How to Manage Your Finances When You're In-Between Jobs?

Changing careers goes hand-in-hand with a degree of financial uncertainty.

The idea of managing your finances when you’re between jobs might be scary, but with a few smart moves, you will be able to significantly minimize the stress when taking some time off working to figure out your next move.

Naturally, between leaving your old job and launching your new source of regular income, you’re going to be in a financial gap. Since you know that already, it’s smart to plan and find out ways to fill that gap.

Here are 7 smart tips to help you manage your finances when you’re changing careers and don’t have a stable source of income in-between jobs.

1. Create a budget

The idea behind creating a budget is learning how much money you need each month to cover your basic needs. Sometimes the exercise might be a bit terrifying, but it will always bring you plenty of valuable insight.

Review the last month of transactions on your bank account and credit card. You can make an Excel spreadsheet to categorize your outgoing expenses. Or you simply resort to one of the free budgeting online tools or apps available on the market.

If you do it well, budgeting will bring you plenty of valuable knowledge and turn out to be quite satisfying. More importantly, the right budget will also free you from any financial anxiety. Learn more about your financial needs and calculate the risk of leaving your current job in search of a new career.

2. Start your job hunt as soon as you can

It doesn’t matter whether you quit, the project you worked on finished, or you were fired – even if you want some time off to do just nothing, remember that it’s not the best for you and your career.

It’s smart to start looking for a job as soon as you know what type of position you’re looking for. Remember that prolonged unemployment raises a red flag with hiring managers. If your former workplace offered you career coaching to help you through the transition, don’t hesitate and take it.

Then revamp your online presence, update your resume and identify the type of jobs or companies that you want to work at. Don’t let too much time go by before you land your next job.

And if you have some gaps in your resume, fill them with activities hiring managers appreciate like local volunteering, taking a class, or building your website.

3. Create a schedule and stick to it

During your time off, you might be tempted by many different things – leisurely checking social media newsfeed, sleeping in, and watching your daily schedule slowly disappears into the abyss.

Don’t let yourself fall into the trap of binge-watching TV series and having breakfast when you should be having lunch. The Internet can be very distracting and getting sucked into the vortex will prevent from getting the new job you want.

That’s why you should create a schedule and stick to it at all cost. It’s easy to feel as if you’re in the vacation mode without the regular 9 to 5 work schedule to keep you in check. So develop a daily list of tasks that will help you stay on top of your things. Set weekly and monthly goals and stick to them.

For example, you can decide to apply for a given number of jobs every week, work out three times a week, and develop a new habit of meditation for 15 minutes every day. Make sure to wake up and go to bed at regular times, spend a lot of time applying for jobs, networking and reaching out to your contacts.

Filling your time with that type of activities will help you to make the most of it all the while you take tiny steps toward a new career. Compartmentalize your days and create a schedule to launch your new job as quickly as possible.

4. Take a second look at your savings

Let’s imagine that you want to take a course or take off some time between jobs. Would your savings cover your costs of living? If you’re toying with the idea of a career break, you need to measure the number of months your savings will sustain you realistically while you prepare your next move.

If you check that and see that your funds fall short of the required amount of time, measure how long you will need to stay employed to make enough money for making that leap comfortable. Calculating that and having a precise figure and time frame in your mind will keep you focused on your plan and optimistic about the future.

5. Don’t just apply for every available job

When in between jobs, it’s easy to become desperate and start applying for every job you see online. Remember that sending a generic resume to as many employers as possible won’t help you land the job you want. Don’t just apply for every job that is available.

Decide what type of position you want to be in, what kind of responsibility you want to have and what sort of company want to work for. When you figure that out, you will know how to match your expertise with a role and company you have in mind.

Tailor your resume and cover letter to the job description every time you apply. By delivering an application that matches the expectations of hiring managers, you will only boost your chances of getting invited for an interview.

6. Simplify your spending

Be brutally honest with yourself for a second to see where you can cut back on things that aren’t essential to your survival. You might feel gratification when buying new stuff, but what does that mean when you are about to make a meaningful career change?

Switching to a minimalistic lifestyle that is less driven by stuff and more by experiences is liberating. Discover your basic needs and preferences and stick to them. They will save you when you make that step towards a career change.

It’s smart to get a payday debit card connected to a separate savings account set up for the career transition. The amount of the card isn’t that important – it’s the idea that you have limited spending that counts.

7. Do your best to stay productive

Always look for new things to do during your transition. The world is full of new opportunities, but you can only be able to benefit from that if you stay healthy in both physical and mental sense.

Since you’re in between roles, you need to keep yourself productive and look for opportunities that will help you learn something. Attended meetups, check free online courses, and create groups of people wanting to learn more about a topic.

Take the time to research the company or industry want to work at. Follow the companies you admire – they might organize online sessions with leaders who share their knowledge and help everyone learn how specific roles or industries work like.

Use these 7 tips to make sure that you make the most of the time you spend in between jobs without falling into the trap of money-induced stress.

Written By
Alana Downer works at Learn to Trade Forex Training and she is an experienced blogger whose main interest lie in finances and new technologies. She might often be found online, sharing her insights into technology trends which shape the way both businesses and individuals.

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