The COVID-19 pandemic has challenged families around the globe, with a disproportionately large burden falling on the shoulders of women. This ongoing crisis has exacerbated demands on women who juggle the responsibilities of a career with a primary caregiver role at home. Women in corporate careers face difficult choices amid the global pandemic. Before you make any major career moves, you should know to consider all your options and consider the long-term consequences. Here are some considerations to take into account:
What should women consider before “stepping back” from work?
According to a recent report from McKinsey, one in four women have considered “downshifting their careers or leaving the workforce” due to lack of flexibility at work, housework and caregiving burdens, and burnout. And in fact, a whopping $2.4 million women left the workforce during the pandemic (compared to 1.8 million men). Every situation is unique, and the decision to make a career change is a deeply personal and individual one. Before moving forward with a career exit or major downshift, there may be smaller steps you can take to alleviate the pressures of balancing work and family — both financially and otherwise.
For starters, reaching out to your employer to discuss your concerns may yield a modified working arrangement that meets your needs, such as reduced hours or flex time, or remote work. You may also be entitled to benefits or other resources to help reduce feelings of burnout and financial anxiety.
Contemplate a career change from every angle.
If leaving the workforce or scaling back to a part-time role still feels like the best solution, it’s important to examine the complex implications of that decision for your personal life, your career, and your finances.
Involve your partner – While it is most often women who make changes in their professional lives in response to COVID-19, involving your spouse or partner in your plans is crucial. Both parties need to understand your household’s current financial situation, your collective goals, and the pros and cons of your decisions.
Map out your budget – From a financial standpoint, there may be budget adjustments within your control that will make reducing hours at work more financially feasible. Take stock of the cash flow basics: your income vs. your spending, where the money is going each month, and where you can easily reduce expenses. If you are in a two-income household, is your partner’s income sufficient to support your family’s needs?
Consider the retirement impact – If you decide to shift to part-time work, will that change or reduce access to benefits you and your family receive from your employer (health insurance, group life or disability insurance, or a 401(k) match)? You should also determine if you can still afford to contribute the same amount to your retirement account if your income is reduced. And if you take time out of the workforce altogether, are you going to be able to continue saving for retirement outside of a corporate retirement plan?
Impact on social security benefits – If you take time out of the workforce or work part-time, you may end up accruing less work credits. Less earnings years means benefits could be reduced.
Who Can Women Turn to for Help?
For women balancing careers and families, the COVID-19 pandemic has piled additional burdens onto plates that were already full. No matter how you ultimately navigate these challenges, taking stock of all your options, involving your partner and your financial adviser in planning, and making decisions that are rooted in your long-term goals can help ensure the best possible outcomes for you and your family.