Is Mini Retirement Right for You?

Most of us have worked hard to get where we are today. You have a nice income and your family lives financially well above 85% or more of the average citizen. Your expenses are likely higher than the average person but hopefully so is your savings rate. 

What if you want a break? What if you have some goals that you never accomplished when you were younger? Are you too late?

 

This is Your Life

You might be right in the prime or just starting your career.  You’re probably either ramping up your salary or already making more money than you ever thought possible. 

 Maybe you’re right in the middle of your career and your kids are in the middle of school. They have friends and activities they love. You love your neighborhood and community. You have friends and family around that you love. There are probably a hundred other reasons not to take a mini retirement now. 

Is there ever a reason for someone like us to shut it down for a time and take a mini retirement?

I didn’t mention that a big majority of your friends and family will think you are crazy for doing this. Oh yeah, and there’s the financial impact to worry about too.

 

What is a Mini Retirement?

What does a mini retirement look like? I would argue that it better accomplish some goals. If you’re burnt out and need to take a break that could be the reason for a temporary leave of absence right now.

Another reason is to accomplish travel goals. You could also start another career and need some time to work out the details.

Others may want a mini retirement because they feel they’ve missed opportunities with their children. Do you want to focus on them while they are young for a while?


Is Mini Retirement Right for You?


Don’t You Need Money?

What if you don’t have enough money to fund a mini retirement right now? I guess we need to ask what the definition is of “enough money”. That will be different for every person but here is my definition.

You won’t delay your future retirement plans beyond your ultimate goal and you still pay your expenses during the mini retirement. You will most likely reduce your saving rate to zero or worse. This shouldn’t make such an impact that you delay retirement beyond the timeline you wish to accomplish. 

If you want to take a year long vacation to all the countries in Europe and stay in every fancy hotel and eat at every fancy restaurant, that trip might cost more than you made in your high salary job. That probably isn’t a realistic goal for mini retirement. If you are in the top 0.1% that trip might be right up your alley.

What if you could reduce your expenses to half or a quarter of what you used to spend? That could be accomplished in some foreign countries.
Could you work someplace else with greater flexibility and a more transient nature for a three months or half the year during mini retirement and then travel the rest of the year?

Could you do that over a couple years and still accomplish your mini retirement and final retirement goals? These are all options to consider. 
Could you move someplace else so that you experience the culture of a country or region first hand and really get to know how the people live and what makes them tick with a longer stay? 

Would that experience be worth working a little longer? Only you can decide, but I can see the benefit.

Using your time while you and your children are young could give you the opportunity to show the world to your kids, accomplish some goals you have been putting off until after retirement and not have the same burdens later in life. Here are some big reasons for pursuing mini retirement today. 

Your Kids are Young 

If you have younger children, they depend on you. They have to do what you say for the most part. If you move, they move with you. If you make a certain food for dinner, they might complain but it’s either eat it or go hungry until breakfast. Put them in the car to drive them to school. They have to go.
That’s nice because it takes a lot of the guess work out of coordinating future schedules. If you want to take a mini retirement now and travel the world in a sailboat or travel the country in an RV, as long as you have room for the kids, they can come along.

If you wait until retirement to accomplish your travel dreams but want to experience those dreams with your children, you will likely have a hard time coordinating with them. They’ll have their own lives and want to pursue their own dreams.

Is Mini Retirement Right for You?

Hurry up Dad and take the picture, We want to get down the mountain!

You’re Healthy and Full of Energy

None of us are getting any younger. You’ll likely not getting healthier. As we age our bodies degrade. It’s a fact of life. You might be postponing a big trip or a big goal. Once you’ve saved enough money or reached career goals, you may have health problems that impair your ability to accomplish that goal. There are numerous examples of a couple saving and saving to eventually realize a retirement dream and then one of them falls ill and they can’t follow through. 

Others wait and wait to find the perfect property where they can have some land or live near a river for fishing. By the time they get around to looking, they realize they’re just too tired to accomplish their goals.

Your health and energy are your greatest assets. You should think about maximizing its use while it’s putting out the highest returns.

 

Gain Life Changing Experience

I’ve read blog after blog about people that have taken the plunge to go out into the world for a time and realize their dreams. They return more fulfilled, more confident and ready to conquer anything. 

Take this couple for example that sailed around the world with their two kids. They flew to Turkey, learned to sail a 40 plus foot sailboat and then took it three-quarters around the world.

The husband reported that his work life has never been better since he returned to his home in Australia. He says that he gets bigger and more important projects in his engineering firm now because his bosses and coworkers know he won’t get over stressed and can accomplish huge goals. He doesn’t sweat the small stuff because he sailed a boat around the world and took his kids! Is there anything harder than that?

Setting out to accomplish a dream and succeeding with that dream could also give you valuable skills that pay off in a career someday. 

The family also reports an amazing change in the children. They have a knowledge of the world they could never gain by staying close to home. They have amazing stories and experiences to share and impress future employers, college recruiters and investors. That is a gift that is difficult to top.

 

Get Off the Hedonic Treadmill

Some of us may have reached a point in our life where we are fed up with all the stuff we have. It’s difficult to know where to start reducing. Maybe a mini retirement will give you the motivation to get your life organized.
Another tactic could be to hit the road. If you sell everything and start traveling, that is an extreme but very productive way to get of the hedonic treadmill. Then after your mini retirement, you could resume a more minimalistic lifestyle.

You don’t have to sell everything. You could put things in storage but limit yourself to the most important possessions. Maybe sentimental value or irreplaceable heirlooms could be kept in storage. Regardless, a small storage facility is a lot less to manage each month than a big home.

Even taking time from a career can help you reevaluate what is important and give you the time to get rid of the things you have been meaning to get rid of for months or years.
Multitasking is difficult. Most of us are terrible multitaskers. Take time off to focus on selling material items you don’t want or need and make a clean sweep of it.

 

Your Own Parents are Independent

Most of my reading audience is between 24 and 45.Right now that is about 70% of you. If you fall outside those parameters, I’m sorry.  For readers that fall within that range, your parents are probably still able to live independently. They may not be as active or healthy as in the past, but they don’t need constant care. What better time to break away and do something when you don’t have to worry about how your parents are fairing without you there for them.


The reality is once they require more constant medical care or need help with decision making, healthcare management, and financial considerations, it will be difficult to break away and do something that is far away from them.

Obviously those on the ends of that age demographic I spoke of earlier are going to have different circumstances, but if your parents are healthy now, they aren’t always going to be that way.
You might have to put off retirement dreams and adventures while you take care of them and miss opportunities in your own life.

 

You Won’t Lose Your Community

If your mini retirement involves travel or moving your family to a new location, lots of people are worried about leaving their friends and extended family. We have the ability to stay connected more than ever. I think connecting is a decision more than a function of location. With internet connections, Skype calls, cell phones, instant picture uploads and the variety of social media apps, we can still stay connected.

My wife has two great friends that she remains connected with even though they have moved thousands of miles away from us. They send packages, write letters, make videos and type text messages. 

I know nothing beats having a face to face conversation with another person for connection, but remember we are talking about a mini retirement here. This isn’t permanent. If you want to travel the world via hot air balloon, that doesn’t mean you can’t move right back to where you are now once you’ve finished. This could give you an opportunity to make other great friends and cultivate new life changing connections.

 

Excuse for Family to Come Visit 

If you mini retire, this is a great opportunity to play tour guide to your loved ones. It is always hard to maintain a career and high productivity at work when you have friends visiting from out of town. It is difficult to focus on them and give them the attention you would like to give. If you don’t have to focus on the distractions (like a career), you can focus on them and build lifelong memories. This could be a great time to encourage your far away friends to travel and take a mini retirement of their own. 

On the other hand, if you decide to travel during mini retirement, what a great opportunity for the people you love to come visit you! Travel to Europe and set up shop in Paris for a few months. You’ll have time to scope out the restaurants and best places to visit. Then have your brother, sister, parents, best friends or whoever come visit.

You get to share those discoveries with them. It is a great gift to be a safety net for them and gives your loved ones a wonderful experience in a foreign land. That mini retirement affords you the time to get to know a place and culture. Then you can share that knowledge all the better.

 


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Will you have Regrets?

I know this isn’t for everyone. If you don’t have the finances or you have other obligations that don’t allow you to get away, its a difficult task. It’s comfortable to stay put and keep doing what works. It’s not bad to keep working and retire only once.

I want to encourage everyone to examine where they are and think about the opportunities you could be missing. If you are good with your life and what you’ve done, then great. If you put off a lot of “crazier” goals to pursue a more conventional life, then take a step back and see if you need to defy convention. Take is from Mark Twain.

Twenty years from now you will be more disappointed by the things that you didn’t do than by the ones you did do. So throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover.
–Mark Twain


What do you think about mini-retirement? Is it too big a risk? Do you hope to try it? What could go wrong? Let me know your thoughts.

Continue on to the next part in the mini retirement series – Funding Mini Retirement

Tom
Tom is a doctor, husband and father of five with a passion for parenting and finance. When he isn't skateboarding, riding BMX, or jumping on the trampoline with his kids, he is reading and writing about personal finance. He helps high income parents educate and mentor their kids to become financially, emotionally, and intellectually self sufficient.

14 Responses to “Is Mini Retirement Right for You?

  • I think one way for physicians to implement this is to do it in between jobs. If for example, you have a 1-2 year restrictive covenant in your contract, then that time in between jobs could be used as a mini-retirement. Obviously not for everyone, but it’s potentially one way to squeeze a mini-retirement into your career in a relatively seamless way.

    • Thats a good strategy. I wonder if it would help more of our colleagues stay away from burnout.
      With the high student loans most physicians have coming out, I bet it is daunting to think about an mini retirement with those hanging over their heads though.

      Tom @ HIP

  • Oh man, with Ms. Montana and Keep Thrifty taking Mini-Retirements, it has definitely put a bug in our ear. Who knows, maybe one of us will join them in a few years… 🙂

    • I wrote this to help me think through the process as well. I just took care of a 43-year-old with terminal cancer the other day. She was fishing up in Alaska when she started feeling poorly and turned out to have metastatic pancreatic cancer.
      It makes you think twice about putting off some dreams to keep chasing that retirement number.

      Tom @ HIP

  • I am a huge fan of the mini-retirement Idea. This is why we moved to Argentina in 2010 to live and work for 10 months. Now we need to plan step 2. I debate at what age we should take our son (4,5,6) and the ability to take the time off work (mini-sabbatical) but a 6 month traveling trip would be awesome. Plus you never know where it will lead.

    I did write a post on how to take a mini-retirement earlier this year. I agree with Wall Street Physician, in between jobs may be the best way to do it.

    • That was an awesome post DDD.

      Here’s the link if anyone wants to read. I’m looking into ways to work outside the US currently but I know zero about it.
      If you know ways to do this you should write a post on it at your site or we could trade guest posts if I could contribute to a topic you’d like covered.
      In between jobs does seem the way to go, the problem I have is I like my job and I think it would be hard to top it.

      Tom @ HIP

  • I can definitely see the benefit, but timing can be difficult. There’s an old farmer saying, make hay while the sun shines. Loosely it means if your high income bringing it in do so because tomorrow might not have the same opportunities. At the same time I see the value in avoiding burnout and trying to do so in a career lull.

    • That’s a good point but what if your hay is your young family and health? If you want to do something physically intensive, it might make sense to do so with a young body even though you aren’t financially independent.
      It’s a balance. There’s no right answer but sometimes we are so focused on hitting that number, we might need to take a step back and see if the number is our ultimate goal.

      Tom @ HIP

  • VagabondMD
    3 months ago

    Great post! I love the idea of a mini-retirement (maxi-retirement, part time, or anything) to get off the hamster wheel and recharge. It is really hard to pull the trigger, though, and walk away from the income, as Full Time Finance alludes.

    Additionally, if you have two earners, the strategy is different. Do both mini-retire at the same time, do you stagger mini-retirements. And what do you do with the older kids (high school and college age)? When you have one person pulling all the earning weight and small children, your choices are much different than with two earners and older kids.

    Thank you for posting this. Lots of interesting things to think about.

    • Two successful earners do make the equation more complex. Staggering the mini-retirement would make more financial sense but might not make sense for the mini retirement goals if they involved traveling abroad or something similar.
      Older kids make it more complex as well. If I was going to travel with my family, I’m already thinking about my oldest going to college in three years. That presents challenges even before he leaves due to applications and the logistics of that.
      Maybe Tim Ferris has the best plan to let your business run itself and then live the retirement lifestyle while you make money. Easy, right? 🙂

      Tom @ HIP

  • I’ve been contemplating a mini-retirement for a few months now since ive been faced with burnout from the sudden loss of a partner. I call it test-retirement so see just how I would fare without a full time practice. I’ve been thinking of tapering down my schedule to half-time over the next 5 years and see how things go along the way.

    I’m relieved you didn’t mention the cost of mini-retirement in terms of the monetary opportunity cost of not working for a while. It’s about so much more than the “number”. It’s cliiche, but you’ve gotta enjoy the journey because you could slave until 45 or so trying to get financial independence and just hate like until then thinking the payoff is huge. Then uh oh, metastatic pancreatic cancer in you or spouse or parent or a child with a serious illness. I’m an oncologist, I see it every day. “But doctor, I’m just so young, why did this happen?”

    The best laid plans of mice and men.

    Don’t forget that you own health isn’t the only think that could derailed your 10-20 year plan. The bigger your family, the more risk there is. Motivating post!

    • That is a really good point. Not only are we racing against our own clock, our loved ones’ health could also derail our own plans. This goes back to the part about taking care of your parents. It is hard to get away when they aren’t healthy anymore.
      I agree with you that this is a topic that isn’t only about money. In an upcoming post, we will look at the financial implications. Some of the difference in time worked isn’t as big as you would think.
      God bless you for doing oncology. You’re a stronger doc than me.

      Tom @ HIP

  • Great tips! My husband and I plan to do one year in an International school overseas when the child(ren) are school age. I’m on maternity leave right now and waiting for baby to come (first baby) so it sort of feels like a mini-retirement haha. But it would be even better if I was somewhere overseas. Life is too short to wait until age 65 to enjoy life! I have a post coming up about my reason for Financial Independence and it’s about being part of the sandwich generation- I have 11-14 years before inlaws and parents hit their 80’s and start becoming frail!

    • That’s a big concern for us as well. Our parents aren’t getting any younger and we want to be there for them when they need us. It might be hard to take extended time off when that time comes.

      Tom @ HIP

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