How to prepare your finances for a career change

Photo by Annie Sprat.

Photo by Annie Sprat.

Shifting careers is a scary thing. I know, because I have done it a few times. I started out in advertising, then went on to journalism, then briefly to digital marketing and then to nursing and then back to journalism and now I am a content strategist, which I believe is the dream career for me. (Are you dizzy yet? Did I tell you that I also thought of being a massage therapist?)

Each time I changed careers I was terrified, because frankly I am a risk-averse person. However, what really helped me was having my No.1 fear addressed: the fear of ending up under a bridge eating out of trash cans.

Yeah I'm being dramatic, but the fear of financial failure is a real one with each career change. Therefore, it’s important to have a firm grasp over your bank account to make the transition  less stressful.

1. Cut your living expenses and live frugally

For the last few years, I have lived extremely frugally, keeping to a budget, sharing houses with strangers (and sometimes living in a shack and having housemates from hell) just to pay off my housing loan debt. It was a deliberate move in order to free me up to be more nimble with my career decisions without making money as a big consideration.

I also used that financial space to pay for courses, particularly the CIM Digital Marketing diploma which costed me an eye watering RM20k. (Though, I suppose it ain’t as bad as some MBAs, which could be six figures.)

2. Pay off your debts

Imagine not paying that mortgage? Or that car loan? Heck, that credit card bill? If you have debt, you may be forced to stay in your current job just to ensure you can pay the bills. If you clear your debt, not only will you be more clear headed to manage your career change, you'll be less driven by fear when you try to find a job.

3. Save, save, save!

You need money to retrain and to weather months where you may be out of a job. Having that financial cushion will give you some peace of mind.

4. Downsize

If you have a corporate job, you may be used to a certain lifestyle. Private school fees, perhaps. That lux condo by the beach. Maybe that gym membership you barely use. But when you shift careers, you may end up with a smaller salary as you're starting anew from the bottom. Weather that shift by downsizing and embracing minimalism, if possible. Your new mindset will help you approach your new job with more enthusiasm and positivity.