“[Life is] like driving a car at night. You never see further than your headlights, but you can make the whole trip that way.” – E. L. Doctorow

A year and a half ago, my life was certain. I was in a steady job, with a steady paycheck and for the first time in my life, I never had to worry about money. Unfortunately, it was the wrong path for me. I have always been an artist and could no longer ignore the nagging sense of purpose that I simply wasn’t living up to at a corporate day job.

As I was within a year of turning 30, I felt that my life could be so much more than working a day job while putting off my dreams. A year and a half later, my life is completely different. I left my job and moved from Vermont to Chicago. I am self employed. I earn a living doing what I love to do. How did I get here? The first thing I had to learn quickly was how to handle and embrace uncertainty. Learning to love uncertainty didn’t happen overnight, but I never imagined that I would actually begin to like not knowing what lies ahead.

How I Faced Uncertainty

Leaving my job and my only source of income brought a high level of uncertainty into my life. It brought a whole lot of anxiety too! On top of that, moving to a big city where I had no friends, family or connections added many more unknowns. Leaving my job and moving to Chicago would have felt terrifying if I hadn’t done my research first.

First of all, I had been honing my skills as a camera operator and videographer over the past few years in Vermont. I knew I had a reasonable chance at making money with my camera as I had been getting a few freelance gigs here and there. While the industry in Vermont is too tiny to support much film and video production, the industry in Chicago is larger, but not too large to make it impossibly difficult to break in. My research indicated that I could make things happen faster in Chicago than in more traditional production cities like Los Angeles or New York. Plus, Chicago was more affordable, which was a huge plus since I wanted to be a self employed freelancer. I had to be frugal and you could be frugal without being destitute in Chicago.

Secondly, I did have valuable, employable skills working as a project manager and provisioner for large telecommunications companies at my old job. My project management skills would translate to any other industry. One of my former clients I managed also had a large presence in Chicago which did give me a local connection, if even at a superficial level.

Thirdly, I had saved up a couple months of living expenses, so I had a cushion in the bank. My wife was completely on board with the move, too. I knew that if things didn’t work out in Chicago, I could always go back to Vermont. My old job would probably be there for me if I returned, and it would be easy to get back on my feet again.

My uncertain future didn’t feel as scary since I had a plan, a back up plan and an escape route. I used my imagination to create “artificial certainty”. Also, I knew that whatever happened, it would be an incredible learning experience. If I did quit my job and move to Chicago to pursue my passion and it didn’t work out and I had to return to a day job back in Vermont, I would have no regrets and would be better prepared for Plan B.

Freedom or Security

I’ve heard it said many times that you can either have freedom or security. I think that security is an illusion and that freedom is the only secure thing we have. Let’s take a look at security for a moment:

We all know that jobs are not secure. A steady paycheck is never secure. In fact, as an employee, you have absolutely no control over your job duties, your paycheck or your ongoing employment. On top of that, 40 years of working doesn’t necessarily secure your retirement. It doesn’t necessarily lead to financial security, either. It might feel like putting off risky dreams in order to have a secure paycheck is the reasonable (grown up) thing to do. In fact, it really is only an excuse for inaction. So many people justify years or decades of sitting in a cage of mediocrity with the fear of losing one’s paycheck and not being able to support their family. Never mind that the alternative is that pursuing your own path could provide a better life and future for you and your family!

On the other hand, I have found that freedom is more secure. Right now, I am in complete control over how much money I make. I can’t snap my fingers and instantly bring in a 6-figure income, but I now have the time, energy and motivation to make that happen in the next few years. I can’t guarantee that I will retire rich, but I have the time, energy and motivation to cultivate wealth that will pay off later in life.

Furthermore, I am free to choose my career direction. If I want to refocus my interests, or pursue a different direction in film and video production, I can. No more hoping for a promotion, jumping through hoops to impress higher ups and no more frustration that my day-to-day activities are not fully utilizing my skills and talents. Boredom is a thing of the past. I cannot tell you the last time I played Spider Solitaire!

One year and a half after leaving my job and moving to Chicago, my life is uncertain. My future is uncertain. I never know from month to month how I will pay the rent or put food on the table. But I’ve been doing this successfully these past 15 months! I am living a life that is much more fulfilled, peaceful and creative. I am much more happy and hopeful. I’ve never missed a rent payment or gone hungry.

An added bonus in pursuing my own path is that while the current recession woes have most people fearing for their homes, their jobs and their 401k’s, I have been able to sleep at night knowing that my future, and to an extent my income, is not affected by recessions, corporate down sizing and growing unemployment numbers. I am doing well right now. I am not rolling in money, but I’m eating well and paying the rent. I’ve had a few difficult months here and there, but I am surviving and thriving. I’ve had a positive cash flow month after month.

Living in the Present

The most profound benefit that I’ve noticed since embracing uncertainty is that I live my life much more focused in the present. This is a good place to be. Living in the moment leads to greater enjoyment of life. It promotes conscious decision making. I have found that living in the present while planning for the future brings security into my life.

I always struggled with living in the present. I was always future-focused and needed to know where I was going and exactly how to get there. My attention would forever be fixated on a future goal or achievement and I often tuned out and ignored my present situation if it was uncomfortable. Unfortunately, it is extremely difficult to enjoy life in this state of mind.

While I was starting my self employment journey, I would get caught up in worrying about the future. I would worry about making the right decisions at the right time. I’d worry about money, getting clients and finding enough business. I noticed this pattern of worry and realized that it was interfering with my ability to focus on what I should be doing to be successful. I was presented with a choice. I could devote all my energy to future-focused worry, or I could devote my energy and attention the the present. This shift in consciousness cleared the way for me to find clients, build my business and enjoy the freedom of my new life.

Getting into the drivers seat of my own life has sharply focused my attention on living in the present. I have seen worry and anxiety practically leave my life. I worry from time to time, but I always remember that I can either flee from uncertainty and embrace mediocrity, or I can learn to love uncertainty and embrace abundance.

Right now, I am loving the uncertainty and excited by the adventure of living the life I want.

I recently found a CareerBuilder.com survey where they polled 7,192 American workers about their saving habits. The statistics are alarming:

• 47% of polled are living paycheck to paycheck.
• 21% with salaries of $100,000 or more also live paycheck to paycheck.
• 25% have no savings.
• 40% feel that they need an extra $500 per month just to live comfortably.

I used to live paycheck to paycheck. It’s scary and it feels like a hopeless situation that is hard to escape from. It is possible if you are willing to embrace a few simple strategies to break the cycle.

Stop Spending Money

This is obvious, but seriously look at your spending habits and create a budget. Keep track of where your money goes. Most people will be surprised at how much money is spent on just coffee or soda a year. Reduce your spending on frivolous things. This might mean cutting back on eating out or you could take a drastic approach and eliminate Cable/Satellite TV, drop your cellphone plan or avoid going to restaurants altogether.

What you want to do is find a happy medium between cutting your expenses while still living a comfortable lifestyle. Your goal is to end the month with a POSITIVE cash flow instead of a “just barely made it” or worse, negative cash flow. For me, this meant taking a hard look at what was most important to keep in my lifestyle and purge all the remaining money traps.

Build Your Savings Account to $1,000 ASAP

Many people (myself included) make the mistake of using all of their extra money to pay down debt. If you do this without first having a sufficient savings account, you will forever remain in debt. When the car breaks down, the dog gets sick or you need to fly out of town on an emergency, you won’t have cash reserves and the unexpected expenses in life will end up on your credit card. Avoid becoming one of the many people who pay hundreds of dollars each month in credit card bills only to maintain a growing balance year after year.

Set a goal of building your savings account up to $1,000 as soon as possible. Go ahead and pay only the minimum payments on your credit cards and loans while you do this. Don’t worry about interest rates. You’ll just keep paying them if you always use your credit cards for unplanned expenses. Cut back on expenses, do side jobs or sell some items on eBay. Do whatever it takes to build your savings to $1,000. Also, be sure to set up a separate savings account instead of simply keeping a surplus in your checking account. It’s better to keep that money separate.

Once your savings account is at $1,000, commit to building it further. Set monthly savings goals and stick to them. I recommend that you try to always have enough in your savings to cover a major car repair, a plane ticket and an emergency vet bill all at once. It might take you some time to get there, but either of these emergencies cost less than $1,000 each and having that cash on hand means it stays off your credit card.

Prioritize Debt Reduction AFTER Building Savings

Once you have built your savings account to $1,000, work on reducing your debt. There is lots of advice on the web for becoming debt free. Strategies I’ve used included personal consolidation loans and balance transfer offers (be extremely careful with these). All the debt-moving and consolidation strategies mean nothing, however, unless you are committed to stop using your credit cards to pay for things.

While you are working on reducing and eliminating your debt, be sure to continue to build your savings.

Create a Profitable Hobby, Launch a Freelance Career or Small Business

The next step in freeing yourself from living paycheck to paycheck is to develop a profitable hobby or launch a small business. You will never get rich as an employee. You will never control how much money you make as long as you have a boss. As we all know from the latest news reports and personal experience, wages are dropping and the cost of living is rising. Besides, what happens when you loose your job? It’s best to have a side project or two that generates revenue and has the potential to be a full time business.

There are a lot of things you can do right now to generate cash if you need to. Offer your skills to businesses and individuals as a freelancer or private contractor. Start a small service business or create a product to sell. Whatever you do, don’t pay $49 to some Internet guy promising that you’ll be making a 6-figure income and driving a Ferrari in 30 days with his “can’t fail” online cash machine.

I left my day job in January 2008 to pursue freelance videography. I now earn most of my income from shooting video. I am currently working on additional projects that will generate revenue in the future. These include niche content websites, writing and creating paintings with my wife, among other things. If you subscribe to my blog or follow me on Twitter, you can find out more about how my “personal liberation” projects are coming along.

Embrace Frugality

Frugal living is a requirement if you want to stop living paycheck to paycheck. Frugality doesn’t mean you have to wear off-brand clothes. It’s doesn’t mean you have to eat rice and beans. You certainly do not have to be one of those people crawling under cars in parking lots looking for dropped change.

Frugal living is simply a ruthless approach to how you spend money. Hold off on big purchases until you can buy them with cash. Buy pre-owned instead of new. Live simply and enjoy your life. Watch less TV and actually LIVE your life and you’ll soon discover that you don’t really need or want a mega-screen TV and 400+ channels of cable TV. What a cost-savings right there!

The important thing is to remember that frugal living is a temporary strategy while you are building a bigger and better cash flow. It might feel like a sacrifice sometimes. It can also be liberating. You can always expand your lifestyle later, but it’s so much sweeter to do so when you don’t have to sweat and fret between paychecks.