Seeking a Career Change

Are you unhappy in your current position? You’re not alone.  According to Gallup’s 2022 data, job unhappiness is at an all-time high.  Happy, satisfied workers tend to be more productive and loyal to their employers.  The opposite holds true if you are working in a less-than-ideal job.  In fact, your unhappiness may negatively impact coworkers around you.

Take this brief career fit quiz to understand if you are working in a career that is satisfying.  You may be in the right industry and role but perhaps the firm culture is off.  Or maybe God is calling you to an entirely new vocation.

The New Yorker article Why Are So Many Knowledge Workers Quitting? examines burnout.  You may be earning good money, but the hours are simply too long.  You may have plenty of tangible items yet not enough time to enjoy them.

Below are five key questions to consider before making a career change.  For illustrative purposes, we’ll assume that you are a married parent and part of a dual-earning household.

1.     Do you have enough saved?

Quitting doesn’t function like unemployment; there are no unemployment compensation benefits available if you voluntarily leave.  You also will not have any company-sponsored short or long-term disability insurance.  If you’re fortunate enough to have an outside disability policy, you’ll need to continue paying premiums if the goal is to eventually re-enter the workforce. 

If your family depends on you for health insurance, how will you keep up with rising health insurance costs?  Consolidated Omnibus Budget Reconciliation Act (COBRA) is a viable but expensive option for a limited time after your employment ends.  The eligibility timeframe is 18 or 36 months, depending on the qualifying event that gives rise to COBRA rights.  When employed, your employer typically subsidizes a big portion of the health insurance premium.  COBRA premiums for unemployed persons represent 102% of the TOTAL cost, including the amount previously covered by your employer.

One other employer-provided benefit that people often overlook is the 401(k) or 403(b) match.  This is essentially free money that your employer contributes to your retirement account.  Employers have unique vesting schedules for the employer retirement contributions.  Some may offer cliff vesting (for instance, you’re fully vested after 3 years of service), while others may have a gradual 5-year vesting schedule whereby 20% of your employer match is vested each year you are employed. 

Vested simply means that you are entitled to that money after you leave the company.  Suppose your company has a 3-year cliff vesting schedule but you leave after year 2.  You will be entitled to the contributions you personally made as an employee but not entitled to any employer match because you left before the 3-year period.  Vesting schedules are designed to reward employees who stay with the organization for a long time.

Giving up benefits such as company-sponsored health insurance, disability insurance and retirement match puts you in a less stable financial position.  I’m not recommending that you should stay in a job you hate, but it is important to be mindful of the benefits you may be giving up and plan accordingly.

Most financial professionals encourage a cash emergency fund that covers 3 to 12 months of living expenses.  A small emergency fund is crucial, but I also recommend building a supplemental cash opportunity fund.  There is a mindset shift from emergency, where you have very little control, to opportunity, where you strategically set goals and have the financial savings to accomplish them.

Do you have enough cash on hand to pay household bills?  For how long?  Temporarily leaving the workforce in pursuit of better pay or greater flexibility is vastly different from permanently leaving your chosen career and pursuing a new vocation.  The financial repercussions vary, too.  You will only need a small amount of cash savings to weather a temporary job change.  Moving to a new career, especially if additional education is necessary, will require far more financial resources. Thoroughly examine your financial situation before pursuing a new vocation.

2.     Is there a better fit at a different company?

Not all companies are created equal.  Large companies often have impressive websites with a robust “Careers” section that makes it look as if employees aren’t working at all.  They’re having too much fun!  However, you cannot possibly know what the day-to-day culture of a firm is like until you’ve experienced it yourself … either through the interview process or informal conversations with friends and family that work at the same company.

It’s clear that the largest global organizations typically have the most financial resources to provide incredible benefit packages.  Many industry titans get “Best Company to Work For” awards because benefits ranging from insurance to retirement plans are second-to-none. 

Nevertheless, large organizations have a lot of formality and bureaucracy.  It is far easier to push a new idea through a 50-person organization than it is a 50,000-person organization.  The Small Business Administration size classifications vary by industry, but a good rule of thumb is a maximum of 250 employees to be called a small business.

If you’re tired of working at a mega corporation, you may find a change of pace at a smaller company to be a breath of fresh air.  Established small businesses may offer an employee benefit package comparable to one offered by larger companies. 

Be sure to explore health insurance options through your spouse’s employer if the new company you are eyeing does not offer health insurance.  Alternatively, research marketplace coverage or healthcare sharing plans.

Before you jump ship and turn in your resignation, know that the grass is not always greener on the other side.  Talk to your supervisor.  Especially in this environment, companies are willing to go the extra mile and retain great employees.  It is far more expensive for an employer to hire a replacement person and train them than it is to keep you happy. 

If you’re afraid to ask for whatever it will take to move from an unengaged to star employee at your current firm, how will you be able to negotiate it at a future place of employment? 

3.     Should you career downsize instead?

Career downsizing means you voluntarily reduce work hours to enjoy other aspects of life.  You find your current career fulfilling and enjoyable but not at the pace you are doing it. 

Particularly among women, there is a growing trend for shifting from full-time to part-time work.  In fact, a PsyPost article explains that the COVID-19 pandemic spurred a shift towards more traditional beliefs about mother and father roles. 

School closures in 2020 led to changes in the division of labor: mothers predominantly cared for children at home and fathers continued working full-time. 

Here’s my opinion: if you are the one in your marriage who is most dissatisfied with your profession, you should be the one to consider the career downsize – regardless of gender.  I know plenty of men and women alike who are happy in their career simply because they have a supportive spouse who takes the lead on parenting, school and home challenges.       

Of course, any voluntarily reduction in hours leads to a reduction of pay.  Again, I’d urge you to explore the financial implications for your family in advance of a career downsize.  Does your spouse earn enough income to financially support the family?  As kids get older, how do expenses change?  Will there be a point in the future when you and your spouse both need to earn money to cover taxes, debt payments, living expenses, charitable contributions, and retirement savings?

Have a clear vision of when you will return to full-time work if your intention is to temporarily reduce working hours.  Look at any large, planned expenditures that will arise between now and that future date to ensure you have enough savings or cash flow to cover them.

Career downsizing is an attractive option especially for married parents who want to keep their professional skills fresh.  I downsized from full-time to an 80% workload at my former employer, Matter Family Office, after my oldest son was born in 2009.  It was the best of both worlds: I had deeply gratifying client relationships but also Fridays off to enjoy with my baby.

Depending on the exact hour reduction, you may lose eligibility of benefits that are only available to full-time employees.  Most employers have policies in place to preserve benefits for those working at least 35 hours weekly, but anything lower may be cause for concern.  Research health insurance options through your spouse’s employer or turn to marketplace coverage. 

4.     Is freelance work more appropriate?

You enjoy your chosen career and feel it matches your skillset.  You ask your existing employer if they are open to a more flexible work arrangement, but unfortunately, the answer is no.  You interview at other companies to see if part-time work is a viable option and hit another roadblock.  It seems like you cannot find the right fit at any established company.

This is how WorthyNest® was born.  I didn’t have entrepreneurial aspirations as a little girl.  In fact, I always thought I would remain in the corporate world.  But no matter how hard I tried, I couldn’t find professional AND personal happiness working for someone else.  Shortly after my second son’s birth in 2013, I left a steady paycheck and jumped into freelance work.  It was one of the best decisions of my life.

Most freelancers develop several years of industry experience before striking out on their own.  They’ve cultivated a unique skillset and do not want to be beholden to a strict 9-to-5 schedule in the office.  They have the capability to work on projects independently and motivation to complete work efficiently with minimal or no supervision.

Freelancing provides ample opportunity to create your own schedule as long as you meet client expectations around completion of the project.  It is especially appealing to parents who feel perpetually stressed about balancing work and family commitments. 

There are two major financial implications of switching from employee to freelancer.  First, you will receive Form 1099 rather than Form W-2 for taxes; this income is considered self-employment income whereby you pay employer and employee Social Security and Medicare taxes when you file your annual income tax return.  On the bright side, you can consider home office expenses and other business-related expenses as tax deductions to offset freelance income.  Consult a tax preparer or CPA to monitor quarterly estimated tax payment requirements and advise on business deductions.

The other major financial implication of switching from employee to freelancer is the potential loss of employer-provided benefits such as health insurance, disability insurance, life insurance, and a retirement account.  If you are moving from employee to freelancer within the same company, be sure to negotiate a higher hourly rate to compensate for the increased tax burden and loss of benefits. 

Eventually, you may realize that you love freelancing so much and want to turn this work into a full-fledged business.  Being a CEO of a business is much different from freelancing because it requires a mindset shift.  True entrepreneurship recognizes that you alone cannot do it all, and you work on building a team of other committed professionals to assist with business growth.

5.     Is God calling you to a different vocation?

Do you ever get a case of what Jon Acuff would call the Sunday Scaries?  It’s Sunday night and your mind starts racing because you dread the work week ahead.  Take this quick quiz on career fit to see if this nervous feeling is temporary or indicative of a bigger problem.

For a college graduate working until age 65, your career span is around 40 years.  That doesn’t include part-time jobs you might have held as a teenager or college student.  It is hard to know as an 18-year-old what you want to do professionally for the rest of your life. 

I graduated with a degree in accounting but transitioned to personal financial planning after two years of full-time work.  My husband Bryan worked in public accounting and treasury for about thirteen years prior to moving into a recruiting role.  Like each of us, you may find yourself in a role that isn’t enjoyable anymore.  Your personal life suffers because you feel drained and empty after a long day of work.

Colossians 3:23 reminds us, “Whatever you do, work at it with all your heart.”  Whenever you find fulfillment in work and know it aligns with your vocation, personal struggles don’t feel like immense challenges.  You have the energy to combat them.

God has blessed each of us with unique talents and skills.  These transferable skills often work well in many industries.  Exceptional organizational skills in a doctor’s office translate nicely to a law office.  Impeccable communication skills work equally well in a corporate boardroom and nonprofit organization.  What are your transferable skills, and how can you let them shine in your next role?

Before you make any move to a new industry, carefully conduct industry research.  Is your chosen occupation in demand?  The U.S. Bureau of Labor Statistics publishes the Occupational Outlook Handbook.  Wind turbine service technicians and nurse practitioners are expected to be some of the fastest-growing careers, while machine operators are expected to decline.

Maybe you’ve lucked out and the new vocation offers better pay than your old position.  In the financial services world, it could be moving from an administrative assistant position to a paraplanner who incorporates financial planning principles into meeting materials.  Earn the Certified Financial PlannerTM (CFP®) designation and command even more pay as you assist with delivery of the financial plan.  Understand the growth opportunities available in the new occupation prior to making a move.

Next Steps

In closing, these preliminary five questions are a starting point as you consider transitioning to a new role.  Making a career change isn’t a quick decision that should be based purely on emotion.  Prayer is another essential part of the discernment process for a Catholic or Christian parent who contemplates a leaving a job. 

At WorthyNest®, we guide parents through important financial decisions using a values-based approach. Contact us to explore a one-on-one relationship.