My wife and I are both retired, although I still busy myself with writing, podcasting, voice-over work, and recording audiobooks. I will turn 66 this year, Rita just turned 73, and we find ourselves facing a situation common to us aging boomers.
We’ve reached the point in our lives where downsizing our home to something easy to maintain and without stairs, whether that be a home in a managed community or a condo, will soon be a part of our lives. The good news in this crazy housing market for our age group, who generally are in the last years of their mortgage, or like us, own their home outright, is that we could sell our home for an historically high price, making a tidy little profit.
The bad news of course, is that if we go to buy our new single-level home or condo, we will also have to pay an historically high price. Why not rent for a while? Well, have you looked at rental prices lately?
Even worse, while savings vehicles are paying relatively high rates, if the boomer-buyer needs to do any financing, mortgage rates are also high.
So what to do?
Well, here’s where we started to think a bit outside the box. First, understand that Rita and I have done a fair amount of traveling. In fact, I’ve been a travel writer for the last ten years, with over 200 articles published and several books and audiobooks available on Amazon – look at jimsantos.net, if I may do a little self-promotion.
In addition to that, we spent almost six years living in Ecuador, and thoroughly enjoyed it. Bottom line, we are comfortable with travel to other countries.
So the thought occurred to us – what if we sold our house, and didn’t buy something right away? What if instead we lived in various countries around the world for a couple of years? After all, we just spent a month in Greece, Istanbul, Vienna and Prague last fall, and right now we are in Panama for 10 weeks to escape the winter. This spring, we already have booked five weeks in Mexico. So why not just stretch that out?
After all, we have found that most of the expense involved in travel is getting there and coming back. Once in Europe, or Central or South America, moving around there is relatively cheap. We also know from our own experience and from people I’ve interviewed on the International Living podcast that we can live cheaper many places overseas than we can in the US.
Being a bit of a geek, my next step was naturally to create some spreadsheets. First, I found that if we set a monthly budget of $3000, we would still have a comfortable cushion from our regular fixed income left over – two social security checks and a pension – plus any extra income from my various side hustles. That would more than cover incidentals like storing some of our household goods and furniture.
My next spreadsheet looked at what to do with the income from the sale of our home. At current rates, we could earn better than 5% by keeping the funds in safe and insured savings vehicles. Let’s face it, at our age we can’t afford to gamble on the stock market or long-term investments that might earn more. Rather intriguing is also the possibility of banking money outside the US. For example, Uruguay has some accounts currently paying a fixed rate of 7 or even 8% for one-year commitments.
Much to our surprise and delight, we were finding that we could potentially travel the world and actually earn money while we do it!
Meanwhile we can keep an eye on the US real estate markets, and time our future re-entry to coincide with the next downturn in prices – or just keep traveling as long as we are physically able. Our plan would be to spend at least 9 months each year abroad, and come to the US in the summer to visit our kids and nine grandchildren while they are out of school. In the US we’ll do a combination of housesitting, AirBnB’s, and staying with family. Outside the US, mostly AirBnB’s for a month or longer in each location, although we may try housesitting there as well.
We have found that it is quite possible to rent a furnished apartment in many places outside the US for less than $1500/month – sometimes much less.
Of course, there are drawbacks. For one thing, we love our home, and there is not a darn thing wrong with it. I upgraded our kitchen a few years ago and have it just like I want it, and I have a slew of musical instruments I would have to do without for a while. We are also taking a risk that the housing market does drop at some point, that we can find something in the same area when it does, and we’re assuming some event won’t arise that forces us to return early.
But still, an intriguing thought.
Intriguing enough that we have already taken steps towards this goal.
Before we left for Panama, we contacted a realtor and prepared our house for showings in our absence. Good news from the start, the realtor suggested listing the house for about $25,000 more than we had considered. We left home in the first week of January, and they proceeded to put on a lockbox and set out a “Coming Soon” sign. In fact, the listing is now live, we’ve had at least five showings, and we may soon hear about offers.
Meanwhile here in Panama we are looking at this as a test case. Can we really stick to that $3000/month budget? Will we be okay living without all of our stuff?
Naturally, I have a spreadsheet to track our expenses during our ten-week stay. This first month, we were in Panama City. Our one-bedroom AirBnB cost us $1165 for one month. That includes all utilities, internet, access to a swimming pool and gym. We have a washer/dryer for our clothes, a small but usable kitchen, access to the big Mercado de Mariscos (seafood market) we can see from our apartment window, and a great mercado for fresh fruits, vegetables, and meats right across the street from the seafood. This greatly reduced our food expenses, as we needed very little from the higher priced grocery stores, and did not need to eat out unless we want a little treat.
To give you an example, the first visit to the fish market I bought a huge 2-pound filet of corvina (sea bass) for just $8. That’s enough to make two dinners for two for me and Rita. I also bought 2 pounds of fresh shrimp for a total of $7. Again, sauteed shrimp for two one night, and a nice shrimp soup should cover another dinner with leftovers for lunch.
All in all, we came in under budget on our month in Panama City. We’re finishing up ten weeks at the beach in Playa Coronado now, and today we shot past that proposed budget. However, when we planned this trip it was just to get away from winter – it was before we hatched the mad scheme of selling everything and taking up slow travel, so we picked out a much more expensive AirBnB than we would normally choose.
There are still a lot of variables. Will we get a decent offer on our home? Will the rest of our time here in Panama go as well? Will we chicken out, or at least sober up?
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