Growing in your career or changing it can be a time filled with mixed emotions. The exciting journey can bring feelings of happiness, stress, and nervousness all at the same time, as it’s new and unknown but also helps you gain personal fulfillment and professional growth.
Surprisingly, growing your career or changing it completely can bring costs and financial implications that many don’t know about. Whether you’re growing with passion and determination or changing it up in search of a better work-life balance, career growth or change often comes with short-term financial sacrifices and long-term benefits. It’s important to understand these to best plan your growing career and manage your finances along the way, helping you to have the best funds possible during the transition and afterward. Explore these useful budgeting tips for career growth or change and gain the ability to make better financial decisions along your journey.
Understanding the cost of career growth or change
Career growth and transitions are more than emotional changes as they come with costs that many don’t know about. These costs fit into two categories which are direct and indirect expenditure. Direct costs are the expenses you can see and touch, such as training programs, education, and certifications to grow your career or step into a new one. Indirect costs incorporate lost income during periods of transition, unemployment, or reduced working hours. They also include opportunity costs which can be bonuses or raises and missed promotions. These hidden costs can shock people and trip them up, so it’s vital to be aware of them and be prepared to tackle them head-on.
Prioritize education and training costs
When budgeting for career growth or change, you need to prioritize education and training costs. Doing this allows you to focus on growing and being prepared for your new role, gaining valuable new skills and certifications which makes the initial costs worth it. Partaking in education and training costs is necessary when stepping into a new role or career. These costs also vary depending on the skill level of the role you are transitioning to. For example, if you are stepping up in the tech industry or changing into healthcare, additional qualifications may be needed. You may need to do college degrees, professional certifications, or even boot camps which all range from a few hundred dollars to several thousand!
Look at lost income and opportunities
Lost income can be the biggest financial difficulty you can face when growing or changing your career. This can happen if you have to quit your job to focus on retraining or education, or if you have to go into a lower-paying role or wait for your new role to begin in a lower-paid role. You need to evaluate this and see how your growth or change in your career will impact your finances.
You should also look at potential opportunity costs that can help you manage your finances. If you’re staying in your current career, you could have opportunities for a raise, bonus, or other advancements. If you are leaving, then you will have to factor in losing these benefits.
Plan education around work schedules
To help you manage lost income and keep on working before your new role, you can plan your education around your work schedule. Many certification courses and online programs offer flexible schedules that allow you to study in your own time and go at your own pace. Having this flexibility makes it much easier to incorporate your studies into your daily life and give you the opportunity to stay in your career position to reduce income losses.
You could partake in evening or weekend classes or choose online courses that have modules to do at your own pace, giving you the chance to complete these in your spare time.
Have a financial safety net
Making a financial safety net for yourself can help you manage any income losses you may experience for transitioning into your new role. This safety net will allow you to handle any unexpected costs or losses, maintaining a sturdy overall income. You should save a set amount of money to cover yourself and also build an emergency fund to cover your essential living costs. During your transition, you should also cut any unnecessary expenses to free up money that can be put towards unexpected costs instead.
Find employer training or reimbursement
To save costs on education and training that you need to grow your career or completely change it, you should find employer training opportunities or reimbursement schemes. Many employers offer useful training programs or reimbursement schemes for courses that contribute to your professional development. Research your company’s policies on professional development funding to see what options you can take and if they can help you change career paths. Some companies can encourage you to grow in the company or outside of it by offering full reimbursement for outside certifications, while others may only give partial funding. It’s best to discuss your needs with your employer to see where you can go from there.
Avoid financial stress and debt
As you grow your career or change it, you need to do everything in your power to avoid debt and financial stress. It could be tempting to take out loans or rely on credit cards, especially if you are going without income or losing money to resources and education. However, doing this for your personal life can lead to financial stress and lots of debt. You need to carefully consider your personal expenditure during the transition period and organize your finances through budgeting. This should include your basic necessities and bills, such as grocery shopping and rent, and should also incorporate highly important costs. These high-importance costs need to be put in order of importance to help you focus on what you need to pay next. This can include budgeting for fixing your car or religious obligations, such as paying Zakat. Use budgeting tools that are specific to these important costs, such as if you need to give Zakat, you can use a Zakat calculator, or you can use a spreadsheet for all of your important costs. Doing this will help you steer clear of financial stress and debts.
You need to also think about cutting out non-essential costs and save your money rather than dipping into your savings constantly. Put away the money you would have spent on unnecessary expenses into your savings to build your finances to help support you through the transition and beyond!
Use these budgeting tips for career growth or change to be prepared for your new role and be financially secure, avoiding stress, anxieties, and debts. Manage your money effectively to help you enjoy the exciting journey of switching your career up and have fun with your new role.
