Blog Detail

5 Key Financial Considerations Before Switching Jobs

Oct 28, 2020 - 05:38 AM Author - Axios


There are 5 key financial considerations you must take before deciding to switch your job. Sometimes, it happens like your workdays look extremely long and irritating and your job loses all its shine. On the other hand, you find other opportunities waving their hand at you. In this case, one should never assume that their newfound job will provide you instant pick up where you left off the old one.

1. How reliant are you on your current group insurance?

While you are deciding on changing your job, don’t just compare the salary factor. Also, take into determination the health advantages(group insurance) of your present employer. As for example, the employer under which you are currently working may have group insurance that coats everything from your dental requirements to critical situations such as stroke and diseases of the heart. If you are heading your job towards a small start-up leaving off from a big corporation, it’s quite doubtful that your new employer will have such elaborated group insurance. If your new employer will have health advantages in a limited number, you should try to make your own insurance of health in order. If you want, you can seek advice from your financial advisor for a rapid policy review, and declare that you’re losing your group insurance.

2. Build an emergency fund before switching jobs

Never believe that this won’t take place. There have been cases of employers making a decision against hiring you, even subsequent to the offer letter being sent (they are aware that many people cannot pay for the time and price of trying to take legal action). This can prove calamitous, provided you’ve left your earlier job to join them. In some cases, people have quit joining a company, only to be made inessential a year or two later. The only alternative to being ready for such incidents is to have proper savings. Make sure you have about six months of expenses collected up in an emergency fund (if you still don’t have one now, get started as fast as you can). When you perceive an emergency fund, you can surely switch between jobs believing confidence.

3. Examine the new costs of your job, and factor it into your budget

There are times where the new prices of a job are quite clear – such as a minimal former pay at the time of training. Although, there are also unrevealed prices to search for. Don’t fail to remember to factor in travel time and the related prices. If you really require to take a cab from time to time, or your children require a babysitter because you’ll get home a little later, these are all prices that must go into the budget. Another understated price to be determined is none other than your apparel. Taking a switch to a more formal job may demand investment in a more upmarket wardrobe, with customized jackets and suits. Some positions also need you to dine out more often, to amuse customers (have a look if there is an amusing budget) or even to hang out with colleagues. Don’t just ignore the financial prices of keeping up appearances, and creating social networks.

4. Check the education benefits of your new employer

There are times, it becomes difficult to increase your income without incrementing your talent set. If this is a prime concern (e.g. you require a diploma or degree to get more ahead in your career), then foresee the instant paycheque. Will your new employer issue talents training, or scholarships, to make sure of your long-term achievements? A S$500 increment now is nothing when compared to a S$3,000 or S$5,000 increment (or even higher) for the remaining of your working life. If your current employer gives room for advance education, but your new employer won’t, then it may not be beneficial leaving just for a small pay increment. Apart from looking for grants and scholarships, don’t ignore time. Some employers may be thinking to give you time off to make your study (e.g. you can acquire an unpaid month off for your finals, and still come back later), on the other hand, the others won’t.

5. How much does time off “cost” in your new job, compared to your current one?

Take into consideration how your new employer holds up holidays, maternity /paternity leave, and sick leave. For example, some employers will provide you an additional week or two of paid leave, after your child comes to this world. Some are not too considerative about sick leave, and are okay to allow you to reside home even without the requirement of a Medical Certificate (therefore saving you the doctor’s fee). Be precise on your new employer’s schemes, so that you can compare. There are times when a little higher pay cheque doesn’t give grounds for the severe hours that will be asked of you.