There are few occasions in life so filled with optimism—and stress—as leaving one company to join another. Regardless of how common career moves are, the tactical skill and emotional fortitude required is anything but typical.
The stakes are high, and as a result, mistakes are often made. Here are three rules to follow to help ensure that you make the most of this major life event, personally and professionally.
1. Leave well. “It’s more important to leave well than it is to start well,” a good friend once told me. And it’s true. You’ve already made a good impression on your new company—you got the job!
But while you’re heading on to new and exciting adventures, your former employer is left to deal with the rejection and cleanup from your departure.
Make it easier by offering to stay on for a reasonable period of time, but not longer. In most cases, shorter is better for all parties, as it reduces the awkwardness and hastens the healing.
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Part of leaving well is preparing to deal with impulsive counterattacks mounted consciously or unconsciously by your former co-workers.
The words “I’m leaving” may magically transform you from friend to foe—especially if you brought or maintained client relationships—but let that be your former co-workers’ choice, not yours. Take the high road whenever possible.
For most, the sensible choice is to aggregate the newly antiquated 401(k) plan with other prior plans in the form of a direct rollover to an IRA. In this case, you are not limited to the investment options in the new 401(k)—options that are notoriously mediocre. Be certain to check all the right boxes to ensure that your rollover is not a taxable event.
It’s also important to take stock of any company benefits that are transferable. Although they are nearly extinct, pension plans of various sorts accrued during your tenure may do nothing for you now but could be meaningful in the future.
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One client recently wondered whether she’d left a small pension behind from a previous job. I encouraged her to call the company’s human resources department, and indeed, there was $9,000 sitting in a plan earning 3 percent per year that she can’t touch for another 15 years.
If you’re blessed enough to have annual income in excess of your saving and spending needs, you may have a qualified or non-qualified deferred compensation plan to handle. And while also rare, there are occasions in which group benefits—such as life, disability income or long-term care insurance through your company—can also be traversed to private policies with the vendor.
3. Make the most of your fresh start. Nobody’s perfect—including you. But as the saintly image of yourself you’ve been promoting to your new company starts to settle into something closer to reality, you do have an opportunity to trade some bad habits for good ones.
Take advantage of this clean slate by embracing the time-management method that’s worked so well for that efficient friend of yours, or finally start using a system to seize control of your email inbox.
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Develop a healthier rhythm of life and work. Be careful not to overextend yourself at the beginning of the new gig, lest you set expectations you’ll never be able to live up to.
Make wise choices with your new benefits package. Increase your 401(k) contribution to the level you know you should be saving, and put sufficient time into really understanding the new investment options and determining the optimal mix for you. Don’t forget to add beneficiaries to your new 401(k) plan and any group life-insurance coverage in the new benefits package.
“A job change navigated well can be an amazing personal and professional launchpad, especially when you leave on good terms.”
As you review your group benefits—especially health, life and long-term disability-income insurance—be sure to actually understand them and acknowledge whether or not you should be supplementing them privately. (You can be almost sure that the base level of free life and disability-income insurance is insufficient.)
Consider opening your mind to a high-deductible health plan, which gives you the option to utilize a Health Savings Account (HSA). Many assume this is too complicated or costly, especially if you have a young family, but even in that case, this can be a great way to make nearly all of your household medical expenses tax-deductible.
While certainly stressful, a job change navigated well can be an amazing personal and professional launchpad, especially when you leave on good terms. So don’t leave anything behind, and take full advantage of the fresh start.