Finding a new job means taking a big career leap. The move could be beneficial in building your career, but a graceful transition could be achieved only with perfect planning. Here are some important financial decisions to take before switching the gear to remain stable in every possible way.
Do not miss out on benefits from the current employer. If the incentives or year-end bonuses with the current employer are due, it is not a good idea to quit the job before receiving them. Also, check if your unused vacation policy is paid by your employer while leaving, else consider using the paid time off before resigning. Be aware of the incentive dates and appraisal dates of your new employer too.
Continue your employee provident fund (EPF) to continue making money. Interest on contributions towards provident fund earns compound interest year after year. Interest earned this year is added to the previous year’s principal that generates compound interest the coming year. Withdrawal from the EPF, results in the loss of this growing interest. Thus, It would be wise to continue the PF, without withdrawing while changing the job, to build a substantial corpus with the power of compounding
Maintain your insurances to stay secured. When you leave your employer, you may not be able to continue the health insurance offered by the company. Get your personal health insurance or check if you can continue using the existing policy even after parting ways with the employer. Some health insurance companies offer seniority benefit to the existing customers and allows continuation as individual policy even after leaving the company. Also, ensure to have all other insurances in place, like term insurance, disability insurance, etc.
Build your emergency fund with at least six months of your net pay. Sometimes, job search may take longer than you imagine or you may not land in the suitable job right away. Meanwhile, you need money for livelihood. In such a case, your emergency fund turns handy, helping you avoid loans and debts. Also, look for a part-time income to fund your livelihood, until you find the suitable job. This way, you need not disturb your emergency fund.
Get a longer vision when switching your job. High salary should not be your only priority. Take up passions and projects, which actually improve your qualification and your future salary. Look out for a job that turns substantial in the long run. Compare all the perks offered by the new employer. Do not neglect even the details like time spent for driving to your new job.
Set clear money goals and plan accordingly. Financial decisions can turn tricky at times. It is essential to take time and put effort to get the best advice and take right decisions, periodically. Take suggestions from the family, friends and well wishers. For expert advice, approach online advisory like ArthaYantra that offers holistic financial services. We help you identify and prioritize all your money goals and offer complete financial plan to achieve all your money goals.
In conclusion, have a graceful transition when switching your job. Do not allow your excitement or emotion to take over crucial finances. Move ahead with a plan and vision!
