How to Think About the Cost

[slowtraveler]

I have a $100/month studio right now with everything I need. I could pay $200 more or 3X for a bigger, cleaner room in a nicer central area with a kitchen.

I could think of this as 3 months to the price of 1, which makes it sound horribly expensive. I could also think of it as $200 more per month, which makes it sound not so expensive since it may increase quality of life by a significant amount to be a shorter walking distance to my favorite parts of town.

I'm leaning more towards finding a $150 studio in the area of town I like that doesn't have a kitchen since I don't actually end up cooking much here.

[NPV]

$100/month! Now that is amazing. Which country/city is that if you don't mind me asking?

[slowtraveler]

Chiang Mai, Thailand.

My first month I paid $300, $150 next month, and now $90 (3000 baht) +$3 (100 baht) for water + 8 baht/kwh for electricity (so don't run AC long or use too much hot water). I'm always in a central area (first Wua Loi, now Nimman) but I figured my favorite central area is by the river. Rates are cheaper by walking town than what I found on the internet but I haven't found as cheap in my desired area, probably since I haven't spent a few days walking there seeking cheap housing.

Some people spend far more than I do, I've seen many 1 bedroom condos around $1000 usd/month. I'd rather spend that on food and various entertainments. Transport is cheap since I can walk most everywhere. On an expensive day I'll spend $5 on transport.

[taemoo]

Those are great prices! When I FIRE, I hope to spend time in Chiang Mai from Oct - Mar and I'm budgeting around 500/mo for accommodations in the Nimman area but sounds like I don't have to go that high.

[stand@desk]

It depends on where you are on your wealth building journey and how proficient your investing is. If you are still in the early stages, every cent counts and it will feel good to build the challenge of early foundations of wealth. If you are already at cruising altitude or older in years, then quality of life determinations carry more weight.

[jacob]

The first thing (there are, of course, several ) I think about when it comes to recurring outgoing cashflows are the assets required to support them?

By the 3% rule, a monthly cost requires 400x (because 12/0.03) the amount in assets, so

$100/month ~ $40,000
$200/month ~ $80,000
$300/month ~ $120,000
etc.

[slowtraveler]

@Jacob

That makes it crystal clear. Staying in dirt cheap housing till I find another dirt cheap home in my target area. Keeping up the exciting piece of this driving costs down challenge.

Can I ask what the following considerations are?
I am guessing web of goals is the next consideration. Ie- walkability/distance to various needs for housing. Followed by whether it is the most efficient way to meet the need and whether it brings reciprocal joy relative to the life energy cost incurred to acquire referenced utility.

[jacob]

Yes, more or less. When you're in the accumulation stage, you should be using a well-designed web of goals to increase your savings rate as much as possible; but also think about future impacts ... e.g. you might have a high rate living in the sticks, but depending on how you "add value" you might also find that it's worthwhile to live in a pricey center-city, because the amount of serendipity might be higher there for you.

If you're in the runaway stage, you can start thinking about "reciprocal joy", but it's best to put your oxygen-mask on first before you start relaxing. Your future self will thank you later.