Considerations Before Switching Careers When You’re in Debt

If you’re in debt, the most important thing is stability. Knowing for certain just how much money you have coming into your bank account every month is essential to keeping your budget healthy. When you introduce uncertainty, this is when things can take a turn. With that in mind, what are the most important considerations before switching careers when you’re in debt?

There are a lot of benefits to switching careers. You might encounter higher earning potential, for example. You might also have a better work-life balance. That being said, the opposite can also be true, and you don’t want to risk your financial security. Keep reading to discover the most important considerations before switching careers. 

When Is It Time to Switch Careers?

To begin, when do you know it’s time to switch careers? A reported 72% of Australians feel unhappy at work within the previous year. This is due to a number of factors, including toxic management, poor mobility, and stagnant wages. 

In reality, there are a lot of benefits to switching careers. Knowing how to transition with grace into a new role with greater potential is an important skill. However, quitting is no small task. When you quit a job — for any reason — this is a decision you typically can’t undo. If you’re already facing debt, this could put you in a dangerous situation. 

However, if any of the following statements ring true for you, it might be time to switch careers:

  • You’ve run out of room to grow: Not all jobs have unlimited potential. Factors like your education, experience level, and even your geographical location can all impact your growth. If you no longer have room to grow your salary or role, it’s time to move on.
  • You’re burnt out: If you’re in the wrong career, you’re much more likely to experience burnout. This is described as feeling completely drained of energy. If you’ve taken time off and still feel completely spent, odds are this is a toxic position for you.
  • Your job impacts your personal life: It’s important to have a strong work-life balance. If your job is getting in the way of your family, friends, and general well-being, this is a red flag. You should always work to live, not the other way around.

Do you relate to these statements above? If so, keep reading to understand the top considerations before you leave your current role behind for good. 

The Smart Way to Switch Careers

If you’ve decided it might be time to switch careers, you’re in luck. There’s a way to do this without burning your financial goals to the ground. Read these next steps closely to determine the best course of action for your situation. 

Step 1. Save an emergency fund. 

Before you do anything else, you need an emergency fund. Even if you have a new job lined up right away, there still might be some weeks between paycheques. Having an emergency fund of at least 3 months is essential. You need enough funds to hold you over, and you need a backup plan in case things don’t work out. 

Step 2. Consider your long-term income. 

The most common reason people switch careers has to do with income. However, the grass might not always be greener. Consider how a new role might affect your income. Most people reach their highest earning years between 45 and 60. If you’re already approaching these years, starting from scratch might not be the solution. 

Step 3. How do your current skills and education fit?

Depending on your education and experience, there might be a lot of hurdles to overcome to land a new career. This is especially true for tech or certification-heavy courses. Weigh the pros and cons of taking on additional years of schooling before you make a decision to move to a new career. 

Step 4. Get a grip on your current spending. 

While being in debt shouldn’t get in the way of changing careers, you need to be honest with yourself. Are you in control of your finances? If you truly have a grasp on your debt, payoff plan, and monthly spending, then odds are a new career won’t put that at risk. Remember to budget for any new costs associated with a job transition, like child care, commuting, and so on.

Are You Ready to Change Careers?

Looking to change jobs? You’re not alone. In 2023 alone, almost 3 million Australians started a new job. Regardless of your city, there is a lot you can gain by putting yourself back into the job market. However, if you’re currently on a debt payoff plan, your financial goals need to come first. 

Your career is only one part of your life. It’s completely possible to find contentment and joy outside of work regardless of your career. That being said, there are a lot of great reasons to explore your options. In the meantime, meet with the experts at Debt Busters to discover your path forward. Our team of professionals is here to help. Call us today on 1300 368 322.

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