Would – and should – you take a pay cut for a better job? Ask yourself these questions
The old saying "money isn't everything" certainly holds water. After all, having money may be secondary to maintaining good health and solid relationships with loved ones.
But while money may not be everything, let's face it – it's still a pretty important thing to have. You need money to pay your bills, meet your financial goals, and enjoy life. And so when seeking out a job, it's important to find a role whose salary allows you to keep up with your expenses and work toward other important objectives.
Still, in some cases, it could pay to give up some money if it means finding the right job. In a recent FlexJobs survey, 85% of respondents said they're willing to take a pay cut for the right role. Of that 85%:
- 35% said they'd take a modest pay cut (6% to 19%)
- 12% said they'd be open to a more serious pay cut (more than 20%)
If you're not happy with your job, a better opportunity could be out there. But what if it pays less than what you're making now? Should you be willing to take a pay cut?
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It's all about priorities
First, let's get one thing out of the way: There's a difference between a modest pay cut and a major one.
If you're currently earning $60,000 a year and your dream job opens up at a $57,000 salary, that's a pay cut you may be able to absorb without too much sacrifice. But if you're talking about going from $60,000 a year in earnings to $45,000, well, that's a very different story.
Before you decide whether taking a pay cut is worth it to get a better job, you'll need to make sure you can afford one. If the pay cut in question will cause you a world of financial stress or will make it so that you have to uproot your life by moving to a smaller apartment and spend your weekends stuck at home in the absence of having spending money to socialize, then it's probably not worth it.
Otherwise, if you can handle a pay cut by making modest lifestyle changes, then you'll need to think about what's more important – a job that's more fulfilling or the financial flexibility to spend more freely. For example, if your pay cut is such that you won't be able to go out much or take vacations, you may decide that giving up those things is worth it to spend your weeks doing work that you love. Or, you may decide the opposite – that you'd rather earn a few extra thousand dollars and have the option to go out more and take a couple of trips every year.
There's really no right or wrong answer. Rather, it's about what will better enhance your quality of life.
Another thing to consider is the state of your savings account. If you have a lot of money socked away, you may have more flexibility to take a pay cut without sacrificing too many aspects of your lifestyle that you enjoy.
Chances are, you spend many hours of your week working, and it's important to enjoy what you do. If a pay cut is your ticket to a better job, it may be worth going after. Just think things through carefully so you don't wind up regretting that decision or, worse yet, falling behind on your bills once your salary decreases.
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