A 125k anniversary! What 4 years of world travel cost in early retirement

What would you pay each month to live an endless travel lifestyle? Can you put a price on exotic world travel in early retirement?

Four years ago, I set out on an experiment to live abroad as an early retired budget traveler. On August 10, 2015, I took off to Mexico. Tedly retired a few months later and then joined me. We haven’t looked back.

In the last four years, we’ve spent $125,000 in early retirement. That includes everything from train tickets to visas, health care to food, housing to museums.

Let’s break that $125,000 down a bit more. It covers all costs for two people. That amount also includes a rather large expense that most retirees in their 40s do not have: early breast cancer treatment. The medical bills for my early tests and surgery last year, and follow ups this year, cost about $10,000. Since most people don’t have that cost, let’s subtract it from the four-year total.

Ellen and Tedly at the airport in Hanoi, Vietnam, in June 2019.

So now we are at $115,000 for four years. Divide that by 48 months, and the average monthly outflow was $2,395. For two people. To travel the world. Wow. That’s pretty good, all things considered. We have lived comfortably, seen amazing sites, experienced new cultures, met wonderful people, and I have all the material stuff that I need, which fits into a carry-on suitcase.

We could have spent less. We could have skipped 10 months in Europe. We could have changed locations less often. Tedly could have drank less beer, and I could have eaten less chocolate and fewer cookies. But, why?

Budgets are relative, and so is travel.

Some people will think $2,395 a month for two people is too high; others will think it’s too low. Some people think living someplace for a month and then moving on is too slow. Other people can’t comprehend our endless travel lifestyle, as they desire to retire to one spot with occasional trips from a “home base.” We say: there is no right or wrong way to do this early retired budget travel thing.

What matters most is that life is now. Did you live the life you really wanted to live in the last four years? In the last year? Breast cancer reminded me with jarring clarity: we get one life on Earth. As E.M. Forster wrote, “Death destroys a man: the idea of death saves him.”

If you’re reading this, you may be trying to crunch the numbers to figure out how to live this lifestyle on your budget, at your comfort level. If $2,395 is too high, there are ways you can spend less.

Cutting back on expenses

Our biggest expenses were housing, transportation, food, and health care. While I subtracted the breast cancer treatment from the monthly average over four years, I kept in all other medically related expenditures in the four-year total of $115,000.

There were many medical expenses, from high-to-low priced. Things like imaging after a motorcycle crash, preventative heart tests, blood tests, medicines, Vbeam face treatments (cosmetic), biannual teeth cleanings, annual doctor visits, prescription eyeglasses. Your health care abroad might cost more, it might cost less. It might move that monthly $2,395 up or down.

In four years, housing was always the most expensive category. We rent monthly, usually through Airbnb. (Read more on that here.) We have also rented from a few local landlords longer term, like that time we decided to stay three months in Majahaul, Mexico. That was much less expensive than using Airbnb.

Tedly and Ellen enjoy Zihuatanejo, Mexico, in September 2017.

We don’t usually want to stay somewhere longer than a month, but that could change in the future, if we find a place where we want to “temporarily settle.” That could save money.

We don’t house sit or pet sit. At this point in our adventure, we don’t want to work for anyone else. (By the way, we don’t work remotely, we don’t freelance, we don’t take jobs during our stays, and this blog makes no money, lol.) If you house sit, that monthly average of $2,395 could shrink.

I mentioned we lived 10 months in Europe. Higher prices for everything in Europe – from food to housing – increased our spending. We also spent many months in less expensive countries that reduced our outflow: many months in Mexico, three months in Vietnam, four months in Thailand, and 2.5 months in Malaysia.

I don’t drink alcohol, and that saves money. We are in Malaysia as I write this, where a 11.5 ounce can of beer is the equivalent of $1.25 – and that is the cheapest deal Tedly found in our current neighborhood. It’s a Muslim country, and alcohol is taxed more. Twice that amount of beer costs just 75 cents in Vietnam. So even in less expensive countries, prices greatly vary. Your drinking preferences (and eating habits) will affect your monthly average.

We enjoy local cuisine, and we buy local groceries. If you need American brands, groceries, or restaurants, it will cost you more.

Visits back to the United States during these four years totaled about four months for a funeral, a family medical emergency, a holiday visit, and to work on our rental property. Living expenses in America and airfare home jacked up our costs, which are included in our four-year total.

Our flights home were from Mexico and so they were cheap compared to what flights would cost from the other side of the planet. This is something to keep in mind as you make long-term plans away from family or business interests.

Where do we get $2,400 a month to spend?

We pull from our savings. It took planning and saving and spending control to realize this early retired travel lifestyle. (Our story on that is here.) We also use passive income.

We have $900 in income ($700 net) from a rental property. We’ve had that income for the last 30 out of 48 months. That’s $27,000 over 2.5 years.

Let’s go back to our four-year total of $125,000, with my breast cancer treatment included. If we subtract our $27,000 of passive rental income from our total, we get $98,000. Divide that by 48 months, and we arrive at a monthly average of $2,041 — that is our actual cost to live a lifestyle of endless world travel. That is what we have pulled out of our savings each month to live a dream life without working.

The plan is to make our savings last until we reach an age when we can draw on retirement accounts without penalty. While it’s a bit concerning to see savings dwindle, our passive income slows the loss and that is somewhat comforting. And yes, it can be challenging to face a critical health care issue while traveling, but as I’ve proven, it can be done.

Happy Anniversary to me!

So that’s the story from early retired budget travel-land. Four years down, hopefully many more anniversaries to come!

(Note: Tedly pointed out a math error near the end of this post regarding our passive income. It was fixed in less than 30 minutes from the original post.)

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