Discover how young professionals in Singapore can embrace micro-retirement by building passive income and long-term wealth through smart investing.

Retirement used to be a faraway milestone, something to look forward to only after decades of work. But today, a growing number of young professionals are flipping the script. Instead of waiting until 65, they are embracing micro-retirement: short but intentional breaks during their careers to rest, recharge, travel, or pursue personal passions.

First coined in 2007 by Tim Ferriss, author of The 7-Hour Work Week, micro-retirement is gaining traction worldwide. For millennials and Gen Zs, it reflects a shift in values, prioritising mental health, work-life balance, and meaningful experiences earlier in life rather than deferring them indefinitely.

Still, while the idea of taking a few months or a year off is appealing, the challenge is clear: how do you afford micro-retirement without draining your savings or derailing long-term wealth goals? 

The answer lies in building a sustainable investment portfolio with growth-focused investments.

What Is Micro-Retirement?

Micro-retirement refers to taking extended career breaks during your working years rather than waiting for traditional retirement. These breaks may last from several weeks to a year or two, and are used for rest and mental health restoration, travel, pursuit of alternative lifestyles like working holiday and more.

Unlike traditional retirement, micro-retirement happens in the middle of your career. It’s less about ending work and more about incorporating periods of rest and renewal into your life.

Reasons behind the rise of micro-retirement include: 

• Burnout and stress – long working hours and high cost of living are prompting young people to pause and reassess their priorities.
• Changing values – Gen Z and millennials place greater emphasis on well-being.
• Career experimentation – more workers are switching industries early, often taking breaks in between.

According to LinkedIn, 17% of professionals who took career breaks in 2024 did so for personal goals like travel or passion projects, up from 12% in 2020. Workforce Singapore has also noted a rise in young job switchers, many of whom are using micro-retirement to recalibrate their careers.

The Financial Challenge of Micro-Retirement

The biggest barrier is financial sustainability. You’ll still have bills and living expenses to manage during a micro-retirement, but no salary coming in. Without planning, a short break could mean burning through your savings or even falling into debt.

The solution is to create a layered financial plan:

1. Build your emergency fund to provide short-term protection
2. Develop a micro-retirement fund to cover your basic expenses in the period you’re unemployed
3. Build passive income portfolios to generate ongoing cash flow.
4. Continue investing in growth portfolios to secure long-term wealth.

Step 1: Build your emergency fund

Before thinking about a micro-retirement, make sure your financial safety net is in place. An emergency fund covering at least three to six months of essential expenses protects you from unexpected costs. This fund is strictly for emergencies. Keeping it in a highly liquid money market fund like Syfe’s Cash+ Flexi ensures easy access and minimal risk. With this buffer, you can take your career break with confidence, knowing you won’t derail your financial stability.

Step 2: Develop your micro-retirement fund

Your micro-retirement fund is separate from emergency savings and is meant to cover expenses like rent, food, or travel during your planned break. Calculate how much you’ll need and set this aside. 

Syfe’s Core Equity100 is fully invested in global equities, giving you exposure to leading companies worldwide. Historically, equities have delivered strong returns, compounding faster than cash or bonds—helping you build your fund over a three-year horizon while staying on track for your sabbatical.

Step 3: Build passive income streams

To reduce reliance on savings, create income streams that continue flowing even while you’re not working. REITs (Real Estate Investment Trusts) are a popular option. 

With REIT+, you gain exposure to the top 20 Singapore REITs, which pay dividends from rental income—S$50,000 invested could generate about S$2,500 annually. 

Pair this with Income+, which invests in global bonds and income strategies for reliable monthly payouts. Together, these portfolios provide steady cash flow to offset expenses, making your micro-retirement more sustainable.

Step 4: Protect Long-Term Growth

While you pause work, your long-term wealth journey shouldn’t pause. Keep investing in growth-oriented portfolios like Core Equity100, which gives you exposure to global equities. Historically, equities deliver higher returns over time, compounding wealth faster than cash or bonds. 

The key is to avoid liquidating your growth investments to fund your break. Instead, use auto-investing or dollar-cost averaging to continue building your portfolio in the background. This ensures that even as you take a breather now, your money keeps working toward future financial independence.

Plan Your Micro-Retirement 

A successful micro-retirement calls for a thoughtful plan that balances short-term needs with long-term security.

Here’s how you can fund a six-month micro-retirement.

Imagine Jane, a 28-year-old professional earning S$5,000 a month, who wants to take a six-month micro-retirement in three years.

Instead of the regular 50-30-20 rule—where 50% of one’s salary goes to essential expenditure, 30% on discretionary expenditure, and 20% to investments and savings—Jane could consider investing 30% of her salary instead. After deducting 20% of her pay for personal CPF contributions, that would mean investing S$1,200 a month for three years. 

Given that she invests in Core Equity100 (which has a three-year annualised return of 10.85%), at the end of three years she would have around S$48,000 for her micro-retirement.

During her micro-retirement, she can continue to let her Core Equity100 funds grow, or invest the S$48,000 in Income+ or REIT+, which each yields 5–6% p.a., giving her dividends of S$2,400–S$2,880 a year on top of the S$48,000. Therefore, instead of dipping S$6,000 into her S$48,000 stash during her micro-retirement, she only has to dip less than S$4,000 due to the dividend offset. 

The Bottom Line: Micro-Retirement Without Financial Burnout

Micro-retirement may not be for everyone, especially those with financial commitments and lower salary or savings base. It would also call for financial discipline when it comes to investing and spending.  

But with the right strategy and a healthy starting point, young professionals in Singapore can take meaningful career breaks while staying on track for long-term wealth. This way, micro-retirement becomes a sustainable lifestyle choice, one that lets you enjoy life now, without compromising your financial future.

Read More:

How Much Do You Need to Retire in Singapore?
Semi-Retirement: The Alternative Path to Financial Freedom
Your Retirement Planning Checklist: Are You on Track?