What to Consider in a Mid-Life Career Change

Switching your career in middle age is not for the faint of heart or the unprepared. To carry it out, it’s vital that you know yourself, the job prospects and your financial health.

Many of us didn’t plan on working in the field we ended up in. Maybe you wanted a career in design but instead settled for insurance because design jobs just weren’t available the year you graduated.

Before you knew it, the years rolled by, you found yourself smack in middle age and thought, “I’ve got plenty of good years left; it’s time to make a career change.”

That’s well and good. But in choosing a second career, there are big challenges to your mental well being, your family life and your retirement prospects. And a mid-life career change is not a decision to be taken lightly, or for the wrong reasons.

“People need to do due diligence,” said Eileen Chadnick, a career coach with Big Cheese Coaching in Toronto.

“Who am I? What are my preferences, what are my strengths, what do I really want to be doing in this next stage in life? Do I really want to invest in this next career? Do I really want to be kind of part-time and fulfilling or how many years do I have where I want to go full gung-ho full time?”

This self-examination is useful because sometimes we just can’t appreciate the wealth of skills picked up over decades spent in the workforce.

“People in their busy working lives may not have had a chance to name their strengths, their values and preferences,” Chadnick noted.

You also need to assess what’s out there before embarking on a second career.

“You might have a great idea but you have to see, is this something where there is demand, will people be willing to pay for this, are there too many people already doing this job?”

Even after going through that checklist, an overriding question remains – can you afford it without going deeper into debt or postponing your retirement dreams, potentially for many years?

Clay Gillespie, a financial advisor and managing director of Rogers Group Financial Vancouver observed that a career move can represent reductions not only in savings and CPP benefits but even salary “because typically when you change industries, you move down the totem pole a little ways.”

It’s important to outline the cost and scope of the change and what it means for that person wanting to embark on a new career path.

“I just run the numbers so they understand the true financial impact of making this change,” he said.

“That’s my job – not to tell them to do it or not to do it. But (rather to show them) what the implications are and what you have to do to get yourself anywhere back (to where you were).”

A good chunk of this planning involves looking at your retirement to see what it would look like with and without the career change.

As an illustration, “you could have made $50,000 after tax and inflation at 65 and if you do this, you’re only going to get $40,000,” Gillespie said.

“That means you have to work to 70 to get to the same spot.”

There’s also the health angle. Some people blithely assume they can go on working full time well into their 70s, but you have to consider the growing odds that you could come down with a health issue that may derail those plans.

According to Gillespie, most people will go ahead with their plans for a new career even after the pros and cons are spelled out.

But the exercise does have a positive effect.

“What happens is they go, ‘so that means to do this I’m going to have to save more when I’m done,’” he said. “It changes their spending patterns dramatically.”

Whatever you do, experts agree you should never quit your job without a plan.

“People that have a passion and move onto something else and they do planning – that’s OK, the math is known, you’re making the decisions, you’re deciding a better lifestyle is worth a lower income,” Gillespie said.

“That, to me, is a sound decision. What is not a sound decision is taking a couple of years of to find myself and go into a new career.”

5 years ago