Author Topic: 1 year vacation starting in 2020  (Read 2295 times)

eddie

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1 year vacation starting in 2020
« on: August 13, 2017, 07:04:25 PM »
A couple weeks ago my wife mentioned this (That we should take a 1 year trip) to me on a walk. 

I'm been slowly pushing her towards frugality and have been trying to convince her that if we save enough money we can retire much earlier than normal.  I wouldn't classify us as mustchian but we are relatively frugal for our income level.  In 2016 49% of our income went towards debt reduction/investments, another 20% to taxes, 10% to tithe/charity, and we lived on a little over 20% of our gross income.  Our income has gone down a little this year but our expenses have stayed the same so I would expect our living expenses to be a little higher percentage of our income this year.

We both love to travel and have taken several international trips together over the past 6 years.

We're 34/35yo and we have a 1yo and want to have another baby in 1-2 years. So we would be likely embarking on this trip with a 1yo and 4yo. 

We have $20K left in student load debt, and $59k left on the mortgage.  We've paid down over $150k in debt in the past few years but really kicked things up a notch last year.

We have $5k in savings, $340k in retirement accounts, a $140k house we live in, a $40k condo we rent out and paid off cars (1 is a junky 2001 Honda CRV with 200k miles and the other is a 2015 Toyota 4Runner with all the bells and whistles).

My goal is by May 2020 to pay off all our $79k in debt, save up $50k+ in cash, $10k+ in our HSA, and have both the house and condo rented out.  They should net about $1,500/mo after taxes, insurance, and minimal expenses.  I also want to have invested some $ for college for the kid(s) and continue to put about $30k+/yr into retirement accounts until we leave on the trip.

I'm pretty sure we'll be fine financially.  We'll spend the $1,500/mo generated by the rentals, and probably use 2/3 of the $50k in cash over the course of 1 year.  I'm more worried about the other things.

1. We want to spend most of our time in Europe.  I'm aware of the 90 day rule in the Schengen Zone and we plan to travel very slowly.  Ideally rent a house or apt for 2-6 weeks in a city and then move on to the next.  I could see us spending 9 months in Europe and the Britsh Isles and then 3 months somewhere else in the world, maybe New Zealand.  Is this crazy to do with two small kids?  Our daughter just turned 1 and I feel like we have just now gotten to the point where we could travel with her and long as the actual travel is kept to a minimum and we keep her on a reasonable eating and sleeping schedule.  I envision us spending lots of time walking around, going to parks, making meals together, and just doing the occasional touristy thing.

2. Quitting my job...  I've worked at a small retail store for the past 13 years, my boss is nearing retirement and wants me to take over, but I'm hesitant to take on the risk.  The timing could work to where he wants to retire around the time we get back from this trip, but I'm not sure I want to commit to the hours I would need to work after we get back.  My wife has a very marketable skill set.  I'm not worried about her being able to find work when we get back.

3. Our dog.  We have an 8yo mini aussie that my wife has had longer than me.  I bet we could get one of our relatives to keep him, but it would be really tough for my wife to leave him.

4. Managing the 2 rental properties.  I'm not too worried about this one.  My brother is super handy and I'm sure I could pay him for any time he would have to spend on the properties.  Worst case, we have a bad tenant, they trash the place and I miss a few months rent.  I'm out $5-10k.  But I have more than that in buffer.

5. Health Insurance.  I'm not even going to bother looking into this until we are less than a year out.

6. I'm sure I'm missing some major things.
« Last Edit: August 15, 2017, 09:09:44 PM by eddie »

Feivel2000

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Re: 1 year vacation starting in 2020
« Reply #1 on: August 15, 2017, 04:37:20 AM »
What has your wife mentioned?
Do you have any questions for us?
You don't even give us your income, how should we know if saving 50k is a realistic goal?

Maybe read the how to write a case study post and give us a chance to help you.

Other than that: a sabbatical is a good test for fire. Enjoy it!


eddie

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Re: 1 year vacation starting in 2020
« Reply #2 on: August 15, 2017, 09:16:26 PM »
What has your wife mentioned?
Do you have any questions for us?
You don't even give us your income, how should we know if saving 50k is a realistic goal?

Maybe read the how to write a case study post and give us a chance to help you.

Other than that: a sabbatical is a good test for fire. Enjoy it!

She mentioned that we should take a 1 year trip.

I spent 5-10 minutes just trying to figure out which category to put this thread under.  It's not exactly a throw down the gauntlet.  I thought the Case Study fit best, but not perfectly.  I'm not very worried about the financial aspect of it.  We make $180-200k a year.  We should be able to pay off all our debt and save up $50k in just under 3 years.  I'm more looking for advice from anyone who has done anything like this.  Am I missing something big that I should be planning for?  Did someone try this with small kids and wish they had traveled more or less frequently?  I'm more worried about the unknown than anything.

onewayfamily

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Re: 1 year vacation starting in 2020
« Reply #3 on: August 16, 2017, 08:04:08 AM »
4. Managing the 2 rental properties.  I'm not too worried about this one.  My brother is super handy and I'm sure I could pay him for any time he would have to spend on the properties.  Worst case, we have a bad tenant, they trash the place and I miss a few months rent.  I'm out $5-10k.  But I have more than that in buffer.

We're dealing with this now (on the road for around 12 months already) self-managing 3 rental properties back home. Some tips of the top of my head:
- find the best tenants you can (obviously) which means good work history, get the previous references properly, even lower the rent a bit to secure good long-term tenants if you have to
- get a good-sized security deposit (at least a month's rent if you can)
- make sure they have all the info they might need before you leave in case they can't contact you quickly in case of emergency, plumbing issues, locked out etc. etc.
- use services like taskrabbit to pay well-reviewed locals to do minor tasks like cleaning, changing over tenants etc.
We FIRE'd at age 28 (me) and 29 (Mrs. OneWayFamily) and are now trying to travel to every country on Earth - it takes longer with 2 toddlers!

If you'd like to keep track of where we're at - check out our photos @ Instagram or our lame attempt at a blog at onewayfamily.com

eddie

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Re: 1 year vacation starting in 2020
« Reply #4 on: August 16, 2017, 08:08:50 PM »
4. Managing the 2 rental properties.  I'm not too worried about this one.  My brother is super handy and I'm sure I could pay him for any time he would have to spend on the properties.  Worst case, we have a bad tenant, they trash the place and I miss a few months rent.  I'm out $5-10k.  But I have more than that in buffer.

We're dealing with this now (on the road for around 12 months already) self-managing 3 rental properties back home. Some tips of the top of my head:
- find the best tenants you can (obviously) which means good work history, get the previous references properly, even lower the rent a bit to secure good long-term tenants if you have to
- get a good-sized security deposit (at least a month's rent if you can)
- make sure they have all the info they might need before you leave in case they can't contact you quickly in case of emergency, plumbing issues, locked out etc. etc.
- use services like taskrabbit to pay well-reviewed locals to do minor tasks like cleaning, changing over tenants etc.

Thank you.  Do you have any kids?  If so, how has the traveling been with them?

ysette9

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Re: 1 year vacation starting in 2020
« Reply #5 on: August 16, 2017, 09:17:26 PM »
I think this is a wonderful idea! If you haven't checked it out already, I recommend the GoCurryCracker of. They are FIRE and travel the world with their toddler.

The only thing I have to comment on is that it may not make sense to pay off your mortgage before going on the trip, unless your interest rate is crazy high. It may be better to just stockpile that in cash or investments for immediate use or for better long-term returns. If it is an emotional decision to make you feel better rather than one driven by hard math, that is another thing.
"It'll be great!"

onewayfamily

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Re: 1 year vacation starting in 2020
« Reply #6 on: August 19, 2017, 06:50:54 AM »
Thank you.  Do you have any kids?  If so, how has the traveling been with them?

We have 2 - aged 2 and 3...
Do I have to tell you how it's been with them?

Haha just kidding - it's hard at home when they're bored as well so it's not that much different in that regard. It definitely takes a lot more out of you travelling for long periods and entertaining the kids all day, but as long as you're getting out there and hiking, checking out all the beaches, town centres etc. etc. it stimulates them mentally and physically and they conk out around 7 or 8pm every day.
We FIRE'd at age 28 (me) and 29 (Mrs. OneWayFamily) and are now trying to travel to every country on Earth - it takes longer with 2 toddlers!

If you'd like to keep track of where we're at - check out our photos @ Instagram or our lame attempt at a blog at onewayfamily.com

Whiskey

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Re: 1 year vacation starting in 2020
« Reply #7 on: August 28, 2017, 08:44:30 PM »
Take the dog to Europe with you. It's very dog friendly. We take ours with us every year:)