Are you thinking of making a career change? It’s a big decision, especially if you have a family to consider. Whether you’ve been thinking about changing careers for a while or just recently, there are plenty of aspects to consider.
Pursuing a new career can affect every part of your life, not just your finances. Even if the new job you’re thinking about will pay better, there are other things to think about: perks, benefits, and personal fulfillment.
We know reevaluating your career can be intense. Use this list to guide your thinking and your career change discussions with your partner or spouse.
Do you want to work from home?
COVID-19 lockdowns gave people in many industries the chance to learn what working from home is like. And for the most part, people loved it. Surveys show that most employees want to continue WFH life completely or commit to no more than a day or two in the office every week.
By eliminating the commute, working from home gives you more freedom for family time and hobbies. It also has financial benefits; you don’t need to spend as much on transportation, work attire, or eating lunch out.
Employers are embracing the remote work concept as well. A study of Indeed and similar sites showed that job listings are now twice as likely to mention remote work as they were before the pandemic. And several big companies, such as Reddit, have said they’ll allow people to work from home permanently.
Of course, working from home isn’t possible in some industries. But if you enjoy the WFH lifestyle, it’s worth considering a career that’s compatible with remote work.
Can you handle some income fluctuation?
Changing careers is about more than just finding a new job. You may need to obtain some new certifications or even a different degree. If paying cash for college or professional development courses isn’t in the cards, you might have to think about student loans.
Once you have the credentials you need for your new career, you can start your job search. Hopefully, you’ll be able to continue at your current employer until you have a new job offer, but it’s wise to have an emergency fund in place just in case. Don’t forget that you may have to settle for a slightly lower salary if you are moving from a higher position in your current field to an entry-level job in your new industry.
If you can rely on your savings account or your partner’s income to cover the difference for a while, that’s ideal. Either way, thoughtful preparation, communication, and budgeting can reduce the effects of a career change on your income.
Do the benefits actually benefit you?
Most employers offer a benefits package in addition to a salary. Some of the most common benefits are health insurance, paid time off, and retirement savings.
Benefits packages may include pension plans and stocks or other investments. Some cutting-edge companies provide unique perks such as transportation reimbursement, on-site yoga classes, vacation stipends, and pet-friendly offices.
It can be easy to get distracted by unusual perks, such as free food or amazing team-building retreats. But it’s essential to consider whether the benefits would actually be valuable to you personally.
For example, fertility assistance benefits may not be meaningful to you if you and your partner don’t want to have children. But if you’re passionate about giving back to your community, you may enjoy working for a company that offers paid days off for volunteering.
What about the happiness factor?
You want a job that pays enough to support your chosen lifestyle, but financial rewards aren’t everything. Personal fulfillment and happiness are key aspects of a career too. In fact, one of the reasons you may be considering a career change is that you don’t get any joy or satisfaction out of your current job.
So if you think a career change would boost your happiness and fulfillment, go for it. Having a job that inspires you and protects your mental health is priceless.
A bigger salary isn’t always the end game
There’s nothing wrong with changing careers because you want to make more money. Pursuing a higher salary can be essential if you are thinking about the costs of raising children or trying to retire early. If your new job does come with a substantial pay hike, make sure to consider all the financial aspects like higher tax brackets and the infamous “lifestyle creep.”
When you’re ready, take the leap
Changing careers is a big step, but with some good planning, it can improve your daily life, financial security, and personal fulfillment. Good communication is vital to make sure you and your partner understand the potential financial benefits and challenges that come with a career change.
Before you dive in, take the time to figure out your finances. For personalized money management tips from a Certified Financial Planner™, check out the Everyday Money Workbook and BudgetingBlocks™.
