Lost salary is the obvious bit. Lost bonus, lost equity vesting, cash burn, and lost compounding to retirement are the real numbers. Most people underestimate.
How long, what it costs to live during it, what you might still earn on the side.
Pay, bonus and equity that wouldn't land during the break.
Investment return and time until retirement, used for the lost-compounding term.
6-month break, priced to retirement at % real
Burn £20,000 during the break plus net income forgone. At % real over years to retirement, the compound cost adds £53,575, taking the lifetime total to .
Illustrative figures only. The model assumes a thirty-per-cent savings rate on the forgone net income. Adjust the inputs if your situation is materially different. For your specific situation, consult a qualified adviser.
Worth carries the lifetime maths into every career decision. Sabbatical, downshift, career pivot. Know the true cost before signing the resignation letter. Join the waitlist.
Unpaid leave preserves benefits, tenure, and the option to return. The differential is usually small (a few months of healthcare premiums in the US, almost nothing in the UK). Default to unpaid leave if the employer allows; quit only if you are sure you do not want to return.
If you have already hit Coast FIRE, the compound argument weakens significantly. Your existing portfolio is doing the heavy lifting. The break costs you the salary you would have earned but not the long-term retirement trajectory. Far less expensive than the calculator suggests for early Coasters.
Because the salary forgone could have been saved and grown for decades. For someone twenty years from retirement at six per cent real, every unit of currency saved roughly triples. Ignoring this term understates the true cost by a real margin.
No. Sabbaticals are often the right call. The point is to price them honestly. Some people decide the break is worth twice the cost shown here; others decide a shorter or later break is the better trade. The calculator gives you the number; you decide what to do with it.