3 Financial Metrics To Know Before Making a Career Change

Know the Numbers

When you're thinking about making a career change, finances are obviously a huge factor.

Money is important. And you’re not about to totally start over.

Money can be something that allows you to live comfortably.

It's certainly not everything. Just ask any high powered lawyer or doctor whose ditched their high-powered lives for something more inline with their strengths, values, and priorities.

But it's a big factor.

Knowing these three financial metrics as you start the career change process can alleviate anxiety and tension when it comes to your finances in both the short- and long-term.

1. Know your monthly expenses and minimal viable salary.

Maybe a new line of work that would allow you to take a big step toward your ideal career has a lower salary range than your current role. Maybe that’s a lower salary to begin or the earning potential is relatively lower.

That might be absolutely okay given other trade offs and advantages, particularly around what you want and need for work to feel fulfilling (what I call your Ideal Career Profile).

Knowing exactly what your base expenses are, as well as some flex, will allow you to identify the minimum figure you should entertain.

2. Know your runway.

After calculating your minimum monthly expenses, take a look at your savings.

Divide your savings by your minimum monthly expenses.

This will give you how many months you have until that hits zero. Your runway.

If you find yourself in a position where you need to, or feel that you want to, leave your job before landing a new one, this will tell you how many months you can sustain.

Sidenote: on average for most career changers that take consistent action and follow the 6-Step Roadmap, most land a new role in 4-6 months. Some in less time, some in more.

3. Know your ideal salary.

This is a variation on the minimum viable salary, where you can add other factors and expenses you'd ideally like to have in your life.

Maybe it's saving an additional 10% each month.

Maybe it's adding more to retirement each month. Vacations, second homes, etc.

Draft up your ideal scenario and this will give you your upper range.

You might have a few versions of this based on where you are today and where you ultimately would like to be.

Do The Math

To help you calculate all three of these financial metrics - your minimum viable salary, your ideal salary, and your runway - I’ve created a Salary Calculator Tool that walks you through the process.

Disclaimer: I am NOT a financial expert. Nor do I claim to be.

However, this is a tool I use for my own finances and in considering my own career moves that has helped me tremendously. As well as numerous clients, friends, and family members

I hope it does the same for you.

Erin

I Help High-Performers Get Out Of The Wrong Job & Into A Career That Lights Them Up...Without Starting Over | Let's connect | erinallett.com

PS You might be wondering outside of finances, other things you should know before making a career change. Get INSTANT ACCESS to the 6-Step Roadmap to Work That Lights You Up and find out exactly how to make a successful career change without starting over.