The micro-retirement trend is seeing more people, especially young people early in their careers, take a step away from their working lives for extended periods of time.
As the name suggests, it involves taking extended breaks, or small ‘retirements’, from one’s career, either to travel or simply live a little.
For many, especially those with endless wanderlust, it sounds like an absolute dream but pursuing a micro-retirement can be detrimental to your career and finances.
While the benefits for some may outweigh the cons, one career expert suggests taking some precautions before making the leap.
What is a micro-retirement?
The trend was coined in 2007 in the book The 4-Hour Workweek by Timothy Ferriss, but has become increasingly popular on social media, especially since the COVID-19 pandemic.
“A micro-retirement or a mini-retirement is a planned break from ‘standard’ full-time work, normally taken to recharge the batteries, up-skill, explore personal interests, travel or pursue lifelong goals,” Dr Giuseppe Carabetta, associate professor of employment law with the University of Technology Sydney Business School, says.
“Unlike retiring at the end of your career, they are interspersed throughout your working life, and sometimes even across multiple types of jobs”.
Dr Carabetta says they can last “from a few weeks, to several months or even a year”. It can be similar to the traditional ‘gap year’ taken by students before uni, but can be taken during studies, between jobs or even in the middle of your chosen career.
Why is it popular?
Dr Carabetta says the trend is especially popular among younger generations who tend to place more value on work/life balance.
He believes younger generations, mainly Gen Z and millennials, tend to put more emphasis on “personal fulfilment and experiences” and want to “seek ‘purpose’ in life beyond work”.
Rather than waiting until they reach retirement age to have the freedom to travel or pursue those passions, this trend is seeing younger people choose to pursue them now.
Why do people take a micro-retirement?
According to Dr Carabetta, people may choose to take a career break “to prevent burnout and improve mental health”, others may take one for personal growth, to explore hobbies, to gain extra education, or take on caregiving responsibilities for children or elderly parents.
But a big reason for taking a micro-retirement, especially among young generations, is to have extended time to travel.
A break to travel around the world
It was Zara Lim’s desire to travel that saw her take an 18 month micro-retirement in her late 20s – an idea borne in the midst of the COVID-19 lockdown.
The Melbournite, who works as a digital marketer, decided to throw herself into her work during the lockdowns and save as much money as she could for whenever travel was permitted again.
When the world opened up again, Lim, who felt she had reached a ceiling in her role at the time, decided it was the perfect time to make the leap.
Over 18 months, Lim used her savings and some sporadic freelance work to fund the trip of a lifetime. She climbed Japan’s Mount Fuji, saw the Northern lights in Norway and soaked in the sights of cherry blossoms in South Korea.
They were the kind of experiences Lim says would have been much harder to tick off under the constraints of a full=time job.
“Being able to travel for an extended period of time lets you travel in a different way,” she tells 9honey.
“[With] your normal annual leave, a week gets taken up by Christmas and you want to be home, so you really only have maybe two and a half weeks to pick one trip or a few destinations.
“I think having the flexibility to travel for a long time just allows for more experiences that you might have missed out on.”
Lim also believes extended trips allow travellers to properly immerse themselves in their destination and get to know the people and the culture.
“You can’t really do that in a week-long holiday where you’re usually staying in a hotel and doing a tour and all the touristy things,” she says.
Lim, now 30, wrapped up her micro-retirement earlier this year and has jumped back into a full-time remote role. She has no regrets about taking time off and believes it’s something everyone should try to do.
“A lot of people have their work tied to their personalities and sometimes being in the grind for so long, [work] just becomes who you are… I think taking a break really just helps to find your identity outside of work,” she says.
“I think you also want to discover who you are outside of just your work and your job.”
A family sailing adventure
Lim is one of many who have made the leap into a micro-retirement. Erin Carey and her husband, like Lim, felt there was more to life than the traditional nine-to-five work life and decided to do something about it.
Inspired by a sailing documentary and other families who had sailed the world, Carey and her husband decided to pursue adventure and travel around the world with their family on a sail boat.
“Our motto became, ‘If they can do it, so can we’,” she tells 9honey.
From that moment, the pair threw all their energy into making the dream a reality and spent two years saving up for the adventure.
At 37, Carey stepped away from her full-time government job to sail around the Caribbean and across the Atlantic Ocean with her husband and their three kids for two years. They loved it so much they set off on another two-year sailing trip when Carey was 40 and are now planning a third.
To fund the trips, the duo initially relied on savings but Carey went on to start her own business – a travel PR agency called Roam Generation – which she is now able to run from land or sea as they travel the world.
For Carey and her husband, their desire to pursue such a mammoth adventure was borne from their love of travel, but also because they felt “a little bit disillusioned with the way everything was set up in society and how we spent so much time at work”.
“I wanted to spend more time as a family and make memories rather than just work all the time.”
Risks of taking a micro-retirement
Lim and Carey’s adventures sound amazing, but Dr Carabetta says there are some cons to taking such a big step away from your career.
“Unless you’re well-financed and smart about your money and your future savings, an extended career break can have significant financial cons, particularly in terms of earning capacity and super contributions,” he says
Carabetta also acknowledges “wealthier individuals have more flexibility” in this instance.
When it comes to career progression, Dr Carabetta says taking a career break “can lead to outdated technical or on-the-job skills, especially in fast-evolving fields like tech or finance”.
It can also mean missing out on “raises, long-service entitlements or even promotional or leadership opportunities”.
Dr Carabetta adds that some employers may view it as “a lack of commitment or ambition” but says this is slowly changing with shifting societal norms and some employers valuing employees who have diverse experiences.
Is it worth it?
While there are some financial and career risks and it’s not the path for everyone, Dr Carabetta believes there is value in taking micro-retirement for those who want to as long as they have the financial resources to do so as well as the employability (skills and experience) to return to work after a break.
“[In Australia] we are now working appallingly long hours, and this will catch up to us,” Dr Carabetta says.
“Up until the ’90s, we used to be fairly ‘chilled’ and everyone would be at the pub or the like by 5pm on a Friday. Nowadays, the cleaners of large buildings need to wait until late in the evening to come in and be able to clean the workplace.”
It’s because of this that Dr Carabetta believes some people have developed a different mindset towards work and careers and this desire for “meaningful breaks”.
While Carey and Lim, who are both passionate advocates for taking micro-retirements, have both returned from their breaks to careers they are happy with, Dr Carabetta stresses it is important to consider the potential cons of taking an extended break.
But for those who are seriously considering stepping away from their careers to pursue travel or a new passion, he has some simple advice.
“I’d tell them to go for it, provided they carefully plan for it and consider strategies for minimising the potential negative impact on things like superannuation and long-service type entitlements.”