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Financing Your Career Change - Part 2

In my previous post entitled Counting the Cost, I talked about the financial fears people may have when considering a career move. In today’s post, we will be tackling some of the money mindsets that can keep us from pursuing our career and financial goals.

Identifying Your Money Mindsets

Many of us have perceptions about money that stem from our families or origin and keep us stuck in our careers. These perceptions aren’t about money per se but about what money represents – namely, the ideals of freedom, success, security, dignity, and acceptance that we want from our money. These mindsets aren’t necessarily wrong, but they have the potential to hold us back, so you’ll need to do some internal work to root them out.

To do this, I’d recommend setting aside one hour to journal your answers to the questions below. Be specific, provide lots of detail, and describe how each of your answers might help or hinder your ability to finance your next career transition:

  • What did money mean in my family growing up?

  • How have those family perceptions shaped my habits today?

  • What does money symbolize for me? e.g. fun, freedom, status, security, etc?

  • What is my level of financial risk tolerance? Low, Medium, or High? [1]

  • How comfortable am I with asking others for financial help?

After you have finished your answers, take some time to honestly reflect on what you wrote. You’ll probably notice some common themes in how you view money – some of them helpful, some of them not. The important point here is not to judge yourself for having these mindsets, but rather to seek a more balanced perspective. Here are some examples of money mindsets you might be able to identify with:

Mindset 1: “My personal sense of value hinges on my income level”

This is a common mindset. Our society trains us to think that our worth and status is measured by how much money we make. But this mindset can be too narrow. We already acknowledge (or should acknowledge!) the value and dignity of child caregivers and volunteers who dedicate themselves to the well-being of others, but may not receive any income for their work. Their worth does not hinge on their income, so why would yours?

Once you let go of the need to earn your worth through a paycheck, you will experience greater freedom to pursue your next career steps: for example, you can (1) reclaim the time and energy lost on comparing your income to others'; (2) leverage “bridge” jobs that move you closer to your career goals even if they pay a bit less; (3) maintain positive self-esteem when asking for financial support; and (4) find satisfaction in things beyond money - e.g. a better career fit!

The truth is – your personal value is not measured by money, so don’t stay in a dissatisfying job just because the paycheck makes you feel better about yourself. It’s not worth it in the long-run!

Mindset 2: “I struggle with a scarcity mentality”

Perhaps you grew up in a family that had little money to spare and find yourself holding tightly to your current assets and income. As a result, the thought of losing money during a career change fills you with fear.

Unfortunately, this mindset can be very limiting if it tends toward an excessively low tolerance for financial risks. Low risk options such as saving money, working overtime, or streamlining your budget are very helpful for funding your next career move, but they are notoriously slow. They will prolong the career change process. If you are fine with that, then great! But if you need to make a quicker exit from your current job, especially if health concerns are pressing, then a scarcity mindset will burn you out before you are able to make a change.

So if you struggle with a scarcity mindset, I’d suggest that you replace it with an investment mindset. In other words, your income may decrease temporarily if you switch roles, but the decrease is really an investment in your long-term health and career future. You are investing, not losing. You are taking care of yourself by living on less for a time and taking a calculated financial risk.

As a result of adopting an investment mindset, you will be free to introduce reasonable levels of additional risk into your financial plan: this may involve (1) applying for student loans to cover tuition fees for reeducation; (2) restructuring loans or mortgage payments to free up extra cash; or (3) liquidating other assets like property or vehicles if at all feasible. Of course, you should not pursue these strategies against the advice of wise counsel, but you should also not dismiss these options simply because you fear them. Higher risk strategies can be a worthwhile investment in your career future.

Mindset 3: “Budgeting sucks the fun out of life”

Maybe budgets haven’t worked out for you in the past because they were overly complicated. Perhaps you dread finding out what your financial situation is really like, so you avoid doing the detailed inventory of your finances that a budget requires. Or worse, perhaps you grew up in a family that used “budgeting” as a justification for neglecting people’s needs. Whatever the reason, budgets feel overly restrictive of your freedom, flexibility, and joy.

As a Career Coach, I believe that this mindset is only partial true. In the short term, budgets can become a chore and a joy killer. But in the long term, and when used correctly, budgeting can actually bring more freedom and joy into your life, not less! A well-thought out budget can (1) protect you from bankruptcy, (2) enable your money to go farther; (3) release extra cash for generosity and fun; (4) ease marital conflict [2]; and most relevantly, (5) support your career change goals by reducing debt and eliminating financial waste.

So the truth is that budgets create greater freedom and joy in the long-term, provided that you are willing to delay gratification in the short-term.

Mindset 4: “I hate asking for financial help”

Perhaps you dislike being a burden on others or feeling financially beholden to other people. That is understandable. To some extent, we all need a healthy sense of independence and autonomy.

But reaching out for financial assistance when you actually do need it is a sign of strength, not weakness. It demonstrates that you are aware of your needs. It also opens you up to new sources of funding. For example, a willingness to ask for help enables you to (1) seek child care support from family and friends if you need to work overtime; (2) apply for bursaries, scholarships, and grants for people in financial need; and (3) seek out the expert advice of financial planners who can identify any blind spots in your current budget.

It may feel uncomfortable asking for help, but it is often necessary and healthy, if only to remind you that you are human and that career change should not be attempted alone.

Starting a Financial Plan

Once you have challenged your money mindsets and calculated the financial costs involved in pursuing your next top career path, you will need to start creating a financial plan for realizing you goals. This will involve identifying the financial strategies that are best suited to your needs and tolerance for risk. In upcoming blog posts, I will delve into three of these strategies: i.e. saving up, supplementing income, and outside funding.



[1] We all have beliefs about money that make us more or less risk-averse so it is important to assess your risk tolerance to get a sense of which career financing strategies fit with your temperament. Russell Clayton (2018) recommends taking the “Financial Risk Tolerance Questionnaire” for this purpose, although this questionnaire is primarily focused on measuring your risk tolerance investing - not for income uncertainty. With that said, the questionnaire can still be a helpful way to raise your awareness of the amount of financial uncertainty you can handle.

[2] John M. Gottman and Nan Silver, The Seven Principles of Making Marriage Work. Harmony: New York, 2015. See chapters 10 and 11 for advice on how couples can manage solvable and perpetual problems related to different values and goals. See pp. 207-212 for specific guidance about money conflicts.

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