Navigating Career Breaks: Managing Money During Maternity Leave Or Career Pauses

Career breaks are a natural part of many women’s professional journeys, whether due to maternity leave, caregiving responsibilities, menopause, or a personal choice to step away and recalibrate. While these pauses can be rewarding and necessary, they can also create financial challenges — from reduced income to disrupted long-term savings.

With the right planning, however, it’s possible to manage a career break without jeopardising your financial future. Here are key strategies to help you stay financially resilient before, during, and after a career pause.

BUILD A DEDICATED EMERGENCY FUND

An emergency fund is your financial safety net — and it’s especially important when income is expected to decrease or stop altogether.

How much to save: Aim for at least 3–6 months’ worth of essential expenses. If you’re planning a maternity leave or career pause, try to adjust your goal to cover the full duration plus a buffer for any unexpected costs.

Where to keep it: Store your emergency fund in a high-interest savings account or an easy-access cash ISA so it’s both safe and accessible.

Pro tip: If you receive enhanced maternity pay or a redundancy payout, consider setting aside a portion specifically for this fund.

KEEP RETIREMENT CONTRIBUTIONS GOING

One of the lesser-discussed impacts of a career break is the hit to long-term retirement savings — a gap that can significantly affect your financial independence later in life.

For employees: If you’re on statutory maternity leave in the UK, your employer typically continues to contribute to your pension based on your pre-leave salary, even though your own contributions may drop. If you can afford to, consider maintaining your usual contributions during this time.

For the self-employed or on unpaid leave: Open a personal pension or SIPP (Self-Invested Personal Pension) and set up small, regular contributions — even a modest monthly amount can compound significantly over time.

National Insurance top-up: If your career break results in missed qualifying years for the State Pension, consider making voluntary NI contributions to close the gap.

CREATE A LEAN, FLEXIBLE BUDGET

Income changes during a career pause, so your spending plan should adapt accordingly.

Prioritise needs over wants. Focus on mortgage/rent, bills, food, and insurance. Cut back on non-essentials temporarily.

Track spending closely. Use budgeting apps or spreadsheets to stay on top of cash flow.

Plan for irregular expenses. Budget for occasional costs like baby gear, childcare, or career re-training.

Creating a lean but realistic budget ensures you’re not caught off-guard by the financial shift.

PLAN YOUR RE-ENTRY STRATEGICALLY

Returning to work often brings both financial and emotional stress — but early planning can ease the transition.

Update your skills: If you anticipate being out of the workforce for more than a few months, consider part-time training, online certifications, or networking during your break to stay professionally visible.

Rebuild your income gradually: If full-time work isn’t immediately viable, explore freelance roles, part-time options, or flexible returnships tailored to women re-entering the workforce.

Childcare costs: Budget in advance for the cost of childcare, which can significantly impact your take-home pay. Consider tax-free childcare or childcare vouchers if you’re eligible.

DON’T NEGLECT YOUR INSURANCE

As covered in our Power of Protection webinar, Life insurance, income protection, and critical illness cover are all important safeguards, particularly during major life transitions.

• Update beneficiaries
• Check coverage if your employment status changes
• Ensure you’re covered during maternity leave or self-employed pauses

These products can help protect your family and your future during periods of lower financial flexibility. If you want to watch our webinar again, please click here to view the recording.

IN SUMMARY

A career break doesn’t have to mean a financial setback. With proactive planning — from building a solid emergency fund to continuing pension contributions and budgeting wisely — you can protect your long-term financial wellbeing while embracing this important chapter of your life.

Whether you’re stepping away for a few months or a few years, a well-thought-out financial strategy can ensure you return to work with confidence and stability. If you would like some financial advice about taking a career break, please contact us here.

Articles on this website are offered only for general information and educational purposes. They are not offered as, and do not constitute, financial advice. You should not act or rely on any information contained in this website without first seeking advice from a professional.

Past performance is not a guide to future performance and may not be repeated. Capital is at risk; investments and the income from them can fall as well as rise and investors may not get back the amounts originally invested.

You are now departing from the regulatory site of Finura. Finura is not responsible for the accuracy of the information contained within the linked site.

Date written: 22^nd May 2025

Approved by Evolution Wealth Network Ltd on 22/05/2025.

Sources:

UK Gov & MoneyHelper (for maternity pay, pensions, NI contributions):

• GOV.UK – Maternity Leave and Pay
• GOV.UK – National Insurance Credits
• MoneyHelper – Planning a career break