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We live, change, and grow at different paces and in different sequences, and our financial life should affect those differences. Patrick turned 18 and left his parents’ house when his mother was 41 years old. My dad was still childless at the same age: He became a father when I was born, at age 44. Even though Patrick’s and my parents decided to share a common experience, they picked entirely different points of their lives to have that same experience.
Becoming a parent is one of those life-changing experiences that varies significantly in timing from person-to-person, but your biggest financial decisions can vary just as significantly. Buying a home or other real estate, achieving financial independence, or expanding your family can happen at different times in your life and in any sequence you prefer.
Retirement, or a sabbatical if you prefer, is no different.
What is a Mini-Retirement?
A mini-retirement is the intentional choice to take a significant gap in working, whether six months or multiple years, to recover and/or enjoy fulfilling experiences that cannot fit into your day when coupled with the typical constraints of a work schedule. When someone leaves the workforce with enough financial stability to say no to work for months or years but knows from the start they will need to accumulate more money eventually, this is a mini-retirement.
Mini-retirements may involve life-changing adventures or just provide a change of pace. There are no rules regarding how to spend your time while happily funemployed, as long as it fulfills your own goals and happiness.
Why Plan a Mini-Retirement?
The socially acceptable timeline that we are all supposed to follow is to start working sometime in our teens or twenties, work for 40 or more years, and then retire to a retirement community to enjoy our “golden years.” I personally find this to be an absolutely terrible life plan. We waste our most mobile years either sacrificing our mobility for a grueling job or sitting immobile at a computer until we cannot stand up from a chair unassisted because we spent too much time sitting in a chair. Absolutely illogical.
In Set For Life, Scott Trench points out that this timeline encourages you to spend the best hours of your days and weeks and the best years of your life working rather than finding adventure, achieving non-work goals, exploring ideas, or improving your community. If you are still under age 30 (or older with a good start on your financial stability), just go read his book because he can help you retire early enough to still have your youth and health in retirement. If you are starting your journey towards financial stability a bit later, you can still reclaim some of these best years of your life through an early retirement or early retirements.
If you are 45 and know you will need to work another fifteen years before retiring but you also want to train and climb Mount Everest, a mini-retirement may be for you. Your chances of success are physically much higher at age 45 than age 60, and work will be there when you return. Take two years away from your “golden years” and enjoy them now while you can easily run, jump, and climb. Oliver Burkeman teaches us that accepting that life is fleeting can actually empower us to use our approximately 4,000-weeks to add joy more intentionally in Four Thousand Weeks: Time Management for Mortals. In Die With Zero: Getting All You Can From Your Money and Your Life, Bill Perkins recommends plotting out the prioritized experiences you hope to have and determining which age range would be optimal for them (for example, go on a rock climbing trip at age 35-40) to make the most out of your time and physical capabilities at various ages. If you identify a number of lengthy experiences that cannot wait until your sixties, or later, a mini-retirement may be the solution.
For the athletes and adventurers, the advantage of a mini-retirement is apparent, but it still adds value to those simply seeking calm and nature. Spend a year going on walks on the shore or sitting in the sunshine with a stack of books without worrying about email. Stay home for the first three years of your child’s life just to enjoy watching the wonder spread across their face when they have each experience for the first time. Take a year to try to build your own business, and go back to work if it fails to support you. Make a small cottage in the Italian countryside home for a year, and enjoy a lifestyle that costs only $20K for the year. Or just take a year because you are on the cusp of burnout. You do not need an explanation.
How to plan a Mini-Retirement
On the path to financial independence, you slowly grow a financial runway.* At first, your money could support your lifestyle for a year, then two, and so forth. As your financial runway grows, it also indicates how long you could theoretically step away from work without receiving a paycheck. While we do not advise draining an emergency fund or withdrawing funds from your IRA early, you can create a high-yield savings account (HYSA) to accumulate a financial runway once the previous accounts are funded. Make that HYSA your long-term happiness spending goal, and save up as much as you need to support yourself for as long as you hope to leave.
If you relocate to a less expensive area, using geoarbitrage as suggested by Kristy and Bryce in Quit Like a Millionaire, that financial runway will go even farther. Hypothetically, you could save up the equivalent of six months of expenses in New York City and survive for two years in Hungary. If your plans involve adventurous activities with a price tag, research those in advance and plan for those costs as well as the cost of your time away.
The most common fear regarding taking an early retirement is the difficulty to return to work. Here is the reality: Jobs are completely unsafe anyway, and your employer can decide to fire you at any time, so do not let this fear hold you back. (I say that as someone with a job in a safe and high-dollar industry: Jobs are never safe.) Others fear that employers will not want to hire them due to employment gaps. In reality, discussing your adventures over that time will make you stand out from the competition, but if you still have fears, hire me to write your resume when you are ready to return to work, and you will end up with a better job at the end of your mini-retirement. (Just note that you want Xa’s resume writing services. Patrick is not an expert in this area. 🙂)
If you have many goals for different points in your life, you can even plan to take multiple mini-retirements throughout your career to break it up or go after different experiences. There is no one way to have a mini-retirement: You are already off the normal path, so embrace your path.
*For more on building a financial runway, read Scott Trench’s Set for Life.
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