Career Transition: Manage Your Finances

Career Transition: Manage Your Finances 

A few weeks ago, I wrote a blog about processing your emotions after a job loss. This is the first step in any career transition, but it’s not the only one.  

As a reminder, these are the basic steps: 

Step 1: Assessment  

Step 2: Preparation 

Step 3: Action 

As a refresher, there are several parts of Step 1: Assessment, namely: 

• Understanding the emotions you have related to your career transition. 
• Assessing your finances. 
• Writing down your skills and abilities. 
• Evaluating your career options. 
• Deciding your values, motivators, and interests. 

• Reviewing your accomplishments. 

 

Today I’ll review the basics of budgeting your money during a career transition. 

Though Don’t Dread Monday is primarily about careers and career resources, financial stability (inasmuch as you can achieve financial stability) is essential to any job search.  

Because it is difficult to predict how long a job search will take, you need to review your finances before starting. Thinking about money can be stressful, but preparing a budget will reduce your anxiety and help you avoid unpleasant surprises. 

Here are some questions to consider as you create your budget: 

• How many days, weeks, or months can you go without a job? 
• If you were laid off, are the terms of your severance package clear to you? 
• Can you file for unemployment benefits? 
• If you had company benefits, when would they expire? 

• Do you have retirement savings or 401k that you can borrow from? How much can you borrow, and what is the tax/penalty impact? 
• If you own a home, is it possible to refinance your mortgage or take out a second mortgage? 
• Are there any expenses you can cut back on? 
• Do you have family or close friends who could help you financially, should you need it? 

Set aside money for job search purchases (such as professional clothing for interviews) and entertainment when crafting your budget. Prudence in spending is always best, but also not very sustainable if you can’t have a little fun. 

Some expenses in your job search may be tax deductible. If you’re uncertain which are, consult with a tax advisor. For this reason, you should maintain accurate, up-to-date records of all your expenses. You may want to schedule a meeting with a financial planner for other tax questions, such as 401(K) disbursements. 

Remember, if this is overwhelming, take it one step at a time. 

I’ve included some sample budget tables below if you need help getting started. Feel free to adapt it to your needs. 

Happy budgeting! 

Sydney 

 

ESTIMATED MONTHLY INCOME
Salary Continuation Pay	$
Unused Vacation Pay	$
Other Company Benefits	$
Unemployment Compensation	$
Interest from Savings	$
Dividends from Stocks/Bonds	$
Rental Receipts	$
Earnings—Partner/Spouse	$
Earnings—Part-Time Job	$
Other	$
TOTAL MONTHLY INCOME	$

 

MONTHLY ESTIMATED JOB SEARCH COSTS
Subscriptions	$
Computer Expenses/Supplies	$
Printing/Copy Costs	$
Phone Bill	$
Wifi	$
Parking	$
Auto—Gas, Service, Repair	$
Other Travel	$
Stationary/Postage	$
Restaurant Costs	$
Clothing	$
Other	$
TOTAL MONTHLY ESTIMATED JOB SEARCH COSTS	$

 

ESTIMATED MONTHLY LIVING EXPENSES
Current Bills Due	$
Installment Loan Payments	$
Mortgage Payments/Rent	$
Utilities	$
Phone	$
Home Insurance Premium	$
Property Taxes	$
Household Needs	$
Personal Needs	$
Automobile Loan Payments	$
Gas/Auto Maintenance	$
Life/Medical Insurance Premiums	$
Food	$
Clothing	$
Medical/Doctor Expenses	$
Laundry/Dry Cleaning	$
Child Care/Tuition	$
Income Taxes/Social Security—FICA	$
Subscriptions	$
Entertainment	$
Contributions/Pledges	$
Miscellaneous	$
TOTAL MONTHLY LIVING EXPENSES	$

 

MONTHLY NET
Total Monthly Income	$
Total Monthly Job Search Expenses	(-) $
Total Monthly Living Expenses	(-) $
MONTHLY NET (Income Minus Expenses)	$