The pandemic shifted work cultures everywhere, inspiring millions of Americans to quit their jobs in what’s since been dubbed the Great Resignation.
The pandemic proved certain jobs could be accomplished remotely, giving many employees a new negotiating chip. For others, perhaps the changes inspired a complete career change.
Whatever the reason may be, quitting your job without a new one lined up is a daunting task, and will cost each person differently.
Here are some tips to help you figure out how much you’d need to quit your job.
Figure out your budget
Most financial advisors will tell you to have at least three months’ emergency savings stowed away, but if you don’t know how much your necessities are costing you per month — you may not know how much you’ll need to get by.
Think of your necessities as the things cannot live without once you quit your job: housing, utilities, food, car expenses, childcare, gym membership, etc. One added expense you’ll want to be sure to include is health care (unless you’re enrolled in a partner’s or parent’s plan).
Once you know the fixed cost of your necessities, you can see how many months your savings will stretch.
If it’s not to your liking, you may have to consider staying at your job longer to save up more money. Or, there may be ways to whittle down your budget even more, such as working out at home or downsizing your takeout budget.
Additional incomes can also be considered.
Assess any additional income
Do you have an upcoming bonus? Will your employer pay out any of your vacation days or sick time? Do you own stock in the company? Putting some forethought into these variables could help get some extra money into your savings.
Other additional incomes that could boost your budget could come from a side hustle or personal stocks.
Taking out money from your 401(k) is also an option but should be considered in emergency situations only as you’ll incur the hefty tax penalty.
File: Business women using calculator, laptop computer, and chart report paper, statistic income on the table in the sunset at the office workplace. via Getty Images
Get help from the pros
A financial advisor can help better prepare you and your budget, especially if you’re changing careers and may not have reliable income for many months or years.
A professional can help assess your stock options as well.
Don’t forget about your 401(k)
And, speaking of that 401k, according to Capitalize, Americans have accumulated more than $1 trillion in "forgotten" or "left behind" 401(k) plan assets. Don't become part of the statistic.
By rolling over your old 401(k) into an IRA or rolling it into your new employer's plan, you can keep your financial house in order while you're in school or starting at a new company.
This story was reported from Detroit.