Mini retirement is the new sabbatical—should you take one?
As burnout rises and careers get longer, Indians are rethinking the traditional work arc—with planned breaks that offer rest, reflection, and a reset.
We’ve all heard of retirement—that long-anticipated moment when you finally hang up your boots. In recent times, the concept of a sabbatical has gained ground. Women have taken sabbaticals to care for newborns, while men and women looking to test the waters as entrepreneurs have done the same. A mini retirement is slightly different.
Unlike a sabbatical, a mini retirement is not just a one-off break. It can be longer, more frequent, and something you can actively plan for. Over the course of your career, you could take three or four such mini retirements. It’s a structured escape from your 9-to-5 life. Tempting as it sounds, it comes at a cost—and we’ll get to that shortly. First, what typically triggers a mini retirement?
What could be the triggers for mini retirement?
There can be many reasons to consider a mini retirement. For one, you may be in a high-pressure job where long hours and constant travel put you at risk of burnout. A mini retirement gives you time to recharge.
Or perhaps you’re at a crossroads in your career. With rapid advances in fields like AI and machine learning, you might want to pause, retrain, and reorient yourself toward a more tech-driven future. A mini retirement gives you the space to rethink your goals and pick up new skills.
Then there are the more personal reasons. You might want to take a year off to indulge in your hobbies—travel to exotic locations, explore your interest in philately (stamp collecting), or simply unwind at a mountain retreat. It’s a well-earned break and an opportunity for some long-overdue me-time.
Or you may want to support your daughter through her engineering entrance journey. After all, there’s no price tag on being there for your family when they need you most.
Can you plan your mini retirement?
Let’s take a practical example. If your daughter is three years old today, you know she’ll be applying to engineering colleges in about 14 years. That gives you time to plan your cash flows. But before you get to saving, there are a few things to sort out.
First, if you’re planning a one-year break, make sure you have enough liquid reserves to cover your home expenses and EMIs.
Second, free yourself from high-cost debt like credit cards and personal loans. Paying with debit cards may be a hassle, but it's a safer option when you're not earning.
Third, check your health insurance. If your employer’s group policy ends during your mini retirement, make sure you have a personal floater policy in place. And above all, don’t skip your life and health insurance premiums—you don’t want to lose that cover at this critical juncture.
Is it possible to plan for a mini retirement?
Let’s revisit that earlier example. Your daughter is three now and will apply to college in 14 years. That’s your timeline.
Assume you expect monthly expenses of ₹2.5 lakh during your one-year break—including EMIs. That’s ₹30 lakh in total. With 14 years to go, you can afford to take some risk and invest in equity funds.
Here’s how to go about it: plan to invest for 13 years and reserve the 14th year for staggered withdrawals. Assuming an annualized return of 13.5% (post-tax), you’d need to save ₹7,500 per month from now to meet your goal.
Of course, insurance should be handled separately. Always plan in post-tax terms—that’s what actually hits your bank account. And while the 13.5% return is a working assumption, be conservative. Run the numbers with lower returns too. After all, mutual funds are subject to market risks.
Five points to ponder before you jump into mini retirement
Even with a solid plan in place, it’s worth asking yourself a few tough questions before taking the plunge:
Do you have a monetizable skill that could bring in some income during your mini retirement? Even a few hours of work a week can help you stay connected with your professional network.
Are you comfortable with the career risk? A one-year break—especially during a highly competitive phase—could affect your relevance in the job market.
Can you negotiate with your employer? Some companies are open to holding your position for key employees. It’s worth a conversation.
Do you have an exit strategy? Things may not go as planned. Stay open to returning to the workforce sooner if needed. A Plan B never hurts.
Will it derail your long-term financial goals? Your mini retirement should fit within your broader financial plan. If it doesn’t, it may not be worth the trade-off.
Nehal Mota, Co-Founder & CEO, Finnovate
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