The following is a post by MPFJ staff writer, Kevin Mercadante, who is a freelance professional personal finance blogger for hire, and the owner of his own personal finance blog, OutOfYourRut.com. He has backgrounds in both accounting and the mortgage industry.
One of the benefits of achieving financial independence is the possibility of creating sabbaticals. These are breaks you can take from work, every few years. They can last anywhere from a few months to a couple of years. They are more typical in the education field, but if you have financial independence, you can work them into your own lifestyle.
After all, since we all have limited time in his life, there’s often a trade-off between time and earning money for a living. We can see the value in weekends and vacations, so periodic sabbaticals aren’t a ridiculous idea.
Early Retirement Doesn’t Have to be the Ultimate Goal of Financial Independence
The whole concept of financial independence has now become almost synonymous with early retirement. The idea is that you will reach a level of financial worth where you will no longer need to work to earn a living.
That’s certainly a worthwhile goal, but it does have a few flaws in it. The first is that it’s not likely that most people are going to reach a point where they can stop working fairly early in life, and never have to worry about money again. Another is that not everyone necessarily wants to stop working and retire. For many, it’s enough just to have the ability to retire, even if you never do.
But that’s where sabbaticals can come into the picture. Even if you don’t fully retire for the rest of your life, you can take periodic breaks during your career. For example, you could decide to work for five years, and then take a year off.
One of the advantages of this is that you don’t have to wait until you have the enormous amount of money you will need to keep you from having the work for the rest of life. Instead of waiting until you can early retire at say, 50, you can take sabbaticals much earlier in life. If you create some level of financial independence, you could even do it as early as 30. It’s a less challenging task, which makes it more doable in the near-term.
Sometimes You Just Need a Break for a While
So why would you even want to take a sabbatical? Sometimes you just need a break. For many people, working year after year is a recipe for job burnout. But if you take a break every few years – and schedule that into your life – just the idea of doing it could prevent burnout from happening.
It may not even be that you dislike what it is you do for a living. Sometimes just getting out of it for a while helps you to reorganize yourself and clear your head, so that you can come back with a fresh perspective and a new determination.
Recharging for the Next Major Advance in Your Life
It may also be that you just need some time to get yourself ready for a major change in your life. It could be a career change, starting a new business, taking a different approach with the same career, or perhaps taking some time to get some additional training or education. A sabbatical can help you to bridge the gap between where you are and where you want to go.
Sometimes those advances are not necessarily career related. For example, you may need to take some time off to be with ailing relative, or even to welcome a new child into the world. Your employer may allow you up to 12 weeks for either of those responsibilities, but you might choose to take more time. If you have achieved a solid level of financial independence, you can take that time.
Adding Rich Experiences to Your Life
Maybe you just want to take some time off to travel the world. While it may be nice to have such a plan for when you retire, what if you don’t want to wait another 10, or 20, or 30 years to do it?
Planning a sabbatical can enable you to take such a trip in just a couple of years. There’s no need to wait until you are 50 or 55 or 65. And let’s face it, even if you’re on track to retire early, there’s no guarantee how it will all play out, or what your outside circumstances will be at the time.
If you’ve achieve financial independence, you should be able to take that time now, rather than waiting for sometime in the distant future.
Creating a Series of Mini-Retirements
It’s not necessary to try and pack a lifetime of experience into a single sabbatical. You can plan one every few years. That will give you time in between to decide on new goals and directions.
It will also help you to prepare financially. Let’s say that you want to take a sabbatical in five years. If you can save 20% of what you will need to live on for a year, each year between now and the time the sabbatical starts, you will be able to take the time off and not worry about how you would survive.
Usually when people achieve financial independence, it’s because they are able to save a much higher percentage of their income than most other people. For example, while the average person might save 10% of their income each year, you may be able to save 20%, 30%, 40% or more. If you allocate some of your savings for your sabbatical, and some for longer-term savings and investments, you will be able to have the best of both worlds. That means a sabbatical in the near-term, and greater wealth in the future or whatever else you want to do.
Early retirement is an excellent life’s plan. But if you don’t entirely trust all the possibilities that the future may hold, it’s not a bad idea to plan on taking some extended time off in the not so distant future. Think about what you want to do with your life, and how a sabbatical might help you do it. You may find out that it’s the best time off you’ve ever had.
How about you all? Have you ever taken a sabbatical from your career? What were your experiences and what did you learn?
Share your experiences by commenting below!
***Photo courtesy https://www.flickr.com/photos/tylerkaraszewski/2654986116/sizes/q/
