Changing jobs: Is the grass actually greener?
Have you ever had a frustrating day at work and thought, "I could take my talents elsewhere and do much better"? If so, you aren’t the first person to think that way, and you won’t be the last. Oftentimes, we see clients changing jobs for a multitude of reasons. The most common reason I hear for people jumping ship to a shinier boat is the pursuit of a “better opportunity.” However, let’s unpack what a “better opportunity” may truly look like, and then you can decide if your perspective has changed.
Identify what makes you happy
In our view, the first thing to consider is the “happiness factor.” This involves answering a few questions as honestly as possible:
- Will you enjoy this opportunity at least as much or more than where you are now? Consider if the work is more interesting and more relevant to your skills and experience.
- Is there less or more travel involved? Depending on your personal circumstances and preferences, the answer could be considered positive or negative.
- Can you work fewer hours at this other opportunity, creating better work-life balance?
- Based on what you’ve learned through research and from your contacts, do you think you’ll like your potential colleagues more than your current ones? Each day you spend many hours working, so it’s important to like your co-workers and the organizational culture.
- Is there greater flexibility in this new job? More pay, benefits and/or incentives? Better chances for advancement? Consider your desired career path and whether this new opportunity is likely to help you traverse that path. We explore all this in more detail below.
- What about this position may raise your level of happiness and satisfaction? If the answer is nothing, then don’t move because you might not last long enough to make it worthwhile. You can often gauge a company’s ability to keep their people happy by the rate of employee turnover. If it seems like a revolving door, that might be a warning sign.
In figuring out the happiness factor, it’s important to understand why the position is open. In the best-case scenario, the person previously in that role was promoted or it’s a new role because the company is growing. A less-favorable scenario is frequent turnover in that particular position. If it’s a new position, make sure the role is clearly defined. You want to understand exactly what it will entail. Sometimes employers entice applicants by overselling certain attributes of the role, which serves nobody well when dissatisfied employees leave and the company must repeat the hiring process.
Keep an eye on the long term
The next big item we suggest is to understand the career track options with this position. Is there a career path and, if not, are you fine with that? Does this make sense for what you want over the long term? It’s okay if not, provided it’s a step of some kind toward what you want. I personally have done this myself, and it worked out well because I knew what I ultimately wanted out of that position. I didn’t think I could move directly from corporate tax to personal finance, so I made a lateral move into personal tax before embarking on that personal finance route. It was an effective way to test the waters and determine if the field was a good match for my capabilities, and to see if it made me happy.
The next obvious thing you may wish to consider is to ensure that the compensation is right. What will you be paid (including bonus) and what’s the compensation structure? Are there long-term incentives, and how are those paid out? What’s your total compensation and what will it look like longer term, not just in the near term? I’ve seen former colleagues jumping for a little more money when they should have been assessing their long-term earning power in the new role. Being shortsighted about compensation can negatively impact you and impede reaching your long-term financial goals.
Compensation isn’t just what you earn in cash and long-term incentives, but it also includes the benefits. Get answers to the following questions:
- Is there a retirement plan like a 401(k), and do they match and/or offer profit sharing?
- Is health insurance offered? What’s the coverage and how much does the company subsidize?
- Are short- and long-term disability offered? Who pays for it? (The best-case scenario is that they gross up your paycheck and you pay for it, so benefits come to you tax-free.)
- Is there group life insurance? Does the company pay for any of the premiums?
- How many paid days off and holidays do you get? Are sick days and other “personal days” considered separate?
- Do they offer maternity/paternity leave, or even just a leave of absence? Are there any daycare benefits?
- Are there any other interesting benefits? (e.g., paid parking, commuter benefits, subsidized meals, professional training/development, legal or other advisory services)
Weigh your options carefully
It’s often not an apples-to-apples comparison when looking at two different opportunities, so understand what you’re being offered and what you may lose when switching jobs. Our clients will often negotiate to make up for lost compensation and benefits, so at least give it a try. If the prospective employer values you and what you can contribute, they’ll often be open to some negotiating. Just remember that no matter how frustrated you are, try not to quit your current job before you’ve secured another position. It’s much easier to get a job when you’re employed, and it’s usually wise from a financial perspective as well.
Last but not least, is a potential new job something you’re eagerly running to, or are you just running from your current role? Before you leave, consider if anything can be done or changed at your existing job that would increase your happiness. If not, then it might be time for a move.
ABOUT THE AUTHOR
Patricia Sklar, CFA, CPA, CFP
Patricia is a Certified Public Accountant, CFA® Charterholder, and a CERTIFIED FINANCIAL PLANNER™ practitioner. She received her Masters of Science in Accounting at Louisiana State University and her Bachelor of Business Administration in Accounting from the University of Georgia. Patricia is a member of the American Institute of Certified Public Accountants and The National Association of Personal Financial Advisors. She is a member of the Junior League of Atlanta and is on the board for Essential2Life which runs the The Fifteen Leadership Program.
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