Thinking of Quitting Your Job? Put a Financial Plan in Place First

If you’re thinking about quitting your job this year, you’re not alone. With a record number of job openings recently, the nationwide “quit rate” remains near all-time highs as the “work from anywhere” trend appears here to stay.

And even beyond the rank and file employees, the CEO of your firm may leave before you do. According to a recent research study published by Deloitte and Workplace Intelligence, nearly 70% of C-suite executives said they are seriously considering quitting their job this year, compared to just 57% of all surveyed employees.

If you count yourself among the millions of Americans thinking about changing jobs, you have many decisions that could significantly impact your finances.

Six Steps to Take Before Leaving Your Job

The landscape for working Americans has undoubtedly shifted. These significant changes in how we do business and manage work-life balance can be nerve-wracking. You must be thoughtful about a potential job change to ensure you’re not inadvertently leaving money on the table. Here are several items to consider before you leave your current job:

1. Seek Help From a Financial Professional

There are many moving financial pieces involved with a mid-career job switch. There might be items you will not see coming. That’s why working with an experienced fiduciary advisor is so critical. While you may choose to work with a local financial advisor, consider if a specialist advisor familiar with your unique circumstances could offer better guidance before you turn in your notice of resignation.

2. Look (at Your Vesting Schedule) Before You Leap

Timing is everything when leaving an employer, particularly during your peak earning years. You want to be sure your exit is not immediately before a vesting cliff date. Perhaps sticking around just a month or two longer will result in clocking out for the last time with a lot more cash.

3. Get Ready to Roll

According to Capitalize, Americans accumulated more than $1 trillion in “forgotten” 401(k) plan assets. Don’t become part of the statistic! By rolling over your old 401(k) into an IRA or rolling it into your new employer’s plan, you can keep your financial house in order when you start at a new company.

4. Review Your Options

Set up what stock options you have earned and plan for striking on them. Stock options strategy is one area where working with an advisor well-versed in this type of employee benefit common among highly compensated workers can pay off.

5. Don’t Bail Before Your Bonus

Be sure to work with your current employer to receive any variable compensation you deserve. Know the qualification periods and payout dates. It would be unfortunate to overlook a key date and miss bonus money by just a few days.

6. Don’t Forget About Your Healthcare Benefits

When making a career move, the elephant in the room is what will happen with your healthcare coverage. It can be a significant risk if you have a growing family. It would be best if you worked with your current and new employers to have continued insurance.

What To Do Upon Starting a New Job

Fast-forward, and you’ve hopped jobs while ensuring all your financial ducks were in a row. Now you must get your house in order at the new company. There are several boxes to check before settling in a financially secure position.

First, sit down with a financial advisor to prioritize your situation. They can help you assess your goals, risk tolerance, time horizon, tax situation, and any unique considerations for you and your family.

Next, get your payroll deductions right – the last thing you want is to find out the following tax-filing season that you owe a considerable amount to the IRS (with possible penalties).

It’s also prudent to ensure that a portion of your new salary goes toward long-term savings. For example, you can use your new employer’s retirement plan to invest for the future and capture any matching contributions.

While most people know they should contribute to a 401(k), the investment benefits of a Health Savings Account (HSA) are somewhat less understood since it is a relatively new account type. So check with your Human Resources department to learn how the company’s HSA works – there might also be an employer match with this account. HSAs feature the “triple-tax advantage” not seen in any other savings vehicle.

Certified Financial Planner Emily Rassam from Archer Investment Management states, “Consider and evaluate any unvested 401(k) match, stock options, or restricted stock units before leaving a company. You may be leaving funds on the table. Also, if you are leaving a position with a non-qualified deferred compensation plan, it may become 100% taxable upon leaving.”


Your head might be spinning. There are many considerations before, during, and after you change jobs. The good news? You are not alone.

More Americans are taking the bold (and often lucrative) move to a new job or career. Whether you are simply transitioning from one employer to a similar role at another company or starting your own business, working with a financial advisor ensures you do not miss a step.

Managing risk, making the most of your old and new benefits packages, and keeping an eye on your long-term financial plan are critical areas sometimes overlooked by today’s job switchers.

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This article was produced by Wealthtender and syndicated by Wealth of Geeks.

Mike is a freelance writer for financial advisors and investment firms. He’s a CFA® charterholder and Chartered Market Technician®, and has passed the coursework for the Certified Financial Planner program. Mike is a frequent contributor to the Humble Dollar personal finance site.