Your Cost Of Living Can Be Almost As Low As You Want It To Be
You could reduce your cost of living to a fraction of what it is right now by moving overseas.
In fact, this cost of living question is more complicated than you might imagine.
If you’re living in Manhattan right now, no question: You could cut your monthly expenses by two-thirds…three-quarters…maybe more…by moving to Cuenca, Ecuador, say, or Leon, Nicaragua.
But what if you’re living now in Boise?
And what if, rather than Cuenca or Leon, you’re looking to move to Buenos Aires or Panama City?
Before you could determine if, in fact, your cost of living in BA would be more or less than in Boise, you’d have to figure first how you want to live.
Are you going to invest in a home of your own…or rent? Are you going to own a car? Engage a driver?
Before we left France, Lief tried to budget our new life in Panama. When he did, he realized that it’s going to cost us more to live here in Panama City than it cost us to live in Paris (yes, I had him double-check his ciphers).
While we owned our apartment in Paris, here in Panama, we’re renting…and rents have spiked in this city in recent months.
While we got by nicely without a car in Paris, here in Panama, we’ll have to have one. And we’ll have to have a driver, too, because I don’t plan to get behind the wheel of a vehicle in Panama City anytime soon.
In addition, you’ve got to remember that cost of living is a moving target. Currencies rise and fall, are devalued and revalued. Inflation spikes. Markets crash.
And, most important, remember that cost of living is relative. If your current home base is Newport Beach, the entire rest of the world looks a bargain.
Friend and perpetual traveler Paul Terhorst, with 25 years of living abroad experience under his belt, was living in Argentina until last year. He’s the friend I told you about the other day…the one who left Argentina, when costs in that country began rising, and moved to Thailand, where the living remains super cheap.
Paul writes, “ Argentina fails the Big Mac test this year. The cost of living in Argentina is slightly higher than in the States, according to The Economist’s report. Friends on the ground in BA concur. Inflation in this country is estimated at about 30% a year right now, and, since May, the government has been revaluing its peso. Bottom line, Argentina costs about the same as the U.S. at this point.
“Then, again, the U.S. is cheap these days. Compare the U.S. with much more expensive Canada, say, or Europe, Hong Kong, Australia, New Zealand, Brazil, even Mexico. With the terrible destruction of the U.S. dollar, you need to work hard to find cheaper places abroad.
“More to the point, though, you’ve got to remember that Argentina (and other ‘ Third World’ countries) still offers many low-cost alternatives that have disappeared in the States.
“For example, in BA and Mendoza, you can find small, family-run hotels in the heart of town for less than $50 a night. Those hotels have long since been driven out of U.S. cities.
“Similarly, in BA, you still can find a steak with a glass of wine for $10 in some restaurants. You still can get a car and a driver for about the cost of the car alone in more developed places. You still can employ a maid for $4 an hour.”
The dear reader writing to us from Uruguay has been making the same point—that is, that the cost of living is on the rise in that country, as well.
“The cost of a gardener has doubled in the past two-and-a-half years,” he’s written. “It’s now about $96 a month.”
In other words, costs are rising worldwide right now. Inflation is a global issue. But the effects are still relative. A gardener may cost twice as much today as he did two-and-a-half years ago in Uruguay. But he’s still a bargain at less than $100 a month.
In all the countries we’re reporting to you about and from in these dispatches, certain things remain bargains, certainly relatively, sometimes absolutely.
Rents are crazy high here in Panama City, as I’ve been reporting to you, but we’ve hired a full-time maid for $250 a month. And Jack had his hair cut the other day for $2.
Roving Latin America Editor Christian MacDonald writes that “You could live in one of the best neighborhoods of Buenos Aires right now on a budget of as little as $1,290 per month.”
In other words, costs in BA may be rising, but less than $1,300 a month remains amazingly cheap, especially when you consider the quality of life you could enjoy in Buenos Aires.
Maybe you could live for less in Boise.
But you’d be in Boise.