You’ve decided to leave your job of 30 years and your $100,000 salary to pursue your dream career – congrats! Making a career change to pursue your passion isn’t easy or cheap, but it’s definitely possible if you’re willing to change your lifestyle and spending habits to make it happen.
Before you make the leap, be 100% sure this is what you want to do because your lifestyle is going to change drastically. Is the job important enough to sell your house/car, move into a condo, and possibly *gasp* ride your bike to work?
If you’ve decided that the lifestyle you’re living isn’t worth the job you’re suffering through to make it happen, the next step is developing a solid financial plan for your new life.
Estimate your future income
Start by getting a realistic estimate of the income your new career will bring in. If you’re starting a business, going back to school or just starting at the bottom in your new field, you need to know how much you have to live on. Chances are it’s nowhere near your current salary, so be prepared for a reality check!
Reassess your lifestyle
How much do you need to change to make your dream financially plausible? Are you willing to buy a smaller house, shop with coupons, and stop eating out so much? Decide how little you NEED in order to be happy.
Once you know your lifestyle and budget, what expenses can you cut to make it happen? Think about getting rid of cable and opting for Netflix & Hulu, or packing your lunch instead of eating out every day. Categorize your expenses for the last several months and see where you’re wasting money the most – cut there! Invest in an espresso machine instead of buying coffee every day at Starbucks.
Get a side gig
Find a way to make a little extra income that doesn’t require too much of your time, like renting out your spare bedroom or even your car. According to Nancy Mann Jackson of Dailyworth.com, “As the concept of the sharing economy grows, more people are looking to rent other people’s cars rather than purchase their own. Sites like Turo and GetAround can connect you with people who may be interested in renting your vehicle by the hour, day, week, or month.”
If renting your home or car is too intrusive, what about all that junk in your garage you hardly use? “Through sites like Zilok, you can list tools, furniture, video game consoles, and other items. Then people can simply rent them for an agreed period of time — and you get paid. It’s an easy way to make money off items you already own,” says Jackson.
Lastly, consider about outsourcing your skills on sites like TaskRabbit or Upwork, where you decide which jobs to take and how often. Show off your web design, software development, or other awesome skills and make a little extra money to make your dream career possible.