If you want to go to the next level in life, a mini-retirement can help with that. Learn how to take a mini-retirement to plan successfully and make your plan a reality.
Many people are stressed and tired in their day jobs, feeling like they need a break. Mini-retirements can provide that break to you, giving you time to think about what you truly want out of life and do what makes you happy.
Mini-retirements can be entire years, or just a month or two. It depends on your personal preference, if you want to keep your job, and more.
Personally I’ve had a mini-retirement when I just graduated from university, where I traveled to South America for four months and choose to stay at home a few months before I started my working career. Recently I’ve taken a mini-retirement with my partner, where we’ve traveled through Central America for four months.
It may seem hard or even impossible to have a mini-retirement yourself. I am here to tell you: it is not impossible. You CAN have a mini-retirement.
If you plan accordingly, prepare for what you’re going to do and actually act on that – you’ll notice how straightforward it is. After that, you can take a mini-retirement every few years or so!
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What Is A Mini-Retirement?
A sabbatical, gap year, or mini-retirement. All names for the same thing.
A mini-retirement is an intentional period that you take to be away from work for a certain period of time. It requires you to plan beforehand what you want to do and how you’re going to finance it.
When you’re taking a mini-retirement, just the act of taking a step back from work and doing what you want to do can bring a lot of insights.
If you’re the right person in the right situation, a min-retirement can be eye-opening and bring a lot into your life.
Why Should I Take A Mini-Retirement?
When I’ve taken my mini-retirements, many people are concerned about my career. What if your employer doesn’t want you back? What if people ask what you’ve done in those few gap months on your resume?
First of all, many people are taking a mini-retirement, gap year, or sabbatical from work. Many companies even have a policy for that, where you can take a sabbatical as soon as you work for the company for over X amount of years.
Besides that, because it’s so widely accepted in society I doubt anyone would make a big deal out of it. The most common thing I hear is: “I wish I could do that”, or “You’re lucky your employer let you”.
Really Take Time Away From Work
For the average American, only 28% plans to take all their vacation days. Even people who have paid benefits don’t take the maximum time away from work.
Breaks from work can be extremely good for you. It will boost your productivity, it is very beneficial for your health, and your mind will thank you for it. Besides that, time away from work will help you prevent burning out and it will let you better cope with stress.
So work is a major stress factor is people’s lives, making it important to take time off to refresh.
Besides that, the trend is more and more companies are offering extended time off of work. This can be in the form of a sabbatical or a mini-retirement. People who take time away from work for a longer period of time come back more productive and happier.
How To Take A Mini-Retirement?
Many people think that you have to give up a shitload of money and your future career if you want to go on a mini-retirement. That’s simply untrue.
I have spent a total of €8.200 in 2019, which includes 4 months of traveling. Besides that, I can pick up where I left off with my career.
So if you want to know how to take a mini-retirement, here are some steps to get you started:
1. Know Why You Want A Mini-Retirement
Before you dive head-first into your mini-retirement, know why you want to do it.
Do you want to travel?
Do you want to pick up a hobby you never had the time for?
Would you want to build your side-hustles into a full-time income?
Would you want to have more time to spend with the people that are important to you?
It is good to think beforehand about what you want to do with your mini-retirement, just like you think about your why for early retirement.
2. Are You Able To Fund It?
It’s a lot of fun to think about what you want to do in your mini-retirement and why you want it. But in order to really take the mini-retirement, you need to break down the costs. You need to be able to fund it.
Many people believe that you need to be financially independent or debt free to take a mini-retirement. That’s not true.
You need to make sure that you make your mini-retirement a priority. When you know what you’re saving for, motivation is often way greater.
Know how much money you need to save:
- Know how long you’re taking the mini-retirement for
- Estimate total costs – this can be traveling, working on your business, or any options for mini-retirement.
- Add up 15% – just as a buffer to make sure you’re having enough and don’t need to stress about money
Once you know how much money you need, you need to start saving for it.
One great way to fund your mini-retirement is by creating a budget. It is not for everyone, but it’s an easy way to know how much you can save towards your mini-retirement monthly.
Another great option is to pay yourself first, where you’re funding your mini-retirement account first thing every month. That way you’re sure that you have enough money to fund your entire time off work.
In order to track your progress towards your mini-retirement savings goals, make sure to develop a monthly money routine where you track your finances.
3. Build Passive Income
Passive income can be a great source when you’re planning for a mini-retirement.
It definitely speeds up the process of saving for your mini-retirement and funding your experience.
Besides that, you’re getting income when you’re on your mini-retirement, helping you when there are some unexpected situations or expenses. It never hurts to have some extra.
It takes time to build passive income, but believe me when I say it’s well worth it. There are many ways to build passive income, my favorites being:
- Peer-to-peer lending – where you lend money to people or businesses through a platform against 10-15% interest. Be aware that this can be risky and invest only what you can lose.
- Real Estate Crowdlending – where you invest in a small portion of a real estate project, giving you monthly passive income just like rent. The building itself is collateral, meaning that the risk is lower compared to peer-to-peer lending.
- Low-Cost Index Funds – where you buy shares and get monthly or quarterly dividends from it.
4, Leave Your Job If Necessary
Depending on your job, you may need to leave or negotiate for a mini-retirement.
I negotiated a mini-retirement with my boss, taking unpaid leave and using up my holidays. It depends on your specific situation.
However, I was prepared to quit my job if my manager wouldn’t agree with my proposal. Part of why you’re taking the mini-retirement is to take some time away from the job. Do things that you don’t have time for when you’re working.
Once you’ve planned for it, go for it!
You have figured out what you want to do, how you’re going to afford it, and you’ve built passive income along the road. That’s amazing!
Go for your dream and don’t let anyone tell you otherwise. Do what it is you want to get out of the mini-retirement and reflect on it.
Most of all: enjoy! You’ve worked hard towards this and you deserve to enjoy every single minute of it!
All In All
Taking a mini-retirement is a great experience that will enrich your life. Plan for it, save for it, and you will have the best time!
Once you’re gone through all the steps outlined above, you will take your first mini-retirement in no-time!
Do you want to have a mini-retirement? What do you think?
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