Finding meaningful work might mean you take a pay cut, but that doesn’t mean it’s not doable. You should get specific about what a reduction in pay means for your lifestyle.

• Get back to budgeting basics. Get a clear picture of what you spend each month on essentials and extras and see if there’s anywhere you can cut back. Small changes go a long way, and you may be able to live on less than you think.


• Buy yourself time. Setting up an automatic savings transfer through your bank can help you stockpile as much of your paycheck as possible before transitioning to a new career. A good rule of thumb is to have six months’ worth of income on hand.


• Expect the unexpected. Your dream job may have unreliable hours or seasonal ups and downs. When you’re budgeting, be prepared to save a little extra in the flush months in order to tide you over in the sparse ones.

Don’t let money issues leave you feeling vulnerable. While it’s not always easy to get ahead financially, you can take measures to stop yourself from falling behind.

• Give your budget a dress rehearsal. Decided to rein in spending during the transition? Creating a budget is one thing, living on a budget is another. Help yourself get into the habit by test driving your budget before you change jobs.


• Tack on taxes. A job change may cause a shift in your tax bracket, which could mean the gain or loss of valuable income tax credits and deductions. If you are going into business for yourself, factor in the self-employment tax and quarterly estimated payments to the IRS.


• Check in with your investments. Your career change may or may not impact your long-term investment strategy. Still, a life change can be a great opportunity to re-evaluate investment goals and tolerance for risk.


• Don’t forget retirement. These continue to be important years for building your retirement fund. Keep making regular contributions, and make sure to put aside enough to qualify for a match if your new employer offers one. And don’t ignore the 401(k) plan you had at your previous job. Consider moving it with you into the new job, or transfer the money to an IRA to invest the funds on your own without penalty.

• Learn about alternative plans. If your passions point toward an industry that doesn’t always offer insurance, you can research independent providers. Depending on your new salary, you may even qualify for a lower cost policy.


• Consider COBRA. Even if you voluntarily leave your job to start a new career, you may have the option to keep the insurance you had at work for up to 18 months through the Consolidated Omnibus Reconciliation Act, or COBRA. You may have a similar option to extend your workplace life insurance coverage. But beware: Premium costs can be high without your employer kicking in.


• Find a part-time solution. If you need more hours in the day to pursue your passion, part-time work may be enough to cover your benefits needs. Many large companies offer health and life insurance to employees working fewer than 30 hours per week.


• Get professional guidance. Talk to your financial professional to compare benefit options. Discuss whether you have enough savings to support yourself and your family through the transition.