Sabbatical leave—what it means and how to finance it
Taking sabbatical leave? Discover our guide on how to take a sabbatical
6 min read
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.
Take a breather from business—defining your sabbatical
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.
1. Do the research
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.
2. Pausing the pay cheques and your leave duration
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.
3. Timed to perfection and making a comeback
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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Setting the sabbatical scene—how to plan for a sabbatical
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:
Monthly Budget for Sabbatical Leave
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'll 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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Funding your sabbatical freedom—how to save for a sabbatical
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.
1. Create a break budget
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.
2.Unseen Expenses
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.
3. Streamline and save early
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.
4. Side-gigs and part-time
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.
5. Budgeting tools
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.
Insured equals reassured: Preparing for any outcome
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.
Travel
Single trip cover from €11
Global multi-trip from €95 incl. winter sports
Health and Medical
Private insurance treatment only from €16 monthly
Treatment and full diagnosis from €45 monthly
Activities
Water sports coverage from €64
90-day trip including shark cage diving €680
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A sabbatical is a paid or unpaid leave of absence to do whatever you want to do for your own personal growth. If your company entitles you to this, speak to your employer to understand any requirements you need to meet in order to be granted a sabbatical, such as having worked for a certain period of time.
This is your employer’s stance on sabbatical opportunities within your company, including further education, retraining, and option to travel. If taking a sabbatical is something you would like to do in the future, you should start the conversation with your employer as early as possible. You need to agree the amount of time you will be away from your job, whether you’ll be paid or not, and to determine whether you can return to the same role.
During a sabbatical, you should take the time to do something you have always wanted to do. Ideas include learning a new skill, studying for a degree, travelling the world, or volunteering for a charity. You and your employer will determine the length of your sabbatical, but they typically range from 2 to 12 months.
Your employer may agree to pay you for the period of your sabbatical, either in full or at a percentage of your salary. But your employer is not obligated to pay you during this period, or even grant you the time off that you require. This is completely dependent on your company’s policy, and at their discretion.
Traditionally a sabbatical is for an employee that has been at the organization seven years or more, but can be granted earlier, subject to negotiation. Speaking with colleagues can help you gauge how many other employees have been granted sabbaticals. If you are financially ready to take a sabbatical using your own funds, then you can take a sabbatical as soon as you have worked the length of any notice periods that were agreed in your contract.
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If you’re looking for a secure investment for your money, term deposits might be a great option for you. Here, we’ll dive into what term deposits are, how they work, and much more.
Ready to take advantage of high interest rates and watch your money grow? Then you’ll need to choose the right savings product to suit your needs. We can help.
