Mini Retirement Epic Adventure Guide for the Average Joe

There’s an instant freedom in making the choice to take an extended break from your day job, even if the goal is years away. This type of break was described as a “mini retirement” by Tim Ferris in his book, 4 Hour Work Week.

Its also been referred to as a sabbatical. It can be life-changing and give you opportunities that your regular routine will never afford you.

Tim Ferris took his own 15 month mini retirement back in 2004. According to him, “The hardest part is deciding. Because until you decide, most people can’t plan.”

The time-frame we recommend for a mini retirement is one to three years. The time to start saving for it is now. Let’s dig in.

Your Immediate Transformation

When you make the decision to take a mini retirement, a few things are going to happen:

  1. whole new world will be open for you. You will notice opportunities that have been within your grasp all along, ones your conscious mind simply didn’t see.
  2. You’ll have an infinite source of energy to pursue your goal. As Benjamin P. Hardy stated, “You’ll no longer need to rely on willpower. Willpower is garbage. It is for amateurs. It’s for people still conflicted about what they want to do.”
  3. You will begin learning at a rapid pace, understanding, and sharing it with others. That’s exactly why we formed a Facebook group – so that you can collaborate on your ideas with those who can offer teaching, and others who need to learn. (sign up for the Club to receive an invite).

There are many more immediate effects that will take place to transform you. Thirty-one of them, according to Benjamin P. Hardy.

Remember in Superman II when Kal El gave up his superpowers to be with Lois Lane and then had to go get them back?

Its your turn to become Superman. Not to save the world, but to save yourself (and possibly your family). So walk into your ice palace, pick up the green crystal, and undergo your transformation.

Congratulations. You are no longer an Average Joe.

Choose Your Adventure

The coolest part about planning a mini retirement is choosing your adventure. Unlike a Choose Your Own Adventure novel from the 80s, your options are practically endless.

The world is your oyster, and possibilities abound. Where to start?

For many of us, a mini retirement is an opportunity to travel. Popular options are backpacking, sailing, a house swap on a different continent, or RV life. For younger adventurers, couch-surfing is a low-cost option.

Some of you may choose to take a mini retirement to fulfill a lifelong dream, or try your hand at a vocation that could lead to a career change.

Creative endeavors or passion projects are excellent choices for a mini retirement.  

Carpenter, filmmaker, photographer, auto dealer: These are all hobbies that could generate a future income, but may require an initial investment in time to build a clientele or start-up company. Taking a mini retirement to devote yourself to this flavor of passion is worth it, to be sure.

Here at 9 to 5 Escape Club we are dedicated to adventure. The methods we teach to save up are for the person who is willing to walk away from their current community, neighborhood, state, kids school, etc. to live their dream of sailing away (or the equivalent).

Do you have an adventure you’ve been dreaming of for years? Let’s get started on making it happen.

Calculate the Cost

How much does it cost to take an abbreviated retirement? Truthfully, it depends on what you’re after.  There are three types of costs we’ll crunch the numbers on: 

  • Initial Costs — Includes big stuff you need to buy to get started like housing, transportation, equipment, refits, and other one‐time purchases. 
  • Burn Rate — Think of this as your monthly expense budget. It pays for all of your basic (and not-so-basic!) needs during your adventure.
  • Cushion — A cash stash for emergencies and to cover costs when the adventure is over, until you get started in your new job, career, or maybe your own company. Who knows!

Initial Costs

Let’s say your dream adventure is to go sailing. As I write this I’m floating on my own sailboat in the Caribbean. We’re anchored in Martinique, awaiting a weather window to move south to St. Lucia. Read more here about how we bought a sailaboat and sailed away.

In this scenario, your upfront costs are going to be your sailboat, refit costs, equipment, gear, moving costs, etc. The table below shows how we might add those up to estimate a total of “initial costs”.

Initial costs are what you’ll spend to kick-start your mini retirement.

If you decide to finance a portion of your vessel/RV/or whatever your mode of travel is, you may add in a “credit” of 80% of the asset value, or $80,000 in this example. The total of Initial Costs would then be $65,000 instead of $135,000.

But let’s not get too complicated yet.

Burn Rate

I first learned the term Burn Rate when I was listening to the audiobook Live on the Margin by Nick O’Kelley and Patrick Schulte – the two “slackers” who convinced me that sailing was the ideal lifestyle.

Your burn rate is the monthly cost of living during your mini retirement. 

The best way to calculate your burn rate is to complete a monthly budget worksheet, using estimatesfrom the research of your chosen lifestyle/adventure. It should look something like this:

Burn Rate is how much you’ll spend monthly during your mini retirement.
Provisioning in the British Virgin Isles

A burn rate of $4,800 monthly is a total of $57,600 every year. If you decide to take a one year mini retirement, your total burn rate will be $57,600 in this example. However, if you want to stay out there for three years, your total burn rate is $172,800.

Now we’re starting to get an idea of how much savings we’ll need to go on our adventure. So far, for a one year adventure, we need $135,000 in initial costs plus $57,600 in burn rate for a total of $192,600.

Hold up, though. There’s one more bucket we need to cover before we’re done.

Cushion

When your mini retirement is over, you want to make sure to have some cash to fall back on to help you get back on your feet. Whether you decide to start a new job, your own company, or whatever you choose, you’ll need some stacks of Benjamins to sustain you for a bit.

The cushion also serves as your “emergency fund”, should something extraordinary happen (accident, health problem, etc.)

I recommend that you have on hand at least six months worth of costs covered with your emergency fund. Using our example of $4,800 per month, the minimum emergency fund you would need is $28,800.

If you want to play it really safe, keep twelve months on hand, or $57,600. The amount YOU need should be based on your burn rate, not our example. Yours may be less or more than our calculations here.

Add It Up

If we add up the three categories in our example, our total minimum required savings (without borrowing for our biggest asset) is $221,400 for a dream mini retirement on a sailboat. If we finance the sailboat at 80% over 15 to 20 years at a good rate, we can lower our required savings by $80,000.

Keep in mind that our burn rate included the boat loan, so the burn rate really needs to be lowered in scenario one below for an accurate estimate.

In the following examples, we show total required savings for:

  1. 12 month adventure without financing an asset purchase (boat, rv, etc.).
  2. 12 month adventure WITH financing an asset purchase.
  3. 36 month adventure WITH financing an asset purchase.

As you can see from scenario 2, for less than $150,000, you could easily buy a boat and sail away for a year. Possibly much longer if you spend less money each month. We were fairly generous with the budget.

Run your own numbers and come up with an estimate of how much savings you’ll need for YOUR dream mini retirement. Once that’s done, it’s time to get to work on filling the coffers.

Filling the Coffers

The amount you need to save for your mini retirement may seem huge; possibly even insurmountable. Don’t be discouraged.

As soon as you get to work, the cash is going to come faster than you think. This is especially true if you put some of our radical savings recommendations in play.

I recommend focusing on a 5 year (60 month) timeline as your target date, unless you have a HUGE amount of debt to pay off. And I’m talking credit card debt, not student loans or a mortgage.

Pay off Credit Card Debt

The very first step you need to take financially is to pay off high interest debt FIRST. All of it. Pay it off and keep it at zero. This is a MUST DO to get your finances in order.

We’re not here to judge. It doesn’t really matter what you did in the past. We are looking forward now, and have our sights set on success.

If you have payday loans, start with those. Then make a list of each credit card and balance. Start either with the highest balance, lowest balance, or highest interest rate.

Regardless of your approach, get that debt paid off in lightning time.

Dissect Your Spending Habits

Take a scalpel to your spending habits. Look at your transaction history in your bank and credit card accounts. Figure out where all of your cash is going.

Stop buying stuff.

Now look for low-hanging fruit first: that gym membership you’re not using, too many trips to Starbucks, the $30 bottles of wine you’ve been buying at Costco. You’re drinking boxed wine from now on.

Get creative. Look for ways to decrease your spending on groceries, restaurants, and any other habits that are costing you extra bucks. This is the easy part. The harder part comes next.

Create a Financial Plan aka Budget

Create a budget and look at it every day. Every. Single. Day. Spending time looking at your numbers and your progress keeps you motivated to keep going, and focused on saving money.

You won’t always meet your budget numbers. Think of it more as a forward-looking tool than a backward one. Always ask yourself, “how can we save more this month than last month?”

Liquidate Your Fleet

How many cars/trucks do you have vs. what you need? Do you have expensive car loans?

Sell them, liquidate them. You drive a junker now. Trust me, it’ll be nicer than the rental you’re going to drive around on Antigua or Martinique, or pretty much in any part of the world besides the USA.

Remember, this is only for a limited time. You can make this sacrifice because it gets you to your end goal of QUITTING YOUR JOB and SAILING AWAY or driving away, or whatever your dream adventure is.

If you own a vehicle outright with no loans, keep it. That’s the cheapest car you can own.

Sell Your House

That’s right. Consider selling your home, especially if you have equity built up in it. You can pocket the profits tax-free if you’ve lived there at least two years.

Buy another house in an area where housing prices are rising, and then sell that one in another 2 to 3 years. Selling two different homes two years apart enabled us to save 50% of our target budget in those two transactions, thanks to a solid housing market in the areas we chose to live.

Switch Jobs

When is the last time you had a pay raise? If its been a while, consider finding a new job. Since you want to be out traveling within the next 5 years or so, you should be open to moving to a new city.

Sell your current house, find one in a rising housing market, and find a new job there as well. Moving states can open the door to a lower cost of living and higher salary, if planned accordingly.

Research what jobs in your field are paying in other areas, and use that information as part of your move planning.

Second Job

I know a second job doesn’t sound very fun, but if it allows you to walk away from work completely for a year or two, it may be worth it to you. Take all of the extra cash from the second job and send it straight into the savings coffers for your mini retirement.

Think just sixty months to save up. Sixty months to sacrifice some time, so that you can gain it all back and more.

stay focused

Life is full of challenges, pandemics, and unexpected financial speed-bumps. Don’t allow setbacks to derail you from your mini retirement goals. There are three primary ways I was able to stay focused on my goal of sailing away for seven years:

  • Dream Boards & Other Visuals – I’ve literally cut pictures out of sailing magazines and glued them onto a foam board. You’d be surprised how much it helps to visualize your dream and keep you excited about it. I’ve also made savings meters and filled them up as we made progress.
  • Playing With Numbers – I wrote previously to look at your numbers every single day, and that is the best way to stay focused on your goals. Enjoy the number crunching, and relish in how well you are accomplishing your goals. All of your efforts will result in a future mini retirement of your dreams!
  • Watching Youtube Channels – Watch other people on Youtube living your dream. Make it part of your daily life. It’s one way you can BE in that world before you’re ready to go. It creates a sense of inevitability, and is also a great way to get your spouse fired up about it as well.
time is money and yours will add up as you work towards your mini retirement of adventure

Summing It Up

I hope this information gets you fired up about getting started working towards your own mini retirement. Don’t wait another day! Life is short and full of unexpected setbacks.

The average joe CAN succeed at a mini retirement, but it may take all of your committment and focus over the next five or so years. If you are hardcore enough, and willing to make tough decisions about money and lifestyle, YOU can have the reward of a mini retirement.

Get started today!

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