Would you take a $20,000 or 12.5% pay cut for job satisfaction?

[Shelley]

Today DH got an interview for a job in government, which the base pay is $135,000, $20,000 less than his current position. His current pay is well above what he should be earning as a friend was in a management position and talked his boss into offering DH lots to get him there. But now he can't move anywhere, even within the company because they can get others for so much cheaper.

He is stuck working in a job he has come to loathe, with all but one of his colleagues moving to other projects that won't take on DH because of his costs. There is the possibility of a redundancy one day, which would be a $50,000 pay out but it could be years away.

So I was wondering, would you do it? DH really has no choice if he wants to not have a mental breakdown, it will be a set back in his steps to retirement, but at least he will not be burnt out in the next few years. I'm so grateful I found MMM this year or money wise we couldn't have coped!

[partgypsy]

Today DH got an interview for a job in government, which the base pay is $135,000, $20,000 less than his current position. His current pay is well above what he should be earning as a friend was in a management position and talked his boss into offering DH lots to get him there. But now he can't move anywhere, even within the company because they can get others for so much cheaper.

He is stuck working in a job he has come to loathe, with all but one of his colleagues moving to other projects that won't take on DH because of his costs. There is the possibility of a redundancy one day, which would be a $50,000 pay out but it could be years away.

So I was wondering, would you do it? DH really has no choice if he wants to not have a mental breakdown, it will be a set back in his steps to retirement, but at least he will not be burnt out in the next few years. I'm so grateful I found MMM this year or money wise we couldn't have coped!

Seems like a no-brainer. Take the job that still is very very good pay, but won't give him a mental breakdown. What is the issue?

[dandarc]

Kinda-sorta have done it.  Same job, less hours = about $20K less and a happier dandarc.  135K is still a fuck-ton of money.

I'd say go for it.

[SaskyStache]

Today DH got an interview for a job in government, which the base pay is $135,000, $20,000 less than his current position. His current pay is well above what he should be earning as a friend was in a management position and talked his boss into offering DH lots to get him there. But now he can't move anywhere, even within the company because they can get others for so much cheaper.

He is stuck working in a job he has come to loathe, with all but one of his colleagues moving to other projects that won't take on DH because of his costs. There is the possibility of a redundancy one day, which would be a $50,000 pay out but it could be years away.

So I was wondering, would you do it? DH really has no choice if he wants to not have a mental breakdown, it will be a set back in his steps to retirement, but at least he will not be burnt out in the next few years. I'm so grateful I found MMM this year or money wise we couldn't have coped!

Seems like a no-brainer. Take the job that still is very very good pay, but won't give him a mental breakdown. What is the issue?

+1

[Shelley]

Definitely a no brainer, I agree. And it is a lot of money. I just think of four months ago when we were spending every cent of it, and not understanding why we couldn't save any. And now we can put away $2000 a month just from small changes, with more to come as contracts on phones etc end. I can't believe we had all that money for the last four years and wasted so much of it.

[2Birds1Stone]

NO brainer, go for it.

[Shelley]

Kinda-sorta have done it.  Same job, less hours = about $20K less and a happier dandarc.  135K is still a fuck-ton of money.

I'd say go for it.

Fantastic dandarc, it's great to know it can work out, with no regrets. It's a very tough, almost emotional decision for him to make as he knows he will be providing less, but also because he knows we've been working hard to claw back the savings we were throwing away before, and he sees it as a step back... I just have to keep being positive and telling him no worries!

[moonpalace]

I did this (although my $20,000 pay cut was more like 25%) about six years ago and I've never regretted it for a second. Truly. Not a single second.

It was only this year that I got back to making what I made when I left the loathsome job, but I'd do it all again in a heartbeat.

And my wife, if she were on here, would only amplify that!

[Spork]

I took about a 40% pay cut for similar reasons....  (and that was a LOT less than $135k).

[ltt]

Absolutely.

[Shelley]

I did this (although my $20,000 pay cut was more like 25%) about six years ago and I've never regretted it for a second. Truly. Not a single second.

It was only this year that I got back to making what I made when I left the loathsome job, but I'd do it all again in a heartbeat.

And my wife, if she were on here, would only amplify that!

Thank you Gavin, I will share some of these stories with him tonight and hopefully he will be less worried about it. Silly thing is he has worked for the current company before and hated it, and went back when offered $50,000 more than he was on before he left. And there was another time before that as well, so this is his third time with the same company. I guess because they are such a huge IT employer. It has that reputation apparently of being every second job for the rest of your life. I hope he doesn't go back again, as his part of it has recently been bought out by another company with a very nasty reputation towards employees.

[tomsang]

Today DH got an interview for a job in government,

What type of government are we talking about?  If it is federal, I would probably keep looking based on the GOP's desire to chop the government down significantly. 

Another thing to really understand is the environment that he will be exposed to.  I know a number of people that say that working for the government is very mind numbing and hard to deal with.  Typically there are no raises in government jobs and if you have a year where raises are given they tend to be cost of living raises.  You don't want to jump from one bad environment to the next. 

Does his salary include all of the government perks?  IE will he be eligible for a pension?  If he is eligible his total compensation may be higher than he is currently making. 

Good luck. 

[Shelley]

Oh, I forgot to put that we are in Australia. It's state government. There is some defined benefit plan which I don't understand. And if he puts in 5% superannuation he will get 12.75% instead of the normal 9.5%. Plus some multiplier for the defined benefit which is a mystery. I might have to put a post up asking if anyone knows how it works, if he gets the job! But we will have to wait and see, because while it is government, it seems to be some strange offshoot that doesn't have a government website.

[marty998]

$20k cut reduces to a a $14k cut after tax remember.

Might delay your retirement plans a year or two but it's infinitely better than being unhappy.

[snogirl]

Yes. Did it. Actually I quit and started my own business. Never been happier.

Sent from my XT1650 using Tapatalk

[stashgrower]

I reckon it's worth the mental health benefits. I've left work that pays lower than that.

[alsoknownasDean]

I'll join the 'take it' crowd.

The advantage of Mustachianism is that you have the freedom to leave jobs that are higher-paying but incredibly stressful if you need to, because you're not spending every cent you bring in (or more) :)

I feel for the poor bastards chained to the high-stress job because of their high-consumption lifestyles. They might have taken the blue pill of super-consumerism, but they're often not happy.

And as Marty said, $20K would be less than that net of tax (and it might push you back under some thresholds for things such as the private health insurance rebates).

MMM says it all here :)

http://www.mrmoneymustache.com/2014/11/23/not-extreme-frugality/
http://www.mrmoneymustache.com/2016/06/08/happiness-is-the-only-logical-pursuit/

[Tetsuya Hondo]

I did it. Glad I did it.

[ringer707]

I took a 15% paycut a year ago for a government job. I have never regretted it for one second. One of my former coworkers is trying to leave my old workplace and asked me if there was anything looking back that I now thought to myself "well it wasn't really that bad considering I made more." Nope. Literally everything about my new job is better. Things were tight for us for a while as we were trying to pay down some debt, but I still don't regret it.

[NorthernBlitz]

Does his salary include all of the government perks?  IE will he be eligible for a pension?  If he is eligible his total compensation may be higher than he is currently making. 

This.

My bet is that if you look at "total compensation" the government job will look better than it does if you just look at salary. My guess is that it also has better job security, especially if the current view is that he is paid too much for what he is delivering (as your post seems to imply). Not sure if it's the same in Australia.

[DavidDoes]

I did it on a much larger scale. I was making $25/hr for a position that required only experience, no certifications or degrees. I busted my butt to get to that position, and ended up absolutely hating it. Now, two years later, I'm still making way less, but I'm so much happier.

Today, I had to skip out in the middle of work to go get my child from school. She ended up getting the stomach flu. Also, I now have more time to focus on learning how to code – something I've wanted to do for so long, and something that will lead to an income of ~2x what I was making two years ago.

All that said, if my wife and I were in your position, I would ask, How close are we to Financial Independence? If the answer is pretty close (within a couple years), I'd stick it out with the job. But even then, I wouldn't knock myself if I chose to go for something that might mean higher satisfaction and lower stress, especially if I'm still making over $100,000/year.