Retire Early and Travel the World On $33 per Day- 2019 in Review

Nomadic FIRE 2019 Year End Review

Highlights to Saving One Million Dollars

  • $1,000,000+: Invested retirement assets as of Jan 2020
  • 5: Numbers of Years Retired
  • 11%: Year over Year growth to reach One Million Dollars
  • 2.6%: Withdrawal Rate as % of 2019 beginning balance of retirement savings
  • $22,000: Annual passive income generated from invested retirement assets (cash flow only, excludes appreciation)
  • 15: Number of countries traveled
  • 0: Number of 10-second handstands held (was my goal for the year)

You asked for follow up to Q3 2019 (July-Sept) Spending Update, this is Spending Update 2.0. The first post focused on my monthly spending. My goal then was to give you a real-life example of early retirement living and traveling around the world.  Based on your feedback, this post reveals even more about my income, withdrawal rate, and invested assets to help you plan a similar lifestyle.

I didn’t start tracking spending until Q3 last year. The first six months of 2019 are not 100% reconciled with cash that I actually spent. I did my best to go back and properly categorize where I spent my money from Jan to June, but I couldn’t identify every line item. The numbers are ~95% correct, but dollars may shift between types of spending (maybe less in Food and more on Entertainment as an example). Regardless, the conclusions on my spending analysis would not change.

A detailed spending article for Cyprus is coming soon. You can see a realistic budget for retirement in a European beach town (specifically sunny Limassol). I’m also in the middle of picking my International Health Insurance for 2020 and applying for a Retirement Visa for Spain. I’ll have more detailed information on both those subjects in the very near future. Keep a lookout for both articles in a few months.

Interested in Healthcare costs when living overseas? Subscribe below for my 2020 International Early Retirement Health Insurance comparison between the US vs. Europe.

Any questions or requests for additional details, leave me a message in the comments below this article.

*UPDATE* As of February 29th, I am no longer a member of the two comma club. But F*ck It, I took a long time getting this information together to write this post. 


Besides, I think the post is even more relevant now. Though my Net Worth has dropped due to market volatility, I’ve diversified enough that my Withdrawal Rate doesn’t change. The passive income from my investments is still 1.8 X my annual expenses. 


The changes I made in 2019 have given me additional levers to pull and reduce my spending level even further if there is a protracted market correction. 

The 2019 Year In Review

Nomadic FIRE- 2019 Travel Map

Countries Visited in 2019

Homebases:
Q1: Medellin, Colombia

Q2: Vienna, Austria

Q3: Sofia, Bulgaria

Q4: Limassol, Cyprus

Nomadic FIRE 2019 Travel Overview e1583146600731

Google Maps recap of my 2019 Travel Timeline

Other Cities and Countries Traveled: Slovenia (Ljubljana), Croatia (Dubrovnik), Bosnia and Herzegovina (Mostar), Bulgaria (Rila, Plovdiv, Varna), Serbia (Belgrade), Cyprus (Nicosia) Turkish Republic of Northern Cyprus (Lefkosa, Kyrenia), Israel (Jerusalem), Palestine (Bethlehem), Italy (Rome), USA (Las Vegas)

Google only recognizes 13 countries, as it ignores disputed territories (Palestine and the Turkish Republic of Northern Cyprus). 

2019 Financial Overview

How I invest one million dollars:

Retirement Accounts (Traditional IRA, Roth IRA, HSA)End of 2019
VTI- Vanguard Total Market ETF315,000
VYM- Vanguard High Yield ETF130,000
QQQ- Invesco NASDAQ ETF110,000
Other160,038
Total Retirement Accounts715,038
*Real Estate285,000
Total Invested Assets1,000,038

Income generated from one million dollars:

Income StreamsFull Year 2019
Dividend and Interest Income10,383
Rental Income19,111
Rental Expenses(8,090)
Misc Bonus933
Total Annual Income22,336

Yearly living overseas expenses :

ExpensesFull Year 2019
Food4,303
Housing2,735
International Flights1,741
Health Care1,064
Fitness959
Shopping715
Local Transportation461
Entertainment122
Utilities62
Total Spending$12,163

Brief Summary of My 12-year Journey to a One Million Dollar Net Worth.

January 11, 2020, I officially became a millionaire.

There was no trumpet sounds or hip hop soundtrack when it happened. There was no 80s movie montage of me working and overcoming obstacles. But there it was on my computer screen, seven digits that represented a goal I had since I was a young kid. $1,000,038. I officially hit millionaire status. The two comma club. A seven-figure Jigga. A paper millionaire. Crossing this milestone put me in the Top 6% of the US or Top 0.2% in the World.

The starting point to my one million dollar journey was less than $50,000.

The earliest documentation I can find of my net worth is from June 25, 2008. I was rejected for a small business loan. Part of the application was the documentation of all my assets and liabilities. The net total was $47,100.

Nomadic FIRE Net Worth 2008

Earliest documentation of my Net Worth, June 25, 2008

My Net Worth would drop further during the Great Recession, as my small business required cash infusions to make payroll. Mercifully, the business shutdown after nine years in 2014. My journey to one million dollars was not smooth. You can read more about my epic failure in the post "What Everybody Needs to Know About Failure But Is Afraid To Hear".

Seven years later, I recovered enough financially that when my CEO fired me in April 2015, I pulled the trigger to Retire Early with slightly under $600,000 saved up. The last five years of retirement life have been incredible. Around the world travel, storybook memories, crossed off bucket lists, and new friends in several countries constitute a happy life.

What I did With One Million Dollars: Where I Traveled and Lived in 2019

Q1: Medellin, Colombia

PROS: Medellin is on my Top 5 favorite cities to live. Beautiful weather, low cost of living, and proximity to the US make it a favorite for many expats. You can read my full write up on what it is like to live in Medellin for less than $1,000 a month.

Nomadic FIRE Colombia Medellin El Poblado

CONS: While SIGNIFICANTLY safer than 25 years ago (Pablo Escobar died 1993), you still have to take precautions (take cabs at night, be extra vigilant of your belongings, never take your eye off your drink, etc) that are unnecessary in any of the other cities I lived this year.

Q2: Vienna, Austria

PROS: In 2019, Vienna was crowned “The Most Livable City in the World” for the second year in a row. There are so many fun things to do in Vienna. With beautiful Old World architecture, robust infrastructure, and a world-class culture and arts scene, it’s easy to fall in love living here.

CONS: All the benefits of living in Vienna come at a cost. While still cheaper than a MCOL city in the US (Kansas City has a roughly equal COL), Vienna is double the cost of Medellin.

Also, it’s a Schengen Agreement country, which means US Citizens only get 90 days out of every 180 days to live there (or any of the 26 other European Schengen countries). Schengen is a pain in the ass visa situation for me. The situation led me to applying for a Spain Retirement Visa this year. Results to the Spanish Visa application to be posted in the near future.

I would not typically choose to live in an expensive city, but two strong reasons compelled me to spend three months in Vienna:

  1. My new girlfriend wants to travel the world with me. She has admirable savings, but isn’t near FIRE. She needed to return to Austria to set up a business allowing her to travel while working as a Digital Nomad.
  2. We were able to house hack by house sitting in an centrally located apartment in District 2. We lived walking distance to our calisthenics gym, a large city park, and several supermarkets. A quick hop on the metro or tram would get us anywhere else we needed in the city. Given the price of similar apartments in the area, we saved roughly $1,000 per month on housing.
Nomadic FIRE Croatia Dubrovnik

Visiting King's Landing from Game of Thrones in Dubrovnik, Croatia

Additional cities visited: Slovenia, Croatia (Dubrovnik), Bosnia and Herzegovina (Mostar).

Austria’s central location in Europe allows for easy trips via bus, train, and cheap flights. I took a one week trip through the Balkans to Dubrovnik. I walked the city walls of "King's Landing" while watching the final season of Game of Thrones.

Q3: Sofia, Bulgaria Cost of Living: 

PROS: After three months in the Schengen area, I choose to revisit Bulgaria for a visa run. Two years ago, I spent a month partying at a beach town called Golden Sands on the Black Sea. It was a fun-filled month, where I met two close friends that I still keep in touch with to this day.

Nomadic FIRE Bulgaria Sunny Beach

Bulgaria is an under appreciated EU country. It is currently a non-Schengen country, which makes it a great place for a three-month visa run. I go into detail about Sofia, Bulgaria in my Q3 2019 Update post here. Rather than repeat, you can read up on what living in Sofia was like and the Cost of Living there. In brief, Bulgaria is extremely underrated: beautiful mountains, sunny beaches, and low cost of living on par with many Southeast Asian countries, but with infrastructure and rule of law that comes from being in the European Union.

CONS: Everyday communication is difficult. In Sofia, most people under 35 years old speak English. But, speaking with older folks or being outside the city becomes challenging. Bulgarians write in Cyrillic, which makes reading anything (store signs, menus, street names, flyers, directions, food ingredients, etc.) impossible. To add to the communication confusion, Bulgarians nod their heads for “no” and shake their heads for “yes.” Nope. Not. Confusing. At. All.

SCAMS: I had a friend scammed out of 100€ in Varna, Bulgaria. He committed a rookie traveler mistake. He exchanged currency on the street for a favorable black market exchange rate. For his euro, the scammer exchange worthless money that Bulgaria pulled from circulation in 1999.

Additional cities visited: Austria (Vienna), Czechia (Prague), Serbia (Belgrade), Bulgaria (Plovdiv and Rila).

I had a chance to visit Serbia for the first time. Even with a quick two-week visit, the capital city made a lasting impression. Belgrade had a robust nightlife, the food was delicious, and the Cost of Living was low.

Nomadic FIRE Serbia Belgrade Splav

Hearing about the Serbian vs. NATO conflict of the early 1990s from a local perspective was fascinating. Since I only received the Westernized/US perspective, hearing young Serbians explain their history from their point of view was enlightening.

Q4: Limassol, Cyprus

PROS: Cyprus was not on my shortlist of countries to live in overseas. I never knew much about it, except it was sunny. Seriously, sunshine for days, as in 340 sunny days a year. We lived a 15 minute walk to the beach. 

A short 45 minute bus ride and you could visit a UNESCO site of Roman ruins or simply hit the beaches in Paphos.

Nomadic FIRE Cyprus Limassol Coast Sunset

Also, My girlfriend was starting University classes and needed cheap flights back to Austria for exams. With $10 direct flights from Vienna to Larnaca, off to sunny Cyprus, we went. 

Cypriots are super very friendly folks. We had a social circle forming, which makes any place 10 X better.

CONS: Cyprus was surprisingly expensive. Also, it's not worth the cost, which makes any place 10 X worse. Limassol's cost of Living is roughly equal to Vienna, but has none of the advantages. Urban sprawl is a real thing here. Walk-ability is restricted, and public transportation is scarce. Food choices are limited (every meal involves meat on a stick). Housing in the city center is expensive, and the accommodation quality is not worth the price. 

SCAMS: After walking crossing the border between Turkish-controlled Northern Cyprus and Cyprus, I bought snacks for the bus ride home. I paid the cashier with a 50€ bill (Cyprus uses Euros) and received back a 20€, two 10€, and a 5€.

The scam was the 10€ bills were not Euros. The cashier gave me two 10 Turkish Lira bills. I didn't look until I was already on the bus. 20 Liras = 3 Euro. Those were expensive snacks.

Most people outside of Cyprus are unaware that Turkey occupied half the country since a civil war in the 1970s. The northern part of Cyprus considers itself an independent nation. The problem is that the only country in the United Nations that recognizes Northern Cyprus independence is Turkey.

Nomadic FIRE Cyprus Nicosia Green Line

The border guards stopped me from taking a picture, so here is one from Wikipedia

Turkey stations troops there to protect the Turkish Cypriots. Soldiers and border guards divide the capital city of Nicosia down the middle. Similar to Cold War Berlin, there is an actual border with checkpoints in the middle of the capital.

Other cities visited: Turkish Republic of Northern Cyprus (Kyrenia), Israel (Jerusalem), Palestine (Bethlehem), Italy (Rome), USA (Las Vegas).

Cyprus's proximity to the Middle East allowed me to visit an area of the world I have largely ignored. My visit to Israel and Palestine were the first forays into the Middle East. 

Nomadic FIRE Israel Jerusalem Damascus Gate

Couples selfie (a Couplfie?) at the Damascus Gate in Jerusalem, Israel

Cost of Living Comparison for Cities I lived in 2019

How Much Interest Can I Earn on One Million Dollars: Income and Withdrawal Rate Breakdown

Income StreamsFull Year 2019
Dividend and Interest Income10,383
Rental Income19,111
Rental Expenses(8,090)
Misc Bonus933
Total Annual Income22,336

For 2019, I was able to generate over $22,000 a year/$1,860 per month in passive cash income.

To be clear, this was not merely “interest,” but a combination of dividends, interest, real estate rental income, and some misc bonus cash. 

Dividends and Interest- ~1.7% dividend yield. 

I based the percentage return on the balance at the beginning of the year. It would be more accurate to calculate on an average balance, but I’m lazy and the benchmark would not change my behavior. 

Real Estate- 4% cash on cash return

2019 Totals
$19,111Gross Rental Income
($8,090)Expenses including management fees, property taxes, and HOA dues
$11,020Net Rental Income
----------Divided By
$274,000Estimated Property Value (based on recent same unit sales in the condominium complex)
4% Cash on Cash Return

4% represents cash income minus cash expenses for my rental property. It does not include any appreciation on the property, nor does it include any depreciation or maintenance reserves. With the rental paid off, I am using the property value in the denominator. The value of the home acts as my proxy for cash investment.

Rental Income-

I had zero vacancies this year, which both increases my income and decreases my expenses. I like my renter, hopefully she will re-up this year with a modest 3.5% increase.

Breakdown of 2019 Rental Expenses-

Homeowners Association (HOA) Dues - $4,211

Property Taxes - $2519

My two biggest rental expenses and I have no control over either of them. The HOA includes maintenance and insurance on the property, a swimming pool, hot tub, movie theater, gym, billiard room, and racquetball court.

Management Fees - $1077

I changed property managers last year, and it’s been great. My new manager charges me 5% per month plus one month of rent if we have to find new tenants. Other than an occasional email to approve a maintenance request, this income is truly passive.

Renters Insurance - $140

Cleaning and Maintenance - $1410

Misc Bonus- Cash Back and Sign Up Bonuses

I received $900 as a sign up bonus for rolling over my 401K to a Merrill Edge IRA. But the bigger story here is I lost THOUSANDS because I was a lazy dumba*s and kept my previous 401K in my prior employer’s plan for five years.

Nothing was stopping me from moving the account, except laziness and apathy. Apathy cost me $90 a month for five years in 401K service fees to T. Rowe Price. My laziness cost me THOUSANDS of dollars in fees and opportunity costs. It’s my fault for not paying attention. Sometimes I want to kick myself in the face.

Paris

Total Annual Income as % of Retirement Savings = Safe Withdrawal Rate (SWR) = 2.6%

Total income is my proxy for a Safe Withdrawal Rate (SWR). Total income is cash generated from my investments and does not include any appreciation. I can live on this cash, without touching the investments themselves. In effect, I am "living off the interest" generated from the one million dollars I saved. 2.6% is the SWR when using the 2019 beginning of year balance is the basis for determining the % rate.

How I invested One Million Dollars: Capital Growth and Appreciation

Diversification of one million dollars in invested assets

Retirement Accounts (Traditional IRA, Roth IRA, HSA)End of 2019
VTI- Vanguard Total Market ETF315,000
VYM- Vanguard High Yield ETF130,000
QQQ- Invesco NASDAQ ETF110,000
Other160,038
Total Retirement Accounts715,038
*Real Estate285,000
Total Invested Assets1,000,038

ETFs and Index Funds: The bulk of my investments are ETFs. 78% of my retirement assets are in three funds: VTI (Vanguard Total Market ETF), VYM (Vanguard High Yield ETF), and QQQ (Invesco QQQ NASDAQ 100 ETF).

I am still in the process of transferring and consolidating my positions. There is ~$160,000 in random funds from a previous account that will be moving into the funds above in 2020. 

Real Estate: 28% of my retirement assets are in a single unit condominium rental with no mortgage. As mentioned previously, the rental generates ~$11,000 in cash that pays for my living expenses.

*Real Estate Value: I update my real estate value once a year since there isn’t an accurate real-time way of getting appraisal costs. Sales of identical units in my condominium complex drive the estimated home value above.

I categorize my retirement accounts into Medium Term and Long Term.

Retirement Accounts (Traditional IRA, Roth IRA, HSA)Start of 2019Increase/
(Decrease)
End of 2019
Medium Term46,22316,37662,599
Long Term548,544
103,895652,439
Total Retirement Accounts594,767
120,271715,038
*Real Estate274,000
11,000285,000
Total Invested Assets868,767
131,2711,000,038

Medium Term: Roth contributions (and soon Roth Ladders) are funds available before I turn 59.5 years old. 

Long Term: These are Traditional IRA accounts not converted into Roth accounts and gains on any Roth accounts that are not accessible until I turn 59.5. 

The Fastest Way to Build One Million Dollars in Retirement: Live overseas for 70% LESS Cost Than Living in the US

There are other benefits of living abroad, besides a low cost of living, but a compelling reason is reducing your monthly expenses and maximizing your retirement savings.

Nomadic FIRE Israel Jerusalem Western Wall

"Do you want to double your retirement savings? It's simple, jump on a plane and move abroad."

What People in the US Spend Money On and How I Compare

Economic Policy Institute Monthly Estimated Expenses

One Adult and No Children - Portland/Hillsboro Oregon Metro Area.

HOUSING

$1,026

FOOD

$274

CHILD CARE

$0

TRANSPORTATION

$800

HEALTH CARE

$229

OTHER NECESSITIES

$524

TAXES

$687

Monthly Total

$3,611

Annual Total

$43,326

$3,611 per month is what I would be spending if I lived in the US with a modest lifestyle. Let's see what I really spent, while traveling the world in 2019.

 My Total Spending for 2019Per Month Average% of Spending
Food4,30335935.4%
Housing2,73522822.5%
International Flights1,74114514.3%
Health Care1,064898.7%
Fitness959807.9%
Shopping715605.9%
Local Transportation461383.8%
Entertainment122101.0%
Utilities6250.5%
Total Spending$12,163$1,014
Average Per Day$33

My expenses for 2019 are my lowest ever. 2019 is the first full year I have had a girlfriend living with me and splitting my living expenses. Having a partner really drives my COL lower than I expected. She pays for 50% the rent and 40% of the food budget.

In addition, I don’t go out partying as much, so my alcohol and nightclub budget is drastically reduced. With the side benefit of watching her wake up and smile at me every morning, this was bonus savings.

Comparing The Top 3 Living Expenses

In the US, the most significant expenses would be Housing, Taxes, and Transportation. This "Big 3" takes up $2,500 per month. Roughly 70% of a person's budget is spent on these 3 categories. Let's see how my spending in 2019 compared.

Spending Comparison

Average American

Marco Living Abroad

HOUSING

$1,026

$228

TRANSPORTATION

$800

$38

TAXES

$687

$0

Total $ Top 3 Living Expenses

$2,513

$266

Monthly Savings Living Abroad = $2,247

Nomadic FIRE 2019 Spending Comparision US vs Living Abroad

HOUSING ($800 savings per month)- This is my biggest savings for 2019.

House hacking reduced my housing costs significantly this year:

  1. Splitting the costs with my girlfriend. This is the first full year I have had a partner to split my housing costs. 
  2. For four months this year, we were house sitting in Vienna. Vienna is a beautiful, but expensive city. I would not choose to live there, but my girlfriend is Austrian and she has family about a one-hour train ride away. House sitting provided the opportunity to keep housing costs low (saving ~$1,000 per month), while we lived in a stunning city, and at the same time making my girlfriend happy. Definition of a WIN/WIN. 
Nomadic FIRE Austria Vienna Apartment 3
Nomadic FIRE Austria Vienna Apartment 2

House sitting a beautiful Viennese flat

Nomadic FIRE Austria Vienna Apartment 1

Excluding house sitting, we spend between $320 to $500 per month TOTAL ($160 to $250 each). In LCOL cities such as Medellin, Colombia and Sofia, Bulgaria, $500 per month covers shared housing in desirable upper-middle-class neighborhoods.

Nomadic FIRE Medellin Laureles Apartment View
Nomadic FIRE Medellin Laureles Apt 2

Hipster coliving in Medellin

Nomadic FIRE Medellin Laureles Apt 1

As an example, our coliving flat in Medellin was in a hipster expat neighborhood across from a University. Rent included all utilities (internet, cable, TV, electric, and water) and maid service for $175 per month per person. The apartment was a vast space with several living rooms, big screen TV, multiple balconies with skyline views, a small gym, and newer IKEA-ish furniture.

In places like Cyprus, our accommodations were less luxurious. The pictures below show our room in a three-bedroom flat. The apartment was promoted as student and intern housing. The location was excellent, with only a 10-minute walk to the city center.

Nomadic FIRE Cyprus Limassol Apartment 1
Nomadic FIRE Cyprus Limassol Apartment 3

Reliving my impoverished student life in Cyprus

Nomadic FIRE Cyprus Limassol Apartment 2

However, the conditions were spartan: there was no place to sit and relax, amenities were negligible, the roof leaked, and the furniture thrift shop-ish. I WILL NOT be living in similar accommodations again. I didn’t work and save my ass off to live like a broke 19-year old college Freshman.

TRANSPORTATION (Savings of $762 per month):

Transportation costs were eye-opening savings for me. Even when working in the US, my transportation costs (car payment, gas, maintenance, parking, etc.) were never this high. My used Mitsubishi SUV puttered along for 10-years after graduation from University. While my friends bought or leased Mercedes, BMWs, and Lexuses every few years, I shuffled along in a paid-off beater.

Expensive transportation is a US issue. Our urban sprawl and lack of adequate public transit make car ownership a near necessity. Beyond need, big expensive cars and SUVs are cultural. We love cars and SUVs. The bigger the better. Cheap gas (compared to Europe) helps fuel our love affair.

People in the US don’t understand how easy public transportation is in Europe vs. the US. Even in “developing” countries in Europe like Romania and Bulgaria, public transport consists of metro, buses, and tramlines. A monthly pass for unlimited use can run as low as $40 per month.

TAXES (Savings of $687 per month): I legally pay almost nothing in income taxes.

The EPI Tax number above represents a combination of state and federal income tax, social security, and Medicare. To maximize my income, I use the following tax breaks/strategies:

My primary income is my rental property.

On a cash basis, I netted roughly $11,000 last year after expenses. I depreciate my property, which reduces my taxes but does not affect cash flow.

Rental income is treated as "passive income" by the IRS.

As opposed to payroll from a job, passive income is not subject to payroll tax (no FICA/Social Security/Medicare taxes).

Roth contributions are tax-free withdrawals.

I fund additional living expenses through withdrawals from my Roth contributions (and eventually Roth conversion ladders).  I paid the taxes associated my contributions when I contributed to my IRA accounts years ago.

HSAs are the Triple Crown of tax savings.

The primary reason I choose a High Deductible Health Plan for my ACA coverage is for the HSA. The HSA is the BEST tax advantaged investment account. Contributions are tax-free, investment growth is tax-free, and withdrawals are tax-free. If you qualify for an HSA, you NEED to max the account out ($3,550 max for for individual or $7,100 for family in 2020). 

The four strategies above, combined with the 2018 increase for Federal standard deductions ($12,200 for an individual/$24,400 for married couples), were incredibly effective in driving my tax liability to zero.

What I Spend My Money On: Spending Priorities For 2019

FOOD (33% of my monthly budget): $359 per month

Continues to be my biggest expense. Note that my girlfriend and I split food costs 60/40. The $359 represents my portion of the food bill. 

My love of food and peculiar dietary needs are covered in a previous post breaking down my monthly budget in Bulgaria. Here is a quick excerpt to give you some context on why food is so expensive.

My most significant expense, by a wide margin, involves stuffing my face...I could cut this down, but eating good food is my raison d'etre. I eat substantially more than most people. I cook ~75% of my meals at home to save cash, but groceries include splurge items like fresh truffles and imported Asian spices, so it's a balance...I eat a protein-heavy carnivore diet. To give you an idea, I eat roughly 160 grams of protein a day, think roughly FIVE 4 oz (114 g) steaks a day. Most meals exclude most refined carbohydrates (bread, rice, and pasta). Regrettably, refined carbs are a super cheap way to fill up. Avoiding carbs drives my food bill higher. For people estimating at home, you would likely spend much less than me on Food.

I eat out roughly once per day, but in LCOL cities, a little bit of money goes a long way.

Nomadic FIRE Bandeja Paisa

$4 Bandeja Piasa- Heart attack special in Medellin, Colombia

Nomadic FIRE Bulgaria Sofia Virtuoso Vietnamese
Nomadic FIRE Bulgaria Sofia Virtuoso Bahn Mi

Vietnamese food fix in Sofia, Bulgaria for $5 vs. $25 in the US
Bún Gà Nướng and Bahn Mi - rice noodles and a sandwich

Nomadic FIRE Bulgaria Plovdiv Rahat Tepe Ribs

$9 Two racks (3 lbs/1400g) of grilled pork ribs in Plovdiv, Bulgaria

Nomadic FIRE Cyprus Limassol Mixed FM Grill
Nomadic FIRE Cyprus Limassol Doner FM Grill

$7 Each for Mixed Grill and Lamb Doner (Gyro) in Limassol, Cyprus

HOUSING (22% of my monthly budget): $228 per month

Housing- I gave my housing examples in the previous section above.

INTERNATIONAL FLIGHTS (14% of my monthly budget): $145 per month

All trips listed below were one-way tickets, except for the Israel trip. International Flights in Europe are mind boggling cheap. In some cases, the Uber to the airport is literally more expensive than my flight to another country. 

  • Medellin, Colombia to London, England = $370
  • London, England to Vienna = $65
  • Dubrovnik to Vienna= $77
  • Vienna, Austria to Varna, Bulgaria = $20
  • Varna, Bulgaria to Larnaca, Cyprus = $30
  • Cyprus to Israel (round trip) = $45
  • Larnaca, Cyprus to Skopje, Macedonia= $19
  • Skopje, Macedonia to Rome, Italy = $20
    A quick four day Italy stop to eat pizza and buy some Limoncello for gifts
  • Rome, Italy to Las Vegas, Nevada $230
  • Las Vegas to Manila= $375

HEALTHCARE and INSURANCE (8% of my monthly budget)- $89 per month

  • Travel Health Insurance = $680 
  • ACA Subsidized US Insurance = $230
  • Out of Pocket = $154

These numbers do not include my 2019 HSA contribution of $3,500. I count that as a long term investment, not an expense. 

I discussed my healthcare strategy in this prior post, but to recap, I have a three tier approach:

  1. 1
    Use Local Healthcare for out of pocket costs. As a rule, I can get all routine checkups and medical tests done cheaper overseas. My Out of pocket costs this year:
Nomadic FIRE Out of Pocket Medical Expenses 2019
  1. 2
    Travel insurance is my transition safety net. If something more serious happens that can’t be handled in a country I am living in, travel insurance is used to stabilize me and get me to the US. My travel insurance, which covers me WORLDWIDE (except the US) is $680 per year.
  2. 3
    US insurance for anything catastrophic. Once my travel insurance brings me back to the US, "Obamacare" takes over. With an ACA subsidized High Deductible Silver plan, I rarely use US medical care. But *knock on wood*, if anything catastrophic happens, my ACA is my fallback.

One requirement of the Spain Retirement visa mentioned at the beginning of this post is paying for Spanish Private Health Insurance. A future post on cost and coverage of Private Health Insurance in Europe vs. Worldwide Travel Insurance vs. US Health Insurance is in the works. The cost and coverage of Private Health Insurance (non-government-subsidized) in Europe will make US citizens cry.

Want more insights on living abroad? Subscribe below for our updates on how to LEGALLY Retire Early in Europe.

Key Lessons Learned in 2019?

Hitting the One Million Dollar mark felt good, but it does not fundamentally change my behavior. 

My spending is tracking well under the 4% SWR benchmark. Five years of Early Retirement completed reduces the Sequence of Return Risk. There are no plans to “reset” my SWR, and my annual spending is unlikely to change.

I'm saving BIG TIME (90%) on Housing, Transportation, and Income Tax by living overseas.

Compared to a living MCOL city in the US, I save about 70% in total expenses, without sacrificing my standard of living. In some countries, my reduced monthly costs still include maid service and dining out once a day.

Hitting One Million Dollars provides a bigger buffer.

Even if the market continues to fall, there will not be any panic to make sizable withdrawals from my retirement funds. Actions to reduce 2020 expenses further help prevent selling into a downturn. 

As an example:

  • I’m ready for a home base. There are no plans to stop traveling, but Spain will be home base for the foreseeable future. Living in a new country long term will mean fewer international flights and more domestic day trips. International flights were one of my Top 3 expenses last year.
  • Shopping and Food expenses can be reduced. Every move to a new city has a "start-up cost, " as I buy a new blender, knives, pans, bed linens, towels, and cooking supplies. Settling down lowers the upfront costs.

How has FIRE helped you manage the latest market downturn? How do you think your behavior will change when you hit the one million dollar mark? Would you feel any differently? Would your spending levels change?  Let me know in the comments below what you might do differently as a FIRE millionaire.

Retire Early and Travel the World On $33 per Day- 2019 in Re…

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