If you decide that you no longer want to stay in the career field you are in, your next step is to make a career change. If you have no experience in the field you are changing to, you will likely experience a drop in compensation. For instance, a successful realtor may be tired of the fierce competition and the long hours in her field and decide to become a teacher. The realtor may experience a significant drop in salary when entering the teaching profession, because teacher salary scales are often based on experience.
Unfortunately, sometimes employers decide to demote employees based on performance or other factors. If you are not in a position to move, such as if you have a spouse with a well-paying job or a family that you can’t uproot easily, you may have to accept the demotion at the lower pay rate. That doesn’t mean that you have to stay in the job forever, of course. You can keep the job while you work towards finding a better opportunity without a total loss of income.
Benefits and Perks
Sometimes leaving a higher-paying job for one that pays less makes sense if the benefits and perks outweigh the pay. For instance, if you work in the restaurant business as a general manager with a healthy salary, but you work 80 to 90 hours per week and have no health insurance or retirement benefits, you may decide to take a lower paying job that offers you health insurance, a 401(k) and a 40-hour work week. In many cases, the lower salary works out to a higher hourly rate. Working less with more benefits may be worth more to you than the extra money each year.
If you move from an area that has a high cost of living to one that has a much lower cost of living, you can afford to take a lower-paying job. Your money will go further because things such as housing, groceries, transportation, healthcare and utilities won’t cost as much. Use cost of living calculator to estimate how much your current salary is worth in another city or state. The calculations will give you a good idea of whether you can live your expected lifestyle on a lower salary in another location.
Your well-paying job may not be worth it if you are unhappy and stressed and your current job is taking a toll on you and those around you. A higher salary can’t make up for the loss of quality time spent with children and loved ones, pursuing hobbies, or simply sleeping right and exercising to keep up your health.
You Need a Job
When a company you work for closes it doors or downsizes, you can find yourself out of a job. Depending on the industry in which you work and the area in which you live, you may have to take whatever job or jobs you can get to pay you bills. There may not be any available jobs in your industry unless you move to another location, which may not be a feasible solution at the time.