This is a guest post from Sean Ogle, a former portfolio analyst who is now pursuing his goals of starting a business and seeing the world. You can read more from him at Location180. You can also follow him on twitter @seanogle. 

Have you ever thought about doing something different with your life? Maybe you’ve decided that you’d like to do more world traveling. Perhaps you want to explore that entrepreneurial idea that has always been buried deep inside you. 

For me, it was both. In my past life, I was a portfolio analyst for a small investment firm. While the job would have been perfect for the right person, I found myself yearning to do something more than just crunch numbers and help other people build their businesses. 

A few years back, job obligations cut my three-month trip through Europe down to three weeks. Ever since, I’ve had an urge to travel more, and held bit of resentment towards the normal 9-to-5. I wanted the freedom to get my oil changed on a Wednesday morning — I wanted the freedom of time. 

The catalyst for change occurred in March when all of my hard work earned me a 20% pay cut. I knew there was a better way for me to live. I wanted to be my own boss and see the world at the same time. 

I started researching business ideas and talking with other people who had seen success working for themselves. There was  general consensus that a combination of blogging and social networking were great starting points if I wanted to create a business online. So in May I began Location180, and set out to learn as much as I could by the end of the year. 

I knew that in order to be successful with my new lifestyle, I’d have to make changes in my day-to-day life. I’d have to do something that, despite my financial background, I’d never been very good at: stick to a budget. 

It wasn’t that I didn’t know how to stick to a budget. But my affinity for nice things always seemed to get in the way. When I saw something I liked, I’d buy it. The times I was most successful at sticking to my budget were the ones that resulted in me getting something I wanted, such as a new car or HDTV, for example. 

Over the last year, however, I’ve learned a lot about how to successfully prepare for a major lifestyle change. Probably the most important thing is to be diligent about applying the stuff you already know. For instance, one of the most important rules of personal finance is still very applicable: 

Pay yourself first
Seems like a simple concept — and it is. But I can’t tell you how many times in the past I have let bills, events, or other obligations get in the way of me putting 15% of every paycheck into my high yield savings account. 

This savings is essential when you make a lifestyle change. If things don’t work out as planned (in my case, I lost my job much earlier than expected), you’ll be glad you kept it up. Automating this process is the best way to ensure it gets done each month. You can’t spend what you never see. 

To take things a step further, I’d actually take whatever you’re saving and increase it by 25-50%. This will force you to make changes that you may never have made otherwise. In my case, I became the king of bootstrapping. In order to meet my goals of starting an online business while also traveling, I adapted myself to a more frugal lifestyle long before I needed to. That has made it much easier on me now that a lifestyle change is no longer a choice. 

You should also: 

Create a budget 
In the past I’ve used both Quicken and spreadsheets with only limited success. It wasn’t until I started using Mint.com that I really started to see success in my budgeting. Its ease-of-use makes this stand out among everything else I have tried. Two features in particular helped me save more money:

  • The ability to categorize my spending in any way I see fit, and
  • Being able to track trending over months.

I had no idea how much my car cost me each month until I started tracking all of the related expenses. It was tough to realize that I was paying over $500/month for transportation alone. Dusting off the old bicycle could definitely drop a couple zeroes off of that number! 

The next step toward a lifestyle change is to: 

Cancel accounts 
It’s funny how easy it is to rack up monthly expenses. I had expenses that I didn’t even know I had! 

After careful review of my monthly statements, I noticed that there was a monthly “credit protection fee” on one my cards that had been there since I set up the account — three years ago. I also found a $7/month web hosting account for some random domain I’d purchased and done nothing with. And don’t even get me started on the gym membership that hadn’t been touched in weeks. 

By carefully looking at your financial statements, you may find recurring monthly expenses that you’d forgotten about. (Or, in some cases, never even realized were there!) This simple step alone can help you save hundreds of dollars annually. 

And, of course, the most important step to a lifestyle change is to: 

Have a plan 
Depending on the lifestyle change you’re trying to pursue, there are specific ways you can prepare. Since one of my goals is to do more traveling, I’ve decided that getting more air miles under my belt is a worthy goal. I was able to rack up around 50,000 miles from opening a new mileage card and transferring my balances. I now use that card for all of my purchases, and pay it off in full every month. 

If you want to leave your job to start a small business, consider running it part-time while you’re preparing to make the leap. Depending on the size and scale of your business, you can register it quickly to start taking advantage of some of the tax benefits right away. The ability to write off things like a home office or mileage can be a great bonus, while giving you a head-start on your business plan. 

Ultimately, preparing for a lifestyle change isn’t much different from how you’d prepare for any big event, such as purchasing a car or buying a house. While it may take a little while for some people to adapt to living on a stricter budget, finding the courage to pursue the goals you’re really passionate about will make it all worth it. 

In January I plan on heading to either Central America or Thailand to work full-time establishing an online marketing business. Despite some nervousness, my planning has put me in a great position to succeed, and I couldn’t be more excited about the adventure to come.

J.D.’s note: If you have a success story that you’d like to share with other GRS readers, drop me a line. I’m a strong believer that the personal part of personal finance is much more interesting than the theoretical stuff. Photo by Eulinky.

This article is about Career, Entrepreneurship, Planning  Sunday, 15th November 2009 (by J.D. Roth)