This archive report was first published on 12 September 2019.
Preparing for a Job Change ¶
Published on September 12, 2019
Millennials are known for frequently changing jobs, with six in ten open to new opportunities, according to a Gallup report. While there can be benefits to making the move, such as a higher salary or better benefits, there are also financial risks to consider.
Before making the leap, it's essential to review your retirement benefits, insurance policies, and debt financing to ensure a smooth transition.
Review Your Retirement Benefits ¶
Check your contract to understand the vesting schedule for employer contributions to your retirement scheme. If you're almost at the completion of the stipulated period, it may be wise to delay any new job offers until it's over.
Look at Your Insurance Policies ¶
Consider the life, health, and disability insurance benefits offered by your current job. Purchasing insurance through an employer is often cheaper and comes with fewer medical reviews. However, the insurance may go away or become more expensive when you leave your job.
Refinance Your Mortgage ¶
Employment history is a key factor in approving mortgage refinancing or home equity line of credit applications. To be safe, handle your debt financing 2-3 months before making the transition.
Stock Shares or Options ¶
If you've acquired company shares as part of your employee benefits, be aware of any restrictions on selling them. You can also use your stock shares or options to negotiate for a better salary or benefits at your new job.
Save Six Months' Worth of Salary ¶
Build up an emergency fund before leaving your job to cover unexpected expenses, such as losing your new job or the startup company failing.
Gather Your Statements ¶
Ensure you have all your financial documents from your current job, including payslips, retirement plan statements, and tax reports, in order and easily accessible.
Don't Make Lifestyle Changes Yet ¶
When you receive a salary bump, continue with your current lifestyle and use 80% of the extra money for debt repayment or long-term financial goals, while saving 20% for discretionary spending.
