Recently, I had a conversation with a good friend of mine who just came back from his hometown after spending almost a year with his dad. His dad is having some old age-related health issues and might not be able to function like in the past.
My good friend who is in his mid-forties, married with no kids decided to quit his full-time job as he had a burnt out at work during Covid and thought that it might be a good opportunity to spend some time with his aging dad who stays alone in his hometown. Moreover, he has been working in the same company spanning two decades and had never really taken a break before. Initially, he faced quite a bit of resistance from siblings, relatives, friends, and ex-colleagues about quitting his full-time job to take this much needed break. They cited some legitimate concerns like:
- You might lose some momentum in your promising career
- You might lose the competitive edge over your peers
- You might lose quite a bit of income if he is out of work for a prolong period of time
- You might not be able to find a job of equivalent compensation with good benefits
But what the people around him do not know is what his financial situation is like and I listed some of it as below:
- He owns two fully paid-up properties in Singapore (HDB) and his hometown (condo but left vacant) with no other liabilities
- He built up quite a sizeable emergency fund of 3 years allocated into cash, bonds and short-term cash solutions.
- He also has an investment portfolio made up of stocks, funds and ETF which churns out dividends periodically which could cover some of his fixed expenses
- Adopts a simple lifestyle with no big-ticket expenses to maintain and does not drive a car.
Before he concluded to quit his full-time job where he is facing a burnout and do not find joy in his life anymore, he was not really sure if it is the pandemic situation or his workload that is affecting him, but he is very sure that he needs to take a break. So, he came to me to ask for advice as a friend.
As a life and financial coach, I always advice that whatever financial goals you have will always link back to your life goals.
- Do you still like your current job after working there for almost two decades? No
- Do you have any more liabilities? No
- Are your monthly household expenses high? No
- Can you afford to take a break? Yes
- Is your spouse supportive of this decision? Yes
- Do you miss your dad a lot? Yes
Then I introduced him to the concept of “Mini-Retirement” made famous by Tim Ferriss who wrote the book “The 4-Hour Workweek”. I told him that his career trajectory does not have to be linear and its alright to take a mini retirement before looking for the next job stint, do a career switch or maybe pursue his own passion projects. The traditional career path that spans over 30 or 40 years is no longer relevant nowadays and people could potentially break up their career paths into multiple 3-, 5- , 7- or 10-years segments so that they could try out some exciting jobs/projects or business opportunities every now and then.
Essentially you could take a series of intentional breaks throughout your life rather than one final retirement after laboring for almost all your life. This concept is very different from a sabbatical or unpaid leave that we are more familiar with. Now, we’re talking about a clean break from your current employer, reentering the labor market on a later date or maybe starting the business you’ve always dreamed of having.
But the financial barriers usually form the biggest concerns about taking a mini retirement and you really need to consult a trusted financial advisor to make sure you could afford one. Below are some simple pointers to take note of before taking the plunge:
- A solid understanding of your personal expenses which includes your utilities, food, transport, insurance, housing costs etc.
- Decide on how long this mini-retirement is going to take
- Set some simple objectives so that you could have a bit of focus during this lull period
- Budget and setting aside enough savings specifically for this mini retirement
- Finding affordable healthcare options during this period
In the end, he was really grateful that he took this “mini retirement” to accompany his aging dad whose conditions improved and the experience was priceless especially during this tough Covid times. He had a lot of soul searching moments and was able to identify what he really wants to do in this next phase of his life. He is now exploring a mid-career switch to another industry that he is very excited and passionate about. Nowadays, he is more purpose-driven and is trying to design a lifestyle around his work.
You can buy a lot of things with money, but you could never buy time.
A gentle reminder to treasure your time with your loved ones when they are still around you and practice self-care.
“Most people choose to live their life by default, very few live it by design”.
So, do you want to live your life by default or by design? The choice lies within you.