employer, you can also consider switching from a full-time job to a part-time job to give yourself more time to scale up your new career, or slashing your budget temporarily so you can build up a savings fund to make up for any income discrepancies when you first transition over.

“The important thing,” Gurnett says, “is to make sure you’re setting yourself up for as smooth a transition as possible.

Your new career may not pay as much right off the bat as your old one did, so you want to make sure your finances will be OK in the interim.”

4. Change Your Attitude

Gurnett admits it was difficult at times to give her all to her day job when she knew she was on her way out the door.

“When you’re devoting so much of your spare time and energy to preparing for your new venture, it can be easy to start resenting your day job as something that’s ‘getting in the way,’” she says. “I found myself starting to feel restless when I was at my day job and getting really irritated over little things I used to be able to just shake off.”

To combat this frustration, Gurnett recommends re-framing your attitude towards your day job:

“Having that steady paycheck gives you breathing room while you explore your options.

Try to see it as an ally in your transition, not an enemy that’s holding you back.”

5. Take Care of Yourself

Make sure to eat well, sleep as well as possible and move your body on a regular basis, even if it’s as simple as taking your dogs for a walk in the evenings. In order to do your best work—both at your day job and on building your new career—you need to take care of your body.

You also need to take care of your mind. Don’t forget to set some time aside to unwind, decompress and recharge your batteries.

“While you do need to hustle to handle the day job/new job transition period,” Gurnett advises, “you shouldn’t hustle yourself into a state of burnout. You’re no good for anything if you hit that point.”