ERE Year 2 - Geoarbitrage, Permaculture, and Nomadic Lifestyle Design

Where are you and where are you going?
classical_Liberal
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by classical_Liberal »

Congrats!

Jin+Guice
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by Jin+Guice »

How'd that first week without a paycheck feel? Have you had to draw down any accounts yet?

2Birds1Stone
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by 2Birds1Stone »

Thanks, c_L!

@J+G, it felt like freedom! Technically yes. My "spending" for November was $1,233, but $164 of that was the last month of car depreciation I had amortized, so actual cash outlay was $1,069. "Income" from SoFi referrals and Chase checking signup bonus was $900, which means that $269 was what I had to draw from the portfolio in the first month of true jobless ERE.

I have $0 in "side hustle" income coming in December, so this will be a truer test of how it feels to spend down assets, everything I spend this month is coming out of savings/investments.

Jin+Guice
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by Jin+Guice »

I'm very interested to know how this feels. I'm also interested to know if your expenses fall/ rise or stay the same post-retirement. IIRC you assumed they would stay the same.

ajcoleman22
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by ajcoleman22 »

Congratulations!

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Stahlmann
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by Stahlmann »

so why u was fat guy in high school?
what would be top5 (subjective) things why ur "transformation" (in terms) of personality is/was longterm?

2Birds1Stone
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by 2Birds1Stone »

@J+G, the expenses are a bit tricky. I can already see that if my lifestyle stayed the same (location, hobbies, housing), the expenses would drop significantly without the job. That being said, we knew and planned for a few adventures over the first few years that are going to cost more than our normal life did while accumulating. I already know that the three months we spend in Western and Southern Europe will be more than my typical $1,500/month spend. Poland might be around the same or possibly cheaper, and then Asia really is a wildcard because we don't know what type of travel we will do there, and what we will want to do. The year we do our AT thru-hike should be cheaper than current lifestyle, and van-life will initially be more expensive with the purchase and building out of a van, but then definitely cheaper once we get on the road. The great thing is, there will be some temporary paid work during those in-between phases (like during the van build) which will mean we are never drawing more than 4% from the portfolio (as outlined by my personal investment policy statement).

In December I didn't find any CC or bank churning opportunities, so my income will be zilch. It is the end of the year, so there are some dividends getting paid out, but those don't actually increase the portfolio due to how dividends work. Many people don't realize this, but this is how your investments look when you get a dividend;

Say you own $10,000 worth of company X
On December 16 the company declares a dividend of 2% (paid in Dec for simplicity)
On the ex-dividend date the dividend gets taken out and NAV drops by 2%, so your investment is now $9,800
A few days later you get your 2% ($200) dividend
Your investment is still worth $10,000

Now the assumption is that the stock will rise back to the same price (NAV) per share as it was before the dividend was paid out, but that's not always the case. So it's a bit of a wash.

@ajcoleman22 thank you!

@Stahlmann, I was a fat guy in HS (though mainly in first few years of college) because I grossly overconsumed calories and under exercised. The top 5 things that helped me drop 100+ lbs and keep off ~90-100 of those have been;

Be mindful over overeating/emotional eating, especially high calorie dense foods (sweets, fried foods etc)
Learn how to cook well, so that I can make lower calorie and healthier versions of my favorite foods.
Lift weights (this was huge, it increased my lean body mass and changed my nutrition partitioning permanently).
Find activities I enjoy outside of the gym to get my caloric expenditure up. I mountain bike, cycle, run, and walk a lot now, which means even without gym I average closer to 3,000-3,500 calories a day burned vs. previous 2,000-2,200.
Lastly, I track my weight in a spreadsheet, and have a general idea of where I don't want to drift over (~210 lbs) and if I do, I consciously do intermittent fasting which works really well for dropping the lbs quickly at the start.

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Lemur
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by Lemur »

@2Birds1Stone

Cool updates.

+1 on tracking weight through a spreadsheet. It keeps one mindful of their health state because I do believe that simply maintaining a healthy body-weight is one of the most, if not the most, important thing you can do for your health. Just maintaining a healthy body-weight keeps one away from all the "western" diseases: obesity, heart disease, cardiovascular disease, diabetes, metabolic syndrome, cancer to some degree, etc. I've been tracking my weight on a spreadsheet as well for the past couple of months. I have a graph with 2 lines: the actual weight recorded that day and a 7 day rolling average line. Interestingly, I noticed that using a 7-day rolling average I consistently maintained weight in a 3 pound range (181-184lbs). The trends are interesting to see (increases around holiday & stress times) and decreases around weekends where I'm typically more active.

2Birds1Stone
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by 2Birds1Stone »

It helps with awareness for sure, now to get my ass in gear and turn some of this motivation into conscious action! I always gain weight as the weather changes, and this year is no different. I see the number climbing significantly over the past 3 weeks, yet I'm still not doing anything to change it. It's a combination of greatly reduced exercise due to the weather and daylight changes, and for some reason I crave more/worse food when it gets cold/darker out.

Ramblings

We've officially been married for two weeks now. Don't feel much different, but didn't expect to. It was a nice ceremony with only our immediate family, followed by a few beers at a local brewery with some close friends. December seems to have flown by, with some preparation for the holidays, time spent with friends/family, and dealing with medical stuff re: wife's work injury. We're making very slow progress on treatment/diagnosis as well as the workers comp claim. Hopefully she is able to get an MRI in the first week of January, and if she needs surgery no later than the end of the same month. Everything points to a torn rotator cuff right now. She's been put out of work for an additional 4-6 weeks. Returning no sooner than end of January.

I've reapplied for UEI, and will have a decision from the NYS labor board by end of the month. If it gets approved, I should be able to claim for 10 weeks until(if) we leave as planned on March 11th. Until the workers comp gets sorted out and/if my UEI gets approved we are in a fairly large income deficit for the foreseeable future, which is fine. This is one of the great benefits of living the ERE lifestyle over the past few years, and more importantly buckling down before it was necessary.

The markets have been blowing my mind lately, and 2019 is going to be our largest net worth increase in history (even larger than when we made significantly more money in 2016). Makes me feel a bit silly for having such a low allocation to stocks for my age, with a bit of FOMO coming into play, but I know I would be singing a different tune had we had a 25% drop in stock valuations vs. an increase. December dividends have been quite nice for mental accounting, and I expect a few more to pay out before the end of the year. Looking forward to my 2019 recap post, as it's going to be fairly detailed and an interesting watermark for our jumping off point into a long unpaid period of our lives.

The landlord contacted us to let us know he only has one more postdated check for January rent, and he will be by around xmas time to say hello and pick up another 6 months of checks. I replied letting him know that we need to have a chat (and unbeknownst to him, break up). February will be our last month living here, regardless of how our travel dates pan out. We continue to sort, donate, pack away, and slowly move out possessions to parents house, as we don't want the burden of moving an entire apartment in the midst of winter. We are hoping he lets us apply our security deposit toward February rent, but are prepared to shell that money out and hope to get our deposit back once we move out (he's been a stand-up guy the past 6.5 years).

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Ego
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by Ego »

2Birds1Stone wrote:
Sat Dec 21, 2019 3:22 pm
We are hoping he lets us apply our security deposit toward February rent, but are prepared to shell that money out and hope to get our deposit back once we move out (he's been a stand-up guy the past 6.5 years).
Make sure to provide the notice in writing and if you have a good relationship you could give him a deposit slip with an envelope addressed to your bank and he can send the refund directly to them. You might offer to show the apartment to prospective tenants as it is a pain in the ass for someone who lives off-site to do so, especially if the apartment is occupied. He may not take you up on the offer but he would be far more likely to refund the full deposit if you did so.

Good luck.

slowtraveler
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by slowtraveler »

Good luxk with everything, I hope your wife heals quickly.

I think winter weight gain is natural. Many animals do this to an extreme degree as winters (prior to modern food storage) were scarcer times. Fat is useful to survive the winters when scarce sunlight provides fewer calories at rhe base of the food cycle.

Still, this all makes me want to start tracking my weight levels.

I'm really curious to see how you keep working out during your travels. Might have to resort to squats and push ups with your wife on your back.

Jin+Guice
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by Jin+Guice »

2Birds1Stone wrote:
Mon Dec 16, 2019 9:49 am
Be mindful over overeating/emotional eating, especially high calorie dense foods (sweets, fried foods etc)

How do you do this?!? I have a really hard time not over-eating. The best I can come up with is restricting myself to 1 meal a day using IF, but even with that I have the capacity to put away more than I need.
2Birds1Stone wrote:
Mon Dec 16, 2019 9:49 am
Lift weights (this was huge, it increased my lean body mass and changed my nutrition partitioning permanently).
I'm hoping this gets me to a point where my body is using the extra calories I eat and I don't have to change my intake, but will I just be hungrier during the day then?
2Birds1Stone wrote:
Mon Dec 16, 2019 9:49 am
I can already see that if my lifestyle stayed the same (location, hobbies, housing), the expenses would drop significantly without the job. That being said, we knew and planned for a few adventures over the first few years that are going to cost more than our normal life did while accumulating. I already know that the three months we spend in Western and Southern Europe will be more than my typical $1,500/month spend. Poland might be around the same or possibly cheaper, and then Asia really is a wildcard because we don't know what type of travel we will do there, and what we will want to do. The year we do our AT thru-hike should be cheaper than current lifestyle, and van-life will initially be more expensive with the purchase and building out of a van, but then definitely cheaper once we get on the road. The great thing is, there will be some temporary paid work during those in-between phases (like during the van build) which will mean we are never drawing more than 4% from the portfolio (as outlined by my personal investment policy statement)
Back on my permanent soapbox: This is why I think saving up $X amount of dollars so you never have to work again, based on current expenses, doesn't make a lot of sense, in most cases. Because current expenses aren't forever expenses. For something like a once in a lifetime (or even decade) trip, I think it makes sense to plan to pay for it with earned income (eventually) rather than investment income.

classical_Liberal
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by classical_Liberal »

Congrats again on the marriage! How are you feeling about having all this extra time? As good as i have been I hope.

The markets have been blowing my mind as well. Although I dwell on this stuff much less than I had been. I'm invested very conservatively and have still seen high teens ROI this year. I have no FOMO though, if anything I'm considering going even more conservative. A side effect of all these returns is that I'm much less motivated to go back to work, and second guessing my half time set-up. If I lost 40K, instead of making it, on investments in 2019, I'd probably be much more thankful for my foresight in leaving high paid work on the table.

Seppia
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by Seppia »

Big congrats on the marriage and best wishes for a speedy recovery to your wife.
The markets have indeed been amazing - which is why I never like to go all-in on one strategy.

2Birds1Stone
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by 2Birds1Stone »

@Ego, thank you. We did speak with him face to face as he visited for the holidays and were able to negotiate the deposit being applied toward rent in return for us being flexible in showing the place the last week or two we're here. Will officially be homeless after Feb 29th!

@slowtraveler, thank you sir. It's been a slow mend but things are moving in the right direction. We were able to get her an MRI right before Christmas and she is scheduling an appointment with the doctor to review the results sometime this week or next. One good thing so far is that we finally were able to get the insurance company to pay the correct workers comp benefit (even if it is small).

@J+G, I use several tricks. The best being not to keep that shit at home, as now I'm much less likely to go out and overpay for shit food. Other than that, it really does help to have a realistic weight range in mind, and consciously make better choices when you approach (or go over) the upper bounds. I'm there now, and I feel sluggish and look much softer at this weight. Fine in the winter, but it makes me feel bad as the weather gets warmer. Luckily warmer weather = more activity and lower appetite, so as st pointed out above, it's more natural to lose weight.

I agree with you wholeheartedly on the saving vs. spending and accumulation topic. It really all is meaningless past a certain point. I was FI, now I'm married and suddenly my WR% went from 3.3% as an individual to ~5% as a couple/household. In the future circumstances, goals, and the world in general will change. Focusing on lifestyle design, resilience, and happiness are far more important to me than an absolute net worth amount moving forward. I still plan on tracking spending, net worth, and really enjoy analyzing the data, though it's much more of a hobby now.

It's very unlikely that we will get our expenses permanently low enough to sustain our lifestyle off of investments alone, so a return to some sort of paid work for both of us is in the cards once we get vagabonding out of our system in a few years.

@c_L, I feel amazing. Today is my 3 month semi-EREversary, and I can't imagine going back to a normal career job right now. If I could flip a switch and have a decently paid PT job (2 days a week, $20/hr) I would take it in a heartbeat, as long as the work didn't suck and I could get some social interaction at said job. It makes no sense to look for this arrangement as we leave in 10 weeks! But when I get back, that's going to be the goal as long as I'm not traveling.

It's a mixed bag on the investments. You made a great point re: my fears of a downturn before/during my long sabbatical. While it might hurt like hell on paper, the reality is that we have enough cash to enjoy the time off, and while the world collapses around us, what better place to be than traveling around the cheap parts of the world, enjoying freedom from work. Eventually the economic cycle will have to improve, and finding a place to trade some time for money will always appear. I can say I'm more grateful for the ability to work after dealing with my wife's health issue. A traumatic injury to her dominant hand really limits the types of unskilled labor she could do, if we were both in that situation, it can change how confident I am about finding a job. Just food for thought for all of the healthy people out there.....it can be gone in an instant.

I really enjoyed your 2019 wrap up post, and I can't wait to do my own. I'll do a shorter December monthly one, as usual, and then a longer more thought out 2019 one. It was one heck of a year, between family health crisis, job loss for both of us, marriage, international travel, planning this crazy trip we're about to embark on, to downsizing our life into 2 50L backpacks.......

@Seppia, thank you my friend! Indeed! I think that's one of the biggest takeaways from ERE for me.

Musings/Updates

Wife got MRI right after xmas, report shows a tendon tear. Scheduling appointment with ortho to review results and further treatment options sometimes this week or next.

NYS approved one week of UEI, followed by sending me a letter stating that I have to appear at a re-employment assessment this week, at the local unemployment office. Looking online, and it looks like I would have to jump through many hoop to collect the benefit, but it might be worth a shot at least for the next two months.

Moved all of my business clothing to my parents house in NYC. Going to take one more trip to get camping gear, triathlon equipment (bike, wetsuit, etc), and few other odds and ends that I don't want to sell/donate over there. Wife is doing the same with her stuff at her moms house.

Hoping to get our 2019 taxes done before we leave. It's going to be a bit complicated with getting married, 401k rollovers, workers comp, losing health insurance mid year, and a slew of other caveats to a simple tax return. Have to change our mailing address for dozens of accounts and won't be able to receive physical mail for almost a year......not sure how to handle this yet.

Still fat, but more active the past two weeks.

2Birds1Stone
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by 2Birds1Stone »

December Financial Update*
*barring dramatic market changes through tomorrow COB

Combined Assets
$717,000 (+$21,400)

Combined Spending
December - $2,340
Trailing Twelve Months - $33,360

Combined Income
$6,250 (primarily EOY dividends)

Savings Rate
62%

Current Withdrawal Rate
4.7% (Portfolio = 21.5X annual expenses)

Activity
42 Miles Ran (10.2 miles last month)
80 miles biked - MTB (213 last month)
75 miles walked (91 miles last month)
10 weigh-lifting sessions (12 last month)
2 lb gained (207.2 on 7 day average)

Musings

Individually @ $18,609 - TTM Spending, 31X annual expenses, and a 3.23% WR

Income this month included wife's workers comp payments + what was owed for November, 1 week of unemployment insurance, dividends in taxable brokerage, HSA, Roth IRA, and Traditional IRA, and interest from CD's. Not a true net income because taxes are owed on interest and taxable dividends.

2019 coming in separate post.....
Last edited by 2Birds1Stone on Wed Jan 01, 2020 8:56 am, edited 1 time in total.

2Birds1Stone
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by 2Birds1Stone »

End of 2019 Wrap Up*
*Final portfolio values subject to change by COB 12/31.

First some 2019 household numbers, since these take precedence moving forward.....(2018 numbers in parenthesis)

Combined Spending - $33,360 ($37,250)
Combined Income - $135,000 ($128,000)
Combined Net Worth - $717,000 ($521,000)
Combined 2019 Savings Rate - 75.3% (70.9%)
Years of Combined Expenses - 21.5X (13.8X)
Current WR% - 4.65% (7.23%)
Current Income @ 3% WR - $21,510 ($15,453)

Now some individual data for myself.....

Spending
$6,600 Rent/Utility
$1,388 Grocery
$551 Gas
$2,110 Entertainment
$1,804 Depreciation - Vehicle
$142 Transportation
$2,184 Travel
$685 Insurance
$759 Health/Hygiene
$1,159 Misc
$1,227 Gifting
$18,609 Total Spend ($16,800 without car depreciation amortization)

Spending increased slightly over 2018, almost exclusively due to the 5 week trip to Poland over the summer (Travel category).

Income
$71,400 Net Salary
$18,965 401k
$6,413 Commission/Churning
$14,021 Dividends/Interest/Referral Bonuses/2018 Tax Return/Misc
$110,800 Total Income

$7,100 increase over 2018, while only "working" for ~7.5 months of the year.

Personal savings rate was a whooping 83%, the highest it's ever been.
Individual net worth increase was ~ $154k, also the highest it's ever been.

Thoughts on 2019 Wrap Up

Baring any wild swings in the markets these numbers are pretty final. By getting married and combining finances with SO (at least for the purpose of our joint pursuit to financial independence, we still have a ways to go in order to be able to cover expenses completely through our investment portfolio. The great news however, is using a 3% WR, the delta between our actual TTM spending and 3% WR is only $12,000 a year. That's essentially what we would need to earn per annum as a household to maintain current standard of living.....NOT BAD!

Individually I'm FI as fuck. At this point, any additional income at current spending levels should send the portfolio into runaway mode.

Quite pleased with spending for the year, both individually as well as jointly. 2020 will be a complete wildcard with how much travel we will be doing. Almost EVERYTHING about our lifestyle will change in the coming months, so I'm excited to share with you how going from a very stable and predictable lifestyle to a completely nomadic and unpredictable one goes....both from a financial standpoint, as well as ongoing ERE-pursuit one.

Our combined assets rose nearly $200k for the year, which is insane to even type out. I count our blessings and am grateful for the delaying of gratification and continuing to earn an income for most of the year. Next few years could be down years in the market, so that could be a huge change and will be interesting to document my reaction to anything that happens now that the income is completely gone.

We have so many options for when we finish our round the world adventure, that it's not even worth thinking about at this point. Really looking forward to the personal growth, new challenges, and perspective gained from our next adventure.

I plan on doing a 2019/2020 goal review/setting post in the coming days. Stay tuned, and until then, Happy New Year!
Last edited by 2Birds1Stone on Wed Jan 01, 2020 9:10 am, edited 3 times in total.

anesde
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by anesde »

Excellent numbers and recap! I too had a mind-boggling NW increase in 2019 - definitely makes it look unsustainable for the future.

Congrats on all of the hard work and best wishes for a speedy recovery to your wife. Happy new year!

Frugalchicos
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by Frugalchicos »

Pretty impressive how much your NW grew in the last year. All the best and happy NY!!

Smashter
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Re: ERE Experiment - Vagabonding On A Shoestring Budget

Post by Smashter »

Nice work! I really look forward to one day being "FI as fuck" :D

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