How do I plan financially for a career break or sabbatical?

Budget for the break plus a re-entry buffer, and treat the job search afterwards as part of the cost. The most common mistake isn't underestimating the break — it's assuming income resumes the day it ends. **Calculate three numbers:** 1. **Cost during the break.** Your actual expenses in that period. If you're travelling, be realistic — people consistently underestimate by 30-50%. If you're studying, include fees, materials and living costs. 2. **Fixed costs that continue regardless** — rent or mortgage, loan repayments, insurance, subscriptions, family support. These are what make breaks expensive, and reducing them before you leave is the highest-leverage preparation. Subletting, moving out, or pausing commitments can transform the arithmetic. 3. **Re-entry buffer.** Assume three to six months of job searching after you return, funded entirely. This is the number people skip and it's the one that causes real damage. **Practical preparation, ideally 12-18 months ahead:** - Save the full amount before leaving, in cash, not investments. Money you need within a year shouldn't be exposed to market falls. - Clear high-interest debt first. Paying credit card interest during a period of zero income is a fast way to undo the whole thing. - Sort health insurance for the break. Employer cover ends when employment does, and this is where a bad outcome becomes catastrophic. - Understand what happens to any retirement contributions, vesting or benefits, and whether you can maintain them. - Check whether a formal sabbatical is possible with your employer. Unpaid leave with a job to return to eliminates the entire re-entry problem, and more employers grant it than are asked. **Reduce the cost while away**: house-swap or sublet, pause rather than cancel subscriptions, choose cheaper destinations for the longer stretches, and consider part-time or remote work that covers a portion of costs without dominating the break. **On the career side**: have an answer ready for what you did and why — a deliberate, well-explained break is not a problem for most employers, particularly if you can point to something you learned or did. Keep a few professional relationships warm while away; a message every couple of months costs nothing and makes the return substantially easier. **And build in a decision point.** If your funds are down to the re-entry buffer, that's the signal to start looking, regardless of how the break is going.