Stuck in a 9 to 5 job that routinely reduces your hope for searching a job you truly love? You might have already attempted to go in a different career path and pursue your dreams, but you are taken aback by the fact that pursuing your passion also entails risks.
What if your dream career just cannot pay the bills? Will you still be brave enough to take a chance and make that big change?
It is not easy to give up your current job let alone pursue your passion while letting your bills pile up. If you have already read a myriad of articles on the perks of pursuing your dreams, you may feel you are ready to face the consequences except the undeniable fact that giving up the job that pays the bills can be such a big risk.
This is where number crunching plays a huge role. You can still pursue your passion and pay the bills at the same time. It is all about focusing on the things you really want to do.
You must also keep in mind that pursuing your dream career also requires you to make some sacrifices. As they say, “you can’t have your cake, and eat it too.”
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1. How much do you really need?
There is no single amount that will “support a family.”
The amount of money you need to support a family in London, for example, is very different than what’s needed in Montgomery, Alabama. Even families within the same city do just fine at vastly different income levels.
The point is that you need to know that number for yourself. Knowing how much a role model makes is interesting, but not particularly helpful. It turns out there’s a psychological factor that is a better predictor of future earnings.
You often make as much as you need.
Think about that for a moment. What I’m suggesting is that if you’re a single parent who needs to support two kids on $55K a year, that’s probably what you’ll make. If you’re lucky enough to have a spouse or partner who cuts your portion of the bills down to half that, that’s probably what you’ll make too. This is true even if our two role models here are running exactly the same kind of business.
Why? Because it’s hard to push yourself to make more than you need. Running a business or stepping into an entirely new career field involves a steep learning curve and a lot of uncomfortable forays outside your comfort zone. If you need the money, you’re more likely to push past those fears than if the money is just a nice-to-have.
Currently I make almost no money from my business. I pay myself a salary of $1000/month, and that doesn’t happen every month. The needs of our family have been primarily funded by my husband’s income.
We also live a pretty modest lifestyle. For the last three years, I’ve used the top of the cat’s scratching post as a bedside table—not because we couldn’t afford a table, but because it wasn’t important to me…
When we needed more money, I made it. For example, when we decided to move to Seattle and knew we would likely buy a house, I made the money for a downpayment with a lucrative contract writing scientific articles and book chapters. People in this position were usually paid around $75/hour. I told them that my coaching clients pay me $200/hour, and if they wanted my services, they would have to do the same.
So they did.
That meant I was able put $70K into savings in just one year while working part-time. Sometimes your business pays more in opportunity—opportunities you can chose to pursue or not based on a combination of need and desire.
What about those people you know that started a business and made six figures right off the bat? Well, first of all, there’s a big difference between revenue and income. So many entrepreneurs throw around revenue numbers without revealing the actual take home, which is far smaller than you think.
Second, that need we talked about can be driven by emotional needs too. I interviewed a start-up founder who nearly worked himself to death to hit 7-figure revenue numbers within a couple of years. He was embarrassed about some prior failures and felt he had something to prove.
When determining your own needs, put a real number on it. Use figures from past spending to make sure you’re being realistic, but also play around with different scenarios. What if you moved to a new location? What if you downsized? What if you moved closer to family? What if you didn’t have to commute to work?
A friend of mine who works in construction sold his house and lives out of his van. This sounds sad to a lot of people, but my friend loves it. Now he only takes projects he’s excited about and enjoys lots of quality time with his kids, who are in their 20’s and just getting started in life.
Most of my clients find the amount of money they need to be happy is lower than expected. That’s reassuring when you’re just starting out. The truth is that many of us need far less than we have. We’ve been trained to trade happiness for things for a long time.
Source: Will Your Dream Career Actually Pay the Bills?
