GCC: Before we retired I looked long and hard for International cost of living/travel data. What I found was limited, vague, or outdated. Since then many sites and blogs have offered new data or a new approach.
Recently I found a new favorite… The Earth Awaits. Others like it too; it is currently featured on BBC’s The Travel Show.
In this Guest Post, see what the Frugal Vagabond has to say about his creation:
A Labor of Love
I love the world, and think that travel makes us better, more thoughtful, and more charitable with each other. In a world that seems to be turning inward, we could all use a little more of that.
Back in July, my wife, my father-in-law, and I sat down to a delicious Indian dinner. Dinners like this are always a little bittersweet— my wife’s mother passed away early last year, and her dad misses his wife terribly. Without her, he has an understandably tough time finding things to look forward to. Seeing his struggle with this loss always reminds me that time is our most precious resource.
As we ate, my father-in-law casually mentioned that his youngest brother had retired, making him the last of his siblings not to have done so. “Someday,” he said, “they’ll find me dead at my keyboard, I guess.”
I glanced at my wife and saw that she wore an absolutely miserable expression. She wants her dad to be happy, but doesn’t know how to help him look forward to anything.
“Hey… you’re collecting your Social Security, right? How much is that check every month?” I asked.
“About $2,300, why?” he replied.
Looking back, that was the moment that The Earth Awaits was born.
The Possibilities Are Endless
“Bob, are you kidding?! $2,300 is a fortune! You just need to get out of Silicon Valley! Even better, you need to get out of the country!” I exclaimed, already calculating just how far that Social Security check would go in many of the places my wife and I have contemplated as slow travel destinations.
“Thailand. Portugal. Spain. Mexico. That kind of money could pay for an amazing lifestyle in any of those countries! You could live among a bunch of English-speaking expats, if you really wanted. You could sit at cafes all day and hang out on the beach! You could stop working today, Bob!”
Sunset View from the Beach Bar, Koh Lanta, Thailand – photo by Winnie
We talked for the rest of the evening about retiring overseas, and I saw the glint of excitement in my father-in-law’s eyes as the seed of adventure— and possible escape from death by desk— was planted.
I already knew from writing a series on retiring abroad that the $2,300 monthly budget was doable, but I wondered just how I could prove it. On the drive home, I started to imagine a tool that would build budgets for places all around the world while considering the important aspects of a person’s lifestyle: their price range, family size, housing needs, and their lifestyle expectations. I knew about Numbeo, which gathers cost of living data for cities around the world. I knew where to get information about safety, visa information, and I had a pretty good idea of how to create a budget that would reflect the local cost of living anywhere in the world. Someone just had to put all the pieces together. Why had nobody thought of this before?
Within days, I had written the first version of what would soon grow into The Earth Awaits. It did exactly what I had envisioned: learn about the visitor, then calculate what it would cost that person to live in hundreds of cities around the world. It got rid of the cities that wouldn’t work for them (or that they couldn’t afford), and showed them the very best of what remained.
When it was ready, I plugged in my father-in-law’s Social Security income, allowed for an ample lifestyle, and even opted for a three bedroom apartment so that wherever he went, his family would have a place to stay when they visited.
The results blew me away. The cities that fit his budget included places like Braga (Portugal), Valencia (Spain), Cuenca (Ecuador), and over 200 others. More importantly, I knew that many of the places were safe, fun, and offered all the comforts of home.
The Possibilities are Endless
My Father-in-Law Is Not Alone
My wife’s dad isn’t a stupid man— quite the opposite. He’s just like thousands of other Americans approaching retirement. They may have only known one home their whole lives, or maybe they’ve become set in their ways. Retirement is in their grasp, if they could only learn to see things from a different perspective. There are thousands— maybe hundreds of thousands— of people around the world who are literally one discovery away from a life of leisure and adventure.
What does this have to do with the early retirement community? What if I told you that you might already be financially independent? Setting aside all your fears or worries about the logistics of doing so, is there a chance that the perfect place might be waiting for you out there, and that you might already be able to afford it, potentially taking years off of your path to financial independence?
Those questions are exactly the ones that The Earth Awaits was built to answer.
Braga, Portugal (photo credit)
A Tool For Globetrotting Retirees
Let’s consider a few ways a person approaching (or having already achieved) financial independence might use the The Earth Awaits to their advantage.
Retire Sooner – If you’re living in a high cost of living city (or country), and can accurately estimate your cost of living elsewhere, you may be able to quit working years earlier by relocating to a cheaper area.
Retire in Better Places/With a Better Lifestyle – Some people, like my father-in-law, are creatures of habit. Just because the life you have is the only one you know doesn’t mean that a cheaper, better life isn’t out there waiting. There are almost 100 cities where English is spoken as the primary language where one person can live an ample lifestyle for under $2,300 per month… and those are just the cities the site tracks! Many of them would be a significant step up from the daily Silicon Valley grind.
Avoid Retirement Failure – A source of huge anxiety in the financial independence community is what to do if the market takes a sudden, significant downturn immediately after you retire. If the 4% rule doesn’t pan out going forward, are we looking at a generation of early retirees that goes crawling back to their employers? Hardly! Rather than going back to work, why not use the magic of geographic arbitrage to decrease your costs and ride out the downturn living in comfort abroad? (GCC: The 4% rule is fine.)
Live in Expensive Places (Some of the Time) – If you’ve got your heart set on a retirement in the south of France, but it requires working an extra ten years to achieve it, why not alternate between the place of your dreams and an interesting, low-cost place? Spend six months in the south of France, then offset it with six months on Southeast Asia, South America, or Mexico. Now you’ve achieved your dream retirement without all that extra work!
Adventure is Waiting
We’re still working on my father-in-law, being supportive and encouraging. I’m holding out hope that someday we might be able to set him on the path to adventure. We’ll take him out to eat tasty foreign food and wonder aloud how the carne asada tastes in Monterrey, or why the crepes always taste so much better on the street in Paris.
Maybe it’s time to stop thinking about life abroad or slow travel as rewards for having achieved financial independence. For some people, they may be viable tools to help retire sooner, happier, and with an even better lifestyle. I’m continually surprised at all of the places (most of which I had either never heard of or never thought of) where we can afford to live today. If you’re a little like me— and if you’re on this site, you probably are— then I think there’s a pretty good chance that your perfect place in the world is out there waiting for you to discover it. Every moment you wait may be a missed opportunity to be free. Visit the site, tell us about who you are and what your dream retirement destination looks like. The results may change your life.
– the Frugal Vagabond
The Frugal Vagabond is an engineer living with a wife and two dogs in Silicon Valley. After falling into the trap of tech company excess for a few years, he realized that despite their high cost, none of the fancy things he bought really made him any happier. This set him on a journey that led to the early retirement community. Today, he and his wife save every spare penny with a goal of retiring early and living abroad by the time they both turn 40. They travel abroad at least twice a year in search of adventure and the best places to call home on their slow travels. Their next adventure is to Australia in early 2017, a $214 trip thanks to careful planning and the miracle of travel hacking. (GCC: Check out our travel hacking tips.)
I found the Earth Awaits through reddit the other day. Such a great concept for the site. My wife and I plan on spending our post financial independence life in New Zealand but travelling frequently. NZ is quite expensive but by offsetting the costs with travel in cheaper locations, it should be an easy lifestyle. We can’t wait to get started, only about 10 more years of saving and hard work to go!
Hey, Spencer! Awesome, glad you tried it out and liked it! My wife and eye have eyed NZ as a possibility in alternation with other places, too. I spent a little time on the North Island a few years ago, and the Hawke’s Bay region (lots of vineyards, really similar to Napa in California) is amazingly beautiful. Good luck!
I love the Earth Awaits. Thanks for sharing! One of things I’ve been looking for is a way to find those secondary cities in great locations where it would be cheaper to live (i.e. Porto, Portugal rather than Lisbon) and this is a pretty fantastic tool for that. I have a feeling a lot of people are about to spend Monday at the office dreaming of places to visit outside of the US.
Nice, BI, thanks! Totally agree on the second cities– actually, Braga in Portugal is the most visited city on the whole site– probably because it comes up at the top of almost everyone’s search (it’s among the least expensive cities in Western Europe, has one of the highest quality of life ratings on the site, low pollution, low crime, etc).
Cool idea for a site! We have always considered doing our retirement abroad. For now Mrs CK has a retirement gig she enjoys which more than offsets our higher cost of living in CT. But we still have been travelling to check out cheaper places like Costa Rica and southern France. We are going back to Costa Rica in a few weeks, and are considering Spain for next year. If and when she gets tired of her retirement gig, there is a good chance we will sell and slow travel full time for a few years.
Hope you father in law starts his dream retirement soon!
Thanks, Mr. Crazy Kicks! I hope he will pull the trigger someday, too. My wife thinks he might, I think it will take a lot more work.
Spain is awesome. Any particular cities in mind?
We have been looking at southern Spain. No city in particular yet, we usually go where we can get the best airfare.
What a great tool! Thanks Frugal Vagabond.
Are those prices for long term rental leases or shorter term like a month or so?
My family is probably more interested in traveling 3 or 4 months out of the year, so we probably wouldn’t be interested in long term leases.
Hey, Mr. Tako, thanks!
The prices are the averaged crowdsourced prices for long term rentals (so generally 6-12 months), but if you can rent for 3-4 months at a time you can probably get pretty close. I think that for a single months’ stay, you might do best by negotiating with an AirBnB host off of the site. You *could* do better by finding a local with an unlisted apartment, but the hassle probably isn’t worth it for such a short stay.
Love using the site and at the moment playing with the possibilities. A question for you – in the “other” under costs breakdown, does that capture any aspect of healthcare? . I know that is invariably one of the largest items for any early retiree but I understand it is so complex that it may be beyond even this fabulous site!!
Great, great work pulling this together. The ability to have our minds opened a bit more provides all sorts of ideas.
Hey Mr. PIE, thanks! Good question– at the moment, there is no automated addition of health care costs to the budget because they vary so much across countries from literally nothing to a fortune, and everywhere in between. In the city details, I do have an editable line item for insurance/medical costs so that you can estimate your own, and one of the top items on my list if the site takes off is to hire out the research on medical expenses across all the countries so that I can estimate these items better.
And sorry, to clarify, the reason they’re not there isn’t the cost, it’s the fact that there’s no one universal source of that data, and how to most easily estimate it for each visitor is going to take a little careful planning. It’s hopefully something that will come in the future, though.
Nice. For a lot of people the variability of healthcare does add a layer of unpredictability. For most young’ish’ early retirees, healthcare shouldn’t be a major cost, but once you add one or two medical issues, the costs do add up. Granted, most developed countries have comparable healthcare options to that of the U.S., but I certainly wouldn’t want to get an emergency appendectomy in Chiang Mai if I can help it. :-)
Chiang Mai has some nice hospitals. Bangkok even more so
The price of some types of international health insurance for different countries as an indicator?
Very interesting concept. Will definitely have to scope it out for international options. We currently have made our US costs easier by keeping our home in low cost TN, and usìng our high timeshare points to travel for months out of the year to more expensive locales on the ocean during offseason times. By staying for weeks/months at a time we are able to almost match our costs of living in TN (eating most meals in the condos, etc) while also keeping costs of our then vacant house in TN to a minimum (water turned off, furnaces at minimum, suspended TV service, etc).
But moving outright to a low (er) cost international location would be ideal financially. Will definitely check out your website.
There are cases where staying in the US can be cheaper than living Internationally as well. This is especially true if you live in a no tax state and/or income is low enough to get close to free health insurance. It also helps to live near a Costco.
I prefer the International living though because of the adventure factor.
What a find The Earth Awaits is. It brings to my attention smaller cities in locations that I had not previously considered. Health care is the only missing info for me as well. Great site to whoever developed it.
Thanks, Vicky, glad you had fun! Health care is on the roadmap for sure, just need to get the site a little further down the road/develop an audience, and then I’m keen to add it.
Access to a large range of natural environments? Would result in Aus, NZ and USA Dominating higher rankings.
For me, part of the fun is changing cultures/foods/lifestyles when you change surroundings.
What about Africa, South America, Mexico…? The whole world has a large range of natural environments.
Or Antarctica – no social / political problems but no first world facilities either, such as safe, cheap, easy, comfortable access. A small lodging in some parts of Spain can cheaply supply most of the essentials of life but ranks poorly on supply of natural environments.
Hey, I’ve visited your site before and love exploring all the options of a place to live. I’ve noticed a couple of people mentioning they are thinking of New Zealand to retire in, which is great. However, if you’re planning to move to New Zealand and not work or invest significantly in the country, it’ll be pretty difficult to get a visa. Perhaps in your site you can also have some sort of selection of countries that allow retirees to move there without jumping through lots of hoops?
Hey Clara, thanks for the kind words and for trying the site out! A little bit longer term, I have a pretty cool vision for expanded visa options/filtering/information. It’s going to take a little bit of human research, though, so I launched the site with what was viable for now, and I’m hoping to be able to do/hire out that research in the future. Really good feedback, though, I totally agree.
That is a cool site. Lots of good information.
I definitely didn’t know about many of the cities it highlighted for me. Very interesting.
This is one of my favorite things, in that it highlights places you wouldn’t have thought of. For example with Spain, everybody thinks Madrid and Barcelona first. But what about Cordoba and Valencia, etc… It’s a great way to have your adventure bug inspired.
Hey there Frugal Vagabond! I am totally a fan of your site and we’ve had fun just searching around all the cities we never would have thought of! I like your idea of spending part of the year in a high cost area and the rest of the year in a lower cost area. You can have the “best of both worlds” while still meeting your budget! I am going to email you an idea I had about your site too. Great work!
Thanks, Vicki, feedback always welcome– I’ll keep on the lookout for your email. :)
I just went back in and I think you’ve made some changes since I was there last. I was thinking that a “compare” tool of some sort would be great (where you could choose a few options and compare side by side). But I see now that you can “sort order” and then choose the list feature – and that gives you a pretty good side by side comparison too! It’s terrific :)
A more comprehensive comparison functionality is coming, but it’s probably a ways down the road. First I need to get accounts, favorites, and custom budgets out the door, which will take the next few months. Comparisons would be the next big feature after those, so sometime next year most likely.
Love the site but it’s consistently missing a key strategy. How does one convince their significant other that we have enough now to walk away? :)
Step one: Take SO on monthlong trip abroad, negotiate monthly rate from friendly AirBnB host.
Step Two: Apply smoked meats and good wine to SO.
Step Three: Sitting in airport on the way home, casually remark, “Hey, you know what I just realized? We spent less this month than our investments produce…”
Step Four: Enjoy!
Brilliant. We’ll have you over the next time we are all in Utrecht!
This is sad. People get excited about flashy website and don’t pay attention to underlying data. Garbage in garbage out. Until they give a through explanation of data validation this is useless
For the record, you could have simply asked and I would have cheerfully answered. I am happy to explain how the methodology was developed (the budget calculation is explained in detail in the FAQ on the site, too). I have also written in a bunch of other places about the technical aspects of the site, but Jeremy and I both felt that focusing on the inspiration and the human element for this post was the right way to go.
I picked four “validation cities” for each continent where I was able to get copious current data across lifestyles and family sizes from sources like blogs, forum postings, etc. I broke down those budgets and bracketed them by approximate lifestyle, then further by family size. I built a standard set of items and quantities which produced a result that fit the validation cities, plus or minus 15%.
The budget calculations will *never* be “perfect” for a number of reasons– variation between people and their expectations, crowdsourced pricing data (which can suffer from both a limited number of data points and from personal biases), and my goal to avoid interrogating the visitor on fifty different things before showing them a result. In particular, on the very highest COL areas the calculation tends to skew high (you could easily spend less) and in the lowest COL areas it tends to skew low (people from developed countries are likely to want to spend more to maintain creature comforts).
This is a tool of discovery, inspiration, and the goal is to give as accurate a starting point as possible. It is not a scientific paper, though I have tried to follow a consistent and reasonable method in producing results. It’s obviously not for everyone, and you are entitled to your opinion. I built it because nobody had stepped up and done it themselves.
Oh, and I built it with editable budgets to satisfy the naysayers, too. If you don’t like the way the budgets are built, you are able to edit them yourself in each city. In the next few months, you’ll be able to store the custom budgets you create and apply them to the search, too.
I’ll jump in here and say that your website is pretty accurate. I plugged in for Seville which is where l currently live and find the figure quite similar, albeit the allocation is different. I have a detailed post on how much we spend monthly, right down to car and health insurance etc. I don’t want to add the link in case it’s not cool but a quick search on the blog with cost of living 2016 will let the naysayers see that you are spot on :-). Well done!
Thanks, kemkem! I am so happy to hear that it’s more or less accurate for you– especially in light of you being in Spain! My wife and I are eying a few spots there as our first slow-travel stops. Safe travels!
You are so everlastingly patient in your responses! I’ve seen this from the time you posted this site on reddit and (as always) some trolls came out to play.
Ha, thanks! It doesn’t come naturally to me. Sometimes I have to walk away for a bit, but I’m working on it :)
What is sad to me is that people comment without even taking 30 seconds to look at the site and the FAQ which explains in great detail. Tools are only as useless as the people who refuse to learn how to use them.
Preach.
Great article. What I always miss when reading about “retiring abroad” is further information on the legal requirements, visas, residency permits. I am aware that pretty much every Country will offer a way for someone living off retirement income to get a visa, residency. But the problem is 1) they are usually not straight forward, 2) they vary substantially from place to place and 3) most importantly, they can be costly and work against your retirement next egg. What I mean by the latter is that some will ask you to invest in their real estate, which to me is a no go; some will require you to come as a entrepreneur with a $500k or $1m spare cash to “invest” in a new business (heck no, I am retiring), and so on. Perhaps these sites could summarize the tips about getting a permit and rank the Countries according to how easy it is to come in as a retiree with kids that go to school.
Hey Pedro, thanks for the feedback– I have a pretty decent idea of how I’d like to implement this. Basically in the country tab for each city, where there is currently a dynamic section that uses your passport country to show you visitor visa information, I’d like to have a dropdown to let you browse through visitor, retirement, and other kinds of visas. I have some idea of where to get this information (I have to buy it if I want to keep it up to date easily) and some others will need some human research. Because of the cost involved, that’s why I am keeping them in reserve for a next phase once I have a better sense of how successful the site will be.
Over some time I have noticed that the numbeo data seems to have a respondent bias which should be factored somehow. Respondents for Australian localities report higher than market prices and repondents for USA localities report lower than market prices. I find that locally $A 1 buys much the same as $USA 1 yet the market exchange rate is ~$A 1 = $USA 0.75. I hypothesise that Aus respondents have a higher purchasing power than USA respondents and are less motivated to shop carefully.
I’ve said it before – I really enjoy playing with this site, thank you. I know it has cost you a pretty penny, and I wanted to say thank you for not starting out by bombarding us with ads and affiliate links. I understand that you will eventually have to make money off of the site, but I’ve enjoyed the fact that in my initial getting to know you days with this site I’ve had such a clean interface to play with.
Thanks, Mrs. BITA, that really means a lot to me. I’m phasing in a little bit of affiliate linking and maybe some sponsorships, but the goal is definitely for the site to always be clean and easy to use, and for the advertisements to be unobtrusive. I’m hopeful that I can find a good balance. I’m grateful to have you checking out the site, so thank you again!
Reading Articles like this make me fall in love with FIRE all over again. Maybe it’s the vision of the future. Perhaps it’s the brilliance of the tech. Possibly the passion of the presenter. No matter the source, thanks a ton of FV for creating a tool like this!
Thanks, JT! Totally my pleasure, the passion makes it easy to devote all the time it takes to keep current and to add fun new features.
Hi! The Earth Awaits looks like a great page! You might be interested to know that there is one similar to it already! http://Www.nomadlist.com
It will be interesting to see assumptions of the cost of living in conparison between both sites!
Seems strongly related to urban areas.
Great point that “time is our most precious resource” Now that im in my mid 40’s I’ve become more aware of this. I dont mind working, but 40 or 50 hrs a week plus commute can really take away too much of your time and energy for the many other important things in life. It really just takes some minor adjustments to curb that wasteful spending and bad habits and you can achieve financial independence way before 60. Devoting your life to the company till 60+ probably won’t mean sh*t to anyone. Make a plan, and get out early while you can enjoy it.
Right on, Arrgo. I always tell my peers here in Silicon Valley– be exactly as loyal to a company as they would be to you. The company will always look after itself first, and so should employees.
Thanks for this great information. We are looking forward to checking out Earth Awaits and plugging in some numbers. But a question first to Frugal Vagabond. You say you and your wife plan to retire abroad, and you also say you live with two dogs now. Well, we’re struggling with the dog thing. We have a 47 lb dog that we adore, and we’d want to retire and live abroad with her. Have you researched living abroad with dogs, and have you discovered anything worth passing along to others like us?
Thanks, Julie and Will
Hey Julie and Will,
I wish I had some particular wisdom to offer on the dog issue, but I think that our conclusions are effectively common sense– for the duration of our dog’s lives, we will avoid places that are dog-unfriendly. We aspire to a slower pace of travel than some– we’re hoping to spend six months to a year in each place (with frequent smaller day and weeklong trips). We’ll probably start in Spain or Portugal, which gives us access to most of Europe. It also means that we’d only have to put our dogs through one long flight. Oceania and parts of Latin and South America are also on the table for us in the first few years. When the dogs pass away, we’ll probably take some time and travel the places we had avoided.
The Earth Awaits looks like a great resource, primarily for international locations or short term stays (<6 months) in the US. I don't see any expenses considered for taxes, but much can be avoided if residency is maintained in a no-state income tax state. Otherwise, staying too long in states like CA or OR could bite the wallet.
Hey Tom, thanks. You’re right that the international travel/settlement aspect is a higher priority than the domestic one (though for baseline costs, I think it still has some value). Taxation information is one of the highest priority items that I plan to add in the future– once I get past my present set of work that I’m trying to finish by the end of the year, it will be one of the things on deck. I’m hoping that the work I’m doing now will allow the site to turn a modest profit, and thus fund some research on things like taxes, education, and health care that are tough to scrape or parse from a single source.