Is $100k a year a lot? Is it Fat FIRE? Used to think so but starting to wonder!

[Morning Glory]

There is a dude with ten million in the bay area who claims he only spends 24k per year.

You aboslutely could do this.  I have a friend who lives on a boat in the Berkeley Harbor.  His slip fees are like $500/month and he gets access to bathrooms and a shower.  If he would finish a degree instead of talking about finishing degrees, or even just develop some marketable skill, he could be living in a very profitable fashion.  Walking distance to the Berkeley Bowl, annual access to Cal Sailing Club, etc.  Alas, he prefers to do something...else.  In keeping with the current drift of this thread.... he claims of have even had affairs whilst captive to his less than optimal living situation (!)

TBH I could have finished my doctorate a few times over in the time I've spent on this forum. The boat life sounds pretty good actually.

Multiple doctorate degrees in 1,833 hours, wow!

Jesus that's 73 days. I hope some of it came from having the forum open in another tab while I was doing my course work. I wonder what my word count is?

[RWD]

There is a dude with ten million in the bay area who claims he only spends 24k per year.

You aboslutely could do this.  I have a friend who lives on a boat in the Berkeley Harbor.  His slip fees are like $500/month and he gets access to bathrooms and a shower.  If he would finish a degree instead of talking about finishing degrees, or even just develop some marketable skill, he could be living in a very profitable fashion.  Walking distance to the Berkeley Bowl, annual access to Cal Sailing Club, etc.  Alas, he prefers to do something...else.  In keeping with the current drift of this thread.... he claims of have even had affairs whilst captive to his less than optimal living situation (!)

TBH I could have finished my doctorate a few times over in the time I've spent on this forum. The boat life sounds pretty good actually.

Multiple doctorate degrees in 1,833 hours, wow!

Jesus that's 73 days. I hope some of it came from having the forum open in another tab while I was doing my course work. I wonder what my word count is?

I made the mistake of looking at mine the other day: 2,500+ hours. I really hope a lot of that is from just leaving tabs open, haha. There are some members on here with over 200+ days (~5,000+ hours)!

[Morning Glory]

There is a dude with ten million in the bay area who claims he only spends 24k per year.

You aboslutely could do this.  I have a friend who lives on a boat in the Berkeley Harbor.  His slip fees are like $500/month and he gets access to bathrooms and a shower.  If he would finish a degree instead of talking about finishing degrees, or even just develop some marketable skill, he could be living in a very profitable fashion.  Walking distance to the Berkeley Bowl, annual access to Cal Sailing Club, etc.  Alas, he prefers to do something...else.  In keeping with the current drift of this thread.... he claims of have even had affairs whilst captive to his less than optimal living situation (!)

TBH I could have finished my doctorate a few times over in the time I've spent on this forum. The boat life sounds pretty good actually.

Multiple doctorate degrees in 1,833 hours, wow!

Jesus that's 73 days. I hope some of it came from having the forum open in another tab while I was doing my course work. I wonder what my word count is?

I made the mistake of looking at mine the other day: 2,500+ hours. I really hope a lot of that is from just leaving tabs open, haha. There are some members on here with over 200+ days (~5,000+ hours)!

I need about 35 more credits for a doctorate so at 3 hours per week per credit over an 18 week semester that's 1890 hours. I imagine my forum time will go up by the same amount, so 2 doctorates. Also please shoot me in the foot if I ever suggest that it might be a good idea.

[Fomerly known as something]

That's our annual budget for FIRE give or take a bit.  We are both nurses and live a pretty un-extravagant lifestyle.  I do not consider it Fat Fire for the Bay Area.  It's more like middle class FIRE.  If I were to move back to my home town in rural Southern Indiana, it would absolutely be mega FAT FIRE.  But we don't want to do that.     
This statement is entirely dependent upon specific situations.

Oh, okay, cool, we'll jump right back into the merry-go-round of the original debate. I have insomnia, so why not?

You say Fat FIRE is location dependent, I say being able to afford to live in a VHCOL is a hell of a luxury. You said it yourself, you could live elsewhere, you just don't want to.

How is the luxury of spending on a location fundamentally different than the luxury of spending on something like travel or any other lifestyle choice that results in me spending much more than the average person can afford?

Let me put it this way, let's say I retire with several million and I decide that because I can afford it, that I'm going to go live in Paris, one of the most expensive cities in the world. I live what an American would consider a "normal middle class" lifestyle, which in Paris would cost an absolute fortune.

Is my obscenely expensive Parisian life not considered Fat FIRE just because Paris is VVVHCOL?

Location in retirement is usually optional, so it's a luxury. I totally respect why you might opt for that luxury, you will get no judgement from me. I hold no judgement of anyone who spends 6 figures in retirement, I just refuse to subscribe to a narrative that a lot of money stops being a lot of money just because you choose to retire somewhere that's crazy expensive.

Also, yet again, we're talking post retirement spending, so at some point you won't have a mortgage, no commute to work, etc, etc.

I'm not familiar with the Bay Area, but does 100K of spending without a mortgage or commute costs really only buy a modest lifestyle?

Like, does a head of cabbage cost $12 or something?

Malcat, as someone who just got word they would be moving to the Bay Area from a L/MCOL Midwest area in September.  I’m going to consider myself having a nice juicy fat but different life with an estimated budget spend of $103,000.  The fact that I’m choosing to go is in fact Fat as you say.  Now my housing might appear middle class, a 1-3 bedroom apartment depending on the sub area I choose but the fact is I have a choice to live pretty much anywhere in the area is a luxury.  And yes, my housing budget is over half of my total budgeted amount.  But I always marvel at those that shout it’s expensive but don’t adjust housing expectations. My housing situation won’t be worse out there, just different. 

I’m also not accounting for taxes or retirement savings (401k) because I’m budgeting from net not gross income.  And Yeah it’s just me, but if I had a larger family I’d be making different decisions overall, I still could find a way to live nicely in the Bay Area.

At the same time the other half of my budget is so high because I’m seeing this as kind of an extended slow travel and I’m going to enjoy myself out there but I’m not going to be a baller at the same time.  Since I have reached my net worth FIRE amount but I have pension considerations that keep me working until July 2025, I can afford this FAT adventure.  I’m guessing I won’t stay permanently because the city proper is a bit bigger than my preference, but I could see myself moving down the coast to some place like Monterey Bay.

[JLee]

There is a dude with ten million in the bay area who claims he only spends 24k per year.

You aboslutely could do this.  I have a friend who lives on a boat in the Berkeley Harbor.  His slip fees are like $500/month and he gets access to bathrooms and a shower.  If he would finish a degree instead of talking about finishing degrees, or even just develop some marketable skill, he could be living in a very profitable fashion.  Walking distance to the Berkeley Bowl, annual access to Cal Sailing Club, etc.  Alas, he prefers to do something...else.  In keeping with the current drift of this thread.... he claims of have even had affairs whilst captive to his less than optimal living situation (!)

TBH I could have finished my doctorate a few times over in the time I've spent on this forum. The boat life sounds pretty good actually.

Multiple doctorate degrees in 1,833 hours, wow!

Jesus that's 73 days. I hope some of it came from having the forum open in another tab while I was doing my course work. I wonder what my word count is?

I made the mistake of looking at mine the other day: 2,500+ hours. I really hope a lot of that is from just leaving tabs open, haha. There are some members on here with over 200+ days (~5,000+ hours)!

oh dear, I didn't know this was tracked. I'm at 118 days...though a huge amount of that time is open tabs, so I suppose that's some consolation.

[neo von retorch]

Is 115 days, 16 hours FatForum? I used to think 50 days was FatForum but now I think that's LeanForum.

[Morning Glory]

Is 115 days, 16 hours FatForum? I used to think 50 days was FatForum but now I think that's LeanForum.

If you have a treadmill desk then it's lean forum.

[exit2019]

100K spend may not be enough depending on the lifestyle one chooses, but even in a VHCOL, 100K *spending* is A LOT. Is it an unreasonable amount? No, not if someone wants that lifestyle, but there's no convincing me it's not a luxurious lifestyle. Having the financial ability to live in a VHCOL area in a nice home *is* a luxury.

100k for a couple doesn't seem outrageous to me at all in a VHCOL especially if you have even one ongoing medical cost.  I helped a friend work out a guess at their spending needs last month, so I have this handy:

health        $2,000 expected, includes paying 2x prescriptions for spouse, will increase over time above inflation
housing        $2,300 includes amortized maint and remodeling (wonders of 1940s construction), property taxes (17000/yr), increases but very slowly
food        $1,600
misc bills    $  800 (utilities, internet, cellphone)
personal    $  500 ($250 a month each, clothes, etc.)
gifts        $  100 ($50 a month each)
car           $  400 (insurance, maintenance/service, wear and tear, amortized cost of car)
travel        $  500 (two-ish trips a year)
garden, etc. $   50 (amortized over the year)
pets        $  150 (food, amortized medical)

8400/month. The top 3 items combined are 70% of the budget.  Food is the only one of those where significant savings are possible. In total, that's $100k post-tax per year in a state that does not feature a lower capital gains rate and thus taxes are on top of that.

Is there fat there?  Yeah.  Of course.  Depending on your expectations, probably a lot or a little. This is a couple who has been living on that level for 20+ years and maintaining a crazy savings rate while doing so, so they're not going to be thrilled to change and, basically, don't need to.  But I also think that a lot of the budgets people post don't bother to include amortized intermittent expenses and basically just leave that stuff out (home maintenance is a big one, failure to budget for medical incidentals and prescriptions is another big one I've noticed people leaving out - "My budget plan for medical expenses is to just be healthy!" - easy to say when you're 25).

[Morning Glory]

100K spend may not be enough depending on the lifestyle one chooses, but even in a VHCOL, 100K *spending* is A LOT. Is it an unreasonable amount? No, not if someone wants that lifestyle, but there's no convincing me it's not a luxurious lifestyle. Having the financial ability to live in a VHCOL area in a nice home *is* a luxury.

100k for a couple doesn't seem outrageous to me at all in a VHCOL especially if you have even one ongoing medical cost.  I helped a friend work out a guess at their spending needs last month, so I have this handy:

health        $2,000 expected, includes paying 2x prescriptions for spouse, will increase over time above inflation
housing        $2,300 includes amortized maint and remodeling (wonders of 1940s construction), property taxes (17000/yr), increases but very slowly
food        $1,600
misc bills    $  800 (utilities, internet, cellphone)
personal    $  500 ($250 a month each, clothes, etc.)
gifts        $  100 ($50 a month each)
car           $  400 (insurance, maintenance/service, wear and tear, amortized cost of car)
travel        $  500 (two-ish trips a year)
garden, etc. $   50 (amortized over the year)
pets        $  150 (food, amortized medical)

8400/month. The top 3 items combined are 70% of the budget.  Food is the only one of those where significant savings are possible. In total, that's $100k post-tax per year in a state that does not feature a lower capital gains rate and thus taxes are on top of that.

Is there fat there?  Yeah.  Of course.  Depending on your expectations, probably a lot or a little. This is a couple who has been living on that level for 20+ years and maintaining a crazy savings rate while doing so, so they're not going to be thrilled to change and, basically, don't need to.  But I also think that a lot of the budgets people post don't bother to include amortized intermittent expenses and basically just leave that stuff out (home maintenance is a big one, failure to budget for medical incidentals and prescriptions is another big one I've noticed people leaving out - "My budget plan for medical expenses is to just be healthy!" - easy to say when you're 25).

Ok but you totally missed Malcat's point that living in an HCOL is a choice. They are probably not interested in early retirement.

$1600 for food, that's 133.3 $12 cabbages every month, or about 4.5 cabbages per day. And $10k every year for house maintenance? They must hire out everything, and 1940s construction is arguably better than today's. I get that they can afford the luxury, but most of us would not choose to work longer in order to afford it. (Or even be able to retire ever if we spent that much).

[ixtap]

food        $1,600
misc bills    $  800 (utilities, internet, cellphone)
personal    $  500 ($250 a month each, clothes, etc.)


Is there fat there?  Yeah.  Of course.

Which is the point: there is a lot of fat there. If that couple is happy with their lifestyle and doing well financially, that is wonderful, but this budget isn't even trying to be frugal, so how does it come in to the current conversation??

[nereo]

...about that “1940s construction is arguably better than today’s”... I’d be one to strongly argue against that statement. But of course that could be it’s own thread...

[Morning Glory]

...about that “1940s construction is arguably better than today’s”... I’d be one to strongly argue against that statement. But of course that could be it’s own thread...

Making another thread would definitely be fat forum.

https://archive.curbed.com/2018/3/7/17087588/home-renovation-unnecessary-mcmansion-hell-wagner

[Fomerly known as something]

food        $1,600
misc bills    $  800 (utilities, internet, cellphone)
personal    $  500 ($250 a month each, clothes, etc.)


Is there fat there?  Yeah.  Of course.

Which is the point: there is a lot of fat there. If that couple is happy with their lifestyle and doing well financially, that is wonderful, but this budget isn't even trying to be frugal, so how does it come in to the current conversation??

Exactly, FATFire isn’t necessarily “rich”, FATFire is being able to hire a cleaning lady or spend $800 per person a month on food.  So yes 100k is FATFire.

[Morning Glory]

If Starbucks is barista fire, then is KFC deep fat fire?

[dougules]

I just want to make the point that almost anywhere in a developed country is HCOL.  $100k/year in rural Mexico would be morbidly obese FIRE. 

[JLee]

I just want to make the point that almost anywhere in a developed country is HCOL.  $100k/year in rural Mexico would be morbidly obese FIRE.

There are levels....my mortgage/taxes/insurance combined on my house in Phoenix were 1/3 lower than my property tax alone in NJ.

[dougules]

I just want to make the point that almost anywhere in a developed country is HCOL.  $100k/year in rural Mexico would be morbidly obese FIRE.

There are levels....my mortgage/taxes/insurance combined on my house in Phoenix were 1/3 lower than my property tax alone in NJ.

Yes, but you could have gone significantly lower just a little to your South if you were dead set on LCOL.  In Phoenix you're still paying a lot extra to live where you feel like you have the best balance of cost and QOL.   Living anywhere in a developed country is a luxury, not that there is anything wrong with that, though.

[JLee]

I just want to make the point that almost anywhere in a developed country is HCOL.  $100k/year in rural Mexico would be morbidly obese FIRE.

There are levels....my mortgage/taxes/insurance combined on my house in Phoenix were 1/3 lower than my property tax alone in NJ.

Yes, but you could have gone significantly lower just a little to your South if you were dead set on LCOL.  In Phoenix you're still paying a lot extra to live where you feel like you have the best balance of cost and QOL.   Living anywhere in a developed country is a luxury, not that there is anything wrong with that, though.

Well sure, you could live in a cardboard box under a bridge for free too, but when you can easily fit your entire living expenses in one part of the USA inside of the housing costs alone of another part of the USA, that's a fair example of low cost vs high cost.  A random cost of living calculator claimed about $700/mo USD for a 3br apartment in city center in Mexico and my 3br house in Phoenix was ~$755/mo.

Granted, that was before the recent real estate explosion in Phoenix so things are different now.

[dougules]

I just want to make the point that almost anywhere in a developed country is HCOL.  $100k/year in rural Mexico would be morbidly obese FIRE.

There are levels....my mortgage/taxes/insurance combined on my house in Phoenix were 1/3 lower than my property tax alone in NJ.

Yes, but you could have gone significantly lower just a little to your South if you were dead set on LCOL.  In Phoenix you're still paying a lot extra to live where you feel like you have the best balance of cost and QOL.   Living anywhere in a developed country is a luxury, not that there is anything wrong with that, though.

Well sure, you could live in a cardboard box under a bridge for free too, but when you can easily fit your entire living expenses in one part of the USA inside of the housing costs alone of another part of the USA, that's a fair example of low cost vs high cost.  A random cost of living calculator claimed about $700/mo USD for a 3br apartment in city center in Mexico and my 3br house in Phoenix was ~$755/mo.

Granted, that was before the recent real estate explosion in Phoenix so things are different now.

It's not just housing.  The cost of medical care alone would make life a lot cheaper.  Food and not needing a car would be other factors among others.  You're still paying a premium to live in AZ over somewhere LCOL on a global level, and that's fine if it's worth the trade-offs to you.  I'm just saying that if we're considering location a luxury, the threshold for Fat FIRE gets pretty low when you consider the ability to move to Mexico, Ecuador, the Philippines, etc. 

[JLee]

I just want to make the point that almost anywhere in a developed country is HCOL.  $100k/year in rural Mexico would be morbidly obese FIRE.

There are levels....my mortgage/taxes/insurance combined on my house in Phoenix were 1/3 lower than my property tax alone in NJ.

Yes, but you could have gone significantly lower just a little to your South if you were dead set on LCOL.  In Phoenix you're still paying a lot extra to live where you feel like you have the best balance of cost and QOL.   Living anywhere in a developed country is a luxury, not that there is anything wrong with that, though.

Well sure, you could live in a cardboard box under a bridge for free too, but when you can easily fit your entire living expenses in one part of the USA inside of the housing costs alone of another part of the USA, that's a fair example of low cost vs high cost.  A random cost of living calculator claimed about $700/mo USD for a 3br apartment in city center in Mexico and my 3br house in Phoenix was ~$755/mo.

Granted, that was before the recent real estate explosion in Phoenix so things are different now.

It's not just housing.  The cost of medical care alone would make life a lot cheaper.  Food and not needing a car would be other factors among others.  You're still paying a premium to live in AZ over somewhere LCOL on a global level, and that's fine if it's worth the trade-offs to you.  I'm just saying that if we're considering location a luxury, the threshold for Fat FIRE gets pretty low when you consider the ability to move to Mexico, Ecuador, the Philippines, etc.

I think that results in a transition from LCOL to VLCOL, much like moving from NJ to Manhattan would be going from HCOL to VHCOL.

[exit2019]

...about that “1940s construction is arguably better than today’s”... I’d be one to strongly argue against that statement. But of course that could be it’s own thread...

It's true, but not in the bay area, that's for sure.  Enjoy your orangeburg tar-and-paper sewer line failing or the in-slab pipes having fully rusted years ago without anyone realizing it until you discover one day that the concrete itself has dissolved away and the house is essentially floating on a plot of sewage-saturated earth.

Everything in the valley was thrown up as quickly as possible and yet is 1400+ a square foot.

[Sid Hoffman]

It's not just housing.  The cost of medical care alone would make life a lot cheaper.  Food and not needing a car would be other factors among others.  You're still paying a premium to live in AZ over somewhere LCOL on a global level, and that's fine if it's worth the trade-offs to you.  I'm just saying that if we're considering location a luxury, the threshold for Fat FIRE gets pretty low when you consider the ability to move to Mexico, Ecuador, the Philippines, etc.

It depends. If you can finagle your income just right you can slot into an ACA category where you may spend less than $1000/year on healthcare even in the USA. I'm not early retired yet, but I've priced it out repeatedly and again, you have to be able to get your taxable income into the level you want (typically by doing traditional to Roth IRA rollovers every year) but as long as that's the case, even healthcare can be quite affordable in the USA. My current US home is a 5 minute walk from a large grocery store, my eye doctor, and my dentist's office so I've commonly gone for extended periods of time without even using my car now that I'm working from home full time thanks to covid.

There's other issues with moving outside the USA as an American that aren't as simple as "Oh but it's cheaper" as you see on expat forums and articles. My favorite was one written recently by a woman who's lived on the cheap in Mexico for a number of years and said the most shocking thing to her is that people would just put their dogs up on the roof of their house to bark at everyone for security. So all day, every day, dogs on rooftops barking all the time. Many other examples, but it was a vivid example of things that are so different that an American might not even think that to be possible, yet it's commonplace.

I'm willing to pay a little extra to not hear dogs barking all day every day from the rooftops of all my neighbors' homes.

[Morning Glory]

I don't think one lady's experience of barking dogs represents a whole country. There's a name for that, some kind of logical fallacy. I'm not being sarcastic I really just can't fucking remember help me!

ETA: Ok it's a hasty generalization, thanks google!!!

[Metalcat]

I don't think one lady's experience of barking dogs represents a whole country. There's a name for that, some kind of logical fallacy. I'm not being sarcastic I really just can't fucking remember help me!

ETA: Ok it's a hasty generalization, thanks google!!!

I agree, but the point does stand that it is VERY difficult for a lot of people psychologically to relocate to a country with a very different culture, especially the older someone gets, especially if they're accustomed to a monoculture their entire lives.

Now, if moving to a retirement haven like Panama or Portugal, that's a bit of a different matter. But picking up and moving to Mexico or Malaysia, that's going to be one hell of an adjustment for a lot of people.

[maizefolk]

In fairness to folks in some of the super high cost coastal cities like NYC and SFO, I think there are a number of them who genuinely believe that relocating out into cities elsewhere in the country would be a culture shock equivalent to moving to Mexico or Malaysia.

I don't think the actually degree of culture shock is anywhere close to equivalent or even comparable, but there is a real fear of the unknown even if there isn't a real unknown to be afraid of.

[Metalcat]

In fairness to folks in some of the super high cost coastal cities like NYC and SFO, I think there are a number of them who genuinely believe that relocating out into cities elsewhere in the country would be a culture shock equivalent to moving to Mexico or Malaysia.

I don't think the actually degree of culture shock is anywhere close to equivalent or even comparable, but there is a real fear of the unknown even if there isn't a real unknown to be afraid of.

Mexico and Malaysia for sure would be a shock, but I wonder what would be more culture shock for someone from SFO, moving to small town USA or moving to Algarve Portugal? What would be more shocking to them? Fellow Americans or Brits?

[By the River]

In fairness to folks in some of the super high cost coastal cities like NYC and SFO, I think there are a number of them who genuinely believe that relocating out into cities elsewhere in the country would be a culture shock equivalent to moving to Mexico or Malaysia.

I don't think the actually degree of culture shock is anywhere close to equivalent or even comparable, but there is a real fear of the unknown even if there isn't a real unknown to be afraid of.

I was talking recently to someone who grew up and lives in NYC and the subject of vacations came up.  They said they normally fly or take trains and that the longest car ride they had ever been in was about a month ago, 1.5 hours (100 miles) one way.  In the last month, I've had 4 trips longer than that and will drive 5 hours one way this weekend.  That's a different culture to me.

[Sandi_k]

I was talking recently to someone who grew up and lives in NYC and the subject of vacations came up.  They said they normally fly or take trains and that the longest car ride they had ever been in was about a month ago, 1.5 hours (100 miles) one way.  In the last month, I've had 4 trips longer than that and will drive 5 hours one way this weekend.  That's a different culture to me.

Yep. My DH's aunt and uncle live in Northern CT. Each summer, they drive to Cape Cod for vacation. It's 175 miles away, less than 3 hours.

We drove from NorCal to SoCal to see them - 6.5 hour drive - just for the weekend. They were amazed, and we were nonchalant. Welcome to CA, where all the driving is lengthy....

[maizefolk]

Mexico and Malaysia for sure would be a shock, but I wonder what would be more culture shock for someone from SFO, moving to small town USA or moving to Algarve Portugal? What would be more shocking to them? Fellow Americans or Brits?

Super small town USA is a different animal. When I've talked to folks like this, I'm usually talking about the potential to live places like Kansas City or Fort Collins or Tucson.

I've never been to Algarve, but I would agree someone living in SFO probably is better socially and behaviorally prepared for life in a western or southern European city than life in small town (<10,000 residents) USA.

[MaybeBabyMustache]

Mexico and Malaysia for sure would be a shock, but I wonder what would be more culture shock for someone from SFO, moving to small town USA or moving to Algarve Portugal? What would be more shocking to them? Fellow Americans or Brits?

Super small town USA is a different animal. When I've talked to folks like this, I'm usually talking about the potential to live places like Kansas City or Fort Collins or Tucson.

I've never been to Algarve, but I would agree someone living in SFO probably is better socially and behaviorally prepared for life in a western or southern European city than life in small town (<10,000 residents) USA.

My husband is not from the US, and has also lived in several places in Canada, and we now live in the Bay Area. He's not white, and part of his list of attractive places to live in the US includes having a reasonably diverse population. I don't think that's a crazy ask. When we visit my parents (small, non diverse community)...let's just say that he stands out. We are raising mixed race kids, & it's certainly a factor in where we would be comfortable moving, within the US.

[Metalcat]

Mexico and Malaysia for sure would be a shock, but I wonder what would be more culture shock for someone from SFO, moving to small town USA or moving to Algarve Portugal? What would be more shocking to them? Fellow Americans or Brits?

Super small town USA is a different animal. When I've talked to folks like this, I'm usually talking about the potential to live places like Kansas City or Fort Collins or Tucson.

I've never been to Algarve, but I would agree someone living in SFO probably is better socially and behaviorally prepared for life in a western or southern European city than life in small town (<10,000 residents) USA.

My husband is not from the US, and has also lived in several places in Canada, and we now live in the Bay Area. He's not white, and part of his list of attractive places to live in the US includes having a reasonably diverse population. I don't think that's a crazy ask. When we visit my parents (small, non diverse community)...let's just say that he stands out. We are raising mixed race kids, & it's certainly a factor in where we would be comfortable moving, within the US.

Of course! That's a perfectly rational thing to financially prioritize.

[ericrugiero]

Mexico and Malaysia for sure would be a shock, but I wonder what would be more culture shock for someone from SFO, moving to small town USA or moving to Algarve Portugal? What would be more shocking to them? Fellow Americans or Brits?

Super small town USA is a different animal. When I've talked to folks like this, I'm usually talking about the potential to live places like Kansas City or Fort Collins or Tucson.

I've never been to Algarve, but I would agree someone living in SFO probably is better socially and behaviorally prepared for life in a western or southern European city than life in small town (<10,000 residents) USA.

My husband is not from the US, and has also lived in several places in Canada, and we now live in the Bay Area. He's not white, and part of his list of attractive places to live in the US includes having a reasonably diverse population. I don't think that's a crazy ask. When we visit my parents (small, non diverse community)...let's just say that he stands out. We are raising mixed race kids, & it's certainly a factor in where we would be comfortable moving, within the US.

Sure, it makes sense and is very reasonable for your family to want a diverse population where you will fit in.  That doesn't lock you into SFO.  There are lots of other areas (in the US or not) with more reasonable cost of living that are diverse.  Maybe this preference limits your options in much of the truly low cost areas.  But, there are certainly places much cheaper than SFO that would work. 

[MaybeBabyMustache]

Mexico and Malaysia for sure would be a shock, but I wonder what would be more culture shock for someone from SFO, moving to small town USA or moving to Algarve Portugal? What would be more shocking to them? Fellow Americans or Brits?

Super small town USA is a different animal. When I've talked to folks like this, I'm usually talking about the potential to live places like Kansas City or Fort Collins or Tucson.

I've never been to Algarve, but I would agree someone living in SFO probably is better socially and behaviorally prepared for life in a western or southern European city than life in small town (<10,000 residents) USA.

My husband is not from the US, and has also lived in several places in Canada, and we now live in the Bay Area. He's not white, and part of his list of attractive places to live in the US includes having a reasonably diverse population. I don't think that's a crazy ask. When we visit my parents (small, non diverse community)...let's just say that he stands out. We are raising mixed race kids, & it's certainly a factor in where we would be comfortable moving, within the US.

Sure, it makes sense and is very reasonable for your family to want a diverse population where you will fit in.  That doesn't lock you into SFO.  There are lots of other areas (in the US or not) with more reasonable cost of living that are diverse.  Maybe this preference limits your options in much of the truly low cost areas.  But, there are certainly places much cheaper than SFO that would work.

I don't feel locked in to living in SFO. We're here for work, because currently we need to be & both make a lot of money living/earning here. We won't stay when that changes and our kids are out of high school. My answer was about the broader, "you can move anywhere in the US" vibe. You certainly could, but there are reasons people may choose to live elsewhere.

[maizefolk]

Mexico and Malaysia for sure would be a shock, but I wonder what would be more culture shock for someone from SFO, moving to small town USA or moving to Algarve Portugal? What would be more shocking to them? Fellow Americans or Brits?

Super small town USA is a different animal. When I've talked to folks like this, I'm usually talking about the potential to live places like Kansas City or Fort Collins or Tucson.

I've never been to Algarve, but I would agree someone living in SFO probably is better socially and behaviorally prepared for life in a western or southern European city than life in small town (<10,000 residents) USA.

My husband is not from the US, and has also lived in several places in Canada, and we now live in the Bay Area. He's not white, and part of his list of attractive places to live in the US includes having a reasonably diverse population. I don't think that's a crazy ask. When we visit my parents (small, non diverse community)...let's just say that he stands out. We are raising mixed race kids, & it's certainly a factor in where we would be comfortable moving, within the US.

I think that is a perfectly valid way to feel. Yet my observation has been that (some) people living places like San Francisco has a very skewed sense of how diverse (or not) many parts of the country away from the coasts are. It sounds like you're particularly focused on racial appearance and not wanting to stand out too much. Again, completely understandable. But relative to San Francisco proper, how much less diverse would you guess a city like Kansas City or Tucson actually is? Just on gut instinct?

A bit under half of SF residents are non-hispanic white (40%). In Tucson 43%. In Kansas City 55%. To me those don't seem like shockingly different percentages. To you, do those percentages make a big difference in terms of how comfortable you and your family would feel living one place verse another?

Edit to add: By all means don't move to Scottsbluff, Nebraska. Your husband wouldn't feel comfortable there. Your kids might feel isolated in schools. And the cultural amenities are not so great to put it mildly. My concern is how many folks living in Manhattan or San Francisco seem to think that most of the people in the USA who don't live in on of a small number of specific cites instead are getting the Scottsbluff experience.

[Metalcat]

Mexico and Malaysia for sure would be a shock, but I wonder what would be more culture shock for someone from SFO, moving to small town USA or moving to Algarve Portugal? What would be more shocking to them? Fellow Americans or Brits?

Super small town USA is a different animal. When I've talked to folks like this, I'm usually talking about the potential to live places like Kansas City or Fort Collins or Tucson.

I've never been to Algarve, but I would agree someone living in SFO probably is better socially and behaviorally prepared for life in a western or southern European city than life in small town (<10,000 residents) USA.

My husband is not from the US, and has also lived in several places in Canada, and we now live in the Bay Area. He's not white, and part of his list of attractive places to live in the US includes having a reasonably diverse population. I don't think that's a crazy ask. When we visit my parents (small, non diverse community)...let's just say that he stands out. We are raising mixed race kids, & it's certainly a factor in where we would be comfortable moving, within the US.

Sure, it makes sense and is very reasonable for your family to want a diverse population where you will fit in.  That doesn't lock you into SFO.  There are lots of other areas (in the US or not) with more reasonable cost of living that are diverse.  Maybe this preference limits your options in much of the truly low cost areas.  But, there are certainly places much cheaper than SFO that would work.

I don't feel locked in to living in SFO. We're here for work, because currently we need to be & both make a lot of money living/earning here. We won't stay when that changes and our kids are out of high school. My answer was about the broader, "you can move anywhere in the US" vibe. You certainly could, but there are reasons people may choose to live elsewhere.

The vibe is that there are tons of low cost options in the US, not that those locations are right for everyone, just as Mexico isn't right for everyone. Some people over estimate the culture issues of geo-arbitrage and others under estimate it.

[dougules]

It depends. If you can finagle your income just right you can slot into an ACA category where you may spend less than $1000/year on healthcare even in the USA. I'm not early retired yet, but I've priced it out repeatedly and again, you have to be able to get your taxable income into the level you want (typically by doing traditional to Roth IRA rollovers every year) but as long as that's the case, even healthcare can be quite affordable in the USA. My current US home is a 5 minute walk from a large grocery store, my eye doctor, and my dentist's office so I've commonly gone for extended periods of time without even using my car now that I'm working from home full time thanks to covid.

This sounds like the price you pay if you're lucky enough to be healthy.  If I'm mistaken I'd like to know where I can find these plans because that would really shorten my FIRE timeline. 

Mexico and Malaysia for sure would be a shock, but I wonder what would be more culture shock for someone from SFO, moving to small town USA or moving to Algarve Portugal? What would be more shocking to them? Fellow Americans or Brits?

Super small town USA is a different animal. When I've talked to folks like this, I'm usually talking about the potential to live places like Kansas City or Fort Collins or Tucson.

I've never been to Algarve, but I would agree someone living in SFO probably is better socially and behaviorally prepared for life in a western or southern European city than life in small town (<10,000 residents) USA.

My husband is not from the US, and has also lived in several places in Canada, and we now live in the Bay Area. He's not white, and part of his list of attractive places to live in the US includes having a reasonably diverse population. I don't think that's a crazy ask. When we visit my parents (small, non diverse community)...let's just say that he stands out. We are raising mixed race kids, & it's certainly a factor in where we would be comfortable moving, within the US.

I'm from the south and I've lived on the west coast.  DH is from the northeast.  Being gay is a different experience in different parts of the US.  In general, I'm sure moving domestically is not as big an adjustment as moving internationally, but just because it's not the same level as an international move does not mean it's trivial.  The logic is still comparable.  For various reasons some people will have real trouble making adjustments to a new place domestically the same way some people would have real trouble with an international move, even if the chances are a lot better for a domestic move.  Some LGBT+ people might even find it easier to move from Seattle to Mexico City than from Seattle to Arkansas.  I just see people acting like moving is trivial just because it's within the same country, and that is just not the case for everyone. 

And on that note, if it's a luxury to stay in a HCOL area not to have to make big life adjustments, it's also a luxury to stay in the US and Canada at all for the same reason.  So don't judge. 

PS I can't type fast enough to keep up with you people. 

[Morning Glory]

What about Chicago or Detroit or Minneapolis? Those are all great diverse cities with much lower cost than the coasts.

[MaybeBabyMustache]

Mexico and Malaysia for sure would be a shock, but I wonder what would be more culture shock for someone from SFO, moving to small town USA or moving to Algarve Portugal? What would be more shocking to them? Fellow Americans or Brits?

Super small town USA is a different animal. When I've talked to folks like this, I'm usually talking about the potential to live places like Kansas City or Fort Collins or Tucson.

I've never been to Algarve, but I would agree someone living in SFO probably is better socially and behaviorally prepared for life in a western or southern European city than life in small town (<10,000 residents) USA.

My husband is not from the US, and has also lived in several places in Canada, and we now live in the Bay Area. He's not white, and part of his list of attractive places to live in the US includes having a reasonably diverse population. I don't think that's a crazy ask. When we visit my parents (small, non diverse community)...let's just say that he stands out. We are raising mixed race kids, & it's certainly a factor in where we would be comfortable moving, within the US.

I think that is a perfectly valid way to feel. Yet my observation has been that (some) people living places like San Francisco has a very skewed sense of how diverse (or not) many parts of the country away from the coasts are. It sounds like you're particularly focused on racial appearance and not wanting to stand out too much. Again, completely understandable. But relative to San Francisco proper, how much less diverse would you guess a city like Kansas City or Tucson actually is? Just on gut instinct?

A bit under half of SF residents are non-hispanic white (40%). In Tucson 43%. In Kansas City 55%. To me those don't seem like shockingly different percentages. To you, do those percentages make a big difference in terms of how comfortable you and your family would feel living one place verse another?

Edit to add: By all means don't move to Scottsbluff, Nebraska. Your husband wouldn't feel comfortable there. Your kids might feel isolated in schools. And the cultural amenities are not so great to put it mildly. My concern is how many folks living in Manhattan or San Francisco seem to think that most of the people in the USA who don't live in on of a small number of specific cites instead are getting the Scottsbluff experience.

Two points of clarification. 1) We don't live in San Francisco, we live in the bay area & there are many cities outside of SF proper. 2) My husband is middle eastern. From a census perspective, middle easterners are considered "white", so the stats you refer to are not particularly helpful when asking the question of whether people stand out. On our street, with possibly 15 homes, there are four families where at least one person is from the same country as my husband.

Diversity matters to us outside of ethnic diversity: we want our kids exposed to a wide variety of perspectives & an acceptance of those who are different than they are. You can find that in many places in the US outside of NYC & SF. We lived in Seattle for 20 years before this, and I'd describe it as fitting the bar as well. I grew up two hours from Seattle, and would most certainly not describe it as fitting the bar. I certainly never claimed that there were only a few places in the US where you can find a diverse experience. I was pointing out why people may choose to live in HCOL places.

To the larger point:
-I still think $100k is fat fire :-)
-Living in a HCOL is a luxury
-There can be reasons people choose to live in a higher cost of living area that are completely valid & reasonable. That comes at a cost from a FIRE perspective. As long as people are looking at all of the options & making decisions aligned with their values, I'm not sure why we need to debate each criteria.

[former player]

Raw numbers on race also don't deal with the issue of segregation - populations in segregated neighbourhoods vs mixed neighbourhoods provides a very different living experience.

[maizefolk]

Yes, if your definition of diversity is specifically "people who look like my family and came from the same country originally" that's a different search parameter from diversity per se.

I agree diversity of perspective is also important. As someone who has lived in Berkeley and half a dozen other cities or towns across the USA, I didn't find diversity of perspective to be any better (or any worse) while living in the bay area, but, unlike race, it's harder to point to hard numbers when people start listening to their preconceived notions about how all sorts of places to live are not suitable for them because of a lack of that kind of diversity. Race, usually, is an easier way to catch people in assumptions and get them to start questioning their preconceptions about how people in other parts of the country live and experience their lives.

[nereo]

Personally, the greatest cost associated with geo-arbitrage is the disruption to your social network.  And I say this as someone who’s lived in three different countries and moved frequently throughout my life.

There’s a value to having friends and family and even former employees/ers nearby, but it’s very hard to quantify.

[FIRE Artist]

Personally, the greatest cost associated with geo-arbitrage is the disruption to your social network.  And I say this as someone who’s lived in three different countries and moved frequently throughout my life.

There’s a value to having friends and family and even former employees/ers nearby, but it’s very hard to quantify.

Yep.  I am too old and too much of an introvert to start over from scratch again. 

[former player]

Personally, the greatest cost associated with geo-arbitrage is the disruption to your social network.  And I say this as someone who’s lived in three different countries and moved frequently throughout my life.

There’s a value to having friends and family and even former employees/ers nearby, but it’s very hard to quantify.

Yep.  I am too old and too much of an introvert to start over from scratch again.

That network of friends, family and local knowledge is also worth cash money, in that they give you the knowledge to be able to get good quality and good value for your spending and people to call on for assistance.  If you are starting over in a new country, or even in a new location in the same country, you lose those advantages.  The disadvantage is even greater if you aren't fluent in the local language.  My strong view is that going to live in another country if you are only bare bones FIREd in that country's economy is a recipe for disaster.

[nereo]

Personally, the greatest cost associated with geo-arbitrage is the disruption to your social network.  And I say this as someone who’s lived in three different countries and moved frequently throughout my life.

There’s a value to having friends and family and even former employees/ers nearby, but it’s very hard to quantify.

Yep.  I am too old and too much of an introvert to start over from scratch again.

That network of friends, family and local knowledge is also worth cash money, in that they give you the knowledge to be able to get good quality and good value for your spending and people to call on for assistance.  If you are starting over in a new country, or even in a new location in the same country, you lose those advantages.  The disadvantage is even greater if you aren't fluent in the local language.  My strong view is that going to live in another country if you are only bare bones FIREd in that country's economy is a recipe for disaster.

Exactly.  Every time I’ve lived or worked in a new place, the first several years (at least) were way more expensive than they needed to be, because I didn’t know what most locals know.  Who to call for a repair, which ‘official’ bills could be contested or dropped, how to gain access to various services, or even the cheapest places to go for various things. When I needed help I had to pay for it.  In every culture (even our own) there is efficiencies and saying built into having a robust social network.  It becomes so familiar to us in our native environment that we often overlook the benefits.  These are in addition to the mental and happiness benefits that come with having lots of friends and family nearby.

I should add that I’m not at all against moving, and one can certainly save a huge amount moving from a HCOL to LOCL region, but the easily quantifiable (lodging, taxes, food, health-care) are just part of the ledger to consider.

[tooqk4u22]

Personally, the greatest cost associated with geo-arbitrage is the disruption to your social network.  And I say this as someone who’s lived in three different countries and moved frequently throughout my life.

There’s a value to having friends and family and even former employees/ers nearby, but it’s very hard to quantify.

Yep.  I am too old and too much of an introvert to start over from scratch again.

Wait...you have friends, family, a social network?   Oh then that's definitely  a LUXURY and you must be stupidly fat FIRE if you choose to stay because of them.....I mean there is Facebook, Instagram and FaceTime to keep in touch with those people so you can lower your cost and move overseas.  I am kidding of course, but others may see it this way.

[maizefolk]

I think it's a very good point. It's also something for young people to keep in mind as they choose what jobs to take and what cities to move to. I've heard the strategy of working and saving in a HCOL area and then moving to a LCOL to achieve FIRE. But it is very possible (and very human) that one may end up putting down roots without realizing or intending it to the point where moving becomes much less appealing.

[Metalcat]

Personally, the greatest cost associated with geo-arbitrage is the disruption to your social network.  And I say this as someone who’s lived in three different countries and moved frequently throughout my life.

There’s a value to having friends and family and even former employees/ers nearby, but it’s very hard to quantify.

Yep.  I am too old and too much of an introvert to start over from scratch again.

Wait...you have friends, family, a social network?   Oh then that's definitely  a LUXURY and you must be stupidly fat FIRE if you choose to stay because of them.....I mean there is Facebook, Instagram and FaceTime to keep in touch with those people so you can lower your cost and move overseas.  I am kidding of course, but others may see it this way.

As the person in this thread who keeps harping on about HCOL being a luxury, I don't even remotely see the connection. Having relationships isn't a luxury, choosing to live a middle class lifestyle in an HCOL area is a luxury.

I've never once said that choosing the luxury of living in an HCOL region is unreasonable or that people shouldn't do it.

I'm all about my luxuries, I have many that are non negotiable.

[Cool Friend]

Personally, the greatest cost associated with geo-arbitrage is the disruption to your social network.  And I say this as someone who’s lived in three different countries and moved frequently throughout my life.

There’s a value to having friends and family and even former employees/ers nearby, but it’s very hard to quantify.

Yep.  I am too old and too much of an introvert to start over from scratch again.

Wait...you have friends, family, a social network?   Oh then that's definitely  a LUXURY and you must be stupidly fat FIRE if you choose to stay because of them.....I mean there is Facebook, Instagram and FaceTime to keep in touch with those people so you can lower your cost and move overseas.  I am kidding of course, but others may see it this way.

As the person in this thread who keeps harping on about HCOL being a luxury, I don't even remotely see the connection. Having relationships isn't a luxury, choosing to live a middle class lifestyle in an HCOL area is a luxury.

I think the connection is that when all your friends, family, and professional relationships reside in a HCOL city, the choice you're making is not to live in an expensive city, it's to live where the people you love are.

[Metalcat]

Personally, the greatest cost associated with geo-arbitrage is the disruption to your social network.  And I say this as someone who’s lived in three different countries and moved frequently throughout my life.

There’s a value to having friends and family and even former employees/ers nearby, but it’s very hard to quantify.

Yep.  I am too old and too much of an introvert to start over from scratch again.

Wait...you have friends, family, a social network?   Oh then that's definitely  a LUXURY and you must be stupidly fat FIRE if you choose to stay because of them.....I mean there is Facebook, Instagram and FaceTime to keep in touch with those people so you can lower your cost and move overseas.  I am kidding of course, but others may see it this way.

As the person in this thread who keeps harping on about HCOL being a luxury, I don't even remotely see the connection. Having relationships isn't a luxury, choosing to live a middle class lifestyle in an HCOL area is a luxury.

I think the connection is that when all your friends, family, and professional relationships reside in a HCOL city, the choice you're making is not to live in an expensive city, it's to live where the people you love are.

Yeah, I got that. There are very good reasons to live in expensive locations. Living in an HCOL location is a luxury, whatever the reason for living there. Having the connections isn't the luxury, being able to choose to live in the HCOL is a luxury.

I can't afford to live where a lot of my friends and family are, I don't have that luxury. I could work a lot more to afford it, but i'm happy living elsewhere, so for me, that luxury isn't worth it. For others it is.

[ixtap]

I think it's a very good point. It's also something for young people to keep in mind as they choose what jobs to take and what cities to move to. I've heard the strategy of working and saving in a HCOL area and then moving to a LCOL to achieve FIRE. But it is very possible (and very human) that one may end up putting down roots without realizing or intending it to the point where moving becomes much less appealing.

Hence why I'm still in expensive yucky coastal SoCal. Came for the job after getting out of the Coast Guard and stayed for the friends and family relationships and activities that are here. Downsizing and living a less spendy life helps a lot but only so much you can do if you are starting out here. Doable for many but tough if you have a family. That said - moving day is this weekend to a rental place for the summer. Not sure where we (BF and I) will end up but it will likely be much lower cost if we decide to buy. Selling my house made me fat FIRE (by my lower spending standards) as selling the BF's house did for him. Neither will spend anywhere near $100k together or separately.

Where is yucky coastal SoCal? Glad I live in pleasant coastal SoCal!