Not many people get to go on a sabbatical during their careers, but if your company has a policy allowing this kind of structured break, you should take it. A career sabbatical offers professionals a set period of time to pursue personal goals, recharge, or even develop new skills. But if you haven’t done some financial planning beforehand, going on that big break may produce more stress than anything else.
Only Take a Sabbatical if You’re Prepared Financially
It takes solid financial preparation to turn your sabbatical into something that doesn’t feel like a risky leap. You want to turn it into a step forward that ensures your future and frees you up to enjoy yourself.1) Set Length of the Sabbatical and Savings Goals
Start planning out the sabbatical long before your last day at work. Do you know how long you want it to last? Some people go three to six months or even as long as a year. Once you know how long you’ll be away, you know how much you must save. A good rule of thumb is multiplying your monthly expenses by the number of months away and adding 20 percent as a buffer for unexpected costs.Your sabbatical expenses will go beyond regular living expenses, so account for travel, any courses you might take, or a side project you decide to take on. Each activity carries its own price tag.
2) Build Your Financial Safety Net
If you’ve ever created an emergency fund for yourself, you may know that a typical fund covers three–six months of expenses. For a sabbatical, you need even more protection than that. Think about dividing your funds into three categories:- Daily cost of living during your time away
- Emergency savings (for genuine emergencies only)
- Expenses for when you return to work
