Checklist: Managing Your Wealth Through Major Career Transitions

By Ashley Bleckner

Understatement of the century: A lot has happened over the last few years. And it’s shaken a whole lot of people out of what felt like a trance, causing them to pause, rethink what they really want, and reevaluate their next steps. Sound familiar?

Whether you’re considering a career change; taking a sabbatical; starting your own business; shifting to part-time, consulting, or board work; or even retiring — there’s a lot that goes into the decision. Not least of which is what it might mean for your finances.

Take, for example, an executive at a tech company who’s been grinding for the past 15 years, working 100-hour weeks. Now she’s over that lifestyle, ready to step back and take a job that feels more meaningful to her. But what would that mean for her income? Can her investments sustain her through a job search, supplement a potentially lower salary in the future, and help her continue to reach her financial goals?

If you’re going to move forward confidently, with clarity on what a life transition like that might mean for you (and your family), financial planning and wealth management are key steps in the process.

5 steps to managing your wealth through major life transitions

1. Reset and explore

First, some soul searching. If you aren’t crystal clear on what you want next, you could end up in the same exact spot you’re in now.

Start by thinking about your core values. What’s important to you? What are the principles that give you direction, help you make decisions that feel right in your gut? Do you have a mission statement you can align your career, philanthropy, investments, and life around?

Then consider your goals, and how they align with those values. (If they don’t, maybe they aren’t the right ones after all?) What do you want out of life? Where do you want to be? (Note: These things can — and definitely will — change. Try to trust your gut and not stress about the answers.)

Finally: What’s motivating you to make this change? What do you want out of it? Is your goal to find a change of pace at work? Make a greater difference? Find more flexibility? Follow a passion? This is the most important part to get clear on, because it will guide your immediate next steps, career-wise.

2. Review your cashflow

To estimate the financial implications of a transition, you have to start with a clear picture of your finances today. A big part of that is cashflow — what’s coming in, and what’s going out.

The first piece, of course, is the salary or income associated with the role you’re considering leaving. (Pretty straightforward.) The second piece will take a little more digging: What are your current expenses? How much of that is necessary or truly valued? Which are fixed, and which are variable?

Finally, if you change jobs, how will those expenses change? Consider the cost of health insurance, the amount you’re contributing to tax-advantaged retirement accounts, and so on.

3. Financial planning

This is where the goals and the numbers really come together, and where your financial advisor will be an especially invaluable partner. Together, you’ll consider decisions like:

  • How much will you work? How much will that earn you?

  • How much will you spend? More than today, less, or the same?

  • What will your lifestyle look like? Will your cost of living change?

From there, financial planning helps you understand and compare your options. Your advisor can show you how various potential paths could impact your finances, in both the short and long term. They aren’t there to tell you what to do — just give you the info you need to make a more confident choice on your own, and serve as a sounding board as you think it through.

4. Financial positioning

Next come the decisions about how you’ll manage your money and position your assets today in order to help make that future you’re envisioning possible. For example:

  • Do you have any big income milestones coming up, like bonus payouts or vesting dates? You’ll want to take those into account in the timing of your transition. If you decide it’s worth it to stay in your current role just a little bit longer, it could completely change your financial plan.

  • Does your investment portfolio’s asset allocation make sense, given that you’re about to make a major change? Does it need to be more conservative while your life is less certain? If you take a more conservative approach, can you completely cover your income needs? Should you be in muni bonds, or maybe corporate bonds? Should you (strategically) liquidate some of it to float you through inconsistent (or lower) income? Or will you now need a portfolio that focuses on income — for income replacement?

  • Are you properly diversified? Will exercising options put you in a concentrated position? If you need to rebalance or make other changes to your portfolio, your advisor should also be able to collaborate with your CPA to make sure each action is executed thoughtfully from a tax perspective.

5. Manage and evaluate benefits

When you leave a job, you’ll of course be leaving certain compensation benefits behind. You’ll have some decisions to make that your financial advisor can help you think through. For example, if you have equity options, what should you do with them? Some deferred compensation plans pay lump sums when you leave — how will that impact your tax year?

Another big one: the 401(k) sponsored by your old employer. You could leave it where it is, although you’ll lose control over what it’s invested in. You could roll it over into a new 401(k), if you have another job lined up and that employer’s plan allows it. Or, if you want greater control, better cohesion with the rest of your portfolio, and professional strategic management, your financial advisor can help you invest it any way you want (into investments that align with your values, for example).

And then, once you have something new lined up (if that’s what you want!), there will be potential new benefits to evaluate: the tax advantages of a new 401(k), employee stock purchase plans, restricted stock units, and so on. Your financial advisor can help you make those decisions, too.

You don’t have to do this alone

You’d consult your company’s board before making major business decisions, wouldn’t you? Do the same for your personal life. This is exactly the kind of thing financial advisors and executive coaches are here for — and Ellevest Private Wealth can help.


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Ashley Bleckner

Ashley joined Ellevest after 8 years’ experience helping high net worth clients toward their financial goals. Today, she’s a financial advisor on Ellevest’s Private Wealth Management team, working with clients to help them develop personalized long-term investment plans that align with their goals and values.