How to Prepare Financially for Your Upcoming Career Change

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career change
Image Credits: Discover

Are you considering a major career transition? Maybe you’ve just finished getting an education in your chosen field and you’re ready to put your new skills to the test. Or perhaps you’ve been given an incredible opportunity to use your talents in a new field. Whatever the reason, it’s important to remember that a change in jobs can also mean a change in your finances. 

Preparing for your upcoming career change can help to make sure that you’re getting the most out of your finances when you switch over to your new role. Here are some top tips to get you started on the right track. 

1.Pad Your Savings

A career change is a huge life transition – and not something you can afford to take lightly. Since human beings tend to spend more during life transitions, you should expect to encounter a few extra expenses when you’re moving into your new job. For instance, you might need to upgrade your car, so you can travel further afield. You may even want to add some new suits or professional clothes to your wardrobe. 

Think about what you might need to spend on your new career, and don’t be afraid to make this investment in yourself, it will pay off in the long-term. 

2. Know When You’re Going to Get Paid

Just because you got your wages on the last week of the month in your old job doesn’t mean that you’re going to get the same payment schedule in your new career. Knowing exactly when you’re going to get your wages is important, as it will help you to decide when to arrange for direct debits and other expenses such as loans and credit agreements to go out of your bank account. 

When you’re having your interview with HR, ask them when you can expect your money to go into your bank account, and ask yourself whether you’re going to need to take any additional precautions the first month after your switch-over. 

3. Plan for Your Future

Now that you’re in a different job, you might have various benefits and perks to think about, as well as a new wage. Make sure you take things like retirement benefits into account when you’re planning all your costs for your new career. For instance, are you going to get the same amount of support towards your future from this new employer, or will you have to spend more of your own money to catch up?

If you’re worried about your benefits, remember that there may be options open for negotiation, depending on how much your new boss wants you to be on the team. Just don’t make too many demands early on, or you might convince your new employer to change their mind about bringing you onboard. 

4. Maximize Your Earnings

Sometimes, a change of career might not be something that you do to make more money. A lot of people today would be happy to switch to a different job with a lower income if it means that they get to do something that they’re passionate about, or it implies that they’ll have a more flexible schedule when they’re working. 

If your career isn’t going to give you the best income moving forward, think about how you can make the most out of your money. Could you consider taking on a secondary freelance job to fill in the gap while you’re working your way towards a time when you can earn a bigger income? If you are earning more money than usual, think about placing some of that extra cash into investments, so it pays off in the long-term. 

5. Look for Support

Finally, remember that sometimes, when you’re making a career change, you might need to take a step back to take a step forward. This is particularly true for people moving into a new career after their education. Just because you’re not earning as much doesn’t mean that your career change isn’t essential, but it can be easy to lose heart when you’re worried about your money. Before you take any major leap into a new job, make sure that you’ve got a support network around you that you can turn to when you need some help. A supportive partner, parents, or even friends that have your back as you make this transition will make the change a lot easier. You’ll be surprised how much easier it is to succeed with the right support behind you.