Early Retirement Frequently Asked Questions

Step up to the mic

About 16 years ago I started on a journey towards Financial Independence and Early Retirement. There weren’t a lot of resources available back then, so I pieced together a plan and strategy as best I could. In essence I applied my engineering degree to a personal finance and lifestyle problem. In some areas I did well, and others not so much, but overall it seems to have worked out.

Since you don’t know what you don’t know, I also sought out people who had been down this path; I was fortunate to be able to meet with Billy & Akaisha Kaderli in Thailand, who retired in their 30s in the early 80s. Winnie and I had our 2nd honeymoon in Hawaii and were able to have brunch with Doug Nordman (aka Nords!) who retired at age 41 after a career in the military. They were kind and generous with both their time and knowledge, but their greatest gift was simply instilling confidence in some young dreamers. Standing on the shoulders of giants, indeed.

When we ultimately opted out of the rat race ourselves, I told myself that I would always pay it forward. Over the past several years I’ve met with 100+ people for coffee, hosted multiple group meet ups, and did a Reddit AMA. Here are the mostly frequently asked questions.

Frequently Asked Questions

What is your net worth?

More than 25x our target cost of living – everybody wants to know a dollar amount because of fiscal voyeurism, and any long time reader of this blog could figure it out if they wanted to. (Most don’t want to because it isn’t really important.)

Could you afford to live in the Bay Area and not work? (sneaky follow up Q to the net worth question)

Financially, probably. Emotionally, no – traffic, strip malls, and NIMBY culture aren’t my thing. There are so many great places in the world that we enjoy that rank higher than the Bay Area.

What is your favorite place in the world?

That is a bit like asking my favorite flavor of ice cream… there are so many good ones!

We’ve only been to about 1/3 of the countries on Earth so we are probably missing a great number of wonderful places, but we are big fans of Southern Spain and France and Central Mexico. We also have family epicenters around Minneapolis and Taipei, which we visit regularly, and there are a lot of places we love to visit but wouldn’t necessarily want to live (e.g. NYC.)

I recommend visiting a few new to you destinations and experiencing how others live; it is a great way to better know yourself.

What do you do for health insurance?

Only Americans ask this question. For many years we were self-insured, which just means instead of paying for health insurance we invested that money for future medical needs. We paid cash for any short term medical care – antibiotics, dental work, etc…

As of this year we are now all 3 covered by the Taiwan health system, which is a single-payer universal health care provider. Cost: ~$25/person/month.

Isn’t it risky to be self insured?

Sure, it is a financial risk. But every year of setting aside premiums instead of buying insurance reduces that risk.

But… If we lived in the US we would buy health insurance on a State or Federal Exchange (or even better, an HDHP) and just pay attention to how the subsidies work. Self insuring in the US is a form of Russian Roulette.

When we travel in places where emergency health care is expensive and prices are unknowable (such as the US) then we will buy travel insurance. If we get hit by a bus we would be covered up to $1 million.

Context is important though – a visit to an emergency room in Portugal set us back $90. A visit to an emergency room in Taipei without insurance cost $60. A doctor visit in Mexico cost $3.

How do you invest your portfolio?

100% in index funds – Like this.

Aren’t you worried about a stock market crash?

No. I try to not worry about things I can’t control, and even in the worst period in recorded history to retire we would have been fine.

I seldom pay attention to what the stock market is doing.

I recall a comment from some readers I met for coffee in Taipei: “You are the most relaxed person I’ve ever met.” That might say more about the people they’ve met than about me, but I’m mostly pretty chill. It helps that I’ve gone through a lot of exposure therapy.

Did you plan to earn income blogging? Would you have quit earlier based on blog income?

No, it was kind of an accident. I wouldn’t have based our future on blog income; it is more important to have a large investment portfolio – to date we’ve made maybe $100k from blogging, but the portfolio has grown 10x that.

Do you ever get bored?

Of course. It’s awesome, try it some time.

Are you minimalists?

Not consciously, but we don’t have much stuff.

What is one luxury item that you bought that was definitely worth it?

I once bought a bike on Craigslist for $50, rode it for 2 years, and then sold it for $60. Totally worth it.

I’m also a big fan of dishwashers and washing machines.

Will you ever stop traveling and settle down?

Possibly. Probably. We moved a bit faster the past 2 years with the idea that we would likely travel less as Jr got older. (We visited 29 countries in his first 2 – 3 years.)

What do you plan to do for schooling?

Jr is in school now, and we have been planning travel around the school calendar. We think a form of home school could be in our future – much like finding people who had already done “early retirement”, I’ve been following families who travel and educate their children on the road for ideas and inspiration.

Do you want to home school because you are some sort of religious nut job who wants to indoctrinate your kids?

I’m an atheist, thanks.

Isn’t traveling with kids hard?

Sure it is. Just like being at home with kids.

Do you ever miss your families?

We focus on quality over quantity, and try to have focused family time every year or so. This year we did a 10-day cruise with family, and the year prior we had 4 generations together at a lake resort for a week.

Do you ever feel un-safe?

Sometimes, but then I just stop watching television and suddenly everything is better. Also, be sure to tie your shoes.

I could definitely be an extreme saver and world traveler, but my spouse… how do I convince them?

Sorry, you don’t. Nobody is ever convinced of anything, particular major lifestyle changes… at best you can live by example and maybe they will decide for themselves that change is worth it.

An analogy – what works better:

  1. “Hey, you are fat. You should lose some weight”
  2. You start waking up early to jog and prepare a healthy breakfast for the whole family. After a few months your spouse comments how you are a little more svelte, and you invite them to join you for your next run.

My spouse has zero interest in finances, how do I get them to be as interested as I am?

Marriage is a team sport, and you both don’t need to play Quarterback all the time. Play to your strengths for a winning combination.

For example, Winnie has minimal interest in finances. It would be foolhardy for me to try to change that. On the other side, she loves to paint which is something I have no interest in. Is that perfectly normal, or is our marriage doomed?

Was it hard to leave your job/career?

Transitioning from accumulating to spending and from working to retirement was challenging, yes.

I was still thinking about work stuff / office politics about 6 months after walking out the door, and occasionally dreaming about work for even longer. None of that happens anymore, and life is better for it, but it takes time to unwind. In hindsight, this is why we were never satisfied with 2 week vacations… it is impossible to completely unplug in that short period of time. It helps to leave to something, such as travel.

Financially, when we were withdrawing dollars instead of adding new investments, it felt different / curious. To ease the transition we started in lower cost of living countries – central Mexico rather than central Tokyo, southern Thailand rather than southern France. Nowadays it feels normal and we don’t think about it beyond basic cash flow management.

Is there anything you miss from your old life?

I liked my bicycle commute to work along the lake. That’s it though.

Are you some kind of anti-tax anarchist?

Nah, I just enjoy optimizing things and stumbled upon the tax minimization hobby. I’m weird like that.

Dude, some of your ideas are pretty extreme, do you really expect people to adopt such crazy positions? (Never Pay Taxes Again, 100% Equities, Renters for Life, Roth IRAs suck, no Emergency Fund, Fewer Dividends, no 529, etc…)

If you think of what we do as extreme, perhaps try to understand the underlying reasons.

Or not. Ultimately, personal finance is personal. Do what works for you.

(Special note: nothing we do is extreme, just a logical outcome of our unconventional lifestyle.)

I found you via mainstream media (Forbes, Yahoo, Business Insider, …) and the comments are pretty toxic. How do you respond to those people?

I don’t. Engaging with toxic people helps no one.

However I do my best to converse with people who are genuinely curious, but skeptical. For example.

Is there any one thing that you think everyone should do no matter their financial goals?

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Get yourself some free flights and free hotel nights.

My favorite card to begin unlocking these benefits is the Chase Sapphire Preferred.

Should we think of you as some kind of role model? (“You’ve changed my life, I couldn’t have done this without you!”)

If you must, but I would prefer if you didn’t. I abhor hero worship of all kinds, whether it be of political figures, “celebrities”, athletes, or whatever. All people have made mistakes, and have good and bad characteristics. In real life, I’m actually a terrible person.

If our way of thinking of the world and/or our example can help with making improvements to your own life, FANTASTIC! But I give you all of the credit.

What is the one piece of advice you would give to someone?

I think this is the catch all question people ask because they feel like they need to ask something but can’t think of anything – We can just have coffee together without all of that pressure ;)

And a question from me:

Did you know GCC has a Forum? Check it out.

Did I miss any Questions? Ask in the comments.

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