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Use Your Paid Time Off—It's Good for You

Jun 21, 2019 5 min read Sheila Olson

Key takeaways

  • Americans forfeited $62 billion in paid time off last year.
  • Time away from work may improve your health and overall happiness.
  • Contrary to popular opinion, taking a vacation may actually be good for your career.


Americans have strange work habits compared to their European counterparts, particularly when it comes to hours worked. According to data from the Organization for Economic Cooperation and Development Opens in new window, the average full-time employee in the US works about 200 more hours per year than her peers in France and the United Kingdom, and over 400 more hours a year than workers in Germany.

Despite the heavy workload, however, most Americans don't take advantage of their paid time off (PTO) each year. The 2018 State of American Vacation report PDF opens in new window showed the average worker took just 17.2 days off last year; as a nation, America's workers forfeited a combined total of 212 million vacation days, the equivalent of $62 billion in benefits left on the table. Over half of all workers had unused vacation time at the end of the year, and nearly a quarter hadn't taken time off in over a year.

If you're one of the work martyrs who fears professional consequences for taking time off (and 56% of workers do), it's time to rethink your feelings about the benefits of PTO.



Increased energy and happiness

A study in the Harvard Business Review1 showed 55% of employees return to work with significantly more energy after a vacation. Not all vacations produce the same effect, however. Although “staycations" are on the rise, they don't do as much to recharge your batteries as travel. Over 90% felt travel vacations were more meaningful and re-energizing than merely relaxing at home.

The energy boost from vacation is wiped out, however, by a stressful, poorly planned trip. To get the maximum benefit from your vacation, plan ahead. Of those who felt happiest after a trip, over 90% had their travel details locked down at least a month in advance.


A healthier heart

Vacation isn't only good for your mind—it could also be good for your heart. A nine-year study Opens in new window showed annual vacations reduce your overall risk for death by 20%, and specifically, your risk of death from heart disease by 30%.

Women's health particularly suffers without regular vacations. A 20-year study PDF opens in new window showed women who vacationed fewer than once every six years were twice as likely to have a heart attack than women who took time off at least twice a year.


Better sleep

Poor sleep leads to a host of surprising health consequences. Researchers at Johns Hopkins Medicine Opens in new window connect inadequate sleep to food cravings and obesity, as well as increased risk for conditions such as colorectal cancer, high blood pressure, diabetes, heart disease, dementia, and depression.

The good news is that vacation can help reset poor sleep patterns and help you get more sleep. The sleep benefits continue even after the vacation ends; the study showed vacationers slept almost an hour longer each night once they got home.2


More raises and promotions

Fear of replacement is the number-one reason workers give for skipping time off. There's a certain logic to it—if work can survive without you for two weeks, maybe you really are dispensable. But a Project: Time Off report3 shows employers believe the opposite is true.

An overwhelming majority of managers believe paid time off contributes to better team energy levels, improved employee attitudes, and happier, more productive workers. Not only that, they back up those beliefs with increased pay and promotions.

The same study showed that 23% of people who forfeited vacation time were promoted in the previous year versus 27% of those who took all their PTO. In addition, 78% of forfeiters got a raise or bonus versus 84% who used their time off. While those statistics aren't necessarily proof of causation, they should tamp down the notion that using your vacation days hurts your career.


Avoid a voluntary pay cut

If your boss offered you a $10,000 bonus, would you say, “I'm good, you can keep it?" Of course you wouldn't.

But that's exactly what happens when workers don't take advantage of paid time off. The Bureau of Labor Statistics shows that PTO represents roughly 7.5% of the average employee's compensation package. Forfeiting PTO is like turning down almost a full month's pay, especially if your employer has a use-it-or-lose-it policy.

Even if it doesn't, don't fall for the misconception that you can bankroll endless hours for a big payout when you leave your job. Most employers without a use-it-or-lose-it policy enforce an accrual cap; in other words, even if you're owed 1,000 hours of PTO, the company's cap may limit you to collecting payment on just 500.


Time away when you don't have PTO

Almost 41 million Americans4 work independently either full- or part-time; that's 31% of the workforce without an employer PTO program. Taking time without pay puts you at a financial disadvantage—and if you're on your own, you risk falling behind without someone to cover your tasks.

But you can still reap the benefits of vacation time with a little advance planning. Set aside a bit of each check for your time-off fund; you'll have more financial flexibility when you're ready to get away. Be sure to give your clients plenty of notice, and coordinate with their schedules and workflow as much as possible.

You may want to consider outsourcing some of your work or hiring a backup to keep things running smoothly while you're away. You'll pay more out-of-pocket for your vacation, but if it keeps long-standing client relationships intact, it's worth the added expense.


Tips to make the most of your PTO

This year, consider making a commitment to use every hour of your paid time off. You earned it, so use it to make yourself a happier, healthier person. These tips may help you enjoy your vacation—and not dread your first day back on the job.

  • Schedule time off in advance; it's not just helpful for your co-workers, it gives you something to look forward to. Anticipation makes you happier Opens in new window before and during your vacation.
  • Set up email autoresponders and voicemail greetings before you go so that clients and co-workers won't expect a prompt response.
  • Unplug as much as possible when you're away from work. If you must check in, schedule a 15-minute session once a day—and leave work behind when it's over.
  • If you're traveling, schedule your return at least one full day before you're due back at work. Keep your first day on the job free of major deadlines, meetings, or appointments.
  • If you can't get away for an extended vacation, schedule more frequent three- or four-day weekends. For many, the stress-relieving benefits from vacation kick in as soon as they leave work.



  1. 1 Achor, Shawn, “When a Vacation Reduces Stress—and When it Doesn’t,” Harvard Business Review february 14, 2014 (https://hbr.org/2014/02/when-a-vacation-reduces-stress-and-when-it-doesnt)
  2. 2 Tugend, Alina, “Take a vacation, for your health’s sake,” The New York Times, June 8, 2008 (https://www.nytimes.com/2008/06/08/business/worldbusiness/08iht-07shortcuts.13547623.html)
  3. 3 Project: Time Off, “The Mind of the Manager: What Your Boss Really Thinks About Vacation,” June 15, 2015
  4. 4 MBO Partners, “The State of Independence in America: Rising Confidence Amid a Maturing Market,” March 2017 (https://info.mbopartners.com/rs/mbo/images/2017_MBO_Partners_State_of_Independence_Report.pdf)


Sheila Olson is a Charlotte-based freelance writer specializing in investing, personal finance, entrepreneurship, and retirement planning. She writes frequently for the banking and financial services industries


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