As many of you know, I used to be an engineer (computer hardware) before I quit my corporate job to become a stay at home dad/blogger. Many readers come to this blog, Retire By 40, through the Why I gave up my engineering career post. It seems like there are quite a few engineers out there who are thinking about leaving their careers to do something else. I think engineers really should save up a freedom fund and keep their options open. Engineering is almost like a sports career where not many people can handle a 30-year engineering career. Let’s take a look at why engineers should plan for early retirement (or at least, a career change).
Of course, quitting engineering should be one of the last options you consider. Some less drastic measures include transferring to a different department, changing engineering jobs, or even finding a new company to work for. Some companies also let you try new roles such as marketing or sales which might be a better fit. Of course, if you tried some of these moves already and you’re still tired of engineering, then it’s probably time to move on.
I invested a lot of time and effort in my engineering career. I spent 5 years in college to get my BS and MS. My university had a great 5-year MS program and I took advantage of it by taking some MS level classes in my senior year to speed things up. Then I became a computer hardware engineer for exactly 16 years, building up my salary over that time. I started with less than $50,000 and eventually made a little over 6 figures. I also became an expert in my field and it felt good to be the go to guy.
Quitting engineering threw all that out the window since I can’t make a similar salary in other fields without a lot of training and experience. Was it worth it? The last 2 years have been one of the best periods in my adult life and it’s still great. We’ll see in the long run, but I’m pretty sure it was the right decision for me.
Plan for a short career
I enjoyed being an engineer when I first started my job, but now I think an engineer should plan for a relatively short career of 15 to 20 years. Many engineers start out loving their jobs, but you don’t know how things will be after a decade or two. It’s better to plan for a reduced income from the start so you’ll be prepared in case your career turns sour after a while. Saving and investing early is a great idea in any case.
Being an engineer can be pretty stressful. There are always deadlines to meet and if you’re the one holding up the product, the heat will turn up. Every company needs to get their product to the market as soon as possible because any delay means a loss of profit. Product cycles also seem to get shorter and shorter so engineers have much less down time.
High time commitment
At many companies, engineers are expected to work 50-70 hours/week with no overtime pay. This is fine when you’re young and single because you want to get ahead. I spent a lot of time at work when I first started and I didn’t mind at all. If you work late, the company usually provides dinner and snacks, so it can be pretty convenient for a single guy. Once you have a family, then you really don’t want to spend a lot of time at the office anymore. Although, these days it’s pretty easy to work from home so that’s what many engineers do.
When a product is pushing the deadline, then the managers would demand more output. If you refuse to work late, then you can be sure that will show up in your next annual review somehow.
There are thousands of young engineers graduating every year. They are younger, smarter, cheaper, and probably better looking than you. It’s easy to replace an engineer. Life will go on as usual even if the most crucial engineer leaves the project. Your ego will tell you that they can’t replace you that easily, but for most people, that’s not true.
Seniority is a two edged sword. You get paid more because you know more, but the company will also demand more from you. I knew many older engineers who got laid off because they got promoted to a higher grade and then their level of output no longer matched their pay. Companies need more from their senior level engineers. When you get to a certain level, you need to become a “multiplier.” That means you need to work through others and contribute more that way. Many engineers like tinkering with their code/hardware/products which is why they got into engineering in the first place. When you become a multiplier, you don’t get to work on what you like as much anymore.
As you become more senior, the company will expect you to take on more leadership roles. One career path is to become a manager. Some engineers are good at project management, but it seems most aren’t very good at managing people (that’s me.) This also takes you completely out of engineering, so it’s pretty much a career change. The other path is to become a senior engineer. This path will let you do some engineering stuff, but you’ll still spend a ton of time in meetings. From my experience, taking on more leadership roles will reduce your time to work as an engineer. (I’d like to hear from other engineers on this subject, though.)
Engineers get compensated pretty well and they have an opportunity to attain financial freedom earlier than many other careers. I started saving with my first regular paycheck and I was able to quit engineering after 16 years. We’re not quite financially independent yet, but we are getting there. If you are an engineer who follows the 8 essential things to do to retire early article, then it should be possible.
I’m sure there are other careers that have similar issues, but I think an engineer career really can’t last a life time anymore. This is especially true if you like doing the engineering work because as you progress up the career ladder, you won’t get to do much of it anymore. I guess you can try to go back to lower level positions, but then you’d have a lower salary and also you’d need to compete with younger workers even more.
What’s your career and does it have similar issues?
For 2018, Joe plans to diversify his passive income by investing in US heartland real estate through RealtyShares. He has 3 rental units in Portland and he believes the local market is getting overpriced.
Joe highly recommends Personal Capital for DIY investors. He logs on to Personal Capital almost daily to check his cash flow and net worth. They have many useful tools that will help every investor analyze their portfolio and plan for retirement.
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