Career Change ROI Tool
Analyze the financial viability of a career change. This tool helps you estimate the return on investment by comparing your old salary to your new potential, factoring in training costs and time.
Quick Use Samples
Current Career
New Career & Transition
Return on Investment
Payback Period
3.3 years
Time until your investment pays for itself.
This career change represents a total upfront investment of $70,000. This includes both direct education costs and the opportunity cost of lost income while re-skilling. You are projected to financially break even on this investment in approximately 3.3 years. After this point, you begin to see a positive financial return. Over a 10-year period, the total financial gain from this career change is estimated to be $200,000, representing a 286% return on your initial investment. The chart below visualizes how your cumulative earnings in the new career eventually overtake your current career path.
Cumulative Earnings Projection
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What is a Career Change ROI?
A Career Change Return on Investment (ROI) analysis helps you evaluate the financial viability of switching careers. It compares the upfront costs of a career change (like education fees and lost income during study) against the potential long-term financial benefits of a higher salary in your new field.
Behind the Formula
The tool calculates the total investment of your career change, including tuition fees and the opportunity cost of lost income while you are retraining. It then projects your future earnings in both your old and new career paths over time. The 'break-even point' is calculated to show how many years it will take for the higher salary in your new career to pay back your initial investment.
Expert Insights
- The younger you are, the higher the potential ROI of a career change, as you have more working years to benefit from the higher salary. For someone in their late 40s or 50s, a costly career change may not have enough time to pay for itself.
- Non-financial factors are extremely important in a career change decision. A lower-paying but more fulfilling career might offer a better 'life ROI' than a high-paying but stressful one. This calculator should be one tool in your decision-making process, not the only one.
- Consider career changes that build on your existing skills. A transition that requires a short TAFE course is much less costly and has a faster ROI than one that requires a full three-year university degree from scratch.
Actionable Tips
- Research the starting and mid-career salaries for your target profession thoroughly. Use reputable sources like government job outlook data and industry salary surveys for the most accurate projections.
- Look for ways to reduce the upfront cost of your career change, such as studying part-time while you continue to work, or choosing an online course with lower fees.
- Talk to people who are already working in your target career. They can provide a realistic picture of the day-to-day work, career progression, and true salary potential, which is more valuable than just looking at statistics.
Real-World Examples
A Retail Manager Becoming a Software Developer
A manager invests $20,000 and one year of lost income to complete a coding bootcamp. The calculator shows that with a much higher starting salary and faster growth in the tech industry, they could break even on their investment in just 4 years.
An Administrator Becoming a Nurse
Someone considers a three-year nursing degree. The tool shows that due to the significant loss of income over three years, the financial break-even point is over 10 years away. The decision to proceed is based more on a desire for meaningful work than a purely financial ROI.
An Accountant Specialising in a New Field
An accountant completes a 6-month online certificate in data analytics for $5,000 while still working. This allows them to move into a higher-paying role with a very fast ROI, as the investment cost was low and there was no lost income.
Glossary of Terms
Return on Investment (ROI)
A performance measure used to evaluate the efficiency of an investment. It is the benefit (or return) of an investment divided by its cost.
Opportunity Cost
The value of the next-best alternative that was given up. In a career change, the lost income from your old job while you study is a major opportunity cost.
Break-Even Point
The point at which the gains from a new venture (like a new career) equal the total costs of pursuing it.