Before You Resign: How Much Money Should You Save?

When you want to leave, but need to feel financially safe

Maybe the thought of leaving your job comes back every Monday. Then another question follows: “Can I afford it?”

There is no single amount that answers that question for everyone. Someone with low fixed costs and skills that are in demand may need a different reserve from someone with children, debt repayments or ongoing health expenses. Start with your own transition plan rather than a number you found online.

Start with your essential monthly expenses

Write down the costs you would still need to cover if your salary stopped for a while:

• housing and utility bills;
• food and everyday household essentials;
• transport;
• debt repayments and other commitments;
• health costs and insurance;
• the needs of children or other dependants;
• essential phone, internet and other services.

You do not need to include every part of your current lifestyle. But avoid creating such a strict budget that you could not realistically live with it for several months.

Work out how long your savings would last

Use this simple calculation:

Months covered = savings available for the transition ÷ essential monthly expenses.

If you have €6,000 available and your essential expenses are €1,000 a month, those savings would initially cover six months.

That is before any extra transition costs. Exclude money already set aside for taxes, an upcoming large payment or another commitment you cannot postpone. Investments whose value can change, or which you do not want to sell, should not automatically count as cash available for your transition.

Add the costs of changing jobs

A change of work can bring expenses you do not have today: training, certification, travel, equipment, health insurance, childcare or a gap before your first salary arrives.

Make a separate list of:

• one-off transition costs;
• expenses your employer currently pays for;
• a possible drop in income;
• a reserve in case the transition takes longer than expected.

This helps you avoid overestimating how long your savings will last because some costs were left out of the calculation.

Think about what comes after leaving

The reserve you need also depends on what you plan to do next.

If you have already signed a contract for a new job, the gap between salaries may be short. If you plan to change fields, study or start a business, there is more uncertainty. A second reliable household income may reduce the pressure, but agree clearly on what that would mean for your family budget.

Write out three scenarios:

• Best case: income starts again quickly.
• Realistic case: the transition takes longer than you hoped.
• Difficult case: extra expenses arise or your next income is delayed.

Your plan does not have to predict everything. It should give you a way to respond if things take longer or cost more than expected.

Build a few steps before handing in your notice

Resigning does not have to be the first step. Before you leave, you could:

• explore a different role or workload with your current employer;
• start looking for a new job while you still receive a salary;
• try the new direction through a small project;
• increase your savings for a defined period;
• reduce one large recurring expense;
• test a manageable source of additional income;
• agree on a transition budget with your family.

These steps can help your savings last longer and give you more information before making the decision.

How do you know when you have enough?

A savings balance is useful when it supports your actual plan, responsibilities and likely transition period.

Before deciding, ask yourself:

• 1. Do I know my essential monthly expenses?
• 2. Have I allowed for transition costs?
• 3. Do I have a realistic estimate of when income could start again?
• 4. Have I worked through a more difficult scenario?
• 5. Do I know what I would do if the transition took longer?

If several answers are “I don’t know”, start by filling those gaps. You may need to adjust your savings target once you have a clearer picture.

Your next step

Calculate one number: how many months would your available savings cover your essential expenses?

Then read Financial Safety: How to Build Your Financial Plan B and decide which part of your plan needs attention next.