Here’s What Happens When You Go From Earning $80K a Year to $12K

A high income doesn't always equal happiness.

I did what most people do — I went to school, I got the grades and then I went searching for a corporate career ladder to climb. And I climbed, believing along the way that success, happiness and validation came with earning a high income. 

Then, at 40, at the higher end of the pay scale, I lost my job. It’s still shocking to me that a 16-year career ended so fast. Just like that, I was thrust into the world of a career change, and it had me seriously considering whether I really wanted back into the rat race that earned me $80,000 Canadian dollars (CAD) a year.

Read More: How Being Underpaid Helped Me Recognize My Worth

When I started looking for my next career move, I struggled. I battled with my intuition. Every part of me screamed, “Please don’t go back.”

So, I would need to take a minimum-wage part-time job that would be relatively stress-free while I built my writing business.

Make Your Money Work Better for You

Here is my story of what happens when you go from earning $80K a year to $12K.

My Relationship With Money Changed

I became mindful and intentional about how and where I spent my money. I tossed my old money beliefs and began to understand that money is a tool. The blinders came off and I started to see all the abundance I had around me already. I became grateful for simple things, like having a roof over my head, healthy food in the fridge, a comfortable bed to sleep in and clothes to put on my body.

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I Learned to Manage My Money Differently

As strange as it may sound, taking a $68,000 pay cut didn’t seem like a big loss to me. It simply meant I had to get better at managing my money and make smarter decisions about how I spent it. I began to prioritize what was most important to me. 

Make Your Money Work Better for You

The decision to not go back to corporate and instead pursue my dream of being a writer forced me to sit down and look at how I could make every dollar work as hard as possible for me. For example, I cut my home phone and relied only on my mobile phone. I called providers, told them I had a major life change and renegotiated my monthly rates where I could. I also looked at all the ways I could save; which meant living with family for longer, reducing bank fees, walking or biking instead of driving whenever I could and using the library for all its free services. Most importantly, I cut back on my Starbucks habit and openly told friends I could no longer afford to go out as often.

More on Switching Careers: 15 Secrets of Getting Your Dream Job

I Checked My Ego at the Door

Previously, I had the “traditional” mindset, in which income equals success, and that climbing a corporate ladder would somehow be more fulfilling than following what I really wanted to do. After the career change, I altered my thinking. I told myself that a change in my income didn’t mean I was a failure or wasn’t good at what I did. I worked on accepting the fact that, regardless of my current income, I was worthy of financial success and any salary I wanted — but on my own terms. 

Make Your Money Work Better for You

I had worked all my life believing that my income validated me. I lived to work. After taking a pay cut, my mindset changed and money became simply a tool that served me. It became the means for me to do things I loved, like travel. It was no longer a symbol of status.

I Was Not a Failure for Taking a Pay Cut

Losing a high-paying job and taking a pay cut is a huge blow. It changes your life. But instead of letting this get me down and keep me down, I focused on the fact that I was now moving toward a career I loved and that having a part-time job at lower pay allowed me to pay my bills and follow that dream. 

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I’m Surviving Even Though I Still Have Debt

Sure, having debt on a super low income can feel suffocating, but you learn to work through it. I stopped worrying about my drastic pay cut because I was still alive. I was keeping up with my bills and payments. Sure, I’m not making the progress I’d like to, but ultimately, it is a huge motivator to make your dreams happen. 

This whole process has been a learning experience. I’ve learned more about myself, my finances, and what abundance and success really look like. I’ve learned that my income doesn’t define who I am as a person. And a higher income certainly does not equal happiness.

Read More: Being Laid Off Twice in One Year Was a Blessing in Disguise

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About the Author

Michelle Summerfield

Michelle Summerfield is a blogger, writer and speaker. She has been blogging about money and lifestyle for over six years at The Classy Simple Life.

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