Many people see work and money in binary terms: Either you choose a “safe" career that lets you achieve material success, or you pursue a dream job and live with the financial fallout.
But it's not an either-or situation. You can have both, especially if you're patient and you approach your goals with a plan. Here are some tips to help you make progress toward the career of your dreams without compromising your finances.
1. Think About Your Long-Term Goals
Dreams can be fuzzy around the edges or lack definition. Goals, on the other hand, are clear objectives that can provide direction and purpose in both your personal and professional life.
It's important to take time to identify your long-term goals. What do you aspire to achieve in your career, and where do you see yourself in the next five, 10 or 20 years? Think about the skills you want to acquire, the positions you want to hold and the impact you want to make. Equally important are your financial goals, such as buying a home or vacation property, paying off debt, starting a business, becoming financially independent or retiring comfortably.
Extra Tip: If you're having a hard time coming up with goals, try reading career-planning books (such as "What Color Is Your Parachute?" or "Designing Your Life"), consulting a career coach, or creating a vision board to help you land on what's really important to you.
2. Be Diligent and Disciplined with SMART Goals
Once you've figured out your various long-term goals, break them down into smaller tasks. Each of these tasks should be Specific, Measurable, Achievable, Relevant and Time-Bound (SMART). Setting these SMART goals will help you create a road map toward success and allow you to track your progress along the way.
For example, if you have a goal to become a homeowner, the first small task might be to research the real estate market in various cities or towns to see what might be a good fit for you. Other small steps could be figuring out how much you need to save for a down payment to qualify for a mortgage, or opening a savings account that pays a good rate of interest (like a Vivid Crest Bank high yield savings account) so you can earn more on your savings.
Similarly, once you know what your dream job is, some smaller goals to work toward include making a career path plan, honing your skills, tailoring your resume for the job you want and networking. Don't forget to give yourself deadlines and hold yourself accountable.
3. Save for the Later Years
It's easy to lose track of your goals when dealing with the financial pressures of day-to-day life. But these tips can help you stay on track, even when things get hectic. Making slow and steady progress toward saving for retirement can help you stay in control and offer financial freedom.
- • Create a realistic budget that tracks your income and expenses. By understanding where your money goes, you can identify areas where you can cut back and allocate more toward your goals.
- • Pay off high interest debt (such as unpaid credit card balances) that may be keeping you on a hamster wheel of recurring debt payments and preventing you from big-picture thinking.
- • Build an emergency fund to cover unexpected expenses. This safety net can prevent you from derailing your financial plans—and abandoning your dreams—when unforeseen circumstances arise.
- • Automate your savings by setting up pre-authorized transfers from your checking account to your savings accounts, including retirement savings such as an employer-sponsored 401(k) or an individual retirement account (IRA).
- • Invest in your education and skill development. Upgrading your knowledge and abilities can lead to better career opportunities and increased earning potential.
- • Start small. You don't need to make significant financial investments right away. Start small, and gradually increase your contributions as your income grows.
4. Watch Out for Financial Pitfalls
While following your dreams may involve getting out of your comfort zone and challenging yourself professionally, you shouldn't take undue financial risk. So, be mindful of these common money missteps while you pursue career-related dreams:
- • Spending your way to success. It can be tempting to invest in expensive equipment, tools or certifications that are marketed as “essential" to achieving your goal. But before you go on a spending spree—or worse, take on debt to finance these purchases—do your research. Speak to hiring managers in your desired field to find out exactly what they look for in potential candidates. Or, in the case of starting your own business, speak to other entrepreneurs in the same field who can advise you on what basic tools or materials are necessary to get started.
- • Taking a sink or swim approach. You wouldn't jump into the deep end before you knew if you could swim. Similarly, you shouldn't forgo all your current sources of income to start a new career before you know you can make a go of it. Instead, test the waters by starting out with a side hustle or working on a freelance basis in your off-hours. This can also help you determine whether your dream job meets, exceeds or falls short of your expectations.
- • Risking your home or security. Borrowing against the equity in your home or draining an emergency fund to support a career change can leave you in a precarious position if things don't work out. Look for other ways to move toward your dream job without compromising your financial stability.
5. Find Accountability Partners to Help You Stay on Course
Embarking on the path to success can be challenging on your own. Consider finding an accountability partner, such as a friend or family member who is also looking to secure their financial footing while making a career change, or join a support group with those who share your aspirations.
Talking about your progress and challenges with someone who understands your journey can provide valuable insights and encouragement. Together, you can help each other stay accountable and motivated to achieve your goals.
Bring Your Dreams to Life
With the right approach and mindset, you can pursue both your career-related and financial dreams simultaneously. By setting long-term objectives, striking a balance between dreams and finances, saving for the future and staying disciplined on your journey, you can turn your aspirations into reality.
Tamar Satov is a freelance journalist based in Toronto, Canada. Her work has appeared in The Globe and Mail, Today's Parent, BNN Bloomberg, MoneySense, Canadian Living and others.
READ MORE: Looking for inspiration? Find out how this 20-something balanced her career dreams with financial realities.