It was August 2009 and I was walking away from a stable job where I was unhappy. It was the height of the Great Recession and people kept asking me, Are you crazy? What are you thinking?

And then I did something they thought was even crazier: I turned down 2 job offers.

This wasn’t the plan. The plan was to get another job before I quit the one I had. You know, like any normal person would. I’d had a few decent job interviews. One even seemed like I might get an offer. But it also seemed boring, so I didn’t go back for the second interview. But I was so unhappy in my job that I couldn’t take it anymore.

So I quit.

Wasn’t it stressful?

I knew a lot of people who were out of work. We all did. This was the summer of 2009. Everyone was stressed out and anxious. They needed a new job NOW!

Not me! I was totally burned out and I decided to take some time off. I worked on hobbies. I got into a good exercise routine for the first time in my life. I finally learned how to cook (thank goodness, because my cooking was pretty dreadful before that.) I did volunteer work. I spent more time with friends and family, including some folks out of town. It was awesome! I was happy and stress-free for months. It was fantastic! Oh wait, did I say that already?

But how was this possible?

I knew what I was doing when I quit my job. More specifically, I knew what was in my bank account. I had saved up enough money. I figured I could be out of work for 6 months, no problem. If I cut back on expenses I could do a year. After that it would get tight. I refused to touch my retirement account, but I had enough money outside that account to pay the rent, food, other necessities, and even some extras.

I’m constantly saying on this blog and in real life, you can have anything but you can’t have everything. It was true for me then. I thought about traveling around Europe for a while. I figured I could have 6 weeks in Europe or close to a year off at home. I chose the year at home. I have no regrets. I doubt I’d have had regrets if I’d chosen Europe. I just couldn’t do both, that’s all.

How much is enough?

I’m asked this question All. The. Time. And the answer is: it depends. But I can help you figure it out pretty easily.

What do you want the money for? If you want to be able to walk away from a job, for example, it’s not too hard to calculate how much savings you need. How long do you think it would take you to find a new job? Be conservative. If you think it would take 4 months, save enough for at least 6.

Now, how much do you spend every month? If you had to cut back, how much would you be able to get away with cutting? But sure to add in extra for COBRA health insurance, if that’s something you’ll need (that can cost hundreds of dollars extra every month.) If you’re not tracking your income and expenses, I suggest you start doing that right now, because it’s the only way you’ll ever really know how much is enough. I’ll go into how to do that in detail in an upcoming post.

Ok, you have an idea of how much you spend every month and how many months you’d be unemployed. Multiply the two and round up. If you think you’d be out of work for 4 months, you might want to save enough for 6 months. If you spend $3000 per month but you think you could easily cut down to $2700 per month, then you’d do 6 x 2700 = 16,200. Round that up to $17,000 and that’s how much you need to save up.

That’s how much you need so that you can walk away from your job any time without stress. There’s a reason one of my favorite bloggers calls it F-You Money. Imagine being able to say (or at least think) “F-You” and then walk away.

F-You Money gives you choices

I will never forget going to parties in 2009-2010 and feeling over-joyed at being unemployed while everyone around me was stressed. And how over and over again people asked me, Why aren’t you stressed out? How can you afford it?

And how confused they looked when I responded, I have savings.

They didn’t have savings. At least, not more than 1 or 2 months’ worth. That meant they didn’t have choices. I did.

The day I gave notice at my job, someone who owned a business we worked with heard about my resignation and asked me to come in for an interview. He offered me the job on the spot, but I didn’t want it. So I walked away. I could do that because I had savings.

7 or 8 months later I got another job offer. It seemed like a great job, but the pay was way too low. I couldn’t live off of that. And why should I take such a huge pay cut? So I passed. Again, I could do that because I had savings, even though they were dwindling.

Eventually I got a new job. It was just what I was looking for. The pay was good, the hours were short (well, shorter than the last one, anyway,) and it had good benefits. I went back to work. Because while I had enough savings to be unemployed for a while, I didn’t have enough to be unemployed permanently. Yet.

The result

You might be wondering what happened to my bank account. Yeah, it took a hit. A few weeks before I got my new job I started to feel some stress about those numbers that kept dropping. But I knew I could make it. As soon as I went back to work I started putting money back into savings. The numbers slowly started to climb again. I didn’t replenish my savings overnight, but slow and steady wins the race, and eventually I managed it.

I could have taken that first job offer and never touched any of my savings. But for me, it was worth every penny to have that time off. That was the choice I made. If you have/had F-You Money, what choice would you make? Please share your answer in the comments. Then use this calculator to see how much money you can add to your F-You Fund this year!

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