Dubai: It’s often said that having a viable exit strategy is a must for any successful project – jobs are not any different.
Not to be confused with a lack of commitment, having an exit strategy can help you know the right time to seek a job change.
Most often, those lured by a monetary boost or a better position, may leave their jobs prematurely. Sticking with each job for the right, often long haul can help you make the best move money-wise.
When you make the decision to quit, then you’re to be sure you’re making the right move. There’s much more than salary to consider when weighing a new job offer, and money plans to make after you accept.
Look beyond the new job’s new pay
The first question most people ask when they get a job offer is: How much will it pay? While salary is clearly important, there are other factors you might not immediately consider.
These prominently include benefits and the potential financial consequences of leaving your present employer. Each could have a significant impact on your long-term financial security.
As Dubai-based financial advisors often reiterate, your upfront salary is just the starting point when considering a job offer.
Additionally, if you accept the position, you’ll need to make other important financial decisions to help ensure that you’re staying on track to meet your financial goals, career consultants add.
Whether you’re just weighing an offer or have already decided to take it, your financial advisor can help guide you through key considerations in the decision-making process.
In fact, as with all big life changes, switching jobs can be a convenient time to review and update all of your financial plans. Use the questions below to shape your conversations with your advisor.
5 questions to ask yourself before you accept a job offer
1. Will I give up annual bonus, equity compensation or deferred compensation at my old job?
If a portion of your current compensation is tied to an annual bonus, any other compensation or compensation plan, you may have to forfeit those assets if they are unexercised, if you move on.
Knowing that you’re leaving assets on the table may give you leverage to negotiate with your future employer.
On the other hand, if you’re taking a lump sum distribution from a retirement plan when you leave your old job, you’ll want to discuss with your financial advisor how to manage them in the most cost-efficient way.
2. How do the benefits at both jobs compare?
Career counsellors view that you need to find out not just what’s available but what you actually qualify for — and when, adding that while a pay hike is important, but if you lose access to benefits, you may end up worse off.
Conversely, over the years, a more generous retirement plan can offset the impact of a slightly lower salary. Ask your financial advisor how company benefits, could affect your finances, both now and in the future.
3. Are there unanticipated costs that could affect my net income?
If a job involves relocating, look closely at housing costs, adds experts — they can vary widely by region and can also have a significant impact on your net income.
See if your new employer might be willing to pick up the relocation costs, and ask your financial advisor to help you calculate what your net income and cash flow might look like in a different area.
4. What are my immediate cash flow needs?
In addition to interim healthcare coverage, you may have additional temporary expenses — moving costs, for instance, or the cost of a long-distance commute until you get settled closer to your new workplace.
Career counsellors also recommend keeping in mind that a job change can make it more difficult to immediately qualify for a mortgage or other loans, so you may need to manage two housing payments or rent for a period.
5. Could the job change affect my investment strategy?
That depends. Overall, job transitions present a good opportunity to meet with your advisor to assess your progress toward specific financial planning goals and to consider potential adjustments.
They can help you fine-tune your portfolio to ensure that your investments are still aligned with your time horizon and level of risk tolerance and are appropriately diversified to help you manage market fluctuations.
As you look forward to starting a new job, it's important to consider how you will manage your finances while making the transition from one employer to the next.
• Discuss dates with your old and new employers to assure continuous coverage
• Check on the status of any pending claims under your old coverage
• Arrange any needed transfers of records from your old insurer to your new insurer
When you're deciding whether to accept a new job, there are many things to think about. The financial factors are vital too: there's the salary you're offered, but there's also the benefit package to consider.
So it's important to remember that your remuneration package isn't all about the salary: What bonus scheme and benefits does the new job offer, and how do they stack up compared to your current firm?
In order to do that, ask the company to clarify when your pay will next be reviewed, and the criteria that they'll use to decide on any pay increase.
Normally, a pay review will take place once you've been in a job for 12 months, but you may be able to ask for a review sooner in certain circumstances.
In other words, you should also find out what the company's bonus scheme is based on and what you can expect to receive.
If your prospective employer is talking about equity as part of the offer package, this means you'll be given some kind of ownership interest in the company.
Once you've taken these things into account, hiring experts evaluate that your move will leave you better off financially.
As mentioned, having an exit plan doesn’t mean that you won’t be full-heartedly investing in your job. Instead, you should keep your eye on your end goals in terms of career advancement.