While sabbatical gives you a chance to rejuvenate, it equally tests your money-management skills. Managing expenses during sabbatical is an art and, in this article, we will tell you the various ways through which you can do so. Let’s get started.

Re-plan your budget

One of the core essentials of managing expenses when you are taking a break from work is to re-plan your budget. This is because when you’ve an active income you know a fixed date when you would get money and plan things accordingly. However, this is not the case when you are on a sabbatical.

So, get to the drawing board and re-plan your budget so that you don’t end up stretching yourself or taking debt in various forms.

Get rid of discretionary expenses

While re-planning your budget, take a close look at expenses that you can do without. While some of them such as paying EMIs, credit card dues, grocery, school fees of children, etc., can’t be comprised, others such as eating out every weekend, going for movies or parties can be curtailed.

Get rid of all such discretionary expenses which can help you save money. The idea is to have a buffer and not dip too much into your savings. Note that these small adjustments make a big difference in the long run.

Limit usage of credit cards

Giving an instant flush of liquidity, credit cards have emerged as a modern-day need. However, when you are on a sabbatical, it’s prudent to limit the usage of credit cards. This is because the amount you borrow from your card needs to be paid back within a stipulated period, failing which not only attracts a penalty but also affect your credit score.

Credit card interest rates are generally high and if you end up using your card too often during a sabbatical, you might end up burdening yourself with too much to take care of at the end of the month.

Avoid instant loan offers

There can be times when you might be tempted to opt for instant loan offers coming your way during the sabbatical phase. While initially, these offers may seem lucrative providing instant gratification, it’s in your best interest to avoid them.

This is because such loans not only carry a high rate of interest but may be also bundled with other offerings which might bind you to multi-year commitment.

Always build an emergency corpus which can take care of your expenses for at least six months when you are away from work or need to take a break. Through disciplined investments in various financial instruments, you can build this corpus to fall back upon during sabbatical.

Learn more about Mutual Funds for a good personal financial management.


The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.

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