Planning a sabbatical, maternity break, higher studies, or just time off? Calculate exactly how much corpus you need, your monthly burn rate, and when your money runs out.
A career break can be one of the most enriching decisions you make — but only if your finances support it. In India, the social security net is thin (no unemployment benefits), so self-planning is essential. The key is building a corpus that covers not just your monthly expenses but also the income you stop earning, the investments you stop making, and the career earnings you potentially lose.
If your break year income is below ₹7L (new regime) or ₹5L (old regime with rebate), you pay zero income tax. This makes a career break year ideal for harvesting LTCG from mutual funds up to ₹1.25L tax-free, realising gains on equity, or converting FDs to equity — since your tax slab is much lower than working years.
EPF contributions stop when you stop working. Your existing EPF balance continues to earn interest for 3 years (36 months) after leaving employment. After 36 months, it becomes a "dormant" account and interest stops. If your break exceeds 3 years, consider withdrawing or transferring to VPF. NPS can be continued with voluntary contributions even without a job.
Corporate health insurance stops immediately when you leave. Before resigning, buy an individual or family floater health plan (₹10–25L cover, ₹15,000–30,000 annual premium). Don't let there be a gap — pre-existing conditions may not be covered in new policies during waiting period. A super top-up of ₹50L–1Cr adds large coverage at low cost (~₹8,000/yr).
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