The quitting-your-job checklist: leave like a pro, not like a movie scene

By Tom, CPA · Updated October 25, 2026

TL;DR: Before you resign, check vesting dates, bonus payout rules and equity schedules, then confirm when each benefit ends. Know your state's final pay and PTO rules, decide what to do with your 401(k) (including the rule of 55 if it applies), and line up health coverage that starts the day the old plan ends. Losing job coverage generally opens a 60-day Special Enrollment Period.

Educational only, not tax, legal, or investment advice. Examples are illustrations, not predictions. Rules and limits change; verify current figures and talk to a qualified professional about your situation.

The fantasy: you walk into your boss's office, say "I'm retiring early," and stroll out into the sunset. The reality: the sunset should wait until after your RSUs vest, your bonus pays out and your new health plan starts. Timing your exit can be worth thousands of dollars.

This checklist covers the steps in order, as of Oct 2026. Rules vary by employer and state, so confirm details with HR and your plan documents. It pairs with the retirement budget checklist.

CPA Warning Label: Please do not quit by flipping a desk. Desks are heavy, and the rule of 55 does not cover property damage.

Timing around vesting and bonuses

• 401(k) vesting. Check your plan's vesting schedule for employer contributions. Leaving one month before a vesting date can forfeit part of the match.
• Equity vesting. List RSU, option and ESPP dates. RSUs are generally taxed as wages when they vest. Options may have post-termination exercise windows.
• Bonus rules. Some plans require you to be employed on the payout date, not just through the bonus year.
• Pension milestones. Years of service or age can affect benefits.
• Deferred compensation. Read the distribution elections.
• Tax timing. Leaving early in the year can make the rest of the year low-income, which is useful for Roth conversions and ACA subsidies. See the Roth conversion calculator.
• Notice period. Give the notice your contract or custom requires. A gracious exit preserves references and consulting options.

Benefits end dates

• Health, dental and vision. Ask HR whether coverage ends on your last day or the end of the month. That date drives everything else.
• FSA. Health FSA balances may be lost after termination unless you elect COBRA for the FSA or spend them first. Schedule appointments before you leave.
• HSA. Your HSA is yours and stays with you; employer contributions stop.
• Life and disability insurance. Ask about conversion or portability, and price individual coverage if you still need it.
• Employee perks such as discounts, tuition benefits, gym subsidies and equipment. Return company property.
• Commuter accounts and other pre-tax balances.

Final paycheck and PTO

• Final paycheck timing is set by state law, and some states require payment quickly after separation.
• Unused vacation payout also depends on state law and company policy. Some states require payout of earned vacation; others leave it to the employer's written policy.
• Use or cash out? If PTO won't be paid out, consider using it before your last day.
• Withholding. Final checks with PTO payouts and bonuses may have high withholding, which may come back as a refund.
• Expense reports. Submit them before you leave.
• Get everything in writing: final pay date, benefits end date, COBRA notice timing.

Retirement plan elections

• Leave it, roll it or split it. You can often leave a 401(k) with the old plan, roll it to an IRA or roll it to a new employer plan.
• Rule of 55. If you leave your job in or after the year you turn 55, distributions from that employer's plan are generally exempt from the 10% early distribution tax, per the IRS. Rolling the money into an IRA ends that exception, so think before rolling it all.
• Direct rollovers. A direct trustee-to-trustee rollover avoids mandatory withholding. With an indirect rollover, the IRS generally requires you to complete the rollover within 60 days.
• 401(k) loans. An outstanding loan may become due after you leave; an unpaid balance can become a taxable distribution.
• Company stock in the plan. Ask about special tax treatment for employer stock before rolling over.
• Roth 401(k) money can roll to a Roth IRA.
• Beneficiaries. Confirm them on every account.

For early withdrawal options, see early withdrawal penalty exceptions.

Health coverage start

• Avoid gaps. Line up new coverage to start the day after the old coverage ends.
• Marketplace Special Enrollment. Losing job-based coverage generally opens a 60-day Special Enrollment Period on HealthCare.gov. You can often apply before the coverage ends.
• COBRA. You generally have at least 60 days to elect COBRA after you get your election notice, and coverage can be retroactive, per the U.S. Department of Labor. Coverage typically lasts up to 18 months.
• Spouse's plan. Losing coverage is usually a qualifying event to join.
• Income estimate. Marketplace premium tax credits depend on your annual income estimate. Update it when your plans change. See the ACA subsidy calculator.
• Prescriptions and doctors. Confirm your providers are in network.

The conversation and the paperwork

• Tell your manager first, in person or on a call, before HR or coworkers hear it elsewhere.
• Keep the reason simple. "I'm retiring" or "I'm leaving to focus on family and personal projects" is enough. You don't have to explain your savings rate.
• Offer a transition plan: documentation, training a replacement, a reasonable last day.
• Ask about part-time or consulting work if you'd like some income. Barista FIRE often starts with a former employer; see the barista FIRE jobs guide.
• Read anything you're asked to sign, such as separation agreements, non-compete or non-solicitation terms and severance releases.
• Collect contacts and say thanks. References and friendships outlast jobs.
• Save personal files only if company policy allows. Leave company data where it belongs.

Illustration: timing the exit

Illustration. Hypothetical: Frugal Fran plans to quit on March 15. She checks her dates:

Moving her last day to April 30 keeps the bonus, the RSUs and an extra half-month of employer coverage. Lavish Larry quit on April 9, then learned what "unvested" means. He describes it as "a teachable moment" and nothing else.

After your last day

• Set up your retirement "paycheck" from savings.
• Start quarterly estimated taxes if needed; see estimated taxes.
• Update your address for W-2s and tax forms, since your final W-2 may arrive months later.
• Review your budget after the first three months against the plan.
• Take a real break before committing to new obligations.
• Download pay stubs and benefits statements while you still have access.
• Thinking about moving? Read the no-income-tax states comparison and the Florida retirees guide.