Taking a mini-retirement can be an eye-opening experience unlike anything you’ve ever done. But if you don’t have a plan and you aren’t funding it adequately, it can become a disaster.

Mini-retirements are becoming more and more common with the way people are starting to feel about their jobs. Many of you are probably tired, stressed, and feeling like you aren’t taking the right path in life.

If you do it correctly, a mini-retirement can be just the antidote you need to redirect your life plan and become more well-rounded personally and financially.

In this article, you’ll learn more about mini-retirements, including what they are and why anyone would want to take one. You’ll learn exactly how to take a mini-retirement and what you need to do now to prepare.

What is a mini-retirement?

A mini-retirement is when you take time away from work for an extended period. It’s defined and intentional and requires meticulous planning in advance.

This isn’t a vacation, a sabbatical, or a string of sick days you take because you just don’t want to be at work. A mini-retirement can be a self-reflective, eye-opening experience.

They aren’t for everyone, either. People who are just sick of work and have a poor work ethic will typically fail when taking a mini-retirement because you have to have a strategic plan for getting back to work after your time off. And you have to want to go back.

But for the right person in the right situation, a mini-retirement can do some beneficial things for you.

Why take one?

You might be wondering why (or even how—which I’ll cover later) you should take a mini-retirement. I mean, taking time away from work is the ultimate kiss of death on your career, right? Not always.

The state of the American worker

In a 2014 study done by Project: Time Off, it was revealed that nearly all respondents knew the value of taking time off, but about 41 percent of them said they would not use all of their vacation time that year.

The study reveals a slew of reasons why this is, but the fact of the matter is that as we progress in our careers, we’re less and less likely to want to take time off (or feel like we can).

Another study done by The National Institute for Occupational Safety and Health (NIOSH) showed 40 percent of workers reported their job was very or extremely stressful and 25 percent view their jobs as the primary source of stress in their lives.

There are all sorts of data to back it up, but one thing is entirely correct – we’re stressed out from work.

The value of time away

According to a study from the Society for Human Resource Management, more companies are offering sabbaticals and extended time away from work than ever before. The study also found that employees who take time away from work for a more extended period come back feeling mentally refreshed, psychologically energized, and overall more productive and happier.

More and more Americans are seeing this trend occurring, too.

Many people realize that waiting until you’re in your mid-60s to start a life of peace and relaxation isn’t always what it’s cracked up to be. We don’t know where we’ll be financially or physically at that time.

Tim Ferriss discusses this concept at length in his book The Four Hour Workweek. He suggests finding a way to enjoy life NOW while you can be happy and healthy—instead of waiting for some fantasy retirement that may never come.

A great example of this is graphic designer Stefan Sagmeister. In the below TED Talk, Stefan shares how he shuts his studio down completely for a full year every seven years to help him become more creative:

How to Take a Mini-Retirement

Now that you understand what a mini-retirement is, and why you should consider one, you’re probably wondering how something like this is even possible.

You probably think that you have to give up your career and save a bunch of money only to skip out on a year or two worth of work, just to go right back.

Well, it doesn’t have to be like that. Here are six tips to get you started:

1. Spend some time exploring why you want a mini-retirement

If you’re young, single, and have no debt, taking a mini-retirement may not be that big of a deal for you. But for many people, it’s a major life decision—and not one that you should jump into lightly.

For instance, are you just looking to get out of a crappy job that you hate? That might be a good enough reason, but you need to explore a little deeper. If you hate your job, figure out why you want to take a mini-retirement and how it will help you move closer to what you do want.

A great example is someone wanting to travel abroad because their dream is to teach English in another country – if you hate your job and know this is what you want to do, then you’ve explored your why (at least a little bit).

Before diving into the mini-retirement world, decide why you want to do this. If you don’t have a plan, you put yourself at risk of wasting the precious time. I recommend giving yourself as much time as you need to figure this out—mini-retirements aren’t going anywhere.

2. Decide how you’d like to use the time

Now that you’ve figured out why you want to take a mini-retirement, you need to decide how you’ll use the time you make. A mini-retirement can be a month or several years—it’s really up to you. A significant determining factor of this is money, which I’ll explore further below.

As I said above, if you don’t know what you want to use this time for, you could end up wasting it. Bren from Bren on the Road used his time away from work to learn Spanish off the coast of Spain. He took eight weeks off of work to do this. He’s since quit his job and completely changed his life and direction.

But Bren didn’t know that he’d end up quitting his job—all he knew was that he was exhausted from working a traditional job and having others tell him what to do and where to be, and that he wanted a break to study a language he’d always found an interest in.

He knew exactly how he’d use this finite period.

And because of that, he found a new path. He met new people and decided to be a world traveler.

3. Figure out how to fund it

You’re probably getting excited now. You know why you want the break and how you’ll use the time. But now comes to the most daunting question—how will you afford it?

Despite common misconceptions, you don’t need to be rich or even debt free to fund a mini-retirement. You just have to make it a priority.

This doesn’t mean you should quit your job on a whim and pay for the break by using credit cards. In fact, that’s a terrible idea.

My advice is to instead budget for this mini-retirement. If you’ve ever read any of my articles, you know that I’m obsessed with YNAB. That’s because it’s changed my financial life. So I recommend you use this tool (or at least the methodology behind it) to fund your mini-retirement.

Here are the steps to take for this:

  1. Know how much time you want to take, in months. This can be one month or 36 months, but figure out how long you’ll be away and stick to it.
  2. Estimate how much your living expenses will be each month (rent, food, and other day-to-day costs). Don’t include unnecessary items like dining out, or gifts for friends (hey—we all want to buy cool stuff we see in local shops while traveling). Also, don’t forget to account for your rent or mortgage at home (unless you plan to sub-lease).
  3. Multiply your monthly living expenses by the duration of your mini-retirement.
  4. Estimate your total traveling costs (assuming you’re traveling). If this is a one-time expense like Bren experienced in going to Spain, then account for that. But if you’re planning to hop around to different cities or countries, estimate how much this will cost over the duration of your mini-retirement.
  5. Add it all up, and add 20 percent (yes, 20 percent—this will give you a nice buffer).

This should be your target number to budget for. Here’s an example of what it could look like:

Say you want to take a year off of work. Assume that since you’ll have to save up for this, you’ll plan it out after your current lease ends and just throw your stuff in storage.

A storage unit costs $100 per month.

You want to go to Thailand for the year and take in the local culture, then write about it. (One of my favorite bloggers did this, by the way—only he stayed).

Seems like a good why.

You figure it’ll cost you about $1,000 per month to get by in Thailand. You’re also estimating another $4,000 in total travel expenses for the year.

Your baseline total is $17,200 ($1,000 per month x 12 + $4,000 total travel + $100 storage unit x 12 months).

Now you’ll add 20 percent. Why? Because s&%# happens. It’s always smart to give yourself a buffer while you’re on your mini-retirement.

That brings your new total to $20,640 ($17,200 x 1.20).

This is the number you’ll plug in as your target amount in YNAB. Now start saving.

4. Be comfortable leaving your job if necessary

Very rarely will a company tell you that it’s okay to take a year off of work and they’ll keep your job nice and warm for you. If you have that opportunity, take it.

But assume that it’s not a reality for you. If you’re considering a mini-retirement, you’re either going to burn through most of your vacation time, or you’re going to need to be willing to quit your job.

Part of taking an extended mini-retirement is to have some time to self-reflect. If you recall the stats from above, you probably have reached this point because of your job. So maybe it’s not the worst thing in the world to walk away from it.

Before finalizing your decision to step away, make sure you’re at peace with quitting your job. You may find what you’re looking for on an extended mini-retirement, but you also may not. You have to be realistic and know that after it’s over, it might be time to look for another job.

5. Take the mini-retirement and don’t look back

Once you’ve decided to do this, do it and don’t look back. Don’t second guess your decision or feel like you have to explain yourself to anyone.

As long as you’ve figured out why you want to take a mini-retirement and you know how you can swing it, there’s no reason why you should have to justify it to anyone. If you do, you’ll end up missing out on critical self-reflection time because you’re too worried about what everyone else is thinking.

The other thing I’d recommend is keeping a journal. Whether it’s a blog or just a personal journal you write in, take daily notes about what you’re experiencing. It will not only help you reflect during your mini-retirement, but you’ll also be able to look back and recount your learnings years later (as well as potentially help others).

6. Decide what you want to be when you grow up

The purpose of a mini-retirement is to propel yourself forward in some way. Remember, it’s not just a vacation or time away from work—it should be done with purpose.

With that being said, make a conscious effort to figure out what you want to do post-mini-retirement. Maybe you’re like Bren, and you want to be a full-time traveler/blogger. Or perhaps you want to go right back into the field you left, only with a new and refreshed perspective.

Regardless of what it is, decide which direction you want to go after it’s over.

A quick note on re-entering the workforce

You’ll also want to think about how to explain this if you’re re-entering the job market. Companies aren’t going to want to hire you if they perceive you’re someone who will frequently take a year off of work. If this is something you plan to do regularly, find a job that fits that lifestyle.

If not, then you can feel comfortable explaining your decision to take time away from work, but I would strongly recommend thinking about what you’ve learned from the experience and how it will make you the best person for the job you’re going after.

Summary

Taking a mini-retirement can be an eye-opening experience unlike anything you’ve ever done (or will ever do) in your entire life. But if you don’t have a plan and you aren’t funding it adequately, it can become a disaster.

Take the time to explore the steps I gave you above in great detail, and take the time to save up for this experience. Once you’ve done that—you’re well on your way to your first mini-retirement.

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About the author

Chris Muller picture
Total Articles: 202
Chris has an MBA with a focus in advanced investments and has been writing about all things personal finance since 2015. He’s also built and run a digital marketing agency, focusing on content marketing, copywriting, and SEO, since 2016. You can connect with Chris on Twitter.