How to quit your job
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Even if you have the most amazing job in the world (which, let’s face it, you don’t), you’ve probably fantasized about quitting this year. People are doing it in record numbers! What better time to throw a big blank on your resume and take a month-long road trip to meet some random acquaintances to avoid rent? Life is short and burnout is real, even Prince Harry says it is.
The bills, however, are also real. And one thing that’s more stressful than having a job you hate is running out of money without working at all (which then forces you to another job you hate).
Ideally, you would choose a new job before quitting your current job. But careers are not always linear like that. Maybe you are resigning to become self-employed, start a business, spend long time with your family, or take care of your mental health. Maybe you just need a break before figuring out your next move. A lot of people will tell you that this is a bad and irresponsible idea, and it is certainly not the safest thing to do from a financial standpoint. But that doesn’t mean you can’t or shouldn’t try it. You just need a plan and some money saved. Below is a step-by-step guide to plotting your exit.
Step 1: Do a financial self-assessment.
Before you do anything, take a look at your numbers. Financial therapist Amanda Clayman calls it the “information gathering phase”: take stock of your current salary, your fixed expenses like rent and student loan bills, and the savings you have. Your goal is to know all the resources at your disposal and to anticipate any surprises. How much does your health insurance cost and what if you had to buy your own policy after quitting? Is Your Credit Score Correct? What is your debt situation? What expenses can you reduce? When does your lease end and could you opt out earlier if you had to? It’s not meant to be an exercise in shame – you just take stock of what’s in your control, financially, and what’s not.
While you’re at it, review the perks your job could offer, including paid time off, 401 (k) correspondence programs, and other perks. These are things you want to enjoy before you quit, says Corbin Blackwell, Certified Financial Planner at Betterment. “When you quit a job, you don’t just give up your salary,” she emphasizes. “You could also forgo things that you don’t consider to be part of your pay, like subsidized health care or parental leave, free coffee or snacks, or commuter benefits. These are obviously not reasons to stay in a horrible workplace. But you will have to factor them into your budget when they are no longer available. (And use them while you still have them, as many as you can.)
Step 2: Create a new budget.
If you cut back to the bare minimum, how much money would you need to get by? It’s what financial educator Tiffany Aliche calls “your noodle budget” – the amount you could live on if you got rid of all the extras. Hope you don’t need to, but calculate this number and know that you could making it work is a liberating and useful exercise.
Alternatively, you can try to live on that budget, or some version of it, for a set period of time if you need to save more money before you quit. I’m not saying it’ll be fun, but a bigger pillow will always give you more peace of mind.
Finally, figure out what your budget will look like when you quit smoking. Doing this calculation will give you a goal of how much to save to forgo paychecks for a period of time, and how far those savings will take you.
Step 3: Consider your options.
Chances are you’ve already looked for new jobs or at least given some thought. But it never hurts to think outside the box. Could you get your current job to fire you, so that you can get unemployment benefits? Could you move in with a relative for a few months? Do you have a plan B to make money if you really need it?
Also, pump up your network. Do you know of anyone who recently quit their job and would like to tell you about the steps they have taken to do so? Sometimes bouncing ideas off a friend or acquaintance can bring to light new options or create connections that you hadn’t thought of before. (For example, a friend of mine sat at home for various people after quitting her job and giving up her lease last year; another attended gigs on TaskRabbit.)
In the meantime, think about Why you want to quit and what you hope to do next. “If you have no idea what to do after you quit your job, it could mean your unemployment spell is much longer,” says Blackwell. “Ideally, you want to figure this out while you’re still working and earning an income. “
You may feel like your current job is so demanding that you don’t have the time or bandwidth to search for a job. (I’ve been there, and it’s exhausting.) There’s no perfect solution to this, but whenever I feel like I can’t fit one more thing into my day or in my brain I think of what Robin Arzón, a former lawyer who is now vice president of fitness programs at Peloton, once told me that she found time to change careers while she was working. 80 hours per week in a law firm. She called it the “ten minute rule”: she was blocking ten minutes a day to research her next move, whether it was Google searching for something, composing an email, or making a phone call. Set a timer and give it a try – I’ve found it helps me when tackling something intimidating.
Step 4: Try to save at least three additional months of living expenses.
I want to be clear: this part is difficult, and downright impossible for some people who just can’t afford to put money aside on a regular basis. But it’s important to be realistic: quitting smoking requires savings. The average duration of unemployment in the United States is currently around five months, according to the latest Bureau of Labor Statistics report. It can seem incredibly long, especially if you have some promising job leads. But keep in mind that it can take years to submit your resume, go through the interview process, get an actual job offer, negotiate your salary, and determine your start date. You’ll be in a better position to do all of these things efficiently (and be picky about the next job you take) if you have enough money to support yourself while you wait.
How much is enough? It’s hard to say, but Blackwell recommends saving at least three months of living expenses, in addition to a healthy emergency fund (which is generally defined as at least three to six months of living expenses), before stopping. “Ideally, you won’t have to drain your emergency fund because quitting your job isn’t necessarily an emergency – it’s something you can plan for,” she says. (I have to note here that most Americans don’t have emergency funds, and the thought of accumulating three to six months of cash may seem foolish, especially if you’re only a few years away. of your career. If so, I would look a lot into your Plan B options – a cheaper living situation, a temporary job, or staying in your current job a little longer to save as much as you can. .)
Of course, no one wants to hang around in a miserable workplace because they can’t afford to leave. And finally, I can’t tell you when or if you should quit – sometimes there is no right answer. Keeping the line between your mental and financial health can be impossible, and I wish no one had to make those compromises (especially since these two things are linked). But it can be powerful to see your job as a means to an end – a source of paychecks you can save until you have enough financial freedom to go your own way and find something better. .
And it doesn’t stop after you quit. Boosting your savings will give you more agency, allow you to set limits, and avoid shitty jobs in the future as well as in the present. For this reason, these steps are useful even if you aren’t planning on quitting your job anytime soon.