After graduation, Varady coached the Chicago U16 AAA Team for the 2001 season. Varady stayed with the Silvertips until 2010, when he took two years off to coach in France's
Ligue Magnus. Upon his return to North America, Varady took over the
Sioux City Musketeers, where he helped lead them to a 136-88-16 record during his coaching seasons. As a result, Varady was awarded the 2017 USHL Coach of the Year Award. He was also selected by Team USA to coach their 2016
World Junior A Challenge team. In 2018, Varady was named head coach of the
Tucson Roadrunners of the
American Hockey League (AHL), the affiliate of the
Arizona Coyotes of the
National Hockey League. In his second season as coach in Tucson, the Roadrunners were named the division champions when the season was curtailed by the
COVID-19 pandemic. Prior to the postponed start of the
2020–21 season, Varady joined the Coyotes' staff as an assistant coach. In his two seasons as head coach, Tucson held a 70–45–6–5 record. Once the abbreviated AHL season was complete, he returned to Tucson on a three-year contract as head coach beginning with the
2021–22 season. He led the Roadrunners to a 93–84–11–6 record in four seasons. On July 18, 2022, Varady was named assistant coach for the
Detroit Red Wings for the
2022–23 season. After three seasons in Detroit, Varady was hired as an assistant coach for the
Philadelphia Flyers on June 5, 2025. ==Personal life==