Early retirement for digital nomads

July 9, 2012 · Posted in Health · Comment 

The concept of an early retirement before the age of 65 is nothing more than pipe dream for most people. They would never even consider it to be a reality given the fact that it’s just not the way things are done…at least not traditionally. The traditional way is to graduate high school and then spend your entire adult life working for someone else’s benefit, working your way up a corporate ladder rung by rung over 40 years of your life, paying off school loans, car loans and a mortgage payment. The cold facts are that most adults in the U.S. won’t see retirement until after 65 years of age because that’s the way the system is designed to work.

But in the 21st century there are more and more intelligent entrepreneurs waking up to the fact that you not only don’t have to wait until you are 65+ to retire…but that you can do it for a lot less than the $500,000 that most people think you need to have in the bank to cover your cost of living for the rest of your life. In fact, if you trade the life of suburbia in for one of international travel as an expat you could find yourself retiring on as little as $35,000.

It sounds like a myth to most people, but it’s a reality that more and more expats are choosing to explore every year. A perfect example of such a place is Bulgaria, which joined the European Union in 2008. A quiet country on the eastern borders of Europe, the country has a low cost of living coupled with a rising medical tourism industry, several major cities and thousands of years of culture and history behind her. And while most Americans look at the country as something inferior, the reality is that Bulgaria is one of dozens of places you can choose for your early retirement.

The cost of living, for example, is a mere $8,000 a year on the high end if you want to enjoy an upper middle class lifestyle as an expat. That’s a total cost of living that includes your entertainment. And considering you can pick up a house, condo or apartment for around $35,000 to $50,000 in any of the major cities, you can easily have your home completely paid for after working just a few short years while utilizing your Western salary of $35,000 or more per year against a cost of living that is less than $10,000. If you saved $25,000 per year for a mere two years you could have your house completely paid for…without the 40+ years of mortgage payments.

This is the reality of the expat lifestyle, and it’s one that is chosen in preference to a life that is controlled by a government who wants you to stay at home and bury yourself in $300,000 of debt. But in the modern era when you can travel the world and choose to retire early in any country that you want, simply by living as an expat, you can see yourself to an early retirement on a lot less than $500,000.

If you have ever wanted to travel full time, there’s no time like the present. There are millions of others just like you from all around the world looking to explore the planet just like you.

Early Retirement While Living Abroad

July 9, 2012 · Posted in Travel · Comment 

When presented with the raw numbers of the expat lifestyle, most people shake their head in disbelief. They think it just isn’t possible to have the same standard of living and amenities as back in the United States for a mere $8,000 to $10,000 per year, but the reality is that it is very much the truth. In fact, it is the primary reason most travelers are choosing to have a base of operations outside of the U.S. As of 2010, the median cost of living (according to the U.S. Census Bureau) for a single, working adult is around $25,000 per year. When you compare 25k to 8k-10k per year, the numbers don’t lie. That extra money could be yours for an early retirement…so long as you are willing to take it.

The median wage (again, according to the U.S. Census Bureau) as of 2010 was the same: $25,000 per year. That is take-home pay, after taxes. The pre-tax number is just above $36,000 dollars. But the other benefit most people don’t know about is the fact that when you live abroad as an independent expat you don’t have to pay the same tax rates that you do while living in the United States. Choosing a country that has a tax treaty with the U.S. means you can pay the local rate of taxes in your chosen country rather than the higher rate back home, effectively allowing you to retain even more of your salary and thus obtain an early retirement.

Most countries outside of the industrialized West still have all of the same amenities and luxuries that people in the “first world” countries have, but the cost of living is significantly lower. As a general rule, places like Colombia, Bulgaria, Mexico, Italy, Greece and beyond hover between the $8,000 and $10,000 range, which means you can head there as an expat with your pre-tax salary of $36,000 per year and live accordingly. What this means for the savvy digital nomad is that you can put a significant portion of your income back in your pocket rather than merely breaking even year after year as you would back home.

The beautiful thing about the expat lifestyle is that you don’t have to be part of the current work force to take advantage of the lowered cost of living in other countries. Pensioners have been choosing to retire overseas for years, and this is one of the primary reasons. You can take your $1,000 a month pension (or rough equivalent) and use it in a place like Cancun, Mexico where you can live on $600 per month, leaving you with $400 per month to spend as you see fit. And because the healthcare is free you don’t have to spend hundreds of thousands on medical fees, plus you have access to the beach and a lush, tropical environment to enjoy every day of the week.

Living abroad as an expat means you can reduce your working hours if you choose, because you need significantly less to pay for your cost of living. Or you can do as many other professionals are doing, which is working abroad for three to five years, working normal hours on your old salary and keeping that money so you can enjoy an early retirement by the time you are 30 or 35, rather than waiting until you are 60 or 65. When you can buy three bedroom house in a place like Italy for $35,000, it’s easy to save up in a few short years and retire comfortably at an early age.

If you have ever questioned traveling full time, there’s no time like the present to get your start. The reduced cost of living is one of the least important reasons.

The Freedom of Expat Living

July 1, 2012 · Posted in Business · Comment 

One of the primary reasons that the expat lifestyle is so important to so many people is the simple fact that you can control your life to a greater extent than you ever could while living back in the United States or the United Kingdom. Many people take for granted the fact that the so-called freedoms you have while living in Western countries come at a cost, and that costs continue to rise every year to the point where the land of the free is anything but.

Perhaps the easiest comparison to make for the uninitiated is between Mexico City and New York City. These two cities are both considered leaders in the global community in terms of population, banking, commerce and education. The cost of living in New York City is around $50,000 for bottom of the barrel living, but if you compare it to Mexico City you can have the exact same creature comforts and style of life for only $10,000 a year.

Think about the difference between these two cities for just a minute. Then reflect upon the fact that $40,000 is a lot of money to the average American, and when you consider the fact that these two cities are exactly the same on paper, you come up with a basic mathematical fact that even a child can understand. It is this reason that expats are choosing to leverage the power of cities around the world, because if a child can understand it, it’s a simple enough mathematical fact that adults don’t even need to think about.

This is what expat living is all about, and it is this reason that more and more people every year are choosing to live outside of Western countries rather than be held down by a prohibitive cost of living. When you can put tens of thousands of dollars a year back into your bank account, all while retaining the exact same amenities and style of living you had back home, there is absolutely no reason to stay in the U.S. or the U.K. when that freedom robs you of your bank account to the point where you are absolutely broke.

When you can put the vast majority of your income back into your bank account every year rather than spend it on the basic amenities that you need to survive, you can control your life to a greater degree than most people would have ever thought possible. There is no reason to spend 40 years of your life as a wage slave in a country that only allows you to put a few hundred dollars per month in your bank account, especially when you can have absolute freedom living in other countries where you can be retired long before your geriatric years.

You can choose the life of a location independent expat over one of suburbia, choosing to live in Mexico or other countries around the world to enjoy an early retirement.

Living beyond the numbers of the expat lifestyle

July 1, 2012 · Posted in Travel · Comment 

Wealth management means different things to different people, as does retirement. For some, it is IRAs and bank-manged stocks or funds. These are common types of investments. And for the vast majority of people whose life is restricted to suburbia, international investments, tax havens and offshore accounts are nothing but words. The thought of being able to make international business deals alongside multi-million dollar corporations seems like a joke.

The reality is that so long as you don’t mind doing a little bit of travel you can enjoy the same benefits. The 21st century has allowed more and more people around the world to access and research international investments via the Internet. As the visibility increases more and more expats around the world are choosing to make international travel and investment their priority rather than leaving their money in banks back home. All of this is to access something average people have a hard time comprehending: early retirement.

Although it might sound like a fantasy at first, the reality is that retiring early is something that anyone can do. The U.S. is continuing to see costs that are three and four times more than most of the rest of the world, which means the average individual has a salary that can’t even cover their basic costs. The only choice is to start borrowing money from the bank and credit card companies to pay the bills, which means instead of saving money you are actually sinking further and further into debt.

This is where the expat lifestyle shines. Expats are entrepreneurs on a global level because they have the flexibility to go anywhere in the world that they want and invest in whatever they want. This is because they aren’t trusting in a failed government or bank to secure their future. Instead, they are looking at places like Chile or Brazil or Singapore where the economies are booming and universal healthcare cuts your cost of living down to almost nothing. On top of that, the cost of living is dramatically cheaper and there are plenty of jobs.

It’s so simple that even a child can understand the numbers. The average, ordinary salary of 25k a year after taxes in the U.S. will only cover your bare-bones basics, but in a country like Mexico where you only need 15k a year for an upper middle class life and suddenly you can start putting 15k a year back in your savings. Plus, whereas a house in the U.S. costs 225k for a 3-bedroom place, you can pick one up in countries like Chile for around 35 to 50k. It’s these types of numbers that allow expats the early retirement most people only dream of.

What’s truly mind-boggling is that all of this is possible on just a median salary. Imagine the types of results you can see when your salary is 50k, 100k and 250k and beyond per year. The more money you make per year the more options you have because your costs are almost nothing. Plus, with medical tourism you can access universal healthcare along with a higher level of control over your income. This allows you to make intelligent living decisions rather than only making it paycheck to paycheck. Once you realize the simplicity of the expat lifestyle you can quickly see that you can retire long before you are 65 years of age.

Each day, more and more expats are choosing to live a life abroad rather than stay at home. That’s because you can achieve more by living a life of absolute freedom than you ever could as one of the countless wage slaves working their lives away back home.