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Can I afford to change my career?

Can I afford to change my career?

Making a Career Change

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Changing career isn't just a case of waiting for a new payslip from your new company. There may be costs involved with factors such as training courses, equipment, and certificates. You may have to take a drop in salary from your previous role. Can you afford it?

A new start
Looking for a change of career is no bad thing, but it needs to be properly planned and considered.

If money is what is driving you to change career then you first need to determine what salary you can expect with your level of education, training and experience.

Not only that, but you will need to consider the additional costs of a new career. These could include time and costs involved in new training and additional travelling expenses.

Hidden costs and gains
Sometimes it's easy to forget those hidden advantages and disadvantages with changing career. When making cost comparisons, therefore, you need to factor in all those hidden costs and benefits.

These include:

  • Health
  • Parking
  • Travelling
  • Benefits
  • Perks

Obviously you may want to change for many emotional reasons such as making a fresh start in life or simply to meet new people and friends.

However, if part, or even all, of the reason for your change is for monetary gain then you effectively need to evaluate the difference in real benefits between your new and old careers. This means taking into account, not only your flat salary, but everything that has financial value.

For example, if you have medical coverage as a part of your old job, will you have it in your new career? If not, you will have to provide for it or go without. Similarly, pensions, bonuses, perks and relocation costs all have to be evaluated financially.

Timing
We have all heard of people leaving a job but not having one to go to. If you are changing careers you'll need to evaluate whether you can begin working immediately or whether there will be a transition time between your new and old career.

If so, do you have enough money to sustain yourself during that transition?

Positioning
Starting a new career may put you lower on the ladder – maybe even below the comparable level you were at in your current job.

Does your new career allow you to climb up and begin to earn more as you are promoted – or will it be a long hard road to the top?

If you are going to have to make financial sacrifices in your new career, then try to create a budget and a timescale that allows you to see how long you can sustain your new lower earnings. Even, if you are going to earn more from day one, you still need to budget carefully in case other expenses turn out to be considerably over-priced.


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