Many people have ask my wife and I if we’re worried about our future. Quitting your job to travel the world and start new businesses is great in the short term, but is it the wisest choice for a secure financial future? What if I get sick? How will I survive when I am too old to work? What if I die, how will my wife survive? There are a lot of questions we have considered and continue to discuss.
Lifestyle Design Take One
I was in my twenties the first time I gave up everything to move abroad. It was just after finishing university and a failed start up attempt so all I had to look forward to was an entry level job in a company I wasn’t particularly enamored with. I needed to reset my life, and leaving Canada for the unknown was the best way I new. I bought a plane ticket to go to Japan one week later with $1000, no work visa and no job. It was probably the best decision I ever made.
Lifestyle Design Take Two
I was 40 years old the second time I decided to change careers and leave Japan, my previous home country. I was married, owned a house and car, had a successful business, a great income, lots of vacation time and a secure path to a good early retirement. The only problem was that it required doing the exact same work for the next decade or two, and giving up on many of my other life’s goals and dreams.
Risking everything when you have a family, established career and a great standard of living is much different then when you are young and single. It is pretty easy to give up everything and move to the other side of the world when you have nothing to lose.
If you are in your twenties, then by all means travel the world. Try different jobs. Start your own business. Do as much as you can, as fast as you can. You have nothing to lose and you have a lot of time ahead of you to restart, even if you lose everything. For us older folks, that choice is a little more difficult. There are clear trade offs between money and time and you have to decide for yourself what is more valuable to you now and in the future.
Here are some of the questions my wife and I answered for ourselves.
How will we live?
Life isn’t much fun without cash. My wife and I have some savings now, so we are okay if we don’t work for a few more years. However, it’s not enough to never have to earn money again.
Selling our old business doesn’t mean we are not working. We are building a handful of websites that are all slowly adding a semi-passive income. Blogging is not a particularly good way to earn money, but we have many niche sites that are starting to generate some ongoing income with minimal effort. We will continue building out these sites and other ideas for a long time in the future.
Giving up our old lifestyle with a house, car, expensive purchases and countless other excesses reduces our living expenses to about a quarter of what they used to be. That means we won’t need to earn as much income as we used to. We have discovered that a simpler lifestyle is not only much cheaper, but more enjoyable as well. We’re not spending our lives thinking about buying, maintaining, cleaning and protecting consumer goods. Instead, we have the time to do the things we enjoy.
Less stuff = More Life
What work will we do if we run out of money?
If we really need to get jobs, we won’t need anywhere near our old salaries. In fact, one of us working half-time is probably enough to live now. If we can earn money online from richer countries and spend that money in inexpensive locations, our incomes will go even further.
How will we fund our retirement?
Government backed pension systems are already becoming strained with the aging population. Simple demographic trends don’t bode well for a secure retirement in most countries. It’s starting in Greece now, but Spain, Portugal, Japan, and other developed countries are not far behind. Paying into retirement pensions now is no guarantee that you will receive enough to live. Retirement ages will have to increase around the globe.
Also, we have all seen that there is no such thing as a secure job. It is absolutely essential for everyone to diversify their income streams.
Working a few hours a day on a computer is feasible well into our seventies so I believe there will be ample opportunities to fund our retirement. The people with no online skills, doing a single job for decades are the most at risk.
What if one of us gets sick or injured?
This is the scariest issue. As I wrote on my manifesto, without health you have nothing. Health insurance against catastrophic accidents or illnesses may offer some peace of mind, but I think there are some problems with our conceptions of health and life insurance.
Look at the richest countries in the west. Most illnesses and deaths are linked to obesity, stress, and chronic fatigue. Destroying your body and then hoping the health care system fixes it doesn’t make much sense. My wife and I, now lead a completely stress free life. We walk or cycle everywhere and go to the gym almost everyday. We eat fresh home cooked meals and avoid processed foods. We sleep as much as we need to because we have few critical deadlines nor have few obligations to maintain. In addition, we don’t take stupid risks. We don’t ride motorcycles, don’t do the silly drunk backpacker stunts, we wear seat belts and helmets and are not particularly interested in bucket list adventures. The best cure is prevention.
Long-term health and life insurance are still something that we plan to get, but it is hard to justify paying hundreds of dollars every month, just in case. We have some coverage on our credit cards and occasionally pay for short-term insurance, but with inexpensive medical care in many countries that we visit, it seems to make more sense to pay out of pocket. (I will write a post on some of the medical visits we have had around the world soon.)
At any rate, I’m not going to spend decades in a career I don’t particularly enjoy, to offer a little more insurance coverage for some hypothetical worst case medical scenario.
Would you rather have security or regrets?
The most important question you need to ask yourself is how you want to live your life. Do you want to work and consume or do you want to live your dreams and experience the world? We all had dreams when we were younger, but sadly our careers often get in the way of pursuing those goals. How many people really love their careers and will happily go to work every day for 40 plus years? I enjoyed my business in Japan for a few years, but I started to stagnate, like most people do in their careers. I have many interests that I want to enjoy now. I don’t want to wait until I am in my sixties to start living.
The absolute worst case scenario is that In five or ten years, I may very well be broke and have to get a job that I don’t particularly enjoy. If I get sick or die young, my wife might also have to go back to work. So what. We love our lives now. We do the things we want, where we want. We work on interesting projects that show future promise and are spending lots of time with family and friends around the world.
A more realistic outcome is that our new online businesses start paying off and we earn enough to fund our lifestyle, provide for retirement and give back more to charities. We live in a world of abundance. There are incredible opportunities to do anything we want, if we are willing to work for it. Cheap travel, the internet, inexpensive technology, the dropping of global barriers, advances in health care and countless other improvements have opened the world more than ever. There is no reason to live afraid.
Are we crazy? Maybe. However, I think it would be crazier to spend decades going through the motions every day in a life that is not particularly rewarding or enjoyable. So far we have unquestionably made the right choice. As I am writing this, I am in Thailand with my wife at our favourite cafe, enjoying great lattes and working on our own schedule. We will go for a workout soon, before going out for a delicious inexpensive dinner and probably listening to some great live music tonight. How can I improve on that?