Financially Independent, Retired Early(ish) at 57.

How to work for 3 days and get paid for 4.

I walked into HR today with a very particular question to ask. Basically, the crux of it was, “I wish to work 3 days a week next year and be paid for 4. Can you grant this wish?”

Turns out she can. She’s like a fairy godmother, granting wishes all over the place.

Long Service Leave is a perfectly brilliant thing!

In Australia we have LSL, which is earned after you work with the same employer for more than 7 years. You get extra days’ holidays that you MUST take as an actual holiday – you can’t cash them out or transfer them to someone else. You can store them up or years if you want to and then take a holiday when it suits. This is what I did when I took a whole term off in 2015 and went to Europe and used up 50 days on full pay, and I did it again last year when I took an extra week’s holiday in April (5 days on full pay) and went to North Korea.

There’s nothing so sweet as standing at the top of the Eiffel Tower/Juche Tower and knowing that you’re getting paid while you’re looking out over Paris/Pyongyang.

People who job-hop obviously forego gaining LSL, but for people like me, who work as teachers in the government system, LSL works brilliantly. Even if we hop from school to school, the State Government is still our employer, so our LSL gently piles up until we’re ready to use it. I don’t know how many days we get/year. I tried googling it but the website had a mathematical formula to explain it so I got out of there quick smart. I’ll just call it magic.

I always assumed that you have to take LSL in biggish blocks of time until I talked with a retiring work colleague late last year. She said that she was going to spend the last 6 months of her career working part-time but getting paid full-time, by using a couple of LSL days every week.

Mind. Blown.

This has rocked my world.

Think about it. In two or three years I’m going to be retired, so I’ll be able to take holidays whenever I want. I won’t be restricted to school holiday times with their exorbitant prices. I won’t need to have access to some holiday days – the whole year will be my holiday smorgasbord table.

I have around 45 LSL days available. Roughly speaking, school terms are 10 weeks long. There’s 4 of them a year.

Imagine being able to work 3 days a week, while having another day’s pay coming in over the first year to Get Things Done and smooth the ride down to retirement?

Now THAT seems like a good use of Long Service Leave!

I sat down 5 minutes later with my principal and ran the idea past her. She’s officially approved it. In writing. It’s really going to happen, folks!

Of course, there’s the other option, which is what most people do. Work and get paid for your normal days, “retire”, then stay on the books and use up the LSL in one fell swoop at the end. This also has its charms.

But I like my way better.


  1. CiCi

    I just discovered your blog yesterday (through Principal FI, which I also just discovered). I am loving it. I am a high school English teacher in the US (California) in her early 50s who dreams of going to part time in the next 5 years. Teaching is a second career for me (started at 39), so there are a lot of extra incentives to stay in as long as possible. I will be following you to learn about your journey into part-time work.

    One thing a friend and I have observed about the few older (65+) teachers at our sites is that some of them seem to actually enjoy “working” with young people, but they just don’t seem to do much … in lesson planning, collaborating, grading, etc. We’re not sure whether they’re not retiring because of money, or because they don’t know what else to do and like hanging out with the younger generation.

    • FrogdancerJones

      Nice work if you can get it!
      To be honest, I don’t do lesson planning – I’ve been here for 15 years so I know that material I’m teaching.
      I don’t know how they’d get out of marking/grading. Surely they have to mark the assessment tasks their classes do?
      Anyway, I’m glad you’re liking the blog. Thanks for the feedback.

  2. Flirby

    Good for you Ms Frogdancer!

    LSL is state based legislation. In Victoria, you get one week of LSL for every 60 weeks you work.

    Although you can’t cash in LSL in Victoria, you do get it paid out when your employment is terminated. I think it is great to use it to smooth your transition to retirement though but nice to know it isn’t lost if you haven’t used it all.

    • FrogdancerJones

      The advantage to using it all up before I leave is that I’m not going to use a large part of the monetary value in tax, as I would do if it was paid in a lump sum.
      Thanks for the explanation of how they work it all out.

      • Kay

        LSL paid on termination is taxed at marginal rates – there’s a formula to work it out which you can find on the ATO website but Iwouldn’t bother as it makes it look unnecessarily complicated – but it’s a myth that you will be slugged a huge amount in tax. You should pay roughly the same amount of tax whether you take it fortnightly or have it paid out.

        • FrogdancerJones

          My understanding is that it depends on when in the tax year you have it paid out. At the end, (May/June in Australia) you’ll get hit with the full amount. If you leave in July/August, by the time the next taxation year finishes you’ll pay little or no tax.

          • Kay

            Shouldn’t make any difference if you get it paid at the beginning or end of the financial year; the calculation is exactly the same. Mind you, I’m talking about the amount of tax your payroll dept deducts; may be different if you are talking about taxable income when lodging your return with the ATO and whether or not you get a refund. Getting a lump sum payment of leave on ccessation would certainly be advantageous at the beginning of a financial year if you don’t earn much for the remainder of that financial year but your employer should be deducting roughly the same amount whether paid as a lump sum or fortnightly – the calculation is based on “what tax would you have paid if you had received this payment over 26 fortnightly pays rather than all at once?”

            • FrogdancerJones

              Yeah, I’m talking about a lump sum being paid. The difference in tax paid on it is sizeable if you retire and don’t earn anything else.

  3. Maria

    That is brilliant! and LSL sounds great.
    Not the same but similar – I’m in the UK and one of my friends did 4 day weeks in the run up to her maternity leave, using normal paid annual leave for the 5th day. It gave her a breather when she was getting tired in the last 2 months!

    • FrogdancerJones

      It’s so handy to be able to do things like this, isn’t it?

  4. Abigail @ipickuppennies

    Brilliant! This is a great way to use up those holidays in a meaningful way that will really better your life. Not that travel isn’t great, but like you said, pretty soon you won’t need to carve out time to travel. Might as well make your life better now!

    My work has a lot of down time, especially on weekends when emails are few and far between, but I get paid for a full eight hours regardless. So I work on my blog, narf around on the Internet, etc. So in a way I’m being paid for time off too. It’s just not quite as coolly or completely as your way.

    • FrogdancerJones

      Never seen the word ‘narf’ before. Urban dictionary says that it can take on any meaning. Thanks for giving me such a useful thing!

  5. Jamie

    This is brilliant!

    My husband has worked at many sites and in a number of different roles, but has been with the same State Government employer since he finished uni in 2002.

    He has always held on to his LSL, wanting to use it for something “special” and “worthy”. I wonder what that will end up being…perhaps we will move overseas for a few months once the kids leave home.

    He is currently sitting at 158 days of LSL (plus over 200 hours of annual leave and nearly 400 hours of sick leave!)

    • FrogdancerJones

      OMG!!! Tell him to start using it up!
      I was worried about being paid out in a lump sum and having most of it disappear in tax. You need to look at it from the angle of: ‘How much do I reasonably need to keep in reserve and how much do I need to use up to get the maximum benefit?”

  6. Girt

    I am so happy you are making the move to three days, and what a great move (particularly taxwise) to take LSL progressively.

    It is great to see how you are making your own life better but also enjoying and supporting your family. That is a key reason why I love your blog so much and find you so inspiring.

    It is a joy to spend time with family and to be of service, but it is an extra priority which makes financial independence action more difficult …. you are not just choosing between today-you and future-you but also today-family needs and future-family needs. I loved your post on what expectations you set with your boys about what they could expect in terms of support. I have been working on this with my own kids since reading that post.

    • FrogdancerJones

      Wow, thanks Girt!
      I was talking about this yesterday with my oldest friend – we’ve known each other 40 years, can you imagine??!!? – and I was saying that I’m glad that I’m able to make this decision without having to worry too much about putting Future Frogdancer in financial jeopardy. This was a decision that I stupidly never foresaw, because of course my parents will always be around and ok, but now it’s an unexpected bonus of FI.

  7. Pia

    As a fellow teacher – I’m glad to have read about this because that is a brilliant way of using long service leave that I might just have to steal it when my time comes! I am one year short of accruing LSL because I swapped states halfway through my teaching career, and that reset the clock, much to my dismay. Ah well.

  8. David

    Hi Frogdancer Jones

    Another magical thing with LSL is that it actually accrues while you are on LSL, so getting paid and also adding towards more LSL.

    Win Win
    Cheers David

  9. chasingFIREdownunder

    LSL is a magical thing! I’m so jealous though, it’s something I’ve never been eligible for! For the initial few years that I worked at public hospitals, even though they were public hospitals each year counted as a new hospital system and long service leave, annual leave and sick leave did *not* accrue. After that when I was training to be a GP, the system was that I had a base salary with attached annual and sick leave, *but* the real income was as a percentage of the money I made for the training practice which is typically higher than the base rate. When taking that into account, any leave is actually unpaid! Though on the plus side back then I got employer paid superannuation – now as a fully fledged sole trader I get no paid leave and no superannuation!

    • FrogdancerJones

      Ouch. No leave and no super… but on the upside I guess that gives you the control over how much you put into super.

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