How will my new job affect my finances?

Whether you’re going back to work after time off, bouncing back from a layoff or moving to a better opportunity, switching jobs during your career has become almost unavoidable. And since a new job may mean a new salary, it’s a good time to make some adjustments to your financial plan.

You’re making less
If you’re taking your skills from one industry to another (like corporate to nonprofit), there’s a good chance your paycheck will be smaller. If you find yourself bringing home less bacon, adjust your budget to compensate.

• Cut back on expenses. Make a budget to help you see what’s necessary and where you can cut back. Remember, small changes can make a big difference.

• Adjust withholdings. Tax refunds are great, unless you really needed that money during the year. Ask your tax professional about the best way to adjust the withholdings on your paycheck so you can bump up your take-home pay.

• Stay invested. Even if you can’t contribute as much to your retirement account, try to keep adding to it with the same percentage of salary as before. And resist borrowing from your retirement savings! Early withdrawals can have consequences that can hurt you in the long run.

You’re making the same
Changing jobs doesn’t always change your income. But don’t overlook how the switch could affect you in other ways financially. There could be hidden costs, as well as welcome savings.

• Think beyond the paycheck. Did your commute change? Will your old wardrobe work for your new position? Does your child care arrangement still work? Make a list of any hidden costs at your new job and make adjustments to avoid surprises.

• Check on retirement. Learn all about your company’s retirement plan and the investment options offered. Ask about the company match for your 401(k), and make sure you qualify. A fresh start is also a good time to review your strategy and confirm you’re on track for your timeline.

• Simplify your banking. Be sure to set up all your direct deposit information with your new employer. Link your accounts, and continue putting aside part of your paycheck for savings and retirement before you even see it.

You’re making more
Congratulations on making the big(ger) bucks! After you celebrate, get smart with that “extra” money.

• Build your emergency fund. Pad your cushion of savings in case you find yourself between jobs. Plus, you’ll be able to handle sudden setbacks like a broken-down car or leaky roof without using your credit card.

• Pay off debt. Whether it’s from student loans, credit cards or your mortgage, paying more than the minimum makes a big difference. Stop paying interest, and start earning it instead.

• Accelerate retirement savings. Even if you love your job, it might be nice to plan to retire early. If you can get by on your past salary, put aside the additional funds — or a portion of them — for your future.

• Look beyond retirement. Once you’re contributing the maximum to your retirement accounts, consider investing for other long-term goals. A 529 education savings plan, for instance, could be a big help to a child or grandchild.

• Take advantage of pretax perks. If your company offers benefits like flexible spending accounts for health care or child care, think about earmarking a portion of each paycheck to pay for those costs over time.