Can I Afford to Quit My Job and Travel?
At one point or another, most of us have dreamt of quitting our jobs, packing it all up, and just hitting the road without a care in the world (at least, for a while). However, whether you just want a sabbatical from your usual nine to five gig, you want to try your hand at freelancing, or you’re planning an early retirement, choosing to quit your job without any upcoming prospects is a risky decision. If you’re thinking of quitting your job and taking a very extended vacation, here are some things to get settled first.
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Quit Forever or Take a Break?
Quitting your job can mean a lot of different things. Mainly, you can either plan on quitting permanently to make a living by freelancing and traveling as you see fit, or you can take a temporary sabbatical, leaving the workforce for an emotional break with the intention of returning at some later date.
Neither of these options is easy, and which of the two is best for you depends on your interests and needs. Freelancing is hard, but if you can get into a groove, you may find yourself working fulltime at what you love. On the other hand, if you want to take a very long unpaid vacation, you’ll need to be absolutely sure that you have the financial stability to justify that.
Make a Budget and Stick With It
Whether you’re taking an unpaid break or you’re interested in freelancing, a budget is absolutely necessary to carry you through these uncertain times.
Since you won’t have a guaranteed income while you’re traveling, and you can’t count on handouts, you need to be absolutely sure that you have enough money to carry you through your new lifestyle. The best way to do this is to create a budget of all the spending that you’ll do while you don’t have an income. This means accounting for every plane ticket, every gallon of gas, every AirBnB room, and every meal for however long you’re without your usual income.
Of course, it’s impossible to get every one of those numbers exactly right. Instead, figure out a monthly budget for different categories of spending that you’ll do, and make it a habit to stay under that ceiling. Here are some categories to start with:
- Plane, train, and ferry tickets
- Recreation (skis, kayaks, etc)
You should divide the categories further and add new categories depending on your particular needs. You can estimate your spending in some categories by tracking your current spending habits. For others, like travel costs, you may want to order things like plane tickets well in advance. That way you know that those costs are accounted for.
At the end of your budget you should also leave room for financial emergencies. Try to have at least 20 percent of your overall budget for that year available should an emergency arise. If you crunch the numbers and you aren’t meeting your budget, then you can’t afford to quit your job just yet.
Build Your Credit and Pay Off Debts
It’s never easy to quit your job while you still have outstanding debt. Carrying debt without a job can lead you down a nasty road that will tank your credit rating and make it very hard for you to get back on your feet after quitting.
We recommend building up your credit score before leaving. This way, if something goes seriously wrong during your extended vacation, you will be able to convince lenders to give you a personal loan and help you get back on your feet. For tips and guides on how to build your credit score, visit our credit score resource center.
Use Your Skills to Freelance…
Freelancing isn’t for everyone, but if you have the right set of skills and you know how to market yourself, you might just be able to pull it off. If you’re thinking about freelancing, start by identifying the kinds of skills that you have that can be sold on a gig-by-gig basis. These might be skills that you’ve picked up from your old job, but don’t rule out the possibility of developing some of your hobbies into income opportunities.
With tools like small business loans you can start your own business and work from wherever you want.
…Or Have a Plan for Your Return
You can have an amazing time traveling while voluntarily unemployed, but you need to remember that you’re not cutting yourself off completely from society. When you get back and start looking for a new job you’ll want to make sure that your resume is in good shape and that you’re still a good candidate for the kind of job that you want.
Although it may be on purpose, you do have to remember that you will be unemployed. Explain to your current bosses what you intend to do. You’re not quitting because of some beef with the company — you’re just looking for a chance to spread your wings before you rejoin the workforce. Secure letters of recommendation beforehand. If you think that you can land a promise of a job before you leave, more power to you, but that’s not necessary as long as you stay employable when you get back.
Quitting your job to travel can be an incredibly rewarding experience. The fresh air and freedom will give you time to reflect on your life and enjoy yourself. As long as you plan responsibly so that you can pay for your time off and create a plan for when you get back, you can enjoy your extended vacation without a care in the world.
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Nick Cesare is a writer from Boise, ID. In his free time he enjoys rock climbing and making avocado toast.