Keep these tips in mind when you’re planning a home office:
- Be sure it’s ergonomically correct
- Find the optimal location
- Consider used office furniture
- Incorporate lighting, plants and sound
If you’re thinking about switching jobs, you’re not alone. Changing roles every few years may actually be beneficial. If you’re thinking about quitting your current gig, or just want to financially prepare for a job transition, there are a few things to consider before you take that leap.
Quitting is usually a permanent decision that can’t be clawed back, and without being financially prepared to quit your job, the search can be stressful. In some cases, it could put you in a nightmare scenario where you are forced to be hasty and take the first opportunity that comes along instead of giving it time to find the right job for you.
Luckily, Sally Brandon, vice president of client services at Rebalance IRA, a retirement and investment management firm, has some good tips to financially prepare for a job transition if you’re feeling ready to move.
An emergency fund may sound like an old-hat suggestion, but it’s one to take seriously, especially if you need to save money for a job change. Brandon suggests taking an emergency fund a step further by saving a year’s worth for extra good measure. That way, if you switch jobs and decide it’s the wrong fit, you’ll be financially prepared to quit your job with funds to fall back on. However, “If you can go from one position to another, six months to a year is a safe bet,” Brandon says. While you’re working on building up those savings for your job change, you’ll also want to consider where to keep your emergency fund.
Any idea how much you spend in fees each month? For many people, this total can be staggering. As you financially prepare to quit your job, take a good look at your fees. There are more obvious fees like interest paid on a credit card or mortgage, but don’t overlook the less evident ones, such as those related to monthly and quarterly subscriptions to magazines, streaming services or premium cable channels. They are often small, but can slowly eat away at your cash. If you don’t have a job lined up, or if you’re attempting to save money for a job change, consider them carefully.
Late payment charges can also hurt your bottom line, but Brandon says this is one place where as a consumer, you have power, but you have to call your creditor first. “Pick up the phone and ask,” she says. “They might waive it.” If you are carrying a balance on multiple cards, Brandon says it’s probably time to look into consolidating them down to one, which makes the payment more streamlined and can cut the amount of interest you pay each month to boot. This can come in handy when you’re looking to financially prepare for a job transition.
While there’s no need to break up with the barista at your favorite coffee joint in order to financially prepare to quit your job, it’s still a great idea to keep track of what those little extras cost you each month. This is a very tangible way to determine where your money is going, and to make sure you save money for a job change if you end up with a long stretch between paychecks. Brandon says one good way to do this is by putting all of your receipts into a bowl and going over them at the end of the month. Once you have a bigger picture of how and where you’re spending, creating and sticking to a budget will hopefully be less painful. When it’s time to treat yourself to your barista’s favorite coffee creation, “Make it more of a treat and brew [your coffee] at home,” Brandon says. “Little things do add up.”
One perk to the current job is that if you have any retirement saved up there, it belongs to you. The trick is to make sure you get it. Brandon says that it is estimated that so-called “orphaned” retirement accounts [which are left behind when an employee changes jobs and don’t get claimed] total a staggering $1 trillion. “[That’s] just money that’s put into the economy and it’s never used,” she says, noting that if you switch jobs enough, it’s easy to forget the crucial step of making sure you take your retirement savings with you.
If you’ve had retirement plans, such as a 401(k), at two or three employers, you can consider combining them and, “That’s significant money if you roll it all together,” Brandon says. You can always consult with an advisor to help decide if you should leave your 401(k) with an old employer, roll it over to a plan with your new employer or invest in a non-employer retirement account (think IRA). “It’s a good nest egg people overlook,” Brandon says.
The biggest way to make sure you don’t overlook your retirement money is pretty simple: Don’t forget about it. It’s surprisingly easier said than done, since a lot is probably on your mind—financial and otherwise—when you’re financially preparing for a job transition.
It’s one thing ‘to be in it to win it’ as far as job searches are concerned, but in reality, the right new job might take a while to find. If you’re buried in debt, haven’t started to save money for a job change or can’t find a logical next place to move on to, rather than drag yourself down while you wait, there is still hope.
Instead of dwelling on what you can’t do, why not use your current position as a springboard to ready yourself while you wait? Want to brush up on your high school Spanish skills? Some employers offer education reimbursement and stipends. Curious about what it’s like to work on other teams? Ask if they could use some help for an upcoming project and if their needs match your skill set, see if you can assist. Both examples not only bolster your resume, they will also show your current and future employer that you’re curious about diversifying your skills, making you more valuable to an employer regardless of where you end up.
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