For most IT people, what you can make per hour as an independent consultant is several times what your boss is paying you per hour. So even with down-time and no paid holidays, you can work for less hours and still be in the same financial shape or good enough (see Reduce Expectations).
If you dont want to work by the hour at all, you can try your hand as an entrepreneur. That would of course require you to
5) Consider taking a risk
The only difference between successful entrepreneurs and other folk is a comfort with risk. They may not thrive on it, or even like it, but they all can live with it. You can make a lot of money working for a salary or for contracts but the only way to get stinking rich is to derive income from something that scales, i.e. something that is not linked to the number of hours you have in a day. This could be selling a product or an idea, trading, or getting other people to work for you. These are all entrepreneurial activities, and they involve higher potential rewards and higher risks.
Paid by the hour you have a good idea how much you will be making in 10 years' time. One catalyst for my downshift was a report from a financial planner who said I only had another 11 years to go before I would have enough saved to downshift to a lower-income job and still have a secure retirement. Eleven years at that job was not an attractive option. About the same time my father dropped dead. So did a neighbor younger than me.
That was it! If I was to get any lifestyle other than grinding away for a third decade as a salary-slave, I had to take a gamble.
The gamble is to become an entrepreneur. Never mind the details (get your own ideas), by chasing business ideas and opportunities my future income is less determinate but potentially much higher.
I can make enough money from occasional odd-jobbing contracts to keep us alive and still have many months a year to spare to work on various projects. So I give myself five years to make $2 million. If I succeed I retire; if I fail, I start my 11-year grind five years late. Not attractive but hardly the end of the world.
To do this you must be ready to fail, or to make a loss. This may not sound like downshifting, and for many it isnt. If not, stop at Step 4. For some of us, the ability to accommodate calculated risk gives us the flexibility, freedom and creative excitement that our previous lives lacked.
Downshifting is a leap of faith. It takes courage, preparation and a belief in yourself. The rewards are worth it I think. Ask me in four years.
Next page: The Downsides of Downshifting