Is It Worth Keeping Your Job?

This weekend I was talking to one of my friends and he had a very interesting predicament. Was he winning or losing working at his current employer at his current salary? He has a bachelor’s degree in administration, he’s been working for over one year now as an administrative agent for a large accounting firm.

Let’s go over his salary, deductions and then his cost. He makes 36,000$ per year (the national average is a little lower than that). In Canada we might get free health care but we are taxed heavily. He gets two paychecks per month, 1500$ each, and after deductions he get about $1100 per pay period (24 pay periods per year). He moved to the suburbs to save on the purchase price of a house (like many others do) and to have a nicer quality of life. The main reason was that most houses he liked in the city were just too expensive. Prior of moving out of the city core he never owned a car and always used public transportation, but because of his work located in downtown Montreal he had to purchase a vehicle.

Now that we know how much he makes let’s look at his costs related to working:
All prices includes taxes and are rounded up

His car : 400$ per month
Insurance 150$ per month
Gas per month : 240$ per month (and going up!)
Monthly parking downtown: 160$ per month
Snacks/food downtown (company suppers, happy hour, etc.) : 200$ per month
Clothes for work (suits, shoes, etc..): 100$ per month

1250$ per month goes for just getting to work and being at work, and this cost does not even include the cost related for maintenance on his car.

One of his pay checks goes to pay for expenses to go to his work and to come back. His mortgage payment is 600$ per month, so this gives him about 350$ for groceries and other expenses. Considering we haven’t talked about saving money, or even other expenses such as internet, cable, heating and electricity. Is it really worth going to work in these conditions ? If his salary would be 40k a year it would give him an additional 200$ per month, yet it does not help much.

After these quick numbers I told him let’s look at this on a different perspective. If you were to work in the suburb close to your home, even if it’s a job in a Home Depot or any large retail chain (that pays more than minimum wage) that opened beside your home and get rid of your car how much money would you have to spend after all recurring expenses ?

Let’s have a look shall we:

0$ for the car
0$ for insurance
0$ for petrol
0$ for parking
Can go eat lunches at home, again 0$
No need to spend money on special type of clothe you probably have a uniform.

Total expense for getting to work and being at work: 0$

Considering Home Depot or any large retailers don’t pay much, let’s say he has a 12$ per hour salary. That’s 800$ per pay period after taxes, take out his housing payment and he is left with 1000$ per month for his other purchases, compared with only $350 with his job downtown.

Not only would he SAVE MONEY by working close to home and in a totally different field, but this does not include his new benefits of no more traffic jams, waking up later each morning, eating at home which means healthier lunches, etc. It would take him 10 minutes to get to work compared to 1 hour right now each morning and the time it takes you to get to work is not paid, you have to disburse to get there yourself.

What we need to learn from this:

1- Public transport is the key

If my friend would have moved close to a metro or suburb train station he could save a lot of money. His parking and the gas price does add up, and the cost is insanely high.

2- Live close to work

Going to work is something you do on a daily basis, I don’t get it when people move AWAY from their work. Just doesn’t make sense to me. Live as close to work as possible and you will save a bundle!

3- Keep expenses at the minimum

Just like a business you always need to keep your monthly expensive as low as possible.

4- Our choices affects our life therefore we must think and plan before we act

We need to be smart about the decisions we take, each decision will affect us and it’s crucial to think about every possible outcome.

I hope this helps to put your life and work in perspective. I hope you will make the right choices in your life & not to live the same situation as my friend. Seriously, when you could technically save more money and have less stress and more time on your hands by working a general job in your neighborhood than by working in a prestigious firm downtown, we need to assess our situation with a lot more scrutiny.