Jerry and Helen kept their two cars, one for each of them. They stayed in the same house, with the same mortgage and taxes, utilities and gardening costs. They kept the golf club membership, their pets, and their symphony tickets. Food costs stayed the same. So in retirement's early years Jerry and Helen had pretty much the same expenses as before, plus they figured they'd go out and travel more, go out to eat more, go out with friends more. They would save a bit of money on work clothes. Jerry had more than enough ties, enough dress shoes. But that small savings was more than offset by trips to Europe, cruises, wine tastings, and more time at the golf course.
By contrast, Vicki and I retired in Argentina. We moved out of our luxury apartment to a small, one-bedroom condo in Buenos Aires with minimal maintenance costs. We lived without cars, without pets, without much of anything. We wanted a small apartment to serve only as a base, a place to land now and again between our overseas trips. Often during our sojourn at "home" we house-sat for friends who lived in the suburbs and wanted to spend their summers in Punta del Este. Our living costs in retirement fell to practically nothing, mainly just air travel, local hotels, and food.
Make no mistake: To retire cheap, you need to relocate. We at Live and Invest Overseas recommend that, when you are considering where to retire in the world, you relocate to a new, sexy, exciting place abroad. After all, as long as you're going to relocate you might as well do it in a big way. Relocating in your same neighborhood seems boring, almost depressing. The word downsizing comes to mind. Relocate to Vietnam, on the other hand, and the mind fills with fun and adventure, the new and exotic.
So, again, Jerry and Helen started their retirement spending more. That was 10 years ago. I can report that, today, Jerry and Helen continue to see their spending go up. They recently remodeled their house--a major expense--and bought new cars. They still take short, expensive trips abroad, afraid to leave their house and pets for very long.
Vicki and I, on the other hand, probably have about the same expenses as when we retired in 1984, adjusted for inflation. We've moved in and out of Buenos Aires a number of times since then. In our view, Buenos Aires these days has become too expensive, and too dangerous, a place to live comfortably. But we'll go back. Meanwhile we're spending most of our time in Southeast Asia.
And that's the point: We're used to relocating. When one place becomes unacceptable, we move to another. When one place we enjoy a lot, like Paris, costs big bucks, we balance our budget with stays in Southeast Asia.
Every time we move we get a kick out of it. We have our emotional struggles, to be sure. We have to get rid of stuff, over and over. But we're used to it, and each time the move becomes easier. With e-mail, Facebook, and Skype, we maintain heartfelt friendships and a sense of community with others we've made connections with around the globe.
Paul TerhorstContinue Reading:
In the report, completed just this week, Paul addresses three main themes:
As Paul explains:
"I'm an optimist. I'm a bull. I believe in the old adage, 'bears make headlines, bulls make money.' In particular I'm convinced that global growth will soon improve.
"Remember that globalization has come about only in the past several years. As recently as two decades ago, the Soviet bloc kept its citizens away from travel, away from markets. China and India persecuted the most productive sectors of society. Dictators from Burma to Brazil, from Romania to Egypt closed ports, markets, and trading in currencies.
"Then came globalization. We got used to trade, markets, and all the benefits economists tell us about. By now virtually every country, everywhere, has profited from trade and commerce. Modern-day dictators and communists have learned that trade fills coffers. Globalization has become unstoppable. You can't put the toothpaste back in the tube.
"As of this writing, the global economy appears shaky. Europe poses the biggest problem, but weakness seems to be spreading to other continents. I take weakness as normal growing pain. I believe we'll soon return to world growth that drives stock markets. After all, Europe has been down before and has always come back.
"In this report, you'll see ways to buy into global growth. Stocks. Natural resources. China. Just remember to stay the course, to stick for the long term.
"The second theme in this report is: Control spending. Advisers tend to believe our spending after retirement will decrease only slightly, if at all. Nonsense, I say. Move overseas, get your rent down, and, in most cases, you'll spend far less. You'll have plenty of money. Vicki and I live these days in Chiang Mai, Thailand. Our living costs are so low that, when we prepare our personal balance sheet, recent living costs amount to a rounding error.
"You may have higher expenses, depending where you choose to live. But almost everywhere you can find a cheaper rental if you have the right attitude. I argue that day-to-day living expenses, on la dolce vita, make more difference than how big your house is, than how big your yard is. Give up trying to impress. Enjoy the rest of your life doing what you want to do rather than spending on a big house.
"In this report I caution against hair-brained schemes. What schemes are hair-brained? All of them. I've seen people lose their retirement stash by opening a bar or helping someone open a bar. By day trading or otherwise going after what looks like a sure bet. By venture capital funding. By buying into IPOs. By buying or building a fortress home in a remote location.
"There are endless ways to lose money, an endless number of hair-brained schemes. Forget about them. Choose steady, long-term, solid investments in global growth, not short-term schemes.
"My final advice: Go For It. Vicki and I retired at age 35 and have enjoyed every minute of our retired life, most of it living overseas. You can retire, too, almost no matter how much money you have, if you're willing to think creatively.
"Choose to retire earlier rather than later; choose to act now rather than at some vague, unspecified future date. In almost all cases we've heard about, retiring early worked out better than imagined. You just need a little courage, a little luck, a little flair for knowing how to enjoy yourself."
Editor's Note: We're making Paul's all-new, hot-off-the-virtual-presses "Retirement Planning Guide--How To Get Your Finances In Order To Make Your Move Overseas Right Now" report available to all newOverseas Retirement Letter subscribers. Details for how to claim your copy are here.
Already an Overseas Retirement Letter subscriber? Donâ€™t worry. We didnâ€™t forget about you. Weâ€™re making Paulâ€™s new report available to you with our compliments. That is, free. A small thank-you for your continued loyalty and custom. Watch your in-box for your copy within the next week or so.Continuing Reading:
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Kathleen Peddicord is the founder of the Live and Invest Overseas publishing group. With more than 25 years experience covering this beat, Kathleen reports daily on current opportunities for living, retiring, and investing overseas in her free e-letter.
Her book, How To Retire Overseas—Everything You Need To Know To Live Well Abroad For Less, was recently released by Penguin Books.
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