The thought of one day retiring and no longer having to punch a clock, answer required emails, work long hours, and the other responsibilities of employment is a dream that can get you through the hard moments of work.

While retirement typically occurs, after completing a career and saving and investing for it, a new trend is emerging among Gen Z career professionals called “micro-retirement.” Micro-retirements involve taking a one to two-week break from work every 12 to 18 months.

Gen Z is using micro-retirement to avoid burnout, find greater fulfillment in their work, and enhance their overall well-being. However, it’s not just Gen-Z: according to a survey from Side Hustles, 10% of workers are considering taking a micro-retirement and 75% thought employers should offer micro-retirement policies such as unpaid sabbaticals.

However, taking a micro-retirement may have long term impacts on your finances and career advancement. Here’s what you need to know.

How ‘Micro-Retirement’ Works 

The idea is to take frequent and longer breaks from work during your career. These breaks are not your standard PTO—they’re intentional, unpaid time to rest and recharge.

Micro-retirements can look like:

• Quitting a job, and finding a new job when you’re ready to work again.
• Setting up a plan with your employer that allows you to take unpaid frequent work breaks.
• Taking breaks from your business if you’re a business owner. 

Joshua Charles is a Gen Z business owner. His consultancy helps institutional investors, pension funds, and insurance companies invest in projects in Africa. Charles currently takes work breaks every six months for two weeks at a time, and said he heard about micro-retirements from a friend. “I reward myself by traveling to different countries. Whether it’s Europe during the summer or other destinations, and so that’s a way that I incentivize myself to reach certain KPIs,” says Charles. 

Charles considers his micro-retirement a full-time break. He doesn’t work: any crisis or issue has to wait until he’s back. He notes the breaks have been helpful for his mental health. Charles says there has been no negative impact on his business or career because he communicates with his clients and team that he’ll be unavailable for his micro-retirements, and a portion of his income is passive. 

The Pros and Cons of Micro-Retirements

Micro-retirement may sound appealing, but with the cost of living in the U.S. rising, a growing unemployment rate due to mass layoffs, Gen Z’s struggle with debt, and uncertainty, micro-retirement comes with pros and cons.

Micro-retirements offer an opportunity to recharge. Gabrielle Siegel, a wealth management advisor at Northwestern Mutual, notes that this is valuable. “It’s taking time to focus on what’s bringing you the most happiness, recharging, mentally avoiding burnout, and realigning with your personal goals. Gen Z is looking at the workplace a bit differently, and happiness is an important factor,” she says.

However, stepping away from work without pay can impact someone’s financial future. Taking time away from work can affect your earnings, investments, and funding your retirement, particularly if your company offers a match. Siegel points out having a plan in place is important. “If you’re taking this micro-retirement with no game plan, that can be detrimental to your long-term retirement strategy,” she says. “You need planning and realistic goals. If they continuously take time off and don’t realign their financial goals, it can disrupt retirement contributions.”

Meanwhile, taking frequent breaks can also impact career growth. Kenyetta Nesbitt-Simmons, a senior partner at HR consultancy firm Simmons HR & Talent Advisory, points out it can be difficult to rejoin the job market. “Some Gen Zers are forced to pivot into other career fields due to the competitiveness of the field they left to take a micro-retirement,” she says. “You could also be seen as a job hopper to some decision-makers within the labor market.” She warns that frequent micro-retirements could also be a red flag when you’re up for promotion.

How to Set Up Your Life and Finances for Micro-Retirement

If micro-retirement sounds like a rest and workplace strategy you’d like to pursue, here are a few tips to help you get started.

• Save enough money to afford not working. Your micro-retirement will be unpaid unless you have a side hustle, so you’ll need enough money to pay your bills during the breaks.

• Understand your options. Your employer may offer flexibility or the option to take a sabbatical. If not, you may need to decide to quit and find a new job when you’re ready to return to work. 

• Consider your next step. If your employer gives you the time off, make sure you understand the implications for your paycheck and benefits such as your retirement match. If you’re leaving your job, what’s your plan for reentering the job market? Make sure you have funds for basic expenses if you don’t get hired immediately. If your industry is going through a hiring lull, think about what other skills you have in case you need to make a career-pivot. 

Benjamin Fields is a public school teacher and PhD student at the University of California, Berkeley. He uses his salary and his side hustle selling perfume to afford micro-retirements once a month where he attends events such as festivals or travels internationally. Each micro-retirement is one to two weeks, depending on whether he is traveling. Fields says he’s not worried about micro-retirement affecting his job advancement prospects now or in the future—he’s confident he’ll always be able to find work. He says that taking time off and having a mental health break are more important than worrying about making money.

Fields accepts that his long-term savings might take a hit and says it’s worth it. “Money is just a tool. If you consider the way estate planning works, as long as I’m saving and investing enough money to retire in the manner I want, then I should be able to spend freely,” he said. “All I’m gonna do is just hand it off to my kids, and they’re probably going to squander the money anyway. So I might as well enjoy the money.” Fields plans to continue micro-retirements until he retires permanently.