George Kamel Says Gen Z Is ‘Retiring’ Early — This Is How

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People often wait until they’re 65 to 67 years old to retire since that’s when they can collect their full Social Security benefits. But not everyone wants to wait that long.

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Personal finance expert George Kamel recently spoke about how Gen Z is “retiring” early in what he calls “micro-retirement.”

Here’s what a “micro-retirement” for Gen-Z actually looks like and how to do it.

How “Micro-Retirement” Works

Micro-retirement is a relatively new thing that younger people — Gen Z — have started to do. It entails taking time off (usually 6 to 12 months) throughout your career rather than waiting until you’re older to retire.

The idea behind micro-retirement is not to work nonstop through your 60s. Instead, you take breaks for other things — like hobbies or rest — so you can enjoy life while you’re young. Once your micro-retirement is over, you find a new job.

Some Gen Zers who’ve done it say micro-retirement makes them feel better, healthier and more rested. For some, companies they’ve later interviewed with don’t care about the time taken off. The world is changing, after all, and more people in leadership (particularly millennials) respect the need to take time off.

As Kamel put it, micro-retirement is “quitting your job so you can take a break, typically lasting six months to a year.” It’s like a sabbatical — only you don’t have to wait for years to get it.

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How To Successfully Micro-Retire

Micro-retirement is a leap of faith since there’s no guarantee you’ll get another high-paying job when you want — or need — it. Because of this (and other reasons), those who like the idea of it are often skeptical.

How can people afford to micro-retire when they have other bills to pay? How can they go back to work after the break?

Here’s how to successfully micro-retire, according to Kamel:

• Get out of consumer debt
• Save 3 to 6 months’ worth of expenses in an emergency fund
• Save enough cash for everyday bills, travel and whatever else you plan to do during the micro-retirement
• Sit down and make a highly detailed budget (you can use an app)
• Plan for health insurance premiums

Kamel also advises against using micro-retirement as an excuse to be lazy. Taking some time to rest is okay, but you should also use that time for personal and professional growth.

And whatever else, never use debt — like credit cards — to fund your micro-retirement. According to Kamel, it defeats the purpose since the point is to de-stress, and running up debt adds stress.

Risks To Watch For

George Kamel does mention a few risks of micro-retirement, which are:

• Your money: You’re not earning any, so how are you paying for your bills?
• Your retirement: The time spent not working also likely means not investing (unless you’ve planned for that). Say you’re 29 years old, earn $50,000 a year and normally invest 15% of that income each year ($7,500). If you had invested that amount with a 10% rate of return, that $7,500 would have become $250,000 by the time you’re 65. That’s a major loss for your nest egg.
• Your career: Not every potential employer will accept the gaps in your resume. Some might see you as a risk. It can also be hard to build momentum in your career with frequent extended breaks.
• Your life: What does micro-retirement say about your life? It’s OK to take a rest, but if you’re trying to escape, that might be a sign of a bigger problem — like the career you’ve chosen.

Micro-retirement isn’t inherently a bad idea, according to Kamel. But you should be cautious. You can also consider other options, like:

• Taking regular vacations so you don’t get burned out
• Taking your available paid time off
• Finding a new job or career if your current one doesn’t make you happy

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