Forget $600K, retire on $100K in the Philippines (or other country)

[VirginiaBob]

I notice the model here is to save up about $600K plus pay off the mortgage and get involved in some post-retirement rental/business.  The question I have to ask you is why do you restrict yourself to your home country?  Lot's of other countries are available where you can live off of $150/mo.  Has anyone considered this in their FIRE plans?  I lived in the Philippines for 6 months with a charity and spent about $150/mo. and I have to say, I didn't really feel like I was left wanting anything.  The population was very friendly and seemed to spend thier free time within social gatherings versus spending a lot of money, rode bikes, didn't need hot water (water was already comfortable since the ground temperature was high), ate lots of rice and fish (protein rich).  The original Mustachians. 

[BooksAreNerdy]

We are talking about doing this sort of thing or some sort of slow travel for at least a year post retirement. We will have two youngish kids at that time. Our goal would be to travel/experience other cultures while spending less than we would at home (America). DH is not on board with that being a permanent situation, and I tend to agree- family and all. We wouldn't want to be too far from aging parents OR our own kids once they are on their own.

It all sounds good, but will probay be a more temporary 'here and there' situation. Maybe we will 'snowbird' is super cheap places when the market is down and we need to tighten our belts as to not over run our portfolio. :)

[sloof70]

I could do that right now, and on days like today, I kind of want to.

[nereo]

I notice the model here is to save up about $600K plus pay off the mortgage and get involved in some post-retirement rental/business.  The question I have to ask you is why do you restrict yourself to your home country? 
(snip)

Your point is a good one - it certainly is possible to retire on far less if you are willing to move to a place with a very low COL

Personally, I want to be close to my family.  Obviously I'm not against moving to another country as I've done that already, but I want to see my parents, niece and siblings frequently which I could never do living abroad on so little money.  I'm also quite happy here and don't mind that I might have to work 10 whole years to achieve FI. 

[Jon_Snow]

Well, substitute Mexico for the Philippines for my wife and I. The ultimate plan is to spend 6 months of the year at our place in the Baja (to stay longer, we would need to get some sort of quasi-Mexican citizenship). Cost of living is probably 40% cheaper than Vancouver is for us currently... not spectacular, but significant. But we will also have significantly more than 600k socked away. Just need to get wifey retired ASAP - and she received some freakin' awesome news at work that should speed this process up.

[VirginiaBob]

I notice the model here is to save up about $600K plus pay off the mortgage and get involved in some post-retirement rental/business.  The question I have to ask you is why do you restrict yourself to your home country?  Lot's of other countries are available where you can live off of $150/mo.  Has anyone considered this in their FIRE plans?  I lived in the Philippines for 6 months with a charity and spent about $150/mo. and I have to say, I didn't really feel like I was left wanting anything.  The population was very friendly and seemed to spend thier free time within social gatherings versus spending a lot of money, rode bikes, didn't need hot water (water was already comfortable since the ground temperature was high), ate lots of rice and fish (protein rich).  The original Mustachians.

I don't want to live in the Philippines. The climate is godawful. None of my family is there. None of my friends are there. It's not somewhere I want to raise my children. I'd rather work and live in the States than be retired in the Philippines. And my husband did not emigrate FROM that part of the world to move BACK there. He'd never go.

Or other country?

[BlueHouse]

I had thought a lot about doing that and have spent a good amount of time checking out ex-pat websites and books and blog by people who do that. I still may consider it but as a single female I have a few more reservations about where I'd live than say a single guy or married couple. I have travelled enough that I am aware that I may not have the same freedom of movement, living or just being alone places, and safety in some other countries that I have in North America or Europe. Even if the actual town or area I live on is safe and tolerate of a woman alone, it might not be the same travelling around certain countries by bike, motorcycle or car. How I dress and the things I do may also not be acceptable everywhere.  So for me it would have to be somewhere that was very tolerant, very open minded, and also safe

+1

[Punchingat50]

This is exactly my plan, but i will still accumulate the 650k just to leave myself some choices. Funny this comes up now. Love MMM.

[olivia]

Living near my family and friends is more important to me than retiring early.  However, if I could get my parents, siblings and friends to move somewhere with me, I would 100% do it. 

[2527]

I have lived in other countries and travelled a lot.  Moving to another country requires a lot of adjustment: language, culture, money laws, social circles, taxes, employment opportunities, being an expat instead of a member, etc.  And they are compounded if there are children or family ties.  And there is a risk that you may want to move back to the US in the future and all your doors will be closed. 

I think a wiser strategy is finding a low cost of living area where you already live or someplace in the US.  For example, move from Boulder to an inexpensive part of Denver.  Or move from northern New Jersey to a small city in Florida.

[johnintaiwan]

I currently live in Taiwan and the COL is very low here. I think the key for long-term success (more than a year) in living abroad is to stop thinking of it as living abroad. You need to be able to get out of the mindset of being an ex-pat. You need to think of the move to another country the same as moving to a new city or state. The first few months you still feel like "wow, I live ont he other side of the world." but soon it just becomes your normal. When people from the states ask me what it is like living so far away, it is tough to tell them. It just feels normal.

I also think that if you do not change this mindset, you will continue to live as an outsider. You will become very lonely indeed. if your friends are not around, you need to make new ones and become a part of the new community. In addition to the loneliness, you will likely not take advantage of the low COL as it will be very expensive to try and continue to eat the same foods from home or enjoy the same lifestyle. Just my $0.02

[southern granny]

I don't move to another country for the same reason I don't move to Florida - my children and grandchildren.  I can't imagine only seeing them once a year.

[Daisy]

Just today I heard at work that if certain things happen, there may be a request for people to do an expat stint in Asia. It's been a while since the company has done that. When they did it in the way past like 10 years ago I was never interested because I was enjoying my life at home and was also worried about being a single female in Asia (10 years ago thinking).

Although I still think there are some parts of the world where I'd be careful as a single female, the place they would send us to has been visited by so many of my co-workers that I am no longer scared to go there for an extended period of time.

Wouldn't that be funny though? I've been planning FIRE'ing in the next year or two, but if this opportunity presents itself I may just volunteer for it. I'd be able to visit a lot of Asia during an expat stint like that...and most things would be on the company's tab. I'd be kickstarting my FIRE travel plans while still being paid for it.

The only thing that would stop me would be that my parents are elderly and need some help. If my siblings can't handle my departure like that, then I wouldn't consider an expat opportunity.

I don't think I'd ever permanently move away from the US as my family and friends are here.

[Lian]

I do plan on retiring outside the US. I would like to live for a few years in several different countries and travel around some before I make a choice, and plan on saving $550-600K for a comfortable cushion and increased options. I would like to save more, but I'm more than ready to leave my job. My preference is to live in low COL countries, but I don't know where I will land. I'm doing it more for the adventure than I am for low COL.

[brooklynmoney]

I am definitely considering this. Somewhere in Central America or the Caribbean or maybe S. America. I have spent 6 months living in S. America before and I felt pretty comfortable. My Spanish is strong enough that I can go about daily life with no problems. Although I lived with my boyfriend who was native to the country but we spoke almost exclusively in English, except with his parents who spoke no English.

[goodlife]

I have been an expat in Asia (multiple countries) for more than 7 years now. I love it. I love the tropical climate, the culture, the dynamism, the excitement, the food, just everything about it. I lived back in Europe/US for a year and realized I can't do it anymore. I so missed the vibrancy of Asia. Here every day is an adventure and there are just so many opportunities popping up all the time. In terms of saving money, it's no comparison. Taxes are super low and with expat packages you make an insance amount. Combine this with very low COL and it's great. I have never been homesick, but I left home (meaning the continent, not just the city or state or country) at 18 and have never moved back and probably never will. I am too adventurous.

For anyone considering retirment in this part of the world, I vote a big yes! I know a lot of people from Europe/US who have done this and have a great time here. Even if they fly home 4X a year, their budget is still so much lower than retirement would be in the developed world. I know some people balk at the idea of a 20h flight, but for me, it has become nothing! The whole world is just a flight away and airtravel is getting ever cheaper.   

[Daisy]

I so missed the vibrancy of Asia. Here every day is an adventure and there are just so many opportunities popping up all the time. In terms of saving money, it's no comparison. Taxes are super low and with expat packages you make an insance amount. Combine this with very low COL and it's great.

Music to my ears. I really hope my company offers these expat packages. Your costs are even lower than staying at home because they pay for your apartment and living costs (per diem) I believe while on the expat assignment.

Not only would I have a wonderful long term trip to Asia, but I'd be padding the stash even more!

This is all speculation though...

[rocketpj]

I love where I live (BC Coast) but might move somewhere else someday.  The kids are really happy where we are and enjoy their lives a lot, and since we are too I'm not sure I'd want to live abroad.  I could happily keep a little place somewhere, but I also like to go to different places on a regular basic, so I'm not sure I'd want to do that either.

[Overseas Stache]

Living overseas is not something that everyone is willing to do. Even moving to a different state is a big deal for many Americans. As someone who has lived almost half his life outside of the USA it is very probable that I will end up retiring in another country or more likely several countries. The one problem with retiring "on $100K in the Philippines" is the cost of travel. Even if your living expenses for a family are only 4K a year your travel expenses are going to be probably around 8K a year for a family of 4 if you only take 1 trip a year to the states to see family.

[colganc]

Cost wise have you compared overseas with a low COL in the states?  It seems pretty favorable at first glance and wihout the legal ambiguities for propety ownership.

[Adventine]

I notice the model here is to save up about $600K plus pay off the mortgage and get involved in some post-retirement rental/business.  The question I have to ask you is why do you restrict yourself to your home country?  Lot's of other countries are available where you can live off of $150/mo.  Has anyone considered this in their FIRE plans?  I lived in the Philippines for 6 months with a charity and spent about $150/mo. and I have to say, I didn't really feel like I was left wanting anything.  The population was very friendly and seemed to spend thier free time within social gatherings versus spending a lot of money, rode bikes, didn't need hot water (water was already comfortable since the ground temperature was high), ate lots of rice and fish (protein rich).  The original Mustachians.

How interesting that you would call Filipinos "the original Mustachians," as I often feel I am the only Filipino among my family/friends/colleagues is who actively trying to live a simple, frugal life because I chose to, and not because I was forced to by economic pressures. It's hard to live decently in the Philippines on an ordinary local's salary. This is why most Filipinos live with their parents until they get married, including the majority of twenty somethings like me, who have benefited from a  middle class upbringing and who have gone to the country's top schools. On an expat's salary, it's possible to live like a king for very little. Where did you stay in the Philippines, VirginiaBob?

It's nice to live in the Philippines if you already have a stash, especially if it's in USD or any other favorable currency. Not so nice if you're a Filipino trying to build a stash from scratch.

[dusty]

After reading your original post I got to thinking.

My original FIRE plan has me retiring in 10 years time at 43 with at least 1m invested.

During a recent conversation at work I found out that a bloke I have been working with for the last year (in Darwin) grew up in the Philippines as he is from a family of Australian Expats who settled there after working in the area during WW2.

His wife is from the Philippines and they have built a home in the town where his family are from.  He fly's home during leave periods through out the year but is planning to retire in at least 2 years time.

 Since discovering this I have been bombarding him with questions about COL and general lifestyle questions.  Living overseas has become a big part of my planing recently and I have considered living in Thailand, Philippines, Ecuador or Malta and may very well hop between them all.  I am also living on my yacht at the moment and may be able to incorporate sailing to each new country in the future though with my lack of experience in O/S cruising I am very wary of pirates in these areas.

Anyway, this post has sent me back to the drawing period as I realise I can realistically retire in 5 years time with $600k invested.

Many things to think about.... thanks for the kick

[dude]

I notice the model here is to save up about $600K plus pay off the mortgage and get involved in some post-retirement rental/business.  The question I have to ask you is why do you restrict yourself to your home country?  Lot's of other countries are available where you can live off of $150/mo.  Has anyone considered this in their FIRE plans?  I lived in the Philippines for 6 months with a charity and spent about $150/mo. and I have to say, I didn't really feel like I was left wanting anything.  The population was very friendly and seemed to spend thier free time within social gatherings versus spending a lot of money, rode bikes, didn't need hot water (water was already comfortable since the ground temperature was high), ate lots of rice and fish (protein rich).  The original Mustachians.

Most definitely.  Mexico, Costa Rica and Ecuador are all possible options, though it would be part-time (3-6 months/year).

[Gimesalot]

We also plan on leaving the US when we retire.  We plan on going back to where I was born for a few years, to be with my extended family.  Then we plan on very slow travel, 6 months to a year in each spot minimum.

While Asia is high on the list, so is a lot of Europe, which is expensive.  We are aiming to save in the $600k to $650k range to be able to live in some expensive desitnations as well.  Also, you need to remember that although the cost of living is low in places like the Philipines right now, the countries with weaker economies can suffer very badly when the world economy goes sour.  Rampant inflation and low access to goods is quite common in some places.  You need to have money set aside to deal with the inevitabilites of living in a waeker economy.

We might come back to the US to live, at some point, but I think that we will most likely wait until health care is more accessible and affordable. 

[going2ER]

I'm in eastern Canada and we have looked at retiring in South America, mostly Uruguay. But, we would likely travel anywhere as we do enjoy travel and trying new things.

In one article I was looking at it was a small coastal community and one of the cons listed was that there were no american style chain restaurants, somehow, I see this as a pro, there were also only markets to buy food at, no grocery stores, again, I am good with fresh seafood, fruits and veggies. So this is the type of place I would like to retire to, a small town with access to my basic needs, I don't want to be in a large city close to everything.

[Kaivalagi]

I'm from the UK but my husband is from Fiji and we plan to move back there once we have enough stashed. The cost of living is low on his island, we could start a small farm and grow our food or something like that anyway. It will mean that we could retire on £250,000 (US$400,000) or much much less depending on how extravagantly we want to live! I might get the calculator out this weekend and get some scenario planning under way :)

Thanks for the motivation!

[Adventine]

I notice the model here is to save up about $600K plus pay off the mortgage and get involved in some post-retirement rental/business.  The question I have to ask you is why do you restrict yourself to your home country?  Lot's of other countries are available where you can live off of $150/mo.  Has anyone considered this in their FIRE plans?  I lived in the Philippines for 6 months with a charity and spent about $150/mo. and I have to say, I didn't really feel like I was left wanting anything.  The population was very friendly and seemed to spend thier free time within social gatherings versus spending a lot of money, rode bikes, didn't need hot water (water was already comfortable since the ground temperature was high), ate lots of rice and fish (protein rich).  The original Mustachians.

How interesting that you would call Filipinos "the original Mustachians," as I often feel I am the only Filipino among my family/friends/colleagues is who actively trying to live a simple, frugal life because I chose to, and not because I was forced to by economic pressures. It's hard to live decently in the Philippines on an ordinary local's salary. This is why most Filipinos live with their parents until they get married, including the majority of twenty somethings like me, who have benefited from a  middle class upbringing and who have gone to the country's top schools. On an expat's salary, it's possible to live like a king for very little. Where did you stay in the Philippines, VirginiaBob?

It's nice to live in the Philippines if you already have a stash, especially if it's in USD or any other favorable currency. Not so nice if you're a Filipino trying to build a stash from scratch.

Filipinos aren't very mustachian; their savings rates are awful.

http://www.tradingeconomics.com/philippines/personal-savings

Also, wealth in the Philippines is concentrated in the hands of the ethnic Chinese minority for a lot of reasons, most of which will be apparent to you if you're familiar with Southeast Asian Chinese (I'm married to one). Almost all the country's billionaires are partly or entirely Chinese, and they hold something like 60% of the wealth despite being a sliver of the population. The so-called "bamboo network" of ethnic Chinese who marry each other across national lines, speak the same dialect and do business among themselves is believed to be the largest Asian economic power after Japan. My husband has relatives in Malaysia, Indonesia, Singapore, Cambodia, Canada, the United States and China, and that's pretty common. Everybody in the family, with the exception of me and one of my husband's cousins wives is Chinese and speaks the same Minnan dialect. Once you dis-aggregate wealth by ethnic group, you find the average ethnic Filipino is very poor indeed. It's a sticky and complicated situation.

http://opinion.inquirer.net/31223/ethnic-chinese-dominate-ph-economy
http://www.prospectmagazine.co.uk/features/amy-chua-philippines-chinese-minority-free-market-democracy-ethnic-hatred (This was written by the Battle Hymn of the Tiger Mother lady before she was (in)famous.)

These articles are more in line with the reality I live with every day. I'd like to add that most wealthy Filipinos are either ethnic Chinese who take very great pains to "keep the wealth" within their communities, or Spanish mestizos who inherited huge landholdings that date back to the colonial era.

Funnily enough, I'm mixed Chinese, Spanish and Malay, myself. The ethnic lines aren't always so clear-cut.

[Zummbot]

I am American and my wife is Brazilian, and we plan to save up our stash here in the states and then buy a small house/plot in rural Brazil once we reach FI. We started with a COL budget and determined to meet our basic necessities we would need about R$2,500 a month to retire in Brazil (that's in brazilian reals). We would keep our bank accounts and investments in USD, as the brazilian real has historically had problems with inflation and has had wild swings in the exchange rate. In the space of 10 years it's been as low as 3.5 reals to the dollar, and as high as 1.5 to the dollar. Inflation this year has reached as high as 6.5%. Planning on the worst case scenario, we are basing all of our calculations on the highest the real has ever been against the dollar, which is 1.56. So to get R$2,500 that's about $1,602 USD at an exchange rate of 1.56. $1,602 x 12 months in a year = $19,224 per year needed to meet our basic necessities while in Brazil. Let's round that up to $20,000 just for good measure. Using MMM's retirement rule of needing your yearly expenses x 25 that puts our FI number at $500,000 USD.

Now the beauty of this is that this entire calculation is based on the worst case scenario of the dollar's exchange rate being at the lowest it's ever been in history against the real, which is 1.56. Today the exchange rate is a generous 2.55, but over the course of the real's existence the average has been about 2.21. If we are to take the average of 2.21 and apply that to $20,000 USD a year that would translate into R$44,200 a year, which is R$3,683 per month. Well above our needs. During times of favorable exchange rates we would be taking out only what we need, which would be less than 4%, ensuring that our stash continues to grow well into the future.

The beauty of the exchange rate is it's kind of like a wild card money multiplier. Of course there is the possibility that the exchange rate could dip below 1.56, which would throw our plans out of whack. But that's where MMM's concept of flexibility comes in. If that were to happen (and I find it unlikely) we can work (my wife's family owns businesses, so we will have easy employment if necessary), we can grow our own food, we can rent out our house for carnival, and as we become more accustomed to life in Brazil we could probably even lower our expenses. etc etc etc.

We would need to save about an additional $130,000 USD to cover buying a house, car and moving expenses. So all said and done we're talking about around $630,000 USD before we can retire in Brazil.

[Adventine]

I notice the model here is to save up about $600K plus pay off the mortgage and get involved in some post-retirement rental/business.  The question I have to ask you is why do you restrict yourself to your home country?  Lot's of other countries are available where you can live off of $150/mo.  Has anyone considered this in their FIRE plans?  I lived in the Philippines for 6 months with a charity and spent about $150/mo. and I have to say, I didn't really feel like I was left wanting anything.  The population was very friendly and seemed to spend thier free time within social gatherings versus spending a lot of money, rode bikes, didn't need hot water (water was already comfortable since the ground temperature was high), ate lots of rice and fish (protein rich).  The original Mustachians.

How interesting that you would call Filipinos "the original Mustachians," as I often feel I am the only Filipino among my family/friends/colleagues is who actively trying to live a simple, frugal life because I chose to, and not because I was forced to by economic pressures. It's hard to live decently in the Philippines on an ordinary local's salary. This is why most Filipinos live with their parents until they get married, including the majority of twenty somethings like me, who have benefited from a  middle class upbringing and who have gone to the country's top schools. On an expat's salary, it's possible to live like a king for very little. Where did you stay in the Philippines, VirginiaBob?

It's nice to live in the Philippines if you already have a stash, especially if it's in USD or any other favorable currency. Not so nice if you're a Filipino trying to build a stash from scratch.

Filipinos aren't very mustachian; their savings rates are awful.

http://www.tradingeconomics.com/philippines/personal-savings

Also, wealth in the Philippines is concentrated in the hands of the ethnic Chinese minority for a lot of reasons, most of which will be apparent to you if you're familiar with Southeast Asian Chinese (I'm married to one). Almost all the country's billionaires are partly or entirely Chinese, and they hold something like 60% of the wealth despite being a sliver of the population. The so-called "bamboo network" of ethnic Chinese who marry each other across national lines, speak the same dialect and do business among themselves is believed to be the largest Asian economic power after Japan. My husband has relatives in Malaysia, Indonesia, Singapore, Cambodia, Canada, the United States and China, and that's pretty common. Everybody in the family, with the exception of me and one of my husband's cousins wives is Chinese and speaks the same Minnan dialect. Once you dis-aggregate wealth by ethnic group, you find the average ethnic Filipino is very poor indeed. It's a sticky and complicated situation.

http://opinion.inquirer.net/31223/ethnic-chinese-dominate-ph-economy
http://www.prospectmagazine.co.uk/features/amy-chua-philippines-chinese-minority-free-market-democracy-ethnic-hatred (This was written by the Battle Hymn of the Tiger Mother lady before she was (in)famous.)

These articles are more in line with the reality I live with every day. I'd like to add that most wealthy Filipinos are either ethnic Chinese who take very great pains to "keep the wealth" within their communities, or Spanish mestizos who inherited huge landholdings that date back to the colonial era.

Funnily enough, I'm mixed Chinese, Spanish and Malay, myself. The ethnic lines aren't always so clear-cut.

Yeah, Malaysia decided to "fix" the problem post-colonialism by implementing affirmative action on steroids for the ethnic Malay majority. At least in Malaysia, part of the problem is that the Chinese are much more economically productive than the Malay majority, and have been since colonial times. In the nineteenth century, Chinese rubber harvesters (about the ultimate in low-skilled labor) gathered twice as much latex as the Malay ones when they worked side by side. The work ethic of Chinese Malaysians frequently blows me out of the water; I would not be surprised if they'd end up a market dominant minority in any country.

When my FIL and MIL were teenagers, they both went into accounting because it was one of the only professions open to Chinese people. My MIL's family has been in Malaysia since the mid nineteenth century and they still aren't considered native Malaysians and never will be. As it stands, Malays are legally privileged in university admissions and hiring, have access to better social welfare programs, almost universally pay no income tax, receive houses at lower prices and get lower interest mortgages and a whole bunch of other benefits. It's succeeded in pushing Malays up economically, but the Chinese are getting tired of providing 90% of the tax revenue and funding their own community welfare benefits as well and so they're leaving. In droves. Most of my husband's generation (a couple dozen people in their teens through thirties) are out of the country, and the family money is fleeing even faster. My in-laws are putting as many assets as possible into the hands of American relatives as possible because they don't trust the ruling government.

Malaysian politicians have cottoned onto this and it's become a huge concern. Countries that lose their most economically productive minority tend to become poorer on the whole (Yemen expelled their Jews and then had to ask them to come back because, whoops, they were most of the skilled tradesmen in the country). There's now a lot of discussions about what the country will look like in thirty years, between a high Malay birthrate, low Chinese birthrate, and massive Chinese out-migration and wealth outflows. If current trends continue, Malaysia is going to end up poorer and much more religiously Muslim (another issue entirely) over the coming decades. It may be better for the Malays (there's good evidence that most people are not happier in diverse environments) but it's hard to predict.

Malaysia's always been  fascinating to me precisely for those reasons. There is no similar affirmative action program in the Philippines. I can't really say if that's a better or a worse policy.

Returning to the original topic of retiring in the Philippines, I do think foreign retirees will probably find a warmer welcome here than in other Southeast Asian countries. Especially if they're white. And most especially if they're white Americans. Again, that has to do with the dynamics of race, class, money and privilege that are particular to Filipino society.

[Zikoris]

Not quite as cheap as the Philippines, but we'll likely spend a lot of time living in Hungary after retirement if I can secure residency for us - I'm half Hungarian, so it's a possibility. Much cheaper than Canada, and a great gateway to anywhere in Europe or Asia we'd want to travel to.

[Threshkin]

It's a much simpler decision if you're single, or if you don't have any young kids. I fail on both accounts :)

Don't forget caring for your aging parents. 

Most people around here seem to be younger and tend to focus on caring for their children, not their parents.  Even if your parents are financially secure, they need increasing attention and assistance as they age.

Extended overseas living is on our bucket list but our parents keep us grounded for now.

[Chuck]

I spent a fair amount of time in the Phillipines when I was in the Marines. Amazing place full of amazing people, very easy to make friends. I also thought the women were beautiful. Local goods are cheap and the food is delicious. Enough westernization that you don't feel totally out of place, and the acceptance of outsiders (at least, young white guys lol) was amazing for an Asian nation. I did not have nearly the same relationship with the people in Japan or Thailand. 

That said, I could never live there. The government borders on dysfunctional. Not in the "wahh, Republicans filibustered again" way. In the "police and military are utterly corrupt and incompetent, and they're the trustworthy ones" way.

If I was still single, I would definitely vacation there, maybe even get a contracting gig for a few years. Learn the language. Meet someone. But at the end of that stay my household would be moving back State-side.

[GuitarStv]

My wife's family is from the Philippines.  Her dad had to flee the country a couple years ago due to trumped up charges (and an arrest warrant) brought against him by someone in the city he was living in.  Some money exchanged hands between my wife's dad and some people high up in the legal system and all charges against him disappeared, so he went back and has been fine ever since.  That's not really shit I want to be dealing with when retired.

[Eric]

Pardon my ignorance, but how hard is it to establish residency in another country if you have no ties there?  I realize that this would vary by country, but I'm wondering in general.  Some of the travel blogs I read talk about going on Visa runs and such, but that seems more for vagabond travelers not people looking to establish permanent residency.

[Albert]

I could live comfortably back in my native city (Eastern fringes of EU) for ca 1,000 $/month plus a paid apartment. All my family still live there so I wouldn't be a stranger. It's not happening in the near term though so who knows how things will look in 15 years. In any case I'm aiming for a passive income at least double that before I even consider leaving my very comfortable life here.

[Zummbot]

Pardon my ignorance, but how hard is it to establish residency in another country if you have no ties there?  I realize that this would vary by country, but I'm wondering in general.  Some of the travel blogs I read talk about going on Visa runs and such, but that seems more for vagabond travelers not people looking to establish permanent residency.

Entirely depends on the country, but generally speaking it is very difficult to gain permanent residency in a place that you have no ties to. Some countries have agreements with each other, so that if you have residency/citizenship in one you can gain residency in the others (like the Euro zone). Some countries have investor visas that allow you to move to that country provided you invest a certain amount in that place (sometimes this has to be in a business, sometimes it can be real-estate). Some countries grant visas based on your professional skill-set. In short it depends entirely on the place, but with no ties it can generally be time-consuming and/or expensive to gain permanent residency. Not impossible though.

[Daisy]

Returning to the original topic of retiring in the Philippines, I do think foreign retirees will probably find a warmer welcome here than in other Southeast Asian countries. Especially if they're white. And most especially if they're white Americans. Again, that has to do with the dynamics of race, class, money and privilege that are particular to Filipino society.

Does speaking Spanish help or hurt in the Philippines as far as being treated warmly? Or the rest of Asia for that matter?

I've used this trick in some countries in order to avoid being tagged as an American tourist....in places where it could hurt you.

[Daisy]

I notice the model here is to save up about $600K plus pay off the mortgage and get involved in some post-retirement rental/business.  The question I have to ask you is why do you restrict yourself to your home country?  Lot's of other countries are available where you can live off of $150/mo.  Has anyone considered this in their FIRE plans?  I lived in the Philippines for 6 months with a charity and spent about $150/mo. and I have to say, I didn't really feel like I was left wanting anything.  The population was very friendly and seemed to spend thier free time within social gatherings versus spending a lot of money, rode bikes, didn't need hot water (water was already comfortable since the ground temperature was high), ate lots of rice and fish (protein rich).  The original Mustachians.

Most definitely.  Mexico, Costa Rica and Ecuador are all possible options, though it would be part-time (3-6 months/year).

I'm curious how this saves you money. Do you plan to keep your home and its associated costs in the US for the other 6-9 months of the year? Health insurance costs, etc.?

[TrulyStashin]

I spent a fair amount of time in the Phillipines when I was in the Marines. Amazing place full of amazing people, very easy to make friends. I also thought the women were beautiful. Local goods are cheap and the food is delicious. Enough westernization that you don't feel totally out of place, and the acceptance of outsiders (at least, young white guys lol) was amazing for an Asian nation. I did not have nearly the same relationship with the people in Japan or Thailand. 

That said, I could never live there. The government borders on dysfunctional. Not in the "wahh, Republicans filibustered again" way. In the "police and military are utterly corrupt and incompetent, and they're the trustworthy ones" way.

If I was still single, I would definitely vacation there, maybe even get a contracting gig for a few years. Learn the language. Meet someone. But at the end of that stay my household would be moving back State-side.

This.

Anyone considering living elsewhere needs to carefully consider the degree to which their prospective new home nation is functional, free, and democratic.   In December, 2010 I traveled to Luxor, Egypt for 10 days.  While there, I met a married couple who had moved from England to retire in Luxor.  They'd bought a house and were pretty heavily invested in Egypt.  They raved about how stable it was thanks to Mubarak's heavy foot.

Three weeks after I came home, the Arab Spring erupted and Egypt was thrown into turmoil from which is has not yet recovered.  The economy is in the tank (not that it had far to go).  Human rights are non-existent.   I often wonder how they're doing.   It would be a hard situation to unwind, that's for sure.

[Albert]

It's a risky choice to retire outside the country where you were born or have lived for a very long time and have a legal status. Even going from England to Southern France or Spain is a considerable risk (financial not safety) let alone to Egypt.

[fireferrets]

I dig this idea!

The biggest drawback for me is that my family resides in North America and Europe, so it's a $1000+ RT flight to anywhere in SE Asia. Currently I visit three separate locations annually in the US (but hoping to pair that down by having two of those be every-other-year by having the family there return the visit). Assuming I kept up that pattern (and it wasn't possible for me to consolidate those into one trip), it would be at least $3000 and three long flights every year.

Don't you still have to pay US taxes if you are a US citizen (and a dual citizen w another country) ?

[Beric01]

Pardon my ignorance, but how hard is it to establish residency in another country if you have no ties there?  I realize that this would vary by country, but I'm wondering in general.  Some of the travel blogs I read talk about going on Visa runs and such, but that seems more for vagabond travelers not people looking to establish permanent residency.

Malaysia has a special visa for retirees. It's hugely popular among Japanese people; some shopping malls in Kuala Lumpur have a whole Japantown section.

http://www.mm2h.gov.my/index.php/en/

My current plan is to use just this.

Right now I'm planning to save $500K (today's dollars) and retire in Malaysia. It will be incredibly easy to live off $10K/year there, so then I have another $10K with which I can use for travel expenses or just keep as a buffer. The only issue is the MYR10K income requirement, which can easily be avoided by just applying while one is still working.

I'd really like to get a full second citizenship in a Southeast Asia country, but that doesn't seem easy. Malaysia only allows one citizenship, for example. Singapore is practically impossible as well.

Any thoughts on meeting a romantic partner while FIRE'd single (in my early 30's) in Southeast Asia? So far my success has not been good as a young male living in Silicon Valley, but I still wouldn't mind changing that. ;)

[Beric01]

Muslims (read: almost all Malays) would be a problem in Malaysia (intermarriage isn't legal and you'd have to convert to Islam and actually practice it to a degree), but a good 25% of the country is of Chinese or Indian descent and they are overwhelmingly not Muslim. I know a lot of Chinese Malaysian ladies who speak fluent English, are university educated professionals, and would be open to dating Americans. Generally the Chinese population clusters in the cities; if you walk around a mall in downtown KL, you'd think the country was Chinese-majority. Nobody in my husband's family has made a peep about the mixed race matches in the current generation. There should be a decent pool of potential partners, though I can not imagine my ILs ever, ever, EVER grasping the concept of FIRE. The Chinese Malaysian work ethic is something to be reckoned with. Why would you ever quit working?!?!?

Yeah, I actually have a Chinese Malaysian co-worker at work, and they seem to be very open and fun people. I'm sure I wouldn't be idle if I lived there - most likely would take up some teaching/part-time/volunteer work or the like.

Thanks for the feedback!

[expatartist]

Pardon my ignorance, but how hard is it to establish residency in another country if you have no ties there?  I realize that this would vary by country, but I'm wondering in general.  Some of the travel blogs I read talk about going on Visa runs and such, but that seems more for vagabond travelers not people looking to establish permanent residency.

* Yes it's for vagabonds living off savings, and people who are working illegally in these countries. Few countries have laws which account for working online, so if they make $ from their blogs etc it goes under the radar.

I'd really like to get a full second citizenship in a Southeast Asia country, but that doesn't seem
easy.

* It's essentially impossible. Passports in these countries are sometimes granted if you invest millions in the country, or contribute on a grand level culturally.

Any thoughts on meeting a romantic partner while FIRE'd single (in my early 30's) in Southeast Asia?

* You'll have women throwing themselves at you, and will have a quick learning curve. Just be very careful getting married, or entangling yourself financially with anyone without getting to know them - and their family - very very well.

Sorry about the weird glow font, for some reason normal colors aren't showing up on this screen.

[expatartist]

I dig this idea!

Don't you still have to pay US taxes if you are a US citizen (and a dual citizen w another country) ?

I believe you have to pay taxes on any income earned in the US like from pensions, other retirement accounts and investments, and also on some foreign income if you earn any money in there. I also read of something called an expat tax that is levied on US Citizens living abroad but don't know anything about it.

* You only pay taxes on income earned overseas if your income (income earned outside the US) is over ~90K. You would be taxed on your US income from investments there: dividends, pensions, capital gains, etc. A good accountant with experience dealing w/US expats can help you sort this out.

I am also looking into the possibility of living in the EU as My Mom was born and raised in Germany, my Grandparents in Sweden and I was born in the UK (Dad was an American and my Mom was a Naturalized US Citizen when I was born) and I'm a US citizen.   

* Are you a UK citizen yet? It's worth looking into, but I don't think they have jus soli like the US does. Does your mom have a passport from Germany as well? You could probably go that route, via your mom or possibly your grandparents.

EU naturalization via residency is easier than UK naturalization. I plan to get an EU passport as part of our pre-retirement process (DH is British). This will provide a hedge against the US's potential repeal of the ACA program. We also enjoy the lifestyle in southern Europe. In the Sicilian towns where we've invested in small-scale real estate, monthly living costs can be as  low as 250Euro/month [per person] in a paid-off home.

Not sure if any of that matter in terms of residency in an EU country or not though but worth checking out. Of course all those countries are expensive but maybe not the eastern EU countries.

*Eastern and Southern EU small cities and towns can be very cheap. Friends have bought homes in small town/rural Bulgaria for just a few thousand Euro and live on several thousand Euro per year.

[Beric01]

I'd really like to get a full second citizenship in a Southeast Asia country, but that doesn't seem
easy.

* It's essentially impossible. Passports in these countries are sometimes granted if you invest millions in the country, or contribute on a grand level culturally.

Any thoughts on meeting a romantic partner while FIRE'd single (in my early 30's) in Southeast Asia?

* You'll have women throwing themselves at you, and will have a quick learning curve. Just be very careful getting married, or entangling yourself financially with anyone without getting to know them - and their family - very very well.

Sorry about the weird glow font, for some reason normal colors aren't showing up on this screen.

Thanks for the advice! I guess on the second passport topic, if these women are really throwing themselves at me then citizenship by marriage becomes an option. But Southeast Asia seems like an awesome place culturally. I wish I could retire there now, rather than at (currently) 32 or whereabouts. I'll be old!

On that topic - any thoughts on saving for FIRE as a single person with the potential of marrying later? I assume $20K/year could support a Mustachian family in Southeast Asia almost in luxury.

I can't stress that enough about being careful with dating across cultures. All the successful rich country-poor country matches I know involved couples of similar social class. In fact, most marriages, period, involve people of similar social class. My in-laws are both professionals, as are most people in their family. It was obvious that not only could my husband support himself, but that my in-laws were not going to be coming to us with their hands out after we moved. Their son did get a somewhat upgraded American standard of living with his marriage and relocation, but there's not a massive gulf between the way we live and the way they live, which means there isn't a lot of resentment or greed going on.

Yeah, thanks for the heads up. I'm an extremely frugal person, so I'll have to watch that it won't conflict with a potential partner.

[Paul der Krake]

I am also looking into the possibility of living in the EU as My Mom was born and raised in Germany, my Grandparents in Sweden and I was born in the UK (Dad was an American and my Mom was a Naturalized US Citizen when I was born) and I'm a US citizen.   Not sure if any of that matter in terms of residency in an EU country or not though but worth checking out. Of course all those countries are expensive but maybe not the eastern EU countries.

Look into this. Seriously, needing only one passport to have full residency rights to 28 countries (not to mention very easy access to places like Andorra or Switzerland) that are extremely diverse in languages, laws, food, weather, cost of living, customs, yet all maintain a fairly similar set of consistent western values. Don't let David Cameron tell you otherwise, the EU is a fantastic deal.

[Adventine]

Returning to the original topic of retiring in the Philippines, I do think foreign retirees will probably find a warmer welcome here than in other Southeast Asian countries. Especially if they're white. And most especially if they're white Americans. Again, that has to do with the dynamics of race, class, money and privilege that are particular to Filipino society.

Does speaking Spanish help or hurt in the Philippines as far as being treated warmly? Or the rest of Asia for that matter?

I've used this trick in some countries in order to avoid being tagged as an American tourist....in places where it could hurt you.

Sorry, only really old Filipinos still understand Spanish. But pretty much everyone understands basic English.

[expatartist]

Seriously, needing only one passport to have full residency rights to 28 countries (not to mention very easy access to places like Andorra or Switzerland) that are extremely diverse in languages, laws, food, weather, cost of living, customs, yet all maintain a fairly similar set of consistent western values. Don't let David Cameron tell you otherwise, the EU is a fantastic deal.

+1! It really does offer so many options. Just be sure to research the tax laws before establishing residency. In Italy and Spain, there are new laws which tax assets overseas, in addition to local taxes. This can add up quickly.

Thanks for the advice! I guess on the second passport topic, if these women are really throwing themselves at me then citizenship by marriage becomes an option.

* 'Citizenship by marriage' is not guaranteed anywhere, and in much of SE Asia is not an option. You get a long-stay visa, or an easy work permit, that's it. Depends on the country.

But Southeast Asia seems like an awesome place culturally. I wish I could retire there now, rather than at (currently) 32 or whereabouts. I'll be old!

On that topic - any thoughts on saving for FIRE as a single person with the potential of marrying later? I assume $20K/year could support a Mustachian family in Southeast Asia almost in luxury.

* $20K/year would support a family very well for the essentials in much of SE Asia, especially outside capital cities. This is barring educational costs; an international school can easily cost more than that per year. You'd want to be sure that you and your partner - and her family - were 100% on the same page financially. This can be a challenge in places where part of the face-giving appeal of a Western spouse is the $ which is assumed to come along with him/her [/cynicism]

I can't stress that enough about being careful with dating across cultures. All the successful rich country-poor country matches I know involved couples of similar social class. In fact, most marriages, period, involve people of similar social class. My in-laws are both professionals, as are most people in their family. It was obvious that not only could my husband support himself, but that my in-laws were not going to be coming to us with their hands out after we moved. Their son did get a somewhat upgraded American standard of living with his marriage and relocation, but there's not a massive gulf between the way we live and the way they live, which means there isn't a lot of resentment or greed going on.

+1000

Yeah, thanks for the heads up. I'm an extremely frugal person, so I'll have to watch that it won't conflict with a potential partner.

[Albert]

When I was engaged I looked into naturalization by marriage in Malaysia. It's functionally impossible, particularly for non Muslims. And if you're going to have kids there, remember they will not be able to have dual citizenship. I know a girl with Malaysian, Singaporean and American papers and her parents have to fly her out of the USA on her American passport and hide it, having her enter Malaysia on her Malaysian one. The USA doesn't care if you have both, the Malaysian government does. My husband will be surrendering his Malaysian citizenship when he is naturalized this year.

Most countries in Asia and Africa base citizenship very closely to ethnicity therefore becoming a citizen there without being born into it is virtually unheard off. Countries founded on immigrants obviously do not and neither do most (all?) European countries.