FINANCIAL PLANNING
The Rise of the Sabbatical
By Cady North
Taking an intentional, self-paid break from work is still a counterculture idea. Despite that, more of my clients are asking for help planning around a sabbatical or extended break from work. This shift is partially due to the pandemic speeding up an evolution of work norms, but, at its heart, it’s about a desire to achieve more balance in life. I’ve found a sabbatical is an amazing way to help clients expand the idea of what “financial freedom” means to them, test-drive retirement, or heal from burnout.
I speak from personal experience. After more than a decade working in government and public affairs and writing about financial regulations, I left my analyst job at Bloomberg for an eight-month sabbatical in 2015. Soon after, I learned how to “just be” without needing to achieve all the time. The experience gave me the time and space to evaluate options for starting my financial planning firm. And it also gave me time to envision a way of working that wasn’t so hustle-focused. It changed my life forever, and I carry many of the lessons I learned with me today.
What I’ve found is quite surprising: Everyone initially thinks money is the main roadblock to taking an extended break from work. The truth is, it’s often not about the money at all, but the more emotional, life-planning side of things. As an advisor, it’s worth preparing yourself to support these emotions or at least provide resources to clients so they know what’s “normal.”
Your role extends beyond numbers and spreadsheets. By understanding the emotional challenges associated with taking a sabbatical, you can provide invaluable support, enabling your clients to embark on this transformative journey with confidence and clarity.
Factors Beyond Money
While money plays a role, it often takes a back seat. When it comes to a sabbatical, clients wrestle with how to explain to family, colleagues, and friends why they’re doing it, what they will do during it, and how they will return to work. Clients wrestle with those questions for themselves, too, as they say it affects their sense of identity and overall life trajectory—not unlike people’s experience as they reach retirement.
Concerns about family dynamics, career impact, and reintegrating into the workforce can lead to anxiety and uncertainty. I’ve found that normalizing the struggle can be soothing. As advisors, we can become even more valued resources if we help clients by facilitating discussions around these topics.
I had a client agonize over her decision to take a sabbatical for an entire year. She already had the money to do it, and we easily incorporated it into her financial plan. The hold-up was that she was scared to leave her law partnership because she didn’t know what she wanted to do next. It’s hard to give up a work identity we’ve worked hard to create.
My strategy was to let my client talk about her fears and to be a sounding board for her. I know I don’t have all the answers, and my client knows herself best. I asked reflective questions like: “What is something you could do to get more clarity on this?” “How could you figure out the best next step?” I also offered gently: “Money is not what will prevent you from doing this.”
It took time, but she eventually took a life-changing year-long sabbatical that included international travel and a U.S. road trip. She’s now doing part-time legal consulting and has much more time and space to explore her creative hobbies. She figured it out, and I was there to validate what she was feeling while providing financial guidance.
Planning for Reentering the Workforce
Sabbaticals and work breaks are still very uncommon outside academia. You may even have preconceived notions about what taking a break from work means. We’ve all been told at one point in our careers: “Don’t leave a job without having another one lined up.” But this advice is outdated. While work breaks to raise children or care for ailing family members are common, even those often come with penalties for career advancement and compensation. It’s worse for sabbaticals, as it’s not as socially acceptable to take a break “just because” or for travel or enrichment.
Despite these outdated cultural norms, clients don’t have to fear announcing it will mark them with a “do not hire” badge. A LinkedIn study discussed in “A new way to represent career breaks on LinkedIn” found almost 50% of hiring managers think candidates with career breaks have gained valuable soft skills. This is one reason LinkedIn launched a feature in early 2022 to not only help users announce a sabbatical or career break but also provide space to give open-ended context on the perspective and skills learned while on break.
Not all clients will want to announce their sabbatical publicly, but doing so may help raise awareness of the sabbaticals’ benefits. It could also help them find a tribe of other sabbatical takers as support during their journey, or it could lead to their next job.
Employers don’t care as much as you think about career breaks. I helped several clients negotiate during their post-sabbatical reentry to work, and very few employers (even in the famously difficult tech interviews) asked about the work break. Even if a potential employer does ask the candidate to explain their work break, you can coach your clients to have their elevator pitch ready. Showing up confident, with perspectives to share, will make all the difference. Groups such as Flexjobs have great resources to help your clients build their confidence during post-sabbatical job-hunting.
On the financial side of things, make sure to include the financial considerations of job hunts. Hiring timelines can take 60 days or longer, and that’s after the client has spent time narrowing down their prospects. They need to be able to fund this transition once the sabbatical is over, and it’s one thing clients often forget to think about on their own.
To position yourself as an indispensable ally, it’s best to encourage open dialogue about your clients’ financial freedom journeys. We’re used to these conversations at retirement, but when it comes to sabbaticals, it’s equally important to be a sounding board when your clients express uncertainty or fears.
Cady North is the founder and CEO of North Financial Advisors and author of The Resiliency Effect. Her latest book, The Art of the Sabbatical, will be on shelves in Spring 2024. Contact Cady at cady@northfinancialadvisors.com for more information.
image credit: istock.com/Irina Shatilova