Riley McPherson recently took a two-month “mini-retirement” between jobs after finding he wasn’t spending enough time with his family. (Source: 9News\/Getty) <\/p>\n
Australians are being warned taking a \u201cmini-retirement\u201d could have a much bigger impact on their superannuation retirement savings<\/a> than they think. The new work trend<\/a> is being driven by Gen Z and Millennials and involves taking several shorter breaks over the span of your career<\/a>, rather than waiting to retire.<\/p>\n Perth man Riley McPherson recently completed his first mini-retirement<\/a>, taking two months off between jobs in property. The 39-year-old said he planned to take a micro-retirement every five to 10 years.<\/p>\n “I wasn’t spending as much time with my family and connecting with my kids,” he told 9News<\/a>.<\/p>\n RELATED<\/p>\n While taking a micro-retirement<\/a> could mean more time with your loved ones and boost your mental wellbeing<\/a>, Colonial First State head of technical services Craig Day said it was not without long-term costs.<\/p>\n “You may end up actually having a much bigger impact on your retirement nest egg<\/a> than you may otherwise have thought,” he said.<\/p>\n Calculations found a 26-year-old who took a year off each decade could end up with 20 per cent less in their superannuation<\/a> by the time they retire.<\/p>\n That\u2019s a hit of around $105,000, which means their retirement savings<\/a> could run out six years earlier.<\/p>\n Do you have a story to share? Contact tamika.seeto@yahooinc.com<\/p>\n There can also be downsides when it comes to your career. Unlike a sabbatical, where you can take a break and come back to your same job, a mini-retirement often means you will have to find a new job<\/a> when you return and won\u2019t be paid during your time off.<\/p>\n Realistic Careers recruiter Tammie Christofis Ballis said taking a few months or even years off could backfire down the line when you\u2019re looking for a new job<\/a>.<\/p>\n “If you keep taking career breaks, it’s not going to look good, because it looks like you’re just going to pack up and go. Employers want longevity,” she told Yahoo Finance.<\/p>\n Ballis said employees could also risk seeing a dip in their salaries and face stiffer competition from those who have more recent experience.<\/p>\n Perth financial planner Fran Hughes is a mini-retirement specialist and took her own mini-retirement last year.<\/p>\n “We’re working longer but also we’re living longer and if we continue this trend, we might actually continue to work till age 70 and only have a short period of time that is 10 years to enjoy our golden years,\u201d she told 9News.<\/p>\n Story Continues <\/p>\n Last year, KPMG analysis<\/a> found the average age of retirement in Australia was now 66.2 years for men and 64.8 years for women.<\/p>\n Hughes said people seeking a mini-retirement may have to \u201cpay it forward and go without today\u201d in order to achieve it.<\/p>\n “The biggest planning mistake is not to plan it out,” Hughes said.<\/p>\n Get the latest Yahoo Finance news – follow us on Facebook<\/a>, LinkedIn<\/a> and Instagram<\/a>.<\/p>\n