Lots of people say you should never work for lower pay than what you could be making elsewhere, but I disagree. Sometimes, it’s the right call. Beyond direct compensation (salary, vacation time, healthcare, etc), what else do you get out of your job? What are you learning? What do you want to be doing a few years from now? Does your job actually advance you toward that goal, or are you just in it for the money?
First, there is the obvious case: do you enjoy the work you do? This is something that’s important, but everyone has their price. Misery is proportional to how long you’re in it and what the tradeoffs are. Let’s take an extreme example: Many people would hate the idea of scrubbing toilets every day for a living, but I imagine most folks would be willing to do it for $300,000/yr. On the other hand, if getting that kind of pay required working 16 hours per day every day for a decade… it might not seem worth it. You don’t get those years of your life back. Figure out how much passion means to you: would you be happier earning $40k/yr at a job you love, or $60k/yr at one that’s kind of boring? There’s no shame in picking either option; everyone has different priorities.
How much are you learning from your job? Every job will teach you different skills, and some are more useful than others. Make sure to think long term. Does what you’re learning bring you towards where you want to be in five or ten years? If you’ve always dreamed of running your own business, it’s probably worth taking a pay cut to work at a startup company so that you can experience building up a business firsthand. If you’ve always wanted to build websites, but your current job is completely unrelated, would you take a pay cut to pursue that new career? Getting paid to do work is nice, but getting paid to learn is even better.
Don’t let yourself be exploited. If you’re an awesome artist, don’t work for free just because “you can use it as a portfolio piece!”. Why work on someone else’s cool idea when you could be working on your own instead? If someone can afford to pay you well, don’t settle for crap pay just so you can say you have work experience. Heath Ledger gives good advice here:
On the other hand, if you have no idea what you’re doing, and someone is still willing to pay you to learn it and figure it out… well, then you’re getting paid despite a complete lack of skills. Then, maybe, it’s worth taking really low pay while learning that skill instead of earning nothing while teaching yourself.
Most importantly, make sure you can support yourself. It’s no use pursuing your passion if you can’t take care of yourself. If you do want to pursue something that’s not financially sustainable, try building up some savings to live off of first. That could even be your main incentive for picking a well-paying but boring job: you plan to save up half your income so that for every year you work, you can take a year off to do something you love that doesn’t make money.
Sometimes it’s okay to work for lower pay. Just make sure you’re doing it for the right reasons.