Sabbatical leave—what it means and how to finance it

With work-life balance becoming more of an issue, and people having less spare time to pursue their interests, many of us dream of taking a sabbatical. A sabbatical can be summarized as taking time out professionally to make time personally; be it for adventure, studying, or some much needed R&R.

In today’s world this might seem like an impossible dream, yet now is the perfect time to look ahead and start budgeting. So if you’re ready to step away from working life for a while, discover our tips on how to take a sabbatical and look forward to funding your leave with confidence. 

Taking a sabbatical means leaving your regular job behind for a set amount of time to focus on doing something for your personal growth. Whether it’s a year out to gain a qualification or travelling to far flung destinations for several months, there are many ways you could fill this time. 

Before diving into how to take a sabbatical, use our 3-step guide to make sure you’re ready to take the leap.

Check if you’re eligible for a leave of absence. With no laws in place for sabbatical leave, it is considered a company benefit and it is not offered by all employers. This means it’s at your employer’s discretion, rather than a given. Review your company policy and speak to your HR team to check the possibilities. 

Consider the financial implications of paid or unpaid leave and decide on how long you want to take off, after confirming what your company will allow.

Think about when the right time to start your leave is, for you and for your company. You’ll need to factor in any notice period and how long it will take to save. And don’t forget a plan of action for your return—if you’re self-employed consider the clients that you’re leaving behind, who you’ll count on when you’re back to business as usual. If you’re quitting rather than returning to a role, bear in mind your homecoming prospects. 

Knowing these basics means you can make an informed decision and, if taking a sabbatical is the way to go, begin planning for your time out. 

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Whether it’s bungee jumping in Bali or mindful meditation in Morocco, you should take full advantage of your break. Decide how you wish to spend your time off before forecasting the costs and writing up a sabbatical plan. The three main reasons people go on sabbatical are to learn, to travel, or to volunteer (or a combination of these).

• Taking a trip—top of the sabbatical list for most people is travel. You might consider touring your own country, or have global dreams further afield. Bear in mind what is affordable and achievable. Here are some examples of the main costs for a travel sabbatical, according to two budget:

  Cost	Tight Budget	Top-end Budget
  Transportation	Interrailing and single country or global pass €47-€376	Around the world cruise €11.000
  Rent	One night shared dorm in Siem Reap Cambodia €4pp	5-star hotel Raffles Singapore €560 per night
  Food	Street-food in Bangkok Thailand €0.85-2.50	Gastronomy Michelin experience in San Sebastian €242 taster meal excl. drinks
  Activities	Bamboo and white-water rafting in Thailand from €38	3-day trip scuba diving the Great Barrier Reef from €750

• Studying—a lot of people take leave to learn. It could be to further skills in your current career or to study something you’re passionate about. With a huge range of courses out there, decide on what you want to learn, where you will study, and how long it will take. If study is the reason for your sabbatical—whether to retrain in a new trade or start on your own as a freelancer—look through our guide to changing your job and starting your own business to understand more.
• Volunteering—we all have core values we believe in, and offering your service to good causes is great for personal development. Regardless if it’s volunteering with an environmental trust, an animal sanctuary or a children’s charity, you’ll need to budget for the unpaid work. Apply for sponsorship funding and see if there’s any local support available.

With your sabbatical proposition in place, you’ll then need to pitch it to your employer if you plan to take leave from your job. Recognize which experiences will be relevant to your career and how it will aid you to become a better professional when you’re back. Pick your moment, come prepared with your plan, and hopefully your once-in-a-lifetime experience will be approved.

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So, you’ve got the go-ahead from work and have your sabbatical plan of action. Now read on for our financial pointers and budget tips on how to save for a sabbatical and fund your leave of a lifetime.

Write a list of all your expenses, including transport, insurance policies, rent and food costs. Average this out over the duration of your trip and you’ll get a rough idea of what you’ll need per day to live, on top of the one-off fees like activities. Also, consider an emergency fund for the ‘just in case’ situations life can throw at you, to allow for peace of mind.

Factor in your monthly mortgage expenses and utilities bills. Look at any bills you can put on hold or cancel, and consider renting out or subletting your home while you are away to maximize funds.

Examine where you can cutback and by how much—scrap the gym fees and do a home workout, shop around for cheaper wifi packages, and dine-out less. 

Moonlighting and working while you travel are great ways to save, for those on a tighter budget or unpaid leave. Join online job marketplaces and apps for manual work like cleaning, dog-walking and food delivery. Bartending and waiting tables are popular because they are a good way to meet other travellers. For longer-term employment, consider au pairing and tutoring. 

Using a budgeting app is a good way to keep a close eye on costs. By detailing your spend, setting up notifications with each transaction, and having a dashboard to check finances regularly—it’ll be easier to stay on track. 

Before you start planning what to pack for your adventure, or purchasing your new course books, don’t rush in just yet—purchasing the right insurance policies is essential for any sabbatical, covering your health, activities, and travel.

There are plenty of comparison sites and insurers to choose from, so do your research and shop around. Whether you are shark cage diving in South Africa or teaching English in Japan, compare policy details and look out for deals. Just make sure to read the fine print, and double check that whatever policy you choose covers you fully for the extent (including any activities) of your trip.

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We know planning for your sabbatical can be demanding, but managing your finances shouldn’t be. With an N26 Smart account you can use your n26 Mastercard to make up to 5 free ATM withdrawals per month, and payments in any currency with no extra fees.

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