Can I Afford to Quit My Job?

How much money to save before you resign

Quitting a job is partly a career decision, but it is also a financial one. Before you give notice, it helps to know exactly what leaving would mean for your finances.

There is no single amount everyone needs to save before quitting. What matters is your financial runway: how much money you have available, how much you need each month, what income you expect after leaving, and what costs or benefits will change when your employment ends.

Start with these seven numbers.

1. Your essential monthly expenses

Start with what you actually need to spend each month: housing, utilities, groceries, transportation, insurance, minimum debt payments, childcare, and other expenses you cannot easily eliminate.

This is your baseline. Separating essential expenses from discretionary spending gives you a more useful estimate of how much it costs to support yourself between jobs.

2. Your available cash savings

Next, calculate the money you could actually use to cover living expenses after leaving your job.

Focus on accessible savings and cash rather than treating retirement accounts or home equity as ordinary runway. The question is simple: If your paycheck stopped, how much money would you have available to live on?

3. How many months your savings will last

Divide your available savings by your essential monthly expenses.

Available savings ÷ essential monthly expenses = months of financial runway

For example, if you have $18,000 available and need $3,000 a month for essential expenses, you have approximately six months of financial runway.

That number is more useful than following a generic rule about how much you “should” have saved.

4. Your health insurance costs

If your health insurance is tied to your job, determine what coverage could cost after you leave.

Compare the options available to you and include premiums and expected out-of-pocket expenses in your post-employment budget. A cost that was previously subsidized by your employer can materially change your monthly expenses.

5. Income you expect after leaving

Leaving a job does not always mean having no income.

Consider income you can reasonably expect from a new position, freelance or consulting work, part-time work, severance, or other sources. Be conservative about both the amount and when that income will actually begin.

6. Compensation or benefits you’re giving up

Your salary isn’t the only financial consideration.

Look at bonuses, commissions, retirement contributions or matching, equity or stock that has not vested, paid time off, and other compensation you may lose by leaving at a particular time.

Sometimes the date you resign matters financially.

7. One-time transition expenses

Finally, consider costs created by the transition itself.

That might include job-search expenses, professional fees, new insurance costs, training or certifications, equipment, transportation changes, or other expenses associated with whatever comes next.

So, can you afford to quit your job?

The answer isn’t a universal savings target.

It’s whether your available resources give you enough time and flexibility for the transition you’re planning.

Knowing your number doesn’t make the decision for you. It gives you better information with which to make it.

Want to work through your own numbers?

The Can I Afford to Quit My Job? Financial Runway Planner helps you calculate your expenses, savings and financial runway so you can understand what leaving your job would mean financially.

Work through your expenses, savings, benefits, expected income and financial runway before you give notice.

​WORK THROUGH THE NUMBERS →​