What’s in our Travel Budget?
All about the Benjamins
I worked up a preliminary travel budget for this adventure based on information gleaned from various travel bloggers, my own research and a little bit of caution. Virtually all of the countries we plan to visit are on someone’s “You can retire here for $1,500 per month” list so I’m allowing $3,500 per month to include travel between locations as well as the fact that food and housing expenses will almost certainly be higher based on frequent travels. You can secure a 12 month lease at a significantly lower cost than a 1 to 3 month lease and moving to a new country every 90 days means A) there will always be new restaurants to explore and B) there will be significant travel expenses, especially on inter-continental moves
We’re starting off with the proceeds from selling our house and selling almost everything ‘stuff’, so there is an investment strategy in the background to maximize return on that money, but this whole thing is predicated on not having any ‘actual’ income; just what we get from investments and the cashflow needs to be managed because we will be living out of that pile of cash we start with. This not a situation where we have millions to invest and we can just live off the return; we need to really make the most of every opportunity so the money doesn’t run out before our SS benefits kick in.
By the same token, we don’t want to be living on beans and rice in a 5th floor walk-up somewhere just to escape the rat race, it would make more sense for us to keep working in that case.
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What’s in our Travel Budget?
Housing
Based on the numbers I’ve heard from various travelers (mostly folks in the ‘digital nomad’ category) I had budgeted $700 per month for housing. Since my search for rental apartments had turned up numerous options in the $350 to $600 range in most of the countries I explored options for online I’m pretty hopeful we can do that. I checked out AirBNB for the first time this week and monthly rentals under $700 aren’t hard to find at least in Panama and Costa Rica which are our two starter countries. I also found a 9 bedroom villa for $26,511 per month that is not a finalist.
Activities
I’ve got $400 per month assigned to ‘transportation and entertainment’ because we’ll certainly want to do things wherever we go.
Relocation
I budgeted $600 per month for relocation assuming a change of countries every 90 days – $1,800 per trip. The first trip will be to Panama and if we were booking tickets right now it would cost about $1,200 so there is carryover to future travels. And the second target country is Costa Rica; we can get from Panama to Costa Rica for $50 by bus or maybe $450 if we fly so there will be additional carryover for the 3rd relocation which takes us to southern Europe. Looking at future destinations there are a few that may be over my baseline budget depending on the starting point so it will be important to keep a reserve in that account.
Food
Ah, my favorite reason to travel; I love to eat. Again based on what I’ve heard from various travelers I $400 for groceries in our travel budget, which should be plenty since our grocery bills here in the US in a pretty high cost of living area run $500 to $600 per month. At present I am NOT a careful shopper and we have several ‘prepared food’ meals each month. I budgeted an additional $450 per month for meals out assuming 15 restaurant meals at an average $30 each. Mostly I hear you can eat in a decent restaurant for $10-$12 per person in most places at dinner prices and less for breakfast and lunch prices so I feel good about that number right now
Insurance
I have travel medical budgeted at $350 (see my post about that _here_) Life insurance right now is listed at $225 but we are discussing ways to reduce that since we really won’t need the amount of coverage we currently have once we sell the house. Policies for us really just need to cover the “Shit, he died now I have to get his carcass back to the states” level of expense. I’ve included $30 per month for prescriptions because I am on several daily medications that currently cost about $50 every 90 days. This is actually one of the more stressful parts of the planning, i.e., how do I get my meds when I live overseas?
You might also be interested in Prescription Refills – Planning an extended period overseas? What You Need To Know About Prescription Refills Abroad
Communications
I threw in a travel budget line for cell phones/internet at basically a random amount of $200 per month. If we go the ‘local sim card’ route and take advantage of WhatsApp and wi-fi calling that’s realistically probably going to be closer to $75 – $100.
If you did the math you’ll see I’m actually a little under, that all totals up to $3,405 per month out of my $3,500 budget because, better to have a little headroom in our travel budget than try and find ways to scrimp. I figure we’ll track as we go and reevaluate quarterly.
Important factors to consider in the budgeting process include a level of ‘cushion’ in that Sandra will probably continue some of the administrative work she’s doing which will generate some cash and we can certainly create an entertaining and informative enough YouTube channel to monetize it to some extent. I’ve based the budget on zero income, completely living off of savings for 7 years. Also important is that if it all goes pear-shaped we can call the whole thing off and go back to residential real estate sales or car sales.
So, there you have it – a peek into our initial travel budget. We’ve factored in what we’ve gleaned from other nomadic travelers, along with some healthy skepticism (gotta have that cushion, folks!). While living on beans and rice might seem quaint for a hot minute, it wouldn’t exactly jive with our vision of this adventure.
The good news? Our research suggests this budget is doable in most of the places we’re considering. We’ll definitely track our spending as we go, with adjustments made quarterly to keep things on track. Remember, there’s always the possibility of some income down the line – Sandra might keep doing some freelance work, and that YouTube channel idea has some monetization potential (fingers crossed!).
The bottom line? This budget allows us to ditch the rat race and explore the world, all without burning through our savings before Social Security kicks in. Here’s to living life on our terms – stay tuned as we continue to refine our plans and share our journey with you!
