Why I Turned Down A £76k Job Offer And How I Calculated The Real Value Of My Job

Recently I completed a series of interviews and was made an offer with a base salary just over £76,000 a year, which would've been a pretty big raise on paper, but I turned it down.


In terms of financial independence it may not make sense to turn down a higher salary, but the real value of a job isn't only determined by the base salary and the bonuses you can earn. Flexibility, commute time, and annual leave entitlement can be calculated in terms of days that you'll have back for yourself which would hold a certain value in monetary terms. In addition to this you should consider other factors such as the costs of socialising with your colleagues, job satisfaction, job security, and relationships you've managed to forge over the years at your current company. When taking all of these things into account you may find that an offer with a bigger number isn't necessarily always the best thing to take.





An invite to apply


Not long ago I was messaged on LinkedIn by a founder of a technology company asking if I was interested in applying for a job as their product manager.


It was a slight surprise to me because I wasn't exactly on the hunt for a new job but the salary range was attractive enough to make me curious, with the higher end of their scale being more than what I was being paid in my current role - so I decided to check it out.


Needless to say, a big salary always comes with big responsibilities and the need to make a positive impact right from the get-go; nobody is going to wait patiently for you to "learn the ropes" like you're a fresh graduate.


Therefore the interview process was extremely rigorous and really pushed to ensure any candidate had the right skillset and could demonstrate them during the tasks they set.


In all honesty, the tasks really highlighted some weaknesses in my game that I already knew about in general - and the interviewers definitely caught on to them quickly. Naturally this was raised during the discussions that followed after the tasks.


To counter-balance this however, I demonstrated other skills and capabilities that are not all that easy to obtain or even learn - the soft skills that really allow a product manager to empathise and listen to a customer and thus make a better end product that they love.


Thanks to this I was ultimately offered the job over an alternative candidate who showed more of the "industry best practice" skills but less of the softer skills that I wield.


They offered the number that I asked for, which was HKD70,000 per month, which equates to a salary of just over £76,000 annually in GBP terms. On paper this was definitely a raise - but despite that fact the offer wasn't as easy to take as I originally expected.



Total flexibility


My current work set up is rather peculiar - I work for a British company and started out as just a regular member of staff based in London, where I lived at the time. However, back in 2019 I decided to move to Hong Kong - where I have residency - and now I'm basically an offshore resource who has almost 100% control of their own schedule.


For example, right now as I'm writing this part of the article it's around 9:30AM on a Tuesday morning - I intend to get the bulk of this article written up today before moving onto any work for my job, which I'll probably start at around 3PM.


I also have some personal errands to run - laundry, grocery shopping, cleaning, and general miscellaneous things since I've recently moved homes - which I'll spend a bit of time doing just after lunch time.


I might even go for a brief run or do a workout before settling in for my "day of work".


The late start and finish is fairly typical for my Mondays and Tuesdays as I will attend check in calls with the UK and US teams during their morning hours, but Wednesday onwards I'm back to my own local hours and managing my time however I want.


In a nutshell as long as I'm delivering my work on time and to standard, nobody is going to be asking too many questions about what I'm doing during my day - which I feel that gives me quite a solid work life balance overall.


In the new job I would find myself locked back into an "office schedule" where I would be expected to turn up at 9AM and still be in the office at around 6PM.


The amount of hours I work would likely be similar but the loss of flexibility would make it seem like I had no time left in my day for anything else. It would all get pushed back due to me being "stuck at work" or too drained after getting home, meaning I'd need to catch up over the weekend when I had some "time off".


Obviously it's hard to quantify this accurately but let's say a person who needs to go into the office spends about a day every 2 weeks catching up on personal errands that they couldn't do while at work - that would come to around 26 days across the entire year.



The shortest commute


Ironically as the person in my current company who lives the furthest away - over 9,000 km - I have the shortest commute to work as I can simply roll out of bed and walk into my office room.


On a typical morning I'll get out of bed at around 7AM, after waking up at 6AM to listen to an audiobook.


I then make my way into the kitchen to put on some coffee before going over to the bathroom to brush my teeth and freshen up.


Next I pour a mug of coffee for myself and my fiancée before sitting down in my office room.


All of this takes roughly 5 minutes in total - unless I spend a bit of time with my fiancée while she gets herself ready to go to work. I do this every day so let's call it 15 minutes.


There was no need to be cramped on public transport, rush in the morning, or worry about forgetting something at home.


Compare this to needing to head into an office if I took the new job - I'd probably wake up at a similar time in the morning but I'd need to spend around 45 minutes travelling into work and another 45 minutes travelling home.


That's assuming no delays or waiting time due to too many people trying to get on board.


Every day I'd lose 90 minutes, which would be roughly 23,400 minutes over the course of a year (90 minutes x 5 days x 52 weeks). In other words, 390 hours or just over 16 days.



Homes in Hong Kong are really small but in this case it simply shortens the commute to work. Do you recognise the article on my screen? Image credit: FI Scribbles.
Homes in Hong Kong are really small but in this case it simply shortens the commute to work. Do you recognise the article on my screen? Image credit: FI Scribbles.


Paid annual leave and statutory holidays


It turns out that the UK is much more generous when it comes to paid annual leave in comparison to Hong Kong - even when taking into account that there are more statutory public holidays in Hong Kong.


In the UK you're entitled to 28 days of paid annual leave, which can include the 8 days of bank holidays and public holidays throughout the year. So you have 20 days left to take in your own time.


In Hong Kong you only get 7 days of paid annual leave that you can take in your own time, but you also get 12 statutory holidays that occur throughout the year. Which means in total you get 19 days off.


As is normal, the number of days you can get off will increase in both the UK and Hong Kong as you spend more time working at a company. It's generally quite normal to see a person in the UK being entitled to 25 days holiday (not including public holidays) after around 5 years of service whereas in Hong Kong you will get up to 14 days holiday after 9 years of service.


This would mean the "maximum" days off a person could have in a year would be at 33 days for the UK, or 26 days in Hong Kong.


Now comes my own situation - I have a UK contract so I still have my 25 days of annual leave that I can take whenever I want, but I get to enjoy Hong Kong's public holiday schedule. This was something my boss kindly agreed to and it effectively means I have 37 days of annual leave in total.


If I were to take the new job I'd find myself down at 19 days which would equate to a loss of 18 days holiday.


Those days lost really are starting to rack up don't you think?



The costs of socialising in the office


I don't want to sound like a boring person who dislikes socialising in the office - in fact I really enjoyed it when I was back in London and one of the best things was going out for a beer after a hard week of work - but there are costs associated with such things.


Grabbing lunch from the deli or café.


Grabbing a few beers after work.


Ending up going to eat dinner together with colleagues because it's already 8PM and the thought of heating up what I bulk cooked on the weekend simply wasn't appealing.


Admittedly I managed to get quite disciplined when it came to preparing my own food but there would still be the occasional temptation - which I suppose isn't all that bad on the bigger picture. Can't be eating the same old boring meal day in day out after all.


But the beers was where the biggest spend would happen. Even after setting some spending rules and limits for myself it would still be very easy for me to go "over budget" each month.


Now, being someone who's completely remote, staying within budget is never a problem.


I'll still have a beer on a Friday evening to wind down, but the difference is I'll be drinking with my fiancée at home instead of in a pub or at a bar. 2 large cans of beers costs around HKD27 (£2.50) which is a fraction of the cost of a single pint from a pub in London.


We drink one each while eating dinner and that'll be all the alcohol we drink for the week.


Needless to say, this keeps my wallet fatter and my belly slimmer. A win-win combination.


I imagine that if I had taken the new job I would've found myself needing to find a new balance between keeping my costs low while still doing enough socialising with my new colleagues. I'm sure that a balance would've been found in time, but the transition period and the new normal would almost have certainly resulted in higher costs over the long term.



Back in London we'd often go to the pub, but sometimes we'd glam things up by getting cocktails instead. Image credit: FI Scribbles
Back in London we'd often go to the pub, but sometimes we'd glam things up by getting cocktails instead. Image credit: FI Scribbles


Job security and job satisfaction


Another thing I took into account during my deliberation was job security and job satisfaction at my current company.


Naturally there are some periods where I become frustrated - perhaps a project isn't going well or certain team members aren't carrying their weight which means I need to pick up their work. But overall I have it pretty good if I'm to be really honest.


I'm familiar with the work I do and I know how to do it.


There's learning and growth opportunities.


My current salary is relatively good, much higher than the averages in both London and Hong Kong, albeit lower than the £76k that was on offer.


Plus I have a good reputation among all my colleagues and clients.


I also know that if I screw something up (by accident) it won't lead to me losing my job. Unless it was something really extreme but that would apply to anyone anywhere.


With this sense of security I know that I'm more financially secure and able to handle some of the big ticket items coming my way, such as paying for a wedding.


In the new company almost none of this would have been available - the salary being the only exception.


While I'm sure I could've got up to speed and established myself as a valuable member of the company there would definitely have been less certainty and security over my future.


If something happened which cost me my job, I would've found myself needing to find a replacement quite quickly in order to maintain my progress towards financial independence. And at worst, the whole situation could wipe out any potential gains I made from the higher salary.



Tallying up all the costs


Now that I've worked through the various costs and trade-offs that crossed my mind I can now tally things up to give you a fuller picture.


In terms of flexibility the estimate was around 26 days lost in a year. An additional 16 days would've been spent each year on commuting alone. 18 more days would've been lost in terms of paid annual leave.


Adding all of that up it would come to 60 days in the whole year.


A person earning £50,000 a year makes roughly £200 a day, based on there being 256 working days in a year in the UK.


I'm above this but let's use that as the working number - that would put the value of those 60 days at £12,000. Not a small amount to lose.


Let's also estimate around £2 per day spent on commuting to work; public transport is rather cheap in Hong Kong. 256 working days at £2 comes to just over £500.


Socialising costs is harder to quantify because it really depends on the people and a number of other factors, but I think a fair estimate could be £100 a month, or £1,200 a year.


I don't know a good way to price in job security and job satisfaction, but both of these things would definitely amplify the value of my current salary by a certain percentage. If I were to simply say both of these things represented an additional 5% then it would mean my salary would be boosted by roughly 10% in terms of the value to me.


Meaning a £50,000 salary - for example - would be equivalent to a £55,000 salary in another company where job satisfaction or job security was uncertain.


An easy way to bake this in would be to say the cost of a day is £220 instead of £200, which would mean the 60 days from above would actually be worth around £13,200.


Total cost at the end would therefore be: £14,900.

(£13,200 + £500 + £1,200)


This ultimately means that the £76,000 salary offer on the table is actually only worth about £61,100.


Keeping in mind that the cost per day I've used in my calculation is lower than the real number, so the offer on the table is actually worth even less to me.





Refusing the offer


Now I don't mean to scoff at an offer of £76,000 because this is undoubtedly a good salary and many people, myself included, would be doing very well with this. But now it's easy to see that the value of the offer isn't as good as what it seemed to be on paper.


However, even at this point I was still on the fence.


Getting a job in Hong Kong would represent a number of things on a personal level and effectively "complete my move" here. It would also make a long-time wish of one day working in Hong Kong come to reality.


I suppose this latter point is already done since I live and work here but there still seems to be a small gap that remains open. Perhaps it's because I don't work for a local company or have local people as my colleagues who I can interact with and get to know - that social aspect once again.


Lastly, there was still an allure of moving onto something fresh and new after being at my current company for almost 7 years.


So I called my boss, the co-founder and managing director of the company.


This is where my decision was ultimately made because after laying out the entire story and my thought process his response was one of support and understanding. He didn't want me to leave, but he could also see my side of things.


This display of empathy was something I couldn't put a price on and it finally tipped the scale towards staying at my current job.


I called the company I interviewed with on the same day and told them that I wouldn't be taking their offer.



What Next?


First things first was that I needed to catch up on all the work I hadn't been doing since I was away interviewing. Thankfully the decision to stay gave me renewed vigour and I quickly caught up.


Next was a series of follow up conversations with my boss as the conclusion was that this time the cards "might not have been right", but what about in 6 months time when another company comes knocking?


We agreed to set some short term objectives within the longer range goals that I was already working on. Achieve those, and the time would be right to review my current salary.


I also get to continue exercising my employee stock options, which has a dividend yield of around 35% based on my strike price. Since I'm using my dividends to buy more stock, as opposed to exercising in one lump sum, it'll take a bit of time to complete my purchase - but over time my earnings from this will definitely be rising up and helping to bridge the gap to £76k.


Finally, I definitely learned a tonne of things from taking the interview and I plan to use what I saw to try and improve my current skill set. The intent is to bake it back into what I do on a day to day basis in my job but it'll also help me raise my own value, which could lead to further raises down the road.


Who knows - maybe the next salary offer at my current company will actually be £76k, and if that were the case then the choice to stay would definitely have been the better one.



Final Scribbles


I'm glad that I managed to get a chance to really look at my current job and try to break down all of the detailed aspects in order to determine its true value to me.


Had I not taken the interview I may never have done this, and it would've been difficult to have the levels of appreciation that I do now for my current situation.


Those of us who are in the financial independence community are always looking forward to the day when we can "retire early" - but that doesn't mean the months or years before it have to be a struggle.


Instead, it's better to take a deeper look at what we currently have, and while we still might need to show up for work tomorrow it doesn't mean we're not living our life the way we want it.

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For me, the purpose of financial independence is to regain control of my personal time rather than needing to spend it in work. Money is just a means to get there and not the end goal itself. In writing this blog I hope to use my own experiences to help others find their reason on why they want to reach FIRE.

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Thanks for reading!

Kujah

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