New ‘mini-retirement’ trend offers young workers ‘happiness’ as Baby Boomer ‘glory years’ dream dies
Liz and Anais have both taken career breaks and they said it has been incredible. (Source: TikTok)
Young workers have started to take “mini-retirement” breaks from their careers in a massive shakeup from their older predecessors. The new work trend driven by Gen Z and Millennials involves several breaks sprinkled across your professional life to capitalise on your youth and avoid burnout.
A Gallup survey recently found the youngest workers are significantly more burnt out than those aged 55 and older (50 per cent vs 34 per cent). Liz Leatrice is on a mini-retirement and said it’s the best way for her to navigate the next few decades.
“I’m not the only person terrified of going to an office every single day, [with] two weeks [of] vacation year, and then retiring at 65 and having to fit decades worth of living into your life,” she said.
“My entire goal with this is to enjoy my life to the absolute fullest when I’m healthy and young, while also being pragmatic, saving for the future and making sure I’m as healthy and wealthy as possible when I’m older.”
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It’s called a mini-retirement in some circles, micro-retirement in others, and even micro-dosing retirement elsewhere.
Instead of taking a few weeks off every year with annual leave, the majority of workers embarking on a mini-retirement are quitting and taking months or even years off.
This is where it splits from the more well-known career break term of a sabbatical.
Under that model, you’ll down tools for a few months and come back to the same role.
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However, those doing a mini-retirement will likely have to find new employment when they’re back and won’t be paid during their time off.
Also, you usually only take a sabbatical once in your career, however, you could have multiple mini-retirements spread out over decades.
There are a bunch of reasons why workers might want to do this, but many do it to protect their mental well-being.
The thinking is that if you have an extended break, you’ll come back more refreshed and ready to work, plus you’ll get to do travelling or something exciting while you’re young and mobile.
Waiting until you’re older means you might miss out on things you really want to see due to health or affordability issues.
Tech worker Anaïs took six months off last year and said it was the best professional decision she’s ever made. She admitted she had saved up a lot of money, paid off $70,000 from her student debt, and didn’t have any children before she took the break.
“I have never felt better. I’ve never felt healthier. I’ve never felt more rested. It’s been amazing. I highly recommend it,” she said.
She claimed that when she started interviewing at some of the big tech companies, no one cared that she had taken the lengthy time off.
Leatrice said you can’t go into a mini-retirement willy-nilly though.
The 31-year-old explained that she aggressively cut down on her personal spending after noticing she forked out $10,000 in one year on her appearance. She’s since invested part of that money to ensure she had money up her sleeve when she would actually retire.
She also said she’s been able to achieve her micro-retirement goals by prioritising work-life balance, which can mean rejecting promotions at work.
“If you’re working 40 hours a week and making $150,000 a year, and you get a promotion, and you go to $200,000 but you’re working 70 or 890 hours a week, your enjoyment of life and your hourly rate has actually gone down,” she said.
But entrepreneur Ben Askins revealed another rationale driving the mini-retirement trend.
“Apparently it’s because people are recognising that a lot of Boomers and Gen Xers, who perhaps thought they would be retiring, can’t afford to and so [their] careers are getting extended,” he said.
“A lot of Gen Zs and Millennials are looking to say, ‘Well, look, the old way was just simply work really hard to 60 or 65 and then retire and enjoy your glory years… I’m not sure I’m ever going to be able to do that’, so I’d rather take smaller breaks, avoid burnout, and treat my career more of a marathon rather than a sprint.”
While it has its perks, there can be some downsides to the concept that might not be obvious at the start.
HR recruiter Tammie Christofis Ballis told Yahoo Finance that having a few months or even years off can backfire down the line.
“If you keep taking career breaks, it’s not going to look good, because it looks like you’re just going to pack up and go. Employers want longevity,” she said.
Ballis said if you take a decent amount of time off, you could be walking back into a very different industry.
“You’re now in competition with people that have recent experience,” she said.
“So why would I retrain you when I’ve got someone that I can pay a little bit extra and they can do the job straight away?”
Recruiter Tammie Christos Ballis said mini-retirements can be good, but you need to be aware of the issues associated with them. (Source: TikTok/Getty)
She told Yahoo Finance that people taking mini-retirements could risk having their salaries drop each time because they’re not as employable as someone who’s been consistently working.
The recruiter said workers will need to evaluate whether they really need a mini-retirement or if they’re just getting sucked in by social media videos of everyone travelling and having fun.
Taking a year off would not only eat into your finances but also 12 months of no money being contributed to your superannuation, which could end up being tens of thousands of dollars by retirement age.
Last year, KPMG analysis found the average age of retirement in Australia is now 66.2 years for men and 64.8 years for women.
The last time the workforce saw Aussies working up to these ages was 1972 and 1971, respectively. The average ages for men and women to stop work 20 years ago was 61.6 and 63.3, respectively.
There are a range of factors driving this trend, with some older Aussies being hit by the cost-of-living crisis and can’t afford to hang up their work boots.
Census data provided by the ABC showed that the number of Aussies aged 55 to 64 who owned their homes outright had halved over the last 20 years.
The Super Members Council of Australia believes that 40 per cent of singles and 33 per cent of couples will end up using their entire superannuation fund to pay off their debt as they hit retirement.
That’s what’s happening now and young workers fear they might never enjoy their twilight years and be forced to work into their 70s and 80s.
A Macquarie University study predicted the age to access the pension will also slowly increase from 67 to 68 by 2030, then again to 69 by 2036 and then 70 years old by 2050.
Matt Loop, vice president of HR company Rippling, told Yahoo Finance that bosses shouldn’t stick their heads in the sand and avoid this trend.
“Mini-retirements point to a shift in how Gen Z approaches work and life,” he said.
“They’ve watched previous generations be loyal to companies only to face redundancies or burnout.
“These trends highlight a workforce that’s rethinking the traditional employer-employee dynamic. Rather than viewing them purely as a negative, I’d encourage employers to see the opportunity here.
“By understanding and adapting to these changing expectations, businesses can foster a culture that attracts and retains top talent – no matter which generation they come from.”
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