I am currently underemployed by my current company. When I started out in their training program I was told I would have the opportunity to work in a variety of different departments. I loved this training program and was very happy, using my knowledge and skill from my degree. After finishing, however, the only open positions were in a department that does not only not utilize my degree, but also makes me flat out miserable.
I have been so miserable, that only a few months into this new role, I started applying elsewhere. I was given an offer from a different (non-competitor) company that is in a location I love, a better salary, will use my degree, and more importantly, accelerate my career by about 3-5 years.
Sounds perfect, right? Well, the only problem is I signed a relocation payback agreement with my current company and I’m in the hole for around $20,000. A colleague of mine who left the company told me that they allowed him to repay on a monthly plan and I am sure they will do the same for me.
However, he owes the company much less and I already have student loan debt. I know you are not here to give financial advice, but would you suggest making a move to advance a career if it puts the person in debt?
First of all, I hate debt. It eats at your soul. It binds you to people you don’t wish to be bound to. It’s horrible and my official policy is that you should only go into debt for 3 things: Housing (within your means!), education (again, no $150,000 loans for a degree in basket weaving), and a functional car (no debt for a sports car). So, generally, you can expect my response to be, “suck it up, buttercup. You signed a relocation agreement and you’re stuck!”
But, nothing in real life is ever that simple. I’d say you should never, ever, go in debt for a vacation. But, if that vacation is to see your 92-year-old grandmother who is close to death and who raised you, then yeah, put those airplane tickets on a credit card. So, ask yourself the following questions.
1. Will the new company pay off the debt for me? This is not unusual, by the way. You must be pretty awesome for a company to offer you relocation worth $20k, so the new company probably thinks you’re pretty awesome as well. They may be willing to pay part or all of the debt.
2. How much is the salary difference? and How fast can I pay off the $20k? I’m sure the old company will allow you to make payments–it’s in their best interest to do so. But, if big new salary is $62k compared to the current salary of $60k, it’s going to take an awful long time to make up that difference. If it’s a $10,000 raise, then you can, obviously, pay it back faster. I certainly would be leery of anything you can’t pay back in a year. If you’re the type that spends, spends, spends, don’t do this. If you’re a disciplined soul who can live on rice and beans, then it’s not as bad of a deal.
3. Is the grass really greener? Your current position is awful. It doesn’t fit your skills. It’s not what you want to do. Clear. But, you’re supposed to work in a variety of departments. How much longer are you going to be in the awful role? Does it make sense to take on $20,000 worth of debt in order to get out of 6 months of work you don’t like? It wouldn’t be for me, but it might be for you. And, you came to this job convinced that this was the greatest thing since sliced bread and now it stinks. How do you know that the new job won’t turn out to be just as lousy–plus debt!
4. Is this a bridge you want to burn? You’re thinking of the relocation money. Repaying that brings you up morally and legally with the old company. This is swell. However, they’ve invested a lot more than relocation in you. You’ve been through a training program that undoubtedly cost the company more money than you earned for them in that training. While you don’t have to pay this back, you are seriously burning bridges by leaving so soon. Your current boss and the development program leaders are going to be loathe to give you a good reference, unless they recognize that they made the mistake in placing you in the wrong place. Don’t count on that.
5. Have you talked with your current boss? You’re in a rotational program. Is your current boss aware of your desire to move on? It may be possible to transfer you out tomorrow (well, not tomorrow, but still). Have you asked? You may be taking on huge debt to solve a problem that isn’t really a problem.
Think through these things and I think it will help you make a good decision.