Most of us don’t go to work because it’s awesome and fun. Most of us work because we need the paycheck.
There’s no denying that monetary compensation is a major part of whether you should stay put at your job or seek “greener” pastures. But, if you are able to land a higher-paying gig, should you job-hop just for the money? While the easy answer may be “yes,” the real answer is: it depends.
To help you decide whether you should switch jobs for the Benjamins, here are 6 things to consider:
1. The Entire Benefits Package
How much you’re getting paid is just one slice of the compensation pie. The whole compensation caboodle includes your paid sick and vacation time, matching contributions on employer-sponsored retirement plans, and benefits such as health and dental insurance. If your new job offers more pay but fewer benefits, it may not be the best “deal” after all.
2. The Cost of Living
If the new job offer requires that you uproot and move to another city, think about how that may affect your quality of life and cost of living. Will your potential new employer foot the bill for relocation costs? And depending on your life situation, don’t forget to consider the added stress of moving. You’ll need to assess whether the relocation is worth it.
3. The Big Picture
Sometimes switching jobs for the money could end up hurting you down the road, points out Steve Wang, a seasoned hiring manager and recruiter.
“Making more money now doesn’t always correlate with making more money in the future,” says Wang. “And jobs with less benefits to start may come with intangible benefits like training, career opportunities, and connections that can end up leading to a far more lucrative career path than the one that pays more today.”
In my experience, I’ve known people to take a job that pays less than what they can ideally make because it would offer more growth opportunities in the long-run. Early in my own career, I took a pay cut because I was in a dead-end job. There were zero growth opportunities and the environment proved to be a toxic one. Within a year into my new job, I was promoted and got a bump in pay.
4. Competitive Pay
When evaluating job offers, always do your research to know the current competitive pay range for the position, says Lydia Frank, vice president of content strategy at PayScale.
“Sometimes people make the mistake of accepting an offer because it sounds like a lot more than they’re currently making, even if it’s not a competitive offer for that role,” says Frank.
When doing your homework, check to see what someone with similar qualifications and years of experience are making in your field in similar roles. You’ll also want to take into consideration your location, the size of the company, and the industry. Pay ranges can be significantly different based on those factors, says Frank.
5. The New Job Expectations
If you’re considering a job offer for significantly more money, make sure you understand what comes along with that higher paycheck, points out Frank. For example, what are the expectations when working more than 40 hours per week? If you’re switching from an hourly job to a salaried one, will you still be making more per hour? And what’s the company culture like?
6. Can You Get Higher Pay at Your Current Role
Let’s say you love your job, but the pay is something left to be desired. If that’s the case, see if your employer is willing to bump up your salary.
“Don’t be afraid to ask for higher pay,” says Frank.
If your boss isn’t able to accommodate your request for a raise, see if the company can throw in more comp time, or greater flexibility in your work schedule. Make it known what’s most important to you, and see if your employer can meet you halfway.
“Money isn’t the be-all end-all. Remember to take into consideration whether you actually like the job,” says Wang.
Be Aware: Job Hopping Doesn’t Always Equate to More Money
It turns out that switching jobs doesn’t always mean you’ll rake in more dough. In a recent PayScale study on whether job-hopping always led to higher pay, it was revealed that it depends on the job.
For more competitive roles, like a software developer, switching jobs on the regular can be beneficial for a bump in pay. But for jobs where the market isn’t changing quite so rapidly, like an operations manager or administrative assistant, employees can earn more by staying at their current company.
All told, Frank cautions against job-hopping simply for a pay increase.
“Pay certainly matters, but doing work you love does as well,” she says.
This page is for informational purposes only. Chime does not provide financial, legal, or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for financial, legal or accounting advice. You should consult your own financial, legal and accounting advisors before engaging in any transaction.