The runway maths

The runway is the maths your accountant would do for you in twenty minutes if you asked. Most men don't ask. They imagine the runway, round it up, and start the pivot with three months less than they think.

I've done this myself. I've watched friends do it. The pattern is always the same. The cash position looks fine in February, the new thing takes longer than expected, and by October the conversation at home has changed shape.

This module is the Australian numbers, run properly. It's the boring section. It's also the section that decides whether the pivot survives month nine.

What runway actually means

Runway is the number of months you can keep the household running while the new income is below the old income. Three things sit inside that:

• Your expenses, skinnied down, monthly.
• Your liquid resources (cash, offset, accessible savings) that you'll spend through.
• Any income still arriving (partner's salary, dividends, contract work, garden-leave pay).

Runway = (liquid resources) divided by (expenses minus arriving income).

That's it. The maths is simple. The honesty in each input is what most men dodge.

Step 1: The real expenses, skinnied

Open the bank statements for the last six months. Pull every direct debit, every recurring subscription, every regular expense. Then build two columns: "Locked" and "Cuttable".

Locked column (you can't cut these in the next month, realistically):

• Mortgage (or rent).
• Council rates and water.
• Insurance (home, contents, car, life, income protection if you have it).
• Utilities (electricity, gas, internet).
• School fees, if private.
• Health insurance.
• Food (a real number, not a fantasy one).
• Fuel and transport.
• Phones.

Cuttable column (you could realistically cut or pause within four weeks):

• Streaming services and subscriptions.
• Gym, beyond a basic membership.
• Takeaway and meals out.
• Holidays beyond essentials.
• Kids' weekend activities (some are negotiable, some aren't).
• Wine, beer, hospitality discretionary.
• Second car running costs, if you can park it.

Add up the Locked column. That's your skinnied monthly burn. For a man at forty-five with two kids, a mortgage on a metro family home and one car running, it usually lands somewhere between $7,000 and $12,000 a month. Higher in Sydney. Lower outside the capitals.

Step 2: The liquid resources, plainly

Three pots:

• Cash and offset. Sitting in savings or against the mortgage. Liquid in 24 hours.
• Term deposits and matured investments. Liquid in days to weeks.
• The buffer you don't want to touch but could. Selling a managed fund holding, redrawing the mortgage to a sensible level, the second car.

Add the first two. Note the third separately. It's your emergency layer; it doesn't go in the runway maths but you need to know it's there.

Step 3: Arriving income, honestly

What's still coming in during the pivot? In Australia, this typically includes:

• Partner's after-tax income. The number that hits the joint account, not the gross.
• Garden leave or notice pay.
• Redundancy payment, after tax. Note: in Australia, genuine redundancy payments have a tax-free portion based on years of service. The leftover taxable portion sits at the lower of marginal rate or 32 percent up to a cap. Don't budget the gross figure. Use the after-tax number.
• Initial contract or part-time income from the new thing. Be conservative here. Money you haven't yet been paid is not income.

Add these. Subtract them from your skinnied monthly burn from step 1. That's your monthly net burn during the pivot.

Step 4: The runway, in months

Liquid resources divided by monthly net burn equals months of runway.

A worked example:

• Skinnied monthly burn: $9,000.
• Partner's after-tax monthly income: $5,500.
• Monthly net burn: $3,500.
• Cash and offset: $35,000.
• Runway: 10 months.

Note how dramatically the partner's income changes the picture. Without it, $35,000 lasts under four months. With it, ten.

Super contributions through the gap

A specifically Australian point. While your income drops, you should think about three super-related questions:

• Concessional cap, partial year. The annual cap is $30,000 (FY 2025-26). If you've stopped earning mid-year, you may have unused cap room you can fill with a personal deductible contribution before 30 June, while you're still in a higher tax bracket from earlier in the year.
• Carry-forward unused cap. If your super balance is under $500,000 at 30 June of the prior year, you can use unused cap from the previous five years.
• Spouse contributions and split contributions. If your partner is still earning and you're not, look at whether splitting last year's contributions across to her account makes sense.

This is genuinely worth a one-hour call with an accountant before you make decisions in the months either side of the pivot.

Mortgage, offset and the conservative move

Two principles, in tension. Pick which one you're optimising for.

Principle A: Keep cash liquid. Park your redundancy payment in the offset account, not in the mortgage. The interest saving is identical. The difference is you can pull the cash out tomorrow if the pivot takes longer than expected.

Principle B: Pay down the mortgage. If your runway is genuinely strong (twelve months plus, partner's income carries the household, low-risk pivot shape) you can put part of the lump sum on the mortgage and reduce monthly interest.

Most men over forty-five in Australia, in a pivot year, should default to Principle A. Liquid is king when the income side of the equation is variable.

Don't refinance during the pivot. Banks look at the income that just stopped and the income that hasn't yet started, and they price accordingly. Wait until you're twelve months into the new role.

Three runway rules

• Add a three-month buffer to your headline runway. Pivots take longer than the optimistic version.
• Don't burn the buffer on the first quarter's gear. New laptop, new chair, new domain name. Two thousand dollars of "set-up" before any income arrives is two thousand dollars of runway gone.
• Talk to the partner about the runway, in numbers, monthly.

The runway maths is the spine of the pivot. Get it right and the rest is logistics.

Count it. Pad it. Talk about it.

Further watching

• How Can I Best Leverage My Studies as Career Capital? | Cal Newport
• What Authors Counter Your Career Capital Theory? | Deep Questions with Cal Newport