CASE STUDY: American Expat Living in UK Starting to Save for ER from Scratch - Help
Hello, I am an American married to a Brit and have been living in the UK for the last 3 years. We intend to live here for at least another 12-24 months as I intend to secure British Citizenship before we think about moving again. We are in our late 30's and due to previous circumstances (the details of which are not relevant) we are just now able to start saving heaps of money towards FI.
I will detail out our finances below, but in summary, what I am hoping to get from this forum is some advice as how to proceed. My husband and I are now in a position where we make good money, we have no children, we have no debts, and we want to maximize the money we are finally in a position to save. We live pretty frugally already and our biggest 'splurge' is occasional travel although we both prefer cheaper outdoor holidays (our tent is our second home).
So, here are the details (please note that all money is represented in British pounds. You can multiple those amounts by 1.5 to get a rough idea of what the amounts would be in USD):
Income:
Mine: £73,000 base salary annually + up to a 20% of base salary variable bonus paid out quarterly
Hubs: £22,000 base salary + up to a 10% of base salary variable bonus paid out quarterly
Total annual base income: £95,000.00 (or roughly $142,000)
Current expenses - Fixed:
Rent: £522/mo (includes council tax)
Water: £34/mo
All Utilities: £64/mo
Mobile phones: £25/mo
Internet: £25/mo
Netflix: £7/mo
Total fixed monthly expenses = £675/mo
Current Expenses - Variable:
Groceries & Toiletries: £300/mo
Travel/Car/Petrol: £200/mo
Entertainment/Gifts: £200/mo
Misc. Expenses: £50/mo
Total variable expenses = £750/mo
Total monthly expenses: £1450.00/mo or roughly £17,100 ($25,650) annually.
Assets:
Emergency Fund: £5,000.00
Car: £3,500.00
Combined work pensions: ~ £28,000.00
Husband's future military pension: ~£200.00/month after age of 55
My Social Security payment (if I never worked another day and SS is still around: $1100.00/month at age 65)
Liabilities/Debts: 0 (took us a long time to get to this point!)
Combined, before any bonuses, we bring in about £5,680.00/month and both contribute to our UK pensions up to the amount our employers match which is 20% of our annual earnings (including the employer match).
Given that we have no debts, no mortgage, and have a solid emergency fund, what should we do with our money to get the most out of it over the next 5-10 years?
A few additional details:
We may move back to the US at some point or live in another EU country. How and where do we place our money in order to maximize it if we need to access it from a variety of countries in the future?
I would like to invest our money but I have no idea where is best to do this. I would like to keep this as simple as possible.
We may buy a house in the next few years but we are happy with small accommodation and would hopefully not have a mortgage more than 1x our annual salary if not far, far less.
I think we would be able to live on £20,000/year comfortably assuming we had a mortgage payment that was less than our current rent and/or non-existent (i.e. paid off).
We don't have a specific time frame by which we are trying to achieve FI we just want to know how best to maximize our money as quickly as possible so as to have more options sooner.
I hope this all makes sense and thank you in advance for any suggestions/help!!