Retire in old-world European charm at an affordable cost of living in Bulgaria.
This is the first post in a Spending Update series. This series breaks down my month spending by quarter to give you a detailed view of what life is really like living and traveling around the world after Early Retirement. Any questions or requests for additional detail, leave me a message in the comments below this article.
Cost of Living in Bulgaria: July - September 2019 Spending
Homebase: Sofia, Bulgaria
Other Countries Traveled: Austria (Vienna), Czechia (Prague), Serbia (Belgrade), Bulgaria (Plovdiv and Rila)
|3 Month Total||Per Month Average|
|Average Per Day||$37|
What kind of retirement lifestyle can I afford on $1200 per month?
It’s another beautiful sunny morning in Limassol, Cyprus. It’s mid-October. The US is already getting the chill and rain of winter. But since Cyprus averages 340 sunny days a year, I’m enjoying my Turkish coffee in shorts and a t-shirt. All is not roses in paradise today and I’m a little anxious. My news feeds are full of reports of upcoming recessions, market volatility driven by trade wars, and IPO disappointments. I’m approaching Year 6 of my Early Retirement. There are still 13 more years till I hit 59½ years old. I am in the middle of the high risk FIRE GAP period and a news of a recession has me a little worried.
The FIRE GAP- The period after early retirement, but before 59½ years old, where you stop working, but have limited access to your 401K and IRA retirement savings accounts. A risky period for Early Retirees, as you must have enough money saved outside of your 401K and IRA to cover living expenses, until you can properly access your retirement savings.
Financially, I prepared before I pulled the trigger on Early Retirement, but mentally, all the crappy news has me a little nervous. I wonder am I spending too much on rent? Are my cost assumptions for food and entertainment too low? Is my healthcare strategy staying within my budget? This post is the first in a new series, where I answer these questions. I will provide quarterly updates on my monthly spending, showing all the surprises and provide REAL LIFE examples of the lifestyle I live.
Here are examples of other people's Monthly Retirement Budgets that didn't give me the information I needed to plan my Retirement Overseas:
I didn’t want generalized estimates on cost of living; I wanted specifics. I wanted to see trends, not just one time statistics. I wanted to be shown what kind of lifestyle I can live and at what cost. The following series of posts will provide these specifics.
Why am I starting to track my retirement expenses now?
In my first 5-years of FIRE, I was admittedly a bit lax in tracking my spending. I knew that my 4% SWR was WELL BELOW my monthly spending, and I didn’t worry about my cost of living expenses in SE Asia or S. America. Life in most of those countries was cheap, and I only had to worry about myself.
This is the first year of living with my girlfriend. The experiences we share traveling together (12+ countries) have been magic. I would not trade them for the world, but lifestyle inflation is creeping upward with her around. She pays her way, but regardless, my spending increased since we have been traveling together. I live in countries I wouldn’t normally consider for Nomadic FIRE. Since she is Austrian, we spend 3-6 months a year living in Austria. Vienna is a beautiful city, but cost of living are not at Medellin prices. With my increased spending, I want to make sure my overall retirement budget stays on track.
What are my biggest retirement expenses?
I pour over my credit card statements, review my budgeting app, and type numbers into my spreadsheet. The numbers blink quickly as the spreadsheet sums up the numbers.
$1,156 per month average.
Less than $1,200 per month.
My cost of living in Bulgaria is less than $40 per day.
|3 Month Total||Per Month Average|
|Average Per Day||$37|
Important note: These budget numbers are what I spent for the months July, August, and September. The figures EXCLUDE the expenses my girlfriend incurs. We split Housing 50/50 and Food 60/40 (I’m the fat ass). I do not include her portion of the rent and in the numbers above, just my piece.
My biggest retirement expense is Food- $442 per month
My most significant expense, by a wide margin, involves stuffing my face. My portion of the food bill averaged $442 a month. 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.
Bulgarian fresh produce is cheap. Watermelons during the summer are .20 cents a pound. Fresh yogurt is .70 cents per 16 oz/ 500 ml. For fresh grown produce, expect your grocery bill to be 75% less than what it would be in the US or Western Europe.
I eat a protein-heavy carnivore diet. To give you an idea, I eat roughly 160 grams of protein a day, roughly equivalent to FIVE 4 oz (114 g) steaks a day. Most meals exclude 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 usually eat 1 meal per day in a local casual/fast food joint. For me, this means a trip to the local grill for sausage and chicken filets. An example is this 2.2 lbs/1 kg box of 10 beef kebapches (Bulgarian sausages) for ~$7. This box with some cheap sides (salad and fried eggs) feeds me for 2 meals.
With our cost of living in Bulgaria so low, we can afford luxuries too costly for us in the US. Once a week-ish, my girlfriend and I treat ourselves to a nice dinner at a nice restaurant. These dinners range from $20 to $30 per person, including appetizers, a main, and dessert. These treats include splurging for dry-aged tomahawk steaks, platters of fresh sushi, and bottles of local wine.
Food is how I socialize. Instead of going to a bar with friends, I am more likely to have a picnic in the mountains. Instead of clubbing on the weekends, I am more likely to have a dinner party at the house. The dollars for social activities involving food with our friends is captured in this category, not in our Entertainment budget.
Housing is less than 25% of my monthly expenses- $271 per month
I split housing costs 50/50 with my girlfriend. Housing is our most variable expense because it depends heavily on the local market. My girlfriend and I try to keep our combined rent and utilities to be roughly $250 per person/$500 combined. In many places (Bali and Medellin as examples), this budget will get us fancy apartments or villas in desirable neighborhoods with amenities like a pool, gym, and weekly maid service that I could never afford in the US.
In Sofia, the market mostly caters to long term rentals > 12 months. Each place we looked at in our price range and desired location charged a premium for month-to-month renters like ourselves. In the end, the best we could do was a shared 2-bedroom, 1-bath Airbnb for $350 per month. The apartment was okay, with a balcony in a trendy central location. We could have spent more, but we could not justify the value we received for increasing our budget.
*Pictures of our Sofia flat were corrupted. Pictures above are of a similar apartment to give you an idea of what is available at roughly same price point (~$350 per month).
Housing also includes any short term Airbnb or hotels we stay at for our mini vacations (see section on travel below).
Fitness is a substitute for my Entertainment budget- $117 per month
2 to 4 weeks a year, I hit a major festival or party for a bit of fun. Otherwise, I’m not a "Go Out to a Bar Every Weekend" type of person. Outside an occasional cocktail or glass of wine with dinner, I am not a drinker. Where many people might spend money on booze, my social life revolves around food (see above) or fitness. The dollars spent here are for gym memberships and classes, where I meet the bulk of my social circle.
I use Fitness as a key component of my social life. When people usually bring up difficulties living overseas, one of the primary reasons is isolation and lack of friends. The money spent here is for classes and gym memberships, which make up the bulk of our social life. My girlfriend and I went to weekly AcroYoga jams, Capoeira classes, and belonged to a Calisthenics gym.
I highly recommend people moving overseas to use activities to build up their local social circle quickly. These activities could be Fitness or less active groups like board game meetups, improv classes, language exchanges, or hiking groups. The more you integrate and build your social circle, the easier it is to make the country you are living at feel like home.
I use travel as cheap Entertainment
My home base the last 3 months was Sofia, Bulgaria. The central location allowed some cheap short trips:
I spent a week camping at a Music, Yoga, and Acrobatics festival in the Bulgarian mountains (tickets $40 each).
I spent another week exploring Roman ruins, wandering the arts districts, and eating tasty food in the oldest town in Europe, Plovdiv (a 2-hour $5 bus trip).
I even squeezed in a two week trip to revisit one of my favorite cities in the world, Prague (a 3-hour $11 train ride from Austria).
International Flights in Europe are shockingly cheap, even compared to domestic flights in the US
My flights purchased over the last three months:
- Vienna, Austria to Varna, Bulgaria = $20.00
- Varna, Bulgaria to Larnaca, Cyprus = $30.00
- Larnaca, Cyprus to Skopje, Macedonia= $19.00 (Dec trip)
- Skopje, Macedonia to Rome, Italy = $20.00 (Dec trip)
- Rome, Italy to Las Vegas, Nevada $230.00 (Dec trip)
These are not even the cheapest flights. My girlfriend took a flight from Austria to Cyprus for less than $10 one-way last month. An Uber to the airport costs more than the actual plane ticket.
Transportation ($40 per month) is a major savings vs. US car ownership
My transportation budget in Europe is obscenely low vs. what I would be spending driving in the US. According to 2019 research by AAA, the average annual cost of car ownership is $9,282, or $773 a month. I spent $40 a month on local transportation. Most European public transportation knocks the socks off any public transportation I have used in the US. In Sofia, which is considered a “poor” infrastructure city, I had a choice of bus, tram, trolley, or metro. Service was on time, the vehicles were clean, and an unlimited monthly pass is less than $30.
Health Insurance and Medical Care is cheaper in Europe- $35 per month
Health care cost outside the US is eye-poppingly less expensive than the US, even if you have US insurance. My healthcare strategy has three levels:
- 1Use Local Healthcare for most things. My only “medical” expenses in the last three months are dental cleanings in Bulgaria for $33 vs. $200 in the US. However, as a rule, I can get all routine checkups and medical tests done cheaper overseas. Some previous examples: My knee MRI in the Philippines cost me $200 vs. $1500 - $2000 in the US. A DEXA and bone density scan in Colombia costs $25 vs. $150 - $250 in the US. My emergency room visit for ten stitches and drugs in Thailand was less than $12.
- 2Travel insurance is my transition safety net. If something more significant 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. You don’t see the insurance payment in this number, as I pay the bill annually in December. My travel insurance, which covers me WORLDWIDE (except the US) is $680 per year.
- 3US insurance for anything catastrophic. As I rarely visit the US, I rarely, if ever, use US medical care. But *knock on wood*, if anything catastrophic happens, I keep my insurance in the US for any major medical emergency that might occur.
You only see my dental insurance premiums in these numbers, which is $18 per month. You do not see my health insurance premiums. I qualify for subsidized ACA Health Insurance. Premiums for a High Deductible Plan with HSA are small enough; I pay the bill lump sum at the beginning of the year.
Miscellaneous Spending and Exceptions
Both my girlfriend and I had the privilege of being chosen for a 1-week fully paid Global Leadership retreat on a Black Sea beach in Bulgaria. Our housing and food budget for the week was paid for and not included in the monthly spending above. The reduced monthly expense is slightly offset by additional transportation and logistics costs to fly to Bulgaria from Austria.
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What have I learned about my spending over the last 3 months?
My cost of living in Bulgaria was $40 a day. $1200 a month. $14400 a year. I can relax a bit now. At this spending level, even if the doomsday forecasts from the news comes true, I don’t have to panic. If the market crashes, I can still make this retirement work.
I may not be able to keep spending levels this low. Last year, when I wasn’t paying any attention, I spent $22,000, so expenses could get higher. But, if there is an extended downturn, I still have expenses I can cut and levers I can pull to live through a recession.
What do you think of this new series? Did you find it helpful? Are you surprised with the low cost of living in Bulgaria? Do you have any questions about specifics? Leave me a message in the comments below, and I will get back with you.