Following the pandemic, there's been a large shift in people looking to step-back from their regular nine-to-five jobs in order to step-up in other aspects of their lives.
Similar to the "Great Resignation," even world leaders and executives of large corporations are making drastic changes in their lives, to focus on their families or switching career paths. While taking this giant leap can seem daunting, there are ways to plan your exit effectively without suffering the financial consequences, according to money expert Robyn Thompson.
"When you think about step-back culture, it's really about stepping back from the environment that you're in and really looking at, where is it that I want to be in my life?" Thompson told CTV's Your Morning on Monday.
She explains this intentional step-back from a one's current position in life will allow them to re-group their priorities, and find a path that will sustain their lifestyle while also honouring their new goals or values.
CREATING A FINANCIAL PLAN
To ensure a safe exit from a steady-income job, Thompson recommends checking in with your savings to make sure you're able to support yourself while pursuing new interests that may not bring in the same amount of income as you're used to.
"I would never recommend that you should step off to the end of the abyss and not have a financial plan. So make sure you have at least three to six months in savings," she said.
For those with investments, Thompson suggests re-arranging your investment plan to bring in extra income that won't risk too much of what you already have.
"You can change that (your) investments to income producing versus capital appreciation to switch into dividends, income and different types of assets that bring you income versus all growth and capital assets," she explains.
Accounting for any lost health or pension benefits are crucial, Thompson says, as she recommends planning for the months you may be without certain benefits and considering if your new job will provide the same or alternative security.
LEANING ON YOUR SUPPORT SYSTEM
Entering a drastically different new life chapter can be challenging on your own, which is why Thompson recommends looking for personal support from friends or family, especially those in your same household.
"Do you have a division of labour within your household where you can have someone pick up some slack? If you're going to be staying home, as an example, and watching kids and not going back to the workforce, how does that look financially within that household?" she said.
Splitting the household responsibilities and planning for living on potentially less income for some time will help ease the transition.
FINDING PURPOSEFUL INCENTIVES
When searching for a new career path that's more fulfilling, Thompson recommends looking for a job that will provide you with benefits that align with your values so you won't dread going to work or miss out on any career advancements in the long run.
"If you're at a job, and you're gonna be there for the next 10 to 15 years, and you get up and you don't want to go to work and you don't enjoy it, that's not a real way to live a life," she said. "You will not perform at work as well as you have been, your raises will suffer from that, your bonuses will suffer from it, because you're not giving it your all."
Purposeful incentives like a focus on specific skills growth, work programs that involve community outreach, or more flexibility to have a better work-life balance are all important benefits to look for in a new career.
Additionally, Thompson says by searching and comparing positions in the job marketplace can help you understand the ranges in salary and find a job that can not only pay you well but also align with your values.
