BONUS: Do I Need to Take a Pay Cut When Changing Careers?

Introduction 00:05

This is the Happen To Your Career podcast with Scott Anthony Barlow. We hope you stop doing work that doesn't fit you, figure out what does, and make it happen. We help you define the work that is unapologetically you, and then go get it. If you feel like you were meant for more, and you're ready to make a change, keep listening. Here's Scott. Here's Scott. Here's Scott.

Scott Anthony Barlow 00:30

We've had over 20,000 discussions with people all over the world about their careers, often about wants, needs, aspirations, maybe even things that they've only told their spouse or partner, and sometimes we're the first people that they are telling. And as you can imagine, this puts us in a pretty unique position to observe patterns. And one pattern is that there are some pretty big misconceptions, especially around pay during career change. And I just want to share what happens during some of these conversations. So it might go something like this, when we initially meet somebody trying to learn about their goals, what they're trying to, what kind of change they're trying to make, and you know how we might build a package around that. So we'll say something like, "Hey, what's your ideal compensation?" And then they'll say, "Well, you know what, that's really hard. It's a hard question to think about." And then they tell us what they're making now. And then, here's the kicker, many people will say, "But I could make as low as" and then they'll throw out a number that's even lower than what they are paying now.

Scott Anthony Barlow 01:36

Okay, so first of all, this is fascinating discussion from a psychology and a sociology perspective, and it doesn't seem to matter whether you make $90,000 or $650,000 a year, almost everyone believes that they are needing to take a pay cut when it comes to making a career change, even if they've heard our podcast, they still think that in their situation, they're probably going to need to make a pay cut. So this is because we falsely believe that we are going to have to start over if we're in a new career or industry or area. But if you have those experiences, if you have experiences at all and skill sets, they don't just disappear because you go to another role or company or industry, your experiences are not automatically less valuable in those scenarios. Are there companies out there that will perceive your experience and skills as less valuable? Yeah, absolutely. What do you do about it, though? Well, turns out, just don't accept a job with those companies. After all, how many jobs do you need? Most people need one, right? Your new rule is to focus on going after what you want, not what you think you have to accept. Okay, but determining what you want creates a new challenge, right? If you don't know the life that you're trying to build and how work fits into that, then it makes it challenging to know how much money you're going to need to support that life in the future. So I want to give you two ways here to completely overturn how you're thinking about your income goals.

Scott Anthony Barlow 03:14

Number one, you have to understand where you're running to first, what is the life that you're trying to build, then you can begin to figure out your financial goals. From there, you can begin to figure out how you want your work to support those financial goals. Now I fully understand this is literally the opposite of how most people are thinking about their career. Instead, it's usually the other way around. It's, "I currently earn this much, and it would be nice to earn a bit more, and if you are in a marginal amount more, then I could buy, I don't know, whatever, insert your goal here, a boat, invest more, save more, invest for kids", whatever it is. So this is normal human behavior. And it turns out it's not helpful if your goal is leading a more fulfilling life and fitting more fulfilling work into that.

Scott Anthony Barlow 04:06

Okay, so I want to give you a second way to think about this differently, and this is what we found when we work with our clients, and also when we get to be involved with helping them establish their goals and later on in negotiations for job offers, all those parts. Very rarely, our clients taking a pay cut when they make a career change. In fact, what we found is less than 15% of the people that we're working with are taking that pay cut in one way or another. And when they choose to, it's 100% intentional, not something they feel they have to do. Okay. I want to give you one more bonus tidbit here. Once you figure out how much money you need to support the life that you want to live, you might be very surprised. Maybe it's less than you thought, and that's amazing, right? Okay, but if it's more than you thought, then that's where you can begin to calculate out the opportunity cost that can occur by not changing careers to something that is allowing the financial side to fit your financial goals.

Scott Anthony Barlow 05:15

Okay, so here's an example for how to do the formula. Let's just say that, you know, I earn $150,000 a year. But I figured out that to support my financial goals and the life that I'm trying to build, whether that's mid term, long term financial goals, that means that every single month, if I am needing to earn 175,000 to support that, then that means every single month I delay moving from this situation that opportunity cost is literally $25,000. So it adds up really quickly if I hem and haw about making a change because today work was okay, and I think I can tolerate this and then, you know, it goes up and down, you go through the roller coaster. Then 90 days goes by, and now that's $75,000 that I won't get to make in my lifetime because I'll continue to allow time to go by.

Scott Anthony Barlow 06:09

Okay, so that's not a great scenario. So here's what I would encourage you to do. Number one, begin to identify the life that you want to build and then how work fits into that. You can start with our 8-day mini course, go to figureitout.co. And if you want to implement what you've heard and you want to completely change your life and your career, then let's figure out how we can help support you. So here's what I would suggest, just open your phone right now, go to your email app, and I'm going to give you my personal email address: Scott@happentoyourcareer.com. Just send me an email and put 'Conversation' in the subject line. And when you do that, I'll make sure you get to the right person on our team, and you can have a conversation with us. We'll try and understand your goals and what you want to accomplish in your career, no matter where you're at, and we can figure out the very best way that we can help you in your situation. So open that up right now. Drop me an email, put 'Conversation' in the subject line, Scott@happentoyourcareer.com.